METRO
- sCore growth strategy: Implementation of the long-term strategy with high growth ambitions through 2030 defined for the group as well as for the METRO countries and delivery specialists.1
- Strategic value drivers: Increasing customer value through clear wholesale alignment, multichannel and digitalisation for professional customers with a focus on HoReCa and Traders.
- Strategy implementation: Wholesale transformation as a significant key enabler for the successful implementation of sCore. Advance of multichannel business model and digitalisation.
sCore growth strategy
METRO is implementing its sCore growth strategy, which was defined in financial year 2020/21 and is geared towards 2030. sCore emphasises the group’s exclusive focus on wholesale. The ambitious endeavour until 2030 encompasses more than €40 billion for sales and more than €2 billion for earnings (EBITDA).
Long-term growth in out-of-home consumtion and the highly fragmented competitive environment provide the external conditions for our sales and earnings targets. From an internal perspective, we see great growth potential in a strong expansion of our HoReCa delivery business, the digital sales share with goods and services and our traditional wholesale business. Our different channels and services are closely interwoven. With regard to sales and costs, they complement each other synergistically and do not compete with each other. By 2030, we want to grow our market share by significantly expanding our role as a leading international food wholesaler. To achieve this aspiration, we want to triple our delivery sales, increase sales in wholesale stores by more than 20% and grow the sales of our online marketplace METRO MARKETS to more than €3 billion compared to base financial year 2020/21.
Strategic value drivers
- Wholesale value proposition: The sCore strategy streamlines the goods and services business exclusively towards wholesale. HoReCa and Traders are our core customer groups. METRO has a wide reach in both customer groups and strives to maximise its customer potential through high customer retention. By 2030, we want to generate more than 80% of sales with our core customer groups. To achieve this goal, we are significantly improving our value proposition for our target customers as part of our sCore implementation in order to further differentiate ourselves from the competition. In addition to a product range explicitly tailored to professional customer needs with a focus on increasing the share of own brands, we use tiered pricing to reflect our wholesale focus even more strongly than today in our price positioning. We will also ensure the highest possible product quality and availability as well as product, quantity and delivery reliability for the delivery business. To increase our productivity, we are reducing the product range in specific product groups that do not address the needs of our core customers.
- Multichannel: The delivery business was our key growth driver in financial year 2022/23. We are continuing to strongly expand the delivery channel and our delivery expertise to continuously increase the delivery sales share. This will allow us to address the channel preferences of our customers better than before. Furthermore, we are opening up access to customer groups who only want delivery, such as in the communal catering sector. By combining the pick-up and delivery business, we serve the different needs of our customers in the best possible way. The online marketplace METRO MARKETS expands our delivery solution to include non-food products with a focus on the needs of HoReCa customers.
In order to increase customer loyalty and to better tap into customer potential, we are further optimising our sales processes and expanding customer support through the sales force. In financial year 2022/23, we created ~750 new sales positions, thus enabling us to offer our customers the most efficient and best possible shopping experience across all channels. Similarly, we are continuing to improve the digital customer experience and strongly promoting the use of our digital ordering platform M-Shop as well as the METRO Companion app, which integrates our sales channels. The digital sales share is expected to grow to at least 40% by 2030. In addition to METRO MARKETS, the expansion of the range of digital solutions for the hospitality industry will contribute to this growth. This is not only highly significant in the sCore strategy in terms of increasing customer retention. The digital solutions also support the shift from a transactional to a service-oriented and partnership-based business relationship with our customers.
- Network optimisation: The Cash & Carry wholesale is the origin of our business and the root of our success. Wholesale stores continue to be pivotal. Their role is increasingly changing from a pure pick-up store to a multichannel fulfilment centre that ensures the fastest and most efficient fulfilment of needs across multiple channels. Accordingly, wholesale stores will be gradually integrated into the delivery network. Depending on the location as well as the market and customer structure, we are adding dedicated delivery-only locations to the existing network in order to realise our sales ambition in the delivery business.
- New business models: sCore also includes the development and scaling of new business models with the goal of acquiring additional segments as customers within our core customer groups HoReCa and Traders. For example, the focus in the Traders segment is on convenience solutions and the expansion of our franchise models. In the HoReCa segment, the focus is on business models tailored to internationally operating key account hospitality customers.
Strategy implementation
Our countries continue to play a key role in the successful implementation of our strategy. All countries and delivery specialists have aligned their local strategy with the content and ambition of sCore until 2030. As part of a review process, the respective strategies were confirmed by the national subsidiaries in financial year 2022/23. In connection with the sCore implementation, we adjusted the portfolio to the exclusion of India, because the country is not prospectively aligned with the sCore strategy. With the acquisition of JHB in Scandinavia, we have undertaken a reinforcement of the portfolio towards delivery business in keeping with sCore.
The successful sCore implementation requires a cultural change, which we are supporting with a transformation programme. As part of this ‘wholesale transformation’, we are also reorganising the collaboration between the countries and the central functions. The objective of the transformation is to realise synergies wherever this is possible from a business and operational point of view. Responsibility for strategy implementation continues to be locally manifested.
In an effort to provide the best possible support for the local strategy implementation by the group headquarters, we have analysed the sCore strategies of the countries to identify common initiatives and priorities. The operationalisation of the strategy is continuously tracked through a key figure system that reflects the strategic value drivers (cf. table ‘sCore key figure system’).
To achieve our sCore multichannel ambition for the wholesale and delivery business, we have begun to implement the detailed network plan that all countries developed until 2030 as part of the strategy development. Except for the local sales ambition, the network target vision takes capacity requirements and productivity targets into account. Based on these parameters, we are able to target investments in wholesale stores, delivery depots and warehouses/transhipment points.
METRO MARKETS launched in the Netherlands and France in financial year 2022/23. The online marketplace is now available in 6 countries. The expansion highlights the strategic importance of METRO MARKETS for the multichannel approach as well as for digitalisation. The cloud-based point-of-sale (POS) system for the hospitality industry from DISH Digital Solutions (formerly Hospitality Digital) is available on the market in Germany and France, following the Netherlands. With the DISH POS system, DISH Digital Solutions not only expands its range of DISH solutions, but also establishes a connection to already-existing DISH solutions, such as DISH Order. METRO offers its HoReCa customers a comprehensive system consisting of various digital tools with the DISH product family.
Strategic value driver |
Key figure |
Ambition 2030 |
|---|---|---|
Wholesale value proposition |
Strategic customer sales share (%) |
>80% |
Wholesale value proposition |
Own-brand sales share (%) |
>35% |
Wholesale value proposition |
Stock availability (%) |
>98% |
Multichannel/network optimisation |
FSD sales share (%) |
>33% |
Multichannel |
Digital sales share (%) |
40% |
1 In the remaining part of the chapter, the term ‘countries’ includes our delivery specialists (Classic Fine Foods, Pro à Pro, R Express, Aviludo and Pro a Pro Spain and Johan i Hallen & Bergfalk), unless the delivery specialists are explicitly differentiated.
