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Political Factors Affecting Aldi

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Political & Legal factors
The fact that Australia is a Common Law jurisdiction, meanwhile Aldi originated in Germany, a Code Law country will be a challenge for Aldi to adapt to the legal requirements differences. Australian taxation is subjected to change according to changes in government structure and agendas, thus becomes an uncertain factor for international firms. Besides, Australian Government strongly protects its local brands, therefore Aldi may find it challenging to deal with various protectionism measures. Regarding grocery industry specifically, food and beverages standards are established very strictly that could tighten the supervision on products for sale.
Economic factors
Australia is the 12th largest economy by nominal GDP with current annual growth rate at 1.7% (Trading Economics 2017) that is believed to steadily increase to 3% by 2018 (OECD 2017), hence attracts huge international investment. Although Australian has been embracing the value-focused attitude since the global financial crisis, the steadily increasing disposable personal income potentially affects Aldi’s sales. In fact, they shops grocery on average three times per week instead of weekly as before (AFN 2015a). Also, Australian fuel prices are among the lowest of the OECD countries (AIP 2017), which directly influence Aldi’s low price strategy. However, Australian dollar has experienced a downward trend since 2011 (AMP 2017), indicating a …show more content…

They also promote ethics and eco-friendly practices in business, especially in grocery industry with food safety has been prioritised by Australian shoppers (AFN 2015a). Private label products that brings great value to buyers with lower price also become trendy in grocery shopping (Jam&Co

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