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Metro Group has partnered with Singapore group, Yoma Strategic Holdings Ltd to enter Myanmar.

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As announced in March, Metro Group will be split into a food company and a consumer electronics company in mid 2017. The new company names have been announced as Metro (or Metro WFS) for the wholesale and food business and CECONOMY for the consumer electronics business.

Focused operations

The split, which was first announced in March, will enable each part of the business to grow faster in its specific area. The food business will be a huge wholesale food and service company, operating internationally. With activities in 35 countries, Metro WFS will be a specialist in food and serve HoReCa customers (hotel, restaurants and caterers) and will operate on both a B2B basis, as well as a B2C basis, offering food and general merchandise at very low prices.

Decentralisation to better serve customers

When the split occurs, it is likely that the organisation will be decentralised, to allow it to better serve its different customers. It plans to be able to have better values, better quality and better service in order to compete effectively worldwide. Each business has unique elements and assets and it is expected that the split will help to unlock the hidden value of each division.

Metro Group has announced plans to build a new logistics facility in Germany - the country’s largest ever retail logistics park.

A groundbreaking development

The logistics facility will be built in Marl, in the west of Germany and will cater to Metro Cash & Carry stores and Real hypermarkets. At 220,000 sq m, the retail logistics park will be the largest ever built in Germany and will create over 1000 jobs in the region.

Modernising Metro’s logistics

The new hub represents an important element of the retailer’s new logistics strategy, which was announced in September last year. The strategy aims for Metro’s logistics networks to be modernised and become more efficient; with new locations and investments throughout the retailer’s logistics operations. The new facilities which are being planned around Germany will help improve product availability, quality and freshness – all of which are key to Metro’s growth in the future.

Meeting the needs of the future

Mark Frese, CFO of Metro Group, commented: "The location in Marl is a stroke of luck for our logistics strategy in Germany. With this new hub, we complete the new logistics network of Metro Group in Germany and will be able to even better meet the needs of our sales lines METRO Cash & Carry and Real in the future."

For more information on Metro Group, have a look at our retailer hub page on Supply Chain Analysis. It covers all of the latest news and developments for Metro Group’s supply chain, as well as any industry case studies it is part of and our Metro Group Supply Chain Snapshot.

Germany's Metro Group is proposing to split itself into two groups: A wholesale and food specialist group and a consumer electrics group, with implementation targeted for mid 2017.

What will the split mean?

The demerger would see Metro, Makro and their associated entities (including Real) form one group, and Media-Saturn and its portfolio of formats and brands become a separate group. Each entity would have its own management board, with full control over corporate strategies and each would be stock listed. Both groups have seen good performance recently and have strong financial profiles, and the proposed split will enable each to focus on its area of expertise. The two businesses currently have little operational overlap so the financial loss of any synergies would be minimal.

Benefits of the demerger

It is believed that the split will facilitate a significant opportunity for faster and more profitable growth. Each entity will be able to independently pursue acquisition and partnership strategies and to define their own expansion plans. It will also increase focus, simplify structures, increase flexibility and improve time to market, beneficial for both groups. The reaction to the proposed plan has been positive, with share prices increasing significantly.

The impact on Metro Logistics

It’s not clear what impact the demerger will have on Metro Logistics, the logistics service of Metro Group. Currently, Metro Logistics is responsible for the flow of Metro Cash & Carry, Real, Media Markt and Saturn, handling 25,000 frozen, fresh and ambient products as well as a strong non-food offering. Metro Logistics Germany handles warehousing, secondary distribution and primary logistics in Germany; whereas Metro Logistics International Supply focuses on all international logistics activities. This simplified management structure offers Metro Group’s retail divisions, especially Metro Cash& Carry and Real, improved logistics services.

Want to find out more about the latest news and developments for Metro Group’s supply chain? Check out the Metro Group hub page to explore insights and industry case studies.


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