1.
INTRODUCTION TO METRO:
METRO Cash & Carry – this name stands for one of the great success stories in moderncommerce. The unique wholesale business-to-business model of METRO Cash & Carry isfocused only towards professional customers such as hotels, restaurant, and caterers as well assmall and mid-sized retailers. METRO Cash & Carry offers this target group a greater efficiencythan the multilayered supply chain thus helping them to improve their business: By offering thema one-stop solution for their purchases, by helping them to improve their assortment, by offeringthem high quality products at reasonable and transparent prices and by offering them a consistentsupply source.
What does METRO offer?
METRO Cash & Carry is a reliable partner for more than 20 million professional customersworldwide. It gives them a clear competitive advantage in their own markets. Professionals can purchase everything they need to run their business: A restaurant owner, for example, can buyfood like fish or vegetables as well as kitchen equipment and office supplies.METRO Cash & Carry offers an exceptionally wide range of high-quality products under oneroof. Depending on the size and type of wholesale center, the assortment includes up to 20,000items in the food range and 30,000 items in the nonfood sector. As the name implies, METROCash & Carry customers select their own items and take them with them to their restaurants andshops. With this unique business-to-business concept, the company has grown to become aleading international player in self-service wholesale.
Company History
METRO Cash & Carry is a leading international company in self-service wholesale and operatesmore than 600 outlets in 29 countries. With over 100,000 employees worldwide, the companyachieved sales of € 31.7 billion in 2007. By generating almost 50 percent of the total sales,METRO Cash & Carry is the top-selling sales brand of the METRO Group. Assortment andservice of METRO Cash & Carry’s unique business-to-business model are targeted only towards professional customers such as hotels and restaurants as well as small and mid-sized retailers or institutions. The company offers these special groups a high level of assortment competency bothin food and nonfood as well as attractive wholesale prices. An efficient and internationallyconferrable concept ensures success in entering new markets.
METRO in Pakistan
METRO Cash & Carry announced its operations in Pakistan in January 2006. Since then, it hasestablished itself as a potential market leader in wholesale. Under the supervision of ManagingDirector Mr. Giovanni Soranzo, METRO Cash & Carry Pakistan has opened its first store in thecity of Lahore in October 2007. The company’s country head office is also based in Lahore andcurrently employs over 400 people in two offices.1
METRO Cash & Carry’s commitment to Pakistan is also echoed in its donations to thePresident’s Earthquake Relief Fund.
– The company donated €100 000 in January 2006towards President's Earthquake Relief Fund. It also has plans to fund development activities inthe country in association with the German Investment and Development Company. Suchactivities have successfully been carried out in other countries.METRO Cash & Carry plans to invest in Pakistan on a sustained and reliable basis in the years tocome. The company’s unique business model offers potential for a decrease in market prices and promotion of local goods and personnel.
Issues:
Tactical sales issues & queues
Metro faces many tactical issues because they have to change their inventory after every 14 dayson Thursdays. They need very active workforce which shifts inventory from the top into the shelf space for this. Sales force facing problem of managing queues on the cash counter. Sales forcemotivation and activate participation in work is shrinking. Giving sales force up to date productknowledge in shorter span of time is a problem
Positioning or segmentation Issue
Metro position itself as a wholesaler brand in Pakistan but people who don’t have retail storesthey also come here and do shopping ,according to our analysis and their advertisement the targetonly businesses and they should position their brand also for ordinary customers who use products in their homes.
Competition’s Prices issues
If we analyze the prices of makro and other whole sale markets then we can see that metro pricesare almost less than all so in order to maintain prices metro face problem during setting customer prices because customer select those whole sale markets who offer maximum discounts onquantity and transportation.
2.External and Internal Analysis:
Key success factors:
10 METRO Cash & Carry principles
The success of the company is based on the following principles:• Focus on professional customers• One-stop shopping• Efficient store concept designed for professional needs• Advanced customer service2
• Enhanced customers’ competitiveness• Excellence in supply chain and quality management• Strengthening of local suppliers• Development of national infrastructures• Career opportunities• internationally transferable concept
Competitive analysis:
There is one major competitor in Pakistan’s whole sale industry and that is Makro.
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Both use News papers, internet, pamphlets and book lets because it contains detailedintroduction about the business and its products.
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Both Metro and Makro are in a wholesale business
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Both Spent not much on Marketing campaigns
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Metro believes in the concept of in source while Makro outsources its food production
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They both have teams for customer service
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Metro has trained staff while Makro has just hired sales person
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Metro has proper shelf placement of products whereas Makro does not
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Metro follows the same layout all over the world and Makro does not
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Metro places its inventory in its store and warehouse, while Makro places inventory onlyin store it does not has any warehouse
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Metro hire logistics for transportation
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Metro focus on proper shelf placement of products while Makro has not practicing this.
SWOT Analysis of Metro:
Opportunities:
1.Changing trend of shopping, people prefer to go the place where they can find maximumvariety under one roof.2.Metro is planning to open new stores at different locations.3.Company name itself is an opportunity as “Metro” itself is a very popular name and theycan expand business with any company they like to.4.People are coming more towards hygienic food.3
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