Why Aldi prices are 25 per cent lower than the big supermarkets

Household budgets across the country are being squeezed as supermarket prices surge. 

A basket of groceries has increased by 14 per cent since last year, but a recent price analysis shows some supermarkets offer bigger savings than others.

The Choice research found Aldi is 25 per cent cheaper than the other big supermarkets, based on a basket of 14 commonly bought items.

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But what does the German supermarket chain do differently to keep prices down?

Aldi managing director Jordan Lack let A Current Affair in on the tricks of the trade.

Watch the full video in the player above.