Metro AG to open 50 stores

Metro AG, Germany’s biggest retailer, plans to open as many as 50 wholesale stores in

the next five years across India. Metro, which has six wholesale stores in India since it became the first overseas retailer to open such a store in 2003. It is now expanding in the world’s second fastest growing economy as it seeks to cut its dependence on its home market, where sales have stagnated in the past decade. It plans to open wholesale stores in India, where local rules bar foreign companies from opening multi-brand retail stores, comes amid similar plans by overseas rivals and home-grown retailers. India, along with China and Russia, will be one of the top three markets for the German retailer in the coming years. Likewise, Wal-Mart, the world’s biggest retailer, plans to open as many as 12 wholesale stores in the country in 2011.

Metro has, so far, invested about Rs 619 crores in the past eight years to open six stores. One of the largest retailers in the world, Metro AG is a Düsseldorf-based holding company formed through the 1996 merger of four giant German retailing groups. It operates 2,250 stores in 25 countries. The company employs almost a quarter-million people. Metro concentrates on four core businesses: cash-and-carry wholesale outlets, retail food markets, consumer electronic stores and home-improvement centers, and department stores. With strong price competition in the German marketplace, the company has aggressively pursued growth in foreign markets. The cash-and carry business accounts for 75 per cent of foreign sales and is the company's most profitable division overall. Metro AG is at the head of a capital market-oriented, highly competitive retail group with an international profile. The Metro group's business and operational structures, entrepreneurial concepts, and strategies are worlds apart from the usual image of a retail company focusing on the domestic market. India has potential for a large number of wholesale, also known as cash-and-carry, stores as the country has an estimated 12 million mom-and-pop outlets that modern wholesalers can cater to.