Strategic positioning of METRO GROUP
METRO GROUP, based in Düsseldorf, is a leading international retail and wholesale company. Worldwide, 269,493 employees passionately work to optimally fulfil the expectations of our customers. Our operating business focuses on self-service wholesale trade, consumer electronics stores, hypermarkets, department stores and online trade. In these areas our four independent sales lines are leaders:
- METRO Cash & Carry is a leading international player in self-service wholesale trade.
- Media-Saturn is number one among consumer electronics stores in Europe.
- Real is one of the leading hypermarket companies in Germany.
- Galeria Kaufhof is the market leader in the department store segment in Germany and Belgium.
With their products and services, our sales lines serve professional and private customers in 32 countries in Europe, Asia and Africa. To reach new target groups and establish long-term relationships with customers, the sales lines are tapping new sales channels and increasingly dovetailing their stationary business with online retailing. In addition, Media-Saturn’s subsidiaries offer pure online shopping options.
So far, we have bundled our attractive retail real estate portfolio and relevant activities into METRO PROPERTIES. On 1 October 2013, its operational activities were integrated into the sales lines and will no longer be reported as a separate segment.
Focus on added customer value
The objective of METRO GROUP’s strategy is generating long-range, sustainable growth. First and foremost, our aim is to improve like-for-like sales and earnings. We are also boosting our performance strength and appeal by improving our margins, and our cost position as well as by optimising our cash flow and reducing our net debt. The prerequisite for METRO GROUP’s long-range, sustainable growth is our intense focus on creating added value for our customers. Five focal points guide us in this work. They provide the strategic framework for our business activities and lend a shared direction to our group across all sales lines and companies.
Our customers’ needs and expectations form the starting point for all our strategic considerations. Which product ranges do they need in their local store? Can we offer new services to pique the interest of additional consumers or commercial customers in our business model? Which sales channels do we have to develop to meet our customers’ increasing demands? Using these questions as our starting point, we have already made significant strides in the areas of multichannel marketing, delivery, franchising and own brands. In this and other areas, we are rigorously forging ahead with the strategic repositioning of our sales lines.
Our second focal point is growth in all business areas. We intend to achieve this first and foremost by improving sales per metre of selling space in existing stores. An absolute focus on the customer and engaging in responsible business practices in dealing with society and the environment are crucial to this effort. We also aim to significantly improve customer satisfaction. To raise our appeal to private and professional customers, we are making targeted investments in new services. In addition, we are selectively adjusting our sales lines’ price levels to further bolster their competitive positions. Finally, we are realigning our incentive systems for employees to encourage additional productivity enhancements.
A company’s competitiveness depends as much on its process performance as on an attractive product and service offering. Our objective is to create streamlined, effective organisational structures. For this reason, we have to continually examine our processes, systematically review our country portfolio and improve our cost structure. In this way, we can improve our cash flow and create headroom for additional investments.
Efficient processes, optimised cash flow and sales growth with stable or improved earnings represent the foundation for further expansion outside our home market of Germany. After all, our mission is to invest in healthy, competitive business systems. Many countries in which METRO GROUP is active offer excellent opportunities for enhancing our footprint. We are currently focusing on our expansion efforts and are exploiting opportunities: by opening new stores in countries such as China, Russia and Turkey – as well as by enhancing our offer in all other countries.
Creating added value for customers means responding to changing requirements early on or even shaping this change – by recognising trends in technology and society, by identifying their potential relevance to our own business and by deriving specific solutions such as optimised processes or new sales concepts. This work begins by firmly anchoring business innovation within our company structure as well as defining innovation focal points that are relevant to our customers and hold growth potential. The key is cultivating a structured dialogue with internal and external experts. This approach forms the foundation of our innovation management.
Additional information on METRO GROUP’s innovation management can be found in chapter “innovation management”.
Framework for sustainable growth
Our business objectives are aligned with ecological and social requirements. For this reason, we have firmly anchored the principle of sustainability within our corporate strategy. Our sustainability vision serves as a group-wide foundation for the long-term transformation of METRO GROUP: “METRO GROUP. We offer quality of life. For our customers, for our employees, for all who work for us and for society.”
Additional information on METRO GROUP’s sustainability management can be found in chapter “sustainability management”.