The Schwarz group that owns German discount supermarket chain Lidl plans to invest €6.5 billion in 2016, with part of that going to sprucing up its stores in its home market. 

Lidl, and its German discounter rival Aldi, have become giants in European retail by keeping prices low with a strategy of selling mostly own-brand goods stacked on pallets in no-frills stores with minimal staff. 

While their fast growth elsewhere in Europe still poses a threat to the likes of Tesco and Carrefour, the discounters are losing market share to supermarkets at home.

This has prompted both to offer more branded and fresh products and to invest in making their stores more attractive. 

The Schwarz group, which owns Lidl and Kaufland hypermarkets, will invest the €6.5 billion in both chains, the company told the Heilbronner Stimme newspaper.

Lidl will invest more than €3 billion in the next five years just in its 3,200 stores in Germany, the chain's boss Sven Seidel told the newspaper. 

Lidl, which plans to follow Aldi into the US market in 2018, saw its sales rise 9.5% to €64.6 billion in the fiscal year to the end of February. 

Total Schwarz group sales should rise to €90 billion in the current fiscal year after an increase of 8% to €85.7 billion in 2015/16, the company told the paper. 

Based in Neckarsulm in southern Germany, Lidl now runs more than 10,000 stores in Europe and is owned by Germany's richest man, Dieter Schwarz, son of the company's founder Josef Schwarz.