Future sector trends
Cash-and-carry wholesale trade business
The global development of the cash-and-carry wholesale trade business in financial year 2016/17 was satisfactory and varied across the regions. This will also be the case in financial year 2017/18.
In comparison to the reporting period, we expect financial year 2017/18 to only deliver a slight growth in revenues for companies operating in this industry sector in Germany. We do however still see potential for additional growth in the food delivery segment. Another year of strong sales is expected for the HoReCa business segment, which is an important customer group for METRO Cash & Carry.
Following a slight growth in financial year 2016/17, the cash-and-carry wholesale trade business is expected to experience a more pronounced nominal growth in financial year 2017/18, which will be slightly lower than in the METRO Cash & Carry countries. The positive outlook for Western Europe is in particular supported by the continued stable macroeconomic situation in important countries, as well as the expected better or at least stable development in the hotel and restaurant industries, for example, in France and Portugal.
The cash-and-carry wholesale trade business segment in Central and Eastern Europe is expected to enjoy a stable positive development throughout financial year 2017/18, with growth rates anticipated to exceed those in Western Europe. Sales revenues are expected to track the significantly improved economic situation in a number of Central European countries, in particular in the Russian and Ukrainian markets.
The cash-and-carry wholesale trade markets in Asia, in particular India, but also in China and Pakistan, are forecasted to deliver a stable economic development in financial year 2017/18. The delivery business remains to be one of the most significant growth drivers in this region.
Food retail business
According to Feri Trust, real consumer expenditure by private households in Germany will increase by 1.8% in the year 2018. Private consumption therefore continues to support the positive macroeconomic development. In combination with sustained economic growth, falling unemployment rates and increasing disposable income, private consumption remains an important economic driver in Germany. The retail industry will also benefit of rising consumer expenditure and deliver an inflation-adjusted growth in line with private consumption expenditure in 2018. Planet Retail expects the food retail sector to deliver a growth of 2.5% in the year 2018.