METRO AG - METRO Group

METRO AG’s internationalization drive:
Global strategy – local concepts
The globalization of the economy is gradually
embracing all sectors of developed national
economies with increasing speed. Since the
beginning of the 1990s, trade has also been
characterized by systematic internationalization.
The driving forces behind this trend are, firstly,
the foreseeable end to great growth opportunities
in domestic markets and, secondly, purchasing
power in the newly industrialized countries,
which is expected to rise overproportionately in
the next ten to fifteen years owing to the dramatically
changing global economic environment.
At the same time, consumer markets in these
countries are opening up to both international
consumption trends and modern forms of trading.
Government and municipal authorities
recognize the economic advantages of mass distribution
which cuts transaction costs and the
additional scope for exports created for local
consumer goods industries from the transfer
of foreign trading companies’ know-how.
In addition, consumers in the newly industrializing
countries are accepting and adopting the
contemporary types of sales outlet found in
industrialized nations without any appreciable
time-related adjustment problems.
In particular, system-driven discounter outlet
types such as hypermarkets and specialty discount
stores will bring about structural changes
in trade at international level.
With the establishment of METRO AG, the central
foundations have been laid for skilled and
dynamic internationalization, which enjoys
strategic priority in the development of selected
outlet chains within the METRO AG portfolio.
METRO AG
Additional information
International trading groups are already active
to a greater or lesser degree or preparing
activities in all the up-and-coming economic
regions. The time frames for penetrating emerging
markets are therefore not only determined
by the specific features of a growth market but
also greatly influenced by the decisions of global
competitors. The majority of trading companies
from Europe, the USA and Japan which are
expanding into new economic regions possess,
for historical reasons, a highly concentrated portfolio
or even a monostructural outlet type concept.
In their home markets, they have achieved
a market position of absolute dominance.
In comparison, METRO AG offers a broad range
of outlet types within its portfolio. The bulk of
the outlet types envisaged for globalization also
enjoy a strong market position at home. Against
the background of limited resources, such a
broad lineup of outlet types leads, however, to
internationalization disadvantages in relation
to monostructural competitors, which can concentrate
their resources on one sector alone.
On the other hand, METRO AG’s diversified
outlet type portfolio offers substantial competitive
advantages amid competition for locations
in the urban areas of newly industrialized countries,
because it can offer up-to-date shopping
centers from a single source.
Crucial benefits are emerging for METRO AG
from its experience abroad spanning more than
20 years with the C&C Group, which is managed
under a nongratuitous contract for services
by Metro International Management GmbH
(MIM). This know-how extends to newly industrialized
countries, to former Eastern bloc countries
as well as to the developed markets in
Western industrialized nations.
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