German hypermarket chain Kaufland’s expansion to Victoria is gathering steam after approval for a further two stores and proposing at least nine more, which – if approved – could deliver hundreds of extra jobs.

Minister for Economic Development Tim Pallas today announced the approval for stores in Coolaroo and Oakleigh South, with the latter to also hold Kaufland’s headquarters.

“This is great news for consumers – another major player in the market will provide more choice for Victorians, more value for money at the checkout and create thousands of jobs,” Minister Tim Pallas said.

This is on top of its 115,000 square metre distribution centre in Mickleham – which is currently being built – and three already approved stores in Dandenong, Epping and Chirnside Park.

The supermarket chain has recently announced the purchase of its third Queensland site as part of its expansion to Australia.

Kaufland has announced plans to build at least nine additional stores across Victoria – in Braybrook, Lyndhurst, Geelong, South Morang, Bendigo, Narre Warren, Warrnambool, Coburg and Pakenham.

“With five approved stores, as well as the additional nine sites under review, we are committed to our long term, sustainable growth across Victoria. We look forward to creating thousands of jobs and creating opportunities for local businesses,” Kaufland Australia Managing Director Julia Kern said.

The Victorian Government has referred the proposals to an independent advisory panel for consideration.

All approvals will be open for public comment and be subject to public hearings which will help inform the advisory panel’s report to the Planning Minister.

Kaufland’s investment in Victoria is worth $435 million and expected to create 1,500 jobs. If the nine stores are approved, the investment will top half a billion and create up to 2,400 jobs.

One of the world’s largest retailers, Kaufland chose Victoria as the starting ground for its Australian expansion, joining the likes of Costco, Aldi, Uniqlo, H&M and MUJI.

Kaufland stores are huge which are up to 15 times bigger than an Aldi and five times bigger than a big Coles or Woolworths.

Like another supermarket chain Aldi, this German company is hoping to be a hit in Australia. However, Kaufland is not like Aldi. It is more like the American retailer Costco but without membership.

So Kaufland is not just an Aldi clone. And that is a risk for it. Aldi is a proven model. It is not obvious Kaufland will be a success in Australia, nor what made the Kaufland management decide Australia is their next best location for expansion.

Kaufland is already engaging with Victorian suppliers, so it can source local products where possible and will provide opportunities for complementary independent retailers such as cafes within shopping complexes.

The supermarket giant’s investment will also benefit the construction industry, with the distribution centre and stores set to create hundreds of opportunities for local construction businesses, workers and apprentices.

Kaufland is part of the Schwarz Gruppe which opened its first store in 1984 and quickly expanded to become a leader in what was formerly East Germany.

The chain operates over 1,200 stores in Germany, the Czech Republic, Slovakia, Poland, Romania, Bulgaria and Croatia. Kaufland plans to open stores in Moldova and in a few months will be serving Australian consumers.


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