German discount chain Aldi is stepping up its AUD$750m (£367m) assault on the Australian grocery market with plans to open 40 stores across South and Western Australia next year.

Aldi, which has previously concentrated on the country’s east coast, plans to open its first 20 stores in South Australia early next year and a further 20 in Western Australia between June and December 2016.

It follows a AUD$70m (£34.2m) investment in a new distribution centre in Adelaide.

The chain, which launched in Australia in 2001, already has an 11% market share and 350 stores. Annual sales are reported to be around AUD$5.3bn (£2.6bn).

Its range includes value private-label food and general merchandise, including homewares, snow and ski gear. It has been reported that it also plans to address criticisms about its lack of fresh produce and step up its battle with leading chains by stocking fresh food from local farms.

Aldi announced two years ago that it intended to invest AUD£2bn (£979m) in taking on Coles and Woolworths, and it has already had an impact on the pair, as well as the independent sector. Analyst UBS forecast that the discounter could take up to AUD$250m (£122m) to AUD$350m (£171m) of annual sales from them over the next five years.