METRO Cash & Carry: sector development in the cash-and-carry business

In Germany, sales generated by the self-service wholesale trade during financial year 2014/15 remained slightly below the previous year’s level. As in the previous year, the cash-and-carry segment lagged overall food retail, which recorded slight sales growth. In 2015, food prices once again rose only slightly. This development was supported by another increase in advertising activities in German food retail and the rising number of brand products at discounters, which also had an impact on the self-service wholesale trade. Consequently, while demand remained largely stable overall in volume terms, there was a lack of positive growth impulses to drive the sector forward. METRO Cash & Carry maintained its market-leading position during the reporting year.

In light of the improving macroeconomic situation in the euro crisis countries in particular, the self-service wholesale trade in Western Europe developed positively for the first time in several years. In financial year 2014/15, the sector recorded slight revenue growth. Sales in Italy, Spain and Portugal matched or slightly exceeded the previous year’s level while sales in Belgium and the Netherlands were weaker. Mostly moderate price increases were recorded across Western Europe, preventing any positive inflation-induced sales effects.

In Eastern Europe, the self-service wholesale trade continued its mixed development in financial year 2014/15. The Russia/Ukraine conflict and the Russian import ban on Western food products resulted in above-average food price increases in Russia and Ukraine. In addition, the devaluation of the local currencies fuelled inflationary trends in both countries. Adjusted for price and currency effects, demand fell in both Russia and Ukraine. Meanwhile, deflationary trends continued in the other Eastern European countries. In Romania, this is primarily due to the reduction in value added tax on foods products. Sales in the self-service wholesale trade developed positively in Romania, Poland and Turkey.

In regional comparison, Asia once again recorded the strongest sales increase in the self-service wholesale trade in financial year 2014/15. With the opening of new wholesale stores in China and India, METRO Cash & Carry was able to maintain its market share in the region. Both countries also remain the focus of strategic expansion with self-service wholesale stores. Despite an increase in international competition, especially in India, market concentration in Asia remains altogether low. Traditional retailers continue to play an important role as suppliers to the population and continue to offer strong growth potential for the self-service wholesale sector. The hospitality sector in Asia is fast gaining importance across the continent and has been recording strong growth. During the reporting period, METRO Cash & Carry gained access to this segment with the acquisition of the Classic Fine Foods group.