Metro in India: Fighting Against Odds

Rupsha NeogiRoll No: 8130

• The entered directly into India by establishing two sales branches in Bangalore.

• The first METRO Cash & Carry wholesale center in India opened in Bangalore in 2003. Currently there are 5 wholesale centers in operation,

• two in Bangalore and • one in Hyderabad which was opened on 30 November

2006 and• one in Mumbai opened in 2008 in Bhandup.• Metro Opened up in Kolkata in 2008.

• The business of Metro Cash & Carry aims at professional commercial customers such as hotel, restaurant and kiosk operators, caterers and small food retailers, hospitals, authorities, and to an increasing extent also service providers. Metro Cash & Carry is a one-stop-shopping solution for everything they need. The company offers assortments, services and store architectures tailored to their specific requirements. A restaurant owner, for example, can buy fish or vegetables as well as kitchen equipment and office supplies. The unique business-to-business concept also caters to the professional work schedule with extended opening hours of up to 16 hours a day. By this means Metro Cash & Carry is the perfect partner for professional customers in 29 countries.

• Under the motto "from professionals for professionals" Metro Cash & Carry is offering a wide range of high-quality goods under the brand names Metro and Makro. One of Metro Cash & Carry’s unique selling propositions is its great competence in terms of freshness. An efficient supply chain and a group-wide standardized quality assurance system ensure that customers have a broad choice of fresh fish, meat, fruits and vegetables every day. In addition, a wide range of non-food articles is available with a focus on restaurant supplies, household goods, stationary and multimedia. Good value for money and the consistent availability of high-quality goods contribute to the global success of the Metro Cash & Carry sales concept.

• Another important competitive edge of Metro Cash & Carry is its distinct ability to adapt the service portfolio of its wholesale stores to the needs and overall conditions typical of the respective location. The assortment is geared to the respective national demand and represents the result of a highly modern and efficient procurement organisation. On a global level, professional buyers shop for commercial consumers or resellers, and select the merchandise according to their customers’ special needs. The availability of goods is clearly above retail’s average. Moreover, easy accessibility and longer opening hours make the stores even more attractive for commercial customers.

• liberalisation of the wholesale-trading sector poses fewer political challenges. Partly because the lobby groups opposing FDI in the sector are fairly weak, foreign investment of up to 100% has been permitted. Unsurprisingly then, most of the global retailing giants that have directly invested in India have focused on wholesale trading, and specifically on cash-and-carry operations

• Reduced time and transaction costs. • Expanding product range• Lower, transparent pricing• Convenience• Cold chain infrastructure

• The concept of self-service wholesale made its way into Europe in the year 1964 with the founding of Metro SB-Großmärkte GmbH & Co. KG in Mülheim/Ruhr. Prof. Dr. Otto Beisheim contributed the idea and initiated the process. Franz Haniel & Cie joined as a shareholder in 1967. Since that time Prof. Dr. Otto Beisheim, Franz Haniel & Cie GmbH and the Schmidt-Ruthenbeck family each hold one third of the German Metro operations.

• Early beginnings of the international expansion• The first step abroad was facilitated by the partnership between Metro

Cash & Carry and the Dutch Steenkolen Handelsvereeniging SHV in 1968 leading to the establishment of the new subsidiary, Makro Zelfbedieningsgroothandel, which opened the first Makro store in The Netherlands.

• In 1998 Metro Cash & Carry – a wholly owned subsidiary of METRO AG – assumed the operating management of all Metro/Makro wholesale operations. Today, Metro Cash & Carry International takes the role of the management holding for the worldwide cash & carry activities of METRO Group. The local cash & carry companies in the respective countries are each controlled by an independent management.

• The core target group comprises hotels, restaurants, caterers as well as Kirana stores and other small retailers. At METRO Cash & Carry‘s wholesale centers they can find everything they need to run their business under one roof. Moreover, the company offers a constant availability of highest quality products at competitive wholesale prices. For instance Kirana stores can use METRO Cash & Carry as their warehouse and utilize their free capital for their businesses, rather than lock it up in inventory. The companies unique business-to-business concept also caters to the professional work schedule with extended opening hours of up to 16 hours a day