Published on November 9, 2016
1. Industry Retail Founded 1964; Metro AG formed in 1996 Headquarter Düsseldorf, Germany Area served Europe, Asia, Africa Key people Eckhard Cordes (CEO and Chairman of the executive board), Jürgen Kluge (Chairman of the supervisory board), Olaf Koch(CFO) Services Supermarkets, hypermarkets, consumer electronics and appliance retail, department stores Revenue €31.6 billion (2012) Employees 283,280 (average, 2010) Divisions Metro Cash and Carry, Real, Media Market, Saturn, Galeria Kaufhof Website www.metrogroup.de Presence in India (2003) Bengaluru, Hyderabad, Mumbai, Punjab, MP, UP, Rajasthan, Delhi, Kolkata, Gujarat Cash And Carry "From professionals for professionals,"
2. • As of 2007, METRO Cash & Carry has operations in the 29 countries. • The group includes: • METRO / Makro Cash & Carry, the world's market leader in cash and carry • Real Hypermarkets and Extra supermarkets • Media Market and Satum, Europe’s leader in consumer electronic retailing • Galeria Kaufhof, the system leader in the department store business. operations internationally
3. THE METRO Cash & Carry MODEL • Wholesale business: Business customers and institution such as Hotels, Restaurants, Bars, Cafes, General or specialized food and non food retailer. • Valid business registration. • Format of stores: • Classic (10,000 to 16,000 sqm) • Junior (7,000 to 9,000 sqm ) • ECO (2,500 to 4,000 sqm ) • Procurement: Metro group buying (MGB), group’s Central purchasing entity. • Source 90% of stock locally . • Develop an efficient supply chain. • Cold-storage facility. • Based on self-service & bulk buying
4. Cont… • Sold food and nonfood goods for immediate cash sales • Clients transport their purchases themselves. Metro stores open for 16hrs • Issue a card to customer or an authorized person to buy • Metro C & C was the 1st foreign C & C wholesaler to enter market
5. Source: Company Documents.
6. Market Entry Evaluation process Country Screening Regional Segmentation. Knock-out criteria . Country ranking. Competition Final country ranking Management Decision Feasibility study process. 1. Desk research (if positive result) 2. Pre- feasibilit y study (if positive result) 3. Full- Feasibility study (If positive result) New country opening Source: Company Documents.
7. Political • Long procedures to make a governmental decision • Political instability • Distinction between government and state legislation • Multiparty in different states destroys the coordination Economic • Consumer Spending increases • FDI Increase • Strong Economic Growth • Increased Land Prices • Prices are 30-45% below the government prices Social • Local Traders and associations are opposing Metro C&C • Urban Immigration and Rising Living Standards • Fear among local community resulted in protests Technological • No cold storage facilities • Delays in infrastructure development Environment • The inefficiency of the Mandis brought out 40% of waste PEST (India)
8. 1. Best Prices 2. It's your Warehouse 3. Everything under One roof 4. Extended business hours 5. Quality guaranteed 6. Free parking 7. After sales Service 8. Offers at your fingertips 9. Clear and easy invoice 10. Great value for money 10 Advantages Here are the Top 10 reasons to partner with METRO
9. Recommendations • Technological development in various areas are required for Indian operations (Cold storage, logistics etc.) • An effective forward and backward integration is must for the company • Indianization is key to success