Is There Lidl in Turkey? Exploring the German Discount Retailer’s Limited Presence

Lidl, the German discount supermarket chain known for its inexpensive private label products, has expanded rapidly across Europe and entered the United States market in recent years However, Lidl’s presence in Turkey remains limited despite the country’s large population and strategic location between Europe and Asia

In this article, we’ll examine why Lidl has not established a significant retail footprint in Turkey and the challenges the company faces in entering the Turkish market

Brief History of Lidl in Turkey

Lidl has attempted to enter the Turkish market multiple times since the 1990s but has struggled to gain a foothold.

• In the 1990s, Lidl established a partnership with Migros, one of Turkey’s largest supermarket chains, to sell Lidl products in Migros stores. This joint venture dissolved after a few years.

• In 2001, Lidl opened two stores in Istanbul but closed them within a year due to low sales and supply chain issues.

• A second attempt to enter Turkey occurred in 2005. Lidl invested 50 million euros to open 10 stores but exited the market again by 2007 after continued lackluster performance.

• Currently, Lidl has no corporate stores operating in Turkey. However, some Lidl-branded products are available through independent Turkish retailers.

So while Lidl has shown interest in entering Turkey multiple times, the company has not committed to establishing a long-term presence as it has in other countries.

Reasons for Lidl’s Limited Success in Turkey

There are several factors that have made it difficult for Lidl to succeed in the Turkish market so far:

Fierce Domestic Competition

Lidl competes directly with well-established Turkish discount chains like Bim and A101 that have national footprints and tight cost controls tailored to local consumers. Local retailers have made it tough for Lidl to poach customers.

High Real Estate Costs

Opening new supermarkets requires major upfront investment. Commercial real estate prices in Turkey’s largest cities are prohibitively expensive for Lidl’s typical store economics.

Complex Distribution Logistics

Lidl’s ultra-low cost model depends on optimized distribution to stores. Turkey’s infrastructure makes delivering efficiency difficult, especially for imported products.

Lack of Supply Chain Control

Rather than own its entire supply chain like in Europe, Lidl must rely on local Turkish suppliers, limiting its bargaining power and ability to control quality.

Differences in Consumer Preferences

Turkish consumer tastes and shopping habits differ from Lidl’s core European markets. The typical Lidl format hasn’t resonated with Turkish shoppers so far.

Challenging Retail Environment

Factors like high inflation, political instability, and currency fluctuations have hampered the growth plans of international retailers in Turkey.

What Does Lidl’s Limited Presence Mean for Turkish Shoppers?

The absence of a full Lidl retail footprint in Turkey has several implications:

• Reduced Competition – With one less deep discounter, other retailers face less pressure to reduce prices. Domestic chains maintain higher profit margins.

• Fewer Quality Imports – Turkish shoppers have less selection of Europe’s better quality private label products that Lidl sells at a discount.

• Missed Innovation – Lidl introduces innovative store formats, digital initiatives, and new products abroad. Turkish consumers miss out on these retail advancements.

• No Flagship Stores – Big cities like Istanbul lack Lidl’s modern concept stores that elevate the standard supermarket shopping experience.

• Less Retail Jobs – A successfully scaled Lidl presence would have created thousands of direct and indirect jobs for Turkish workers.

So for now, most Turkish consumers will need to shop at pricier domestic supermarkets and forego the signature Lidl shopping experience.

Could Lidl Make Another Run at the Turkish Market?

While Lidl has struggled historically in Turkey, the retailer likely hasn’t abandoned aspirations to tap into the country’s massive population and strategic geography.

Here are some factors that could motivate Lidl to invest in Turkey again:

• Pent-up demand for lower cost shopping options as inflation weighs on consumers

• Maturing organized retail landscape, with consolidation opening attractive sites

• Improving infrastructure reducing distribution and import costs

• Rise of online grocery shopping playing to Lidl’s digital strengths

• Potential for smaller, specialized store concepts catering to Turkish preferences

With the right strategy tailored to the Turkish consumer, Lidl may be able to overcome past barriers and establish a profitable presence. But for now, the company seems content to grow in other markets. Turkish shoppers eagerly await the day they can shop Lidl’s aisles.

Lidl has attempted to crack the Turkish market multiple times since the 1990s but has failed to scale its operations due to entrenched local competition, challenging economics, and differences in shopping culture. The absence of Lidl’s game-changing discount formula means Turkish consumers pay higher prices and have less selection. However, if Lidl can adapt its approach to serve Turkish tastes and overcome inherent challenges, the retailer may still have a chance to succeed in this critical market.