DICK SMITH WARNS OF ALDI DANGER

DICK Smith has warned that ALDI will send either Coles or Woolworths out of business unless the two Australian companies undergo a radical overhaul and reduce local staff.

The day after Woolworths announced it would not renew its contrct with SPC Ardmona to supply private-label tinned tomatoes, Smith (pictured) launched his tirade.

"Don't blame Woolworths for the SPC Ardmona disaster, blame ourselves and capitalism as it gets to the limits of greed," says Smith, who famously started his own food brand using only Australian suppliers.

While Woolworths has cut the tomato deal, it remains in a five-year contract it signed in 2014 for fruit products, which prevented the Victoria-based cannery from closing and saved hundreds of jobs.

Credit rating agency Moody's has described Aldi's operation in Australia as "maturing", and Smith says that spells big trouble for the established players.

He believes that the German supermarket giant will continue to exert serious pressure on Coles and Woolworths due to its lower overheads and private ownership.

"Aldi is one of the smartest and most ruthless retailers in the world. Their greed is unlimited. Aldi Australia is now one-third the size of Coles and they haven't opened in Australia for charitable reasons.

"They are here to eventually take hundreds of millions of dollars out of our country and repatriate this money to Germany."

"It's clear that Woolworths and Coles will have to either replicate Aldi, that is, move to around 90 per cent home brand products and reduce their product selection from over twenty thousand to just a few thousand, while sacking most of their Aussie employees, or they will be sent into bankruptcy."

Smith even tied Aldi's lower food prices to the obesity epidemic.

"Of course, as Aldi becomes more successful with lower and lower food prices Australian's will become more and more obese with the associated health problems," he says.

"And who will pay for that? Yes, Aussie taxpayers. Not the Albrecht family in Germany.

"And Australian parents, don't think your children will have a 'first job' stacking shelves at your local retailer. There will virtually be no jobs, as the Aldi formula is designed for very low staffing levels.

"So don't blame Woolworths or Coles and don't even blame Aldi. It's simply our system of extreme capitalism, with its need for perpetual growth. It will be so sad for our children."