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How Lidl has used monopsony power to increase their market share

Geoff Riley

17th February 2019

There is some super applied business economics here. Lidl and Aldi are having a transformative impact on the UK food grocery landscape with a combined market share north of 12 percent.

How much room is there for the "deep discounters" to drive market share still higher - perhaps to round 20 percent?

This article is great for understand how lean retailing helps to increase productive and where buying power (monopsony) gives the retailer an advantage in an age when real incomes have been squeezed.

But Aldi and Lidl themselves face growing competitive pressures especially if there is a scaled change in the cost, price and convenience of online food deliveries.

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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