Daily Management Review

No Plans To Part With Real: C.E.O of Metro


07/16/2018


On Metro’s Real, the chief executive says that the company is “successfully set up for the future”.



The C.E.O of Retailer Metro, Olaf Koch, informed that the company is not planning to sell Real, “its German hypermarket chain”.
 
Metro’s expansive business reach was being restructured through several year’s attempt while some business of Metro like “Kaufhof department stores” have been sold to retain the company’s focus on “cash-and-carry business and Media-Saturn electronics chain”. Moreover, the company has split “its food business from its consumer electronics business”, whereby the new section has been renamed as Ceconomy.
 
In reply to the question of “how long Metro would keep Real”, Koch said:
“We are now at a point in which we can say: the company is successfully set up for the future”.
“Now it’s about successfully developing Real further and boosting the value potential of the new business model, the rapidly growing online market place and the more than 70 of our own properties”.
 
The Real story of Krefeld, Germany saw an increment of “customer traffic” by 30% after it introduced a “market hall” trail concept. While, Koch added that around 30 Real stores of Metro out of the total 280 stores, could be “suited to the market hall model over the medium-term”. Similarly, other stores could adopt “individual aspects of the model”.
 
Koch’s comments comes in a time when its “labour union Verdi” at Germany’s Real is calling “34,000 workers” to come on a strike to stage a protest against a “wage agreement” which was adopted by the “struggling chain” for reducing the costs of staff.
Furthermore, Reuters informs that:
“In its financial year to Sept. 30, Metro’s 282 Real outlets posted a 3.1 percent decline in sales and a 24 percent drop in operating profit”.
 
However, Koch confirmed during an interview that Metro remains faithful to “its Russian business” even though the performance has not been great whereby reflecting the same on its “share price”. In his words:
“Metro Russia continues to be a cash cow in our portfolio. The Russian market offers enormous growth potential”.
 
There has been a management overhauling at Russian business of Metro, while “bulk discounts” have been introduced for attracting “more independent traders and restaurant owners”.
 
 
References:
reuters.com







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