If you ‘just roll out’ abroad, you are buying into expensive misconceptions.
Many German SMEs are internationalising because the domestic market is becoming saturated. That is logical. The mistake often happens at one point: people believe that the successful model just needs to be ‘exported’. Lidl’s experience in the US shows how important it is to learn, focus and become local.
Starting point: Known, but not understood
Lidl has been active in the US since 2017. The company continues to work on being perceived as a “full-service supermarket”. In a discussion, it was reported that the company’s research revealed that only 58% of people in states with Lidl stores even knew that Lidl was a food retailer.
This is a classic internationalisation problem: the product may be good, but the market does not understand your role.
What Lidl concludes from this: density instead of area
Several recent reports describe the strategic focus: Lidl does not want growth at any price, but rather targeted growth in markets where it already has a presence.
The logic is harsh but sensible: without regional density, logistics, marketing efficiency and brand perception are expensive. With density, unit costs fall – and visibility increases.
“As global as possible, as local as necessary”
Another report summarises a guiding principle: as global as possible, as local as necessary – including a focus on market density.
This is invaluable for SMEs because it is a clear rule of action:
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Standardise where it reduces costs.
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Localise where it influences purchasing decisions.
The SME transfer: 5 questions to ask before launching abroad
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What are we really known for there? (not: what do we want to be known for)
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Which local peer group does the customer have in mind?
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What minimum density do we need for sales/service/marketing to be efficient?
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What must be local (product range, service, pricing logic, distribution channel)?
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Which key figures decide after 90 dayswhether we scale up or readjust?
Where AI-supported research makes the difference here
Internationalisation often fails due to “soft” assumptions:
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Competitors are misjudged.
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Customer logic is derived from the UK.
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Local cost and service realities are underestimated.
AI can quickly generate a robust external picture: competition, pricing logic, regional clusters, job advertisements, supply chain signals, customer feedback patterns. People then have to draw the strategic consequences: focus, adaptation, timing.
What SMEs can learn from this
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Success abroad requires density or a very clear niche.
- Brand awareness is not the same as understanding your role.
- Piloting is cheaper than rolling out.
- Measure after 90 days – and then act consistently.
Sources (selection): Grocery Dive; Supermarket News; NJBIZ; The Packer.
