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The UK boss of Aldi has said shoppers could face higher food prices if the government introduces further measures that increase costs for employers.
The warning by Giles Hurley, the chief executive of Aldi in the UK and Ireland, came as the supermarket chain released annual results showing sales increased slightly to £18.1bn last year while profits fell more than a fifth.
“Any policies which affect the operating costs of business should be considered very, very carefully because of the very real risk they find their way … back into the food system and on to prices,” Hurley told the BBC.
The German discounter said its decline in profits – from £552.9m to £435.5m – was in part due to the budget chain’s spending in price promotions and raising pay for staff, as well as an intensive store opening programme.
The results released as the Food and Drink Federation warned food and drink inflation could hit 5.7% by the end of the year, up from a previous forecast of a 4.8% average annual price rise.
The trade body, which said food and non-alcoholic drink prices had risen by 37% between January 2020 and July 2025, blamed the price increases of the past two years on “the financial impact of domestic policies” such as April’s rise in employer national insurance contributions (NICs) and the new packaging tax.
Hurley said the impact of the NICs rise and the extended producer responsibility for packaging had “rippled through to prices on the shelf edge”.
Last month, more than 60 retailers wrote to the chancellor, Rachel Reeves, urging her to avoid implementing further taxes on the industry in the November budget.
Aldi said it intended to invest a further £1.6bn in the UK to open 80 new stores over the next two years. The retailer has 1,060 stores in the UK and Ireland, with plans to scale up to 1,500.
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The German discounter is snapping at the heels of Britain’s third-biggest supermarket, Asda, with figures out earlier this year from analysts Kantar showing it just one percentage point behind in terms of market share – 10.8% v 12.1%.
Hurley said shoppers were “still finding things difficult”, which is why it was “laser focused” on keeping its prices low.
“We’re more determined than ever to meet that demand,” he said. “And that’s why we’re investing a record £1.6bn over the next two years, to bring Aldi prices closer to millions more customers.”
