The German supermarket chain Aldi has become extremely successful in America, thanks to their super low prices on great items, like fancy cheeses, chocolates, wines, and a whole lot of delicious snacks. All of these are, surprisingly, from the store's in-house brand, as are most of the store's products. However, it won't be the specialty products from Aldi that'll keep you coming back to the store. It's Aldi's basic pantry staples that outshine everything else, especially their milk. A gallon of whole milk from Aldi will cost you a cent less than even Walmart's, but how do they do it? This is why Aldi's milk is so cheap.
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00:00You might find yourself drawn to budget grocery store Aldi by the lure of its specialty products
00:05and weekly finds.
00:07But you'll find yourself staying for the basics, mainly because their prices tend to undercut
00:12just about any other grocery chain.
00:14And one of those staples is milk.
00:17Why is Aldi's milk so inexpensive when compared to some of those other brands?
00:21It has partly to do with Aldi's shoestring operating costs — smaller stores, shorter
00:26opening hours, limited product selection, and, of course, the rent-a-carts-and-bring-your-own-bag
00:31policy both help keep Aldi's prices way down.
00:34There's also the fact that over 90 percent of the items Aldi's offers are store-branded,
00:39so they can cut out all of the middlemen from their supply chain.
00:43According to the website Taste of Home, the milk Aldi purchases comes in racks.
00:47All the workers need to do is transfer these milk racks directly into the cooling case.
00:52There's no need for them to unload each individual container.
00:55Less labor equals lower labor costs, after all, which is basically the Aldi way.
01:00It's the same thinking behind Aldi's cart policy, since employees don't have to round
01:05carts up from the parking lot.
01:07Or if they do, they at least get to keep your quarter.
01:10A few years back, the website James' Ordinary Guy Reviews undertook an investigation to
01:15see why Aldi's milk is so cheap.
01:17He writes,
01:18"...I purchased a gallon of 2 percent Aldi milk sold under their Friendly Farms label
01:22for $2.49 and compared it to a gallon of 2 percent store-branded milk from another
01:27local supermarket that costs $3.99."
01:30So why is Aldi's milk cheaper?
01:33As it turns out, the milk isn't a low-grade product.
01:36Although there is such a thing as B-grade milk, it's only sold for use in cheese and
01:40other dairy products.
01:42Aldi's milk also isn't sold past its expiration date, and the product comes from cows that
01:47haven't been treated with hormones.
01:49Aldi Farms' milk has even been given the real seal, meaning that the milk is produced
01:54on a U.S. dairy farm, and it really is 100 percent cow's milk.
01:58Eventually, James found a website called Where Is My Milk From?
02:02After inputting the dairy code from his Aldi milk, he found that it came from the same
02:06plant that sourced milk bearing the Kemp's label.
02:09So Aldi's milk product is basically a generic label version of the exact same stuff that
02:14sold at a higher price under a brand name label.
02:18What a shock.
02:19Brand names mean higher prices
02:20Sadly, there's another reason why the milk at Aldi is cheap.
02:24The dairy industry is reportedly in a state of crisis.
02:28As the Milwaukee Journal Sentinel reported in May 2019,
02:31Whipsawed by low and unstable milk prices, farmers have increasingly called it quits.
02:37Nearly two farms a day closed in 2018, and more than 300 folded from January 1st through
02:43May 1st of this year.
02:45Most were small operations unable to survive farm milk prices that, adjusted for inflation,
02:50were among the lowest in a half-century.
02:53In the U.K., Aldi was one of the retailers linked to the farmgate price cuts forced on
02:57British dairy farmers, many of whom subsequently called for a boycott of Aldi and other grocers
03:03in 2012.
03:05It took another three years before Aldi responded by raising the prices they paid for U.K. milk,
03:10a move hailed as progress by the Farmers' Guardian.
03:14But Aldi's cheap milk prices might reflect some questionable business ethics, at least
03:19in regards to paying dairy farmers.
03:22According to the Food and Agricultural Organization of the United Nations, dairy industry profits
03:27worldwide are in a state of freefall, and this appears to be a problem that's too big
03:32to solve with protests, boycotts, or even switching to a different retailer altogether.
03:37But if it makes you feel any better, you're practically guaranteed to pay a whole lot
03:41more at Whole Foods for what's basically the exact same milk.
03:45If you want milk that's entirely guilt-free, you'll have to either move next door to a
03:49dairy farm or get your own cow and milk her yourself.
03:52You could also consider switching to non-dairy milk.
03:55The Living Well website suggests that Aldi's prices on its milk alternatives compare quite
04:00favorably to almond and soy milks found at other grocery stores.
04:04Could we pour in that for a man?
04:06Order for you?"
04:07Sadly, we have absolutely no idea whether they pay their soybean and almond suppliers
04:12fairly or not.
04:13But when we do find out, we'll let you know right away.