This Europe: Germans stock up on bad service and cheap food

"Out the way" barked the man in blue overalls as he pushed past shoppers and began stacking bottles of cut-price champagne on the supermarket shelf. Service with a smile was not in his repertoire.

The rest of the store in the genteel Berlin suburb of Charlottenburg looked as if it had been vandalised: ripped-open boxes lay on top of each other, their contents almost spilling into the aisles.

At the check-out, a scowling till operator punched the keys and ordered customers to "get a move on" because her shift was about to end. This is Aldi, Germany's most successful discount outlet.

Germany's retail food sales dropped by 2.4 per cent in the first six months of 2002 and shop owners have been complaining of a slump in business due to stagnant growth.

Yet Aldi's sales rose by 12 per cent over the same period. Germans, it seems, don't mind rummaging in boxes or being insulted by shop assistants, provided they can buy food cheaply.

Two generations of Germans have grown up with the idea of no-frills shopping and they like it. "I don't need friendly shop assistants and free plastic bags if goods are cheaper," said Agatha Achermann, an architect, as she left the store laden with groceries.

Aldi's formula is to slash overheads. It offers one size of 1,000 or so of the fastest-selling items, made under its own labels. Products range from cans of tomatoes to champagne – which shows not all its customers are on the breadline. Prices can be 30 per cent lower because it buys cheaply and in bulk.

The American retailer Wal-Mart had hoped to break into the German "service desert" by opening stores based on the "have a nice day" concept. But Wal-Mart recently announced it was closing two of its 95 existing outlets and scrapping plans to open 50 more stores in Germany.

The Aldi system was devised by the Albrecht brothers – Theo, 80, and Karl, 82 – who started in their mother's shop in Essen after the Second World War. They opened the first Aldi – short for Albrecht discount – in 1962. This year their wealth was estimated at $26.8bn (£17bn). Aldi is the second largest food retailer in Europe, behind Tesco, and has 263 stores in Britain.

The brothers never give interviews. Their media paranoia may stem from 1971, when Theo was kidnapped for 17 days. He was released only after the company paid a £1.3m ransom. Needless to say, profits were not harmed.