Ahmer Javed 4291-Fms-Mba-F09

Zohaib Shakoor 4250-Fms-Mba-F09

Waqas Tahir 4279-Fms-Mba-F09

Syed Nayyar Sajjad 4253-Fms-Mba-F09

Irfan Afzal 2069-Fms-bba-F07

December 15

Entrepreneursh
ip
201
0
Mr. Hafiz
A case study on Metro(cash & carry)
Ghufran
Sajjad Ashraf Basra 3537-Fms
Metro (Cash and Carry)
Company History

METRO Cash & Carry is a leading international company in self-

service wholesale and operates more than 600 outlets in 29
countries. With over 100,000 employees worldwide, the company
achieved sales of 31.7 billion in 2007. By generating almost 50
percent of the total sales, METRO Cash & Carry is the top-selling
sales brand of the METRO Group. Assortment and service of METRO
Cash & Carrys unique business-to-business model are targeted only towards
professional customers such as hotels and restaurants as well as small and mid-
sized retailers or institutions. The company offers these special groups a high level
of assortment competency both in food and nonfood as well as attractive
wholesale prices. An efficient and internationally conferrable concept ensures
success in entering new markets.
METRO Cash & Carry A story of expansion
The self-service wholesale trade came to Europe in the year 1964 when METRO
SB-Gromrkte GmbH & Co. KG was founded in Mlheim/Ruhr. The initiator and
driving force behind this concept was Prof. Dr. Otto Beisheim. In 1967 the Franz
Haniel & Cie. company became a partner in the new venture. Prof. Dr. Otto
Beisheim, the Franz Haniel & Cie. GmbH company and the Schmidt-Ruthenbeck
family then each held one third of the shares in the German METRO activities and
thus constituted the original group of partners.
As from the year 1968 the concept was extended beyond the German borders,
with the Dutch company Steenkolen Handelsvereeniging N.V. (SHV) as a new
partner. The two sides jointly established Makro Zelfbedienigsgroothandel C.V.
with the original group of partners holding 40 percent of the shares in this
activity. Within the framework of a first major expansion drive METRO/MAKRO
Cash & Carry entered the market in nine Western European countries by 1972. In
the nineties, METRO Cash & Carry expanded its activities to Portugal, Turkey, and
Morocco and to Eastern Europe.
In July 1996 METRO Cash & Carry merged with Kaufhof Holding AG and Asko
Deutsche Kaufhaus AG and the METRO Group was founded. That year also saw
the groups going public. The Metro stock is the only retail stock listed in the
German blue-chip index DAX 30.
The first step into Asia was taken when METRO Cash & Carry moved into China in
1996. Today the company is present in 5 Asian countries: China, India, Japan,
Pakistan and Vietnam. The METRO Cash & Carry business is going to be further
internationalized and expanded with the focus on Eastern Europe and Asia.
Already by today, more than 80 percent of the staff is working outside of
Germany. In many countries the company is on of the major employers.

What is METRO Cash & Carry?

METRO Cash & Carry this name stands for one of the great success stories in
modern commerce. The unique wholesale business-to-business model of METRO
Cash & Carry is focused only towards professional customers such as hotels,
restaurant and caterers as well as small and mid-sized retailers. METRO Cash &
Carry offers this target group a greater efficiency than the multilayered supply
chain thus helping them to improve their business: By offering them a one-stop
solution for their purchases, by helping them to improve their assortment, by
offering them high quality products at reasonable and transparent prices and by
offering them a consistent supply source.

What does METRO offer?

METRO Cash & Carry is a reliable partner for

more than 20 million professional customers
worldwide. It gives them a clear competitive
advantage in their own markets. Professionals
can purchase everything they need to run their
business: A restaurant owner, for example, can buy food like fish or vegetables as
well as kitchen equipment and office supplies.
METRO Cash & Carry offers an exceptionally wide range of high-quality products
under one roof. Depending on the size and type of wholesale center, the
assortment includes up to 20,000 items in the food range and 30,000 items in the
nonfood sector. As the name implies, METRO Cash & Carry customers select their
own items and take them with them to their restaurants and shops. With this
unique business-to-business concept, the company has grown to become a
leading international player in self-service wholesale.

METRO Cash & Carry Pakistan Wholesale Centers

METRO Cash & Carry is successfully operating 5 wholesale centres in Pakistan

i.e. 2 in Lahore, 1 in Karachi, Faisalabad & Islamabad respectively.
Opening Dates:
Canal Bank Wholesale Centre, Lahore: October 30, 2007
Capital Wholesale Centre, Islamabad: April 03, 2008
Lyallpur Wholesale Centre, Faisalabad: January 14, 2009
Airport Wholesale Centre, Lahore: January 14, 2009
Safari Park Wholesale Centre, Karachi: March 26, 2009
10 METRO Cash & Carry principles
The success of the company is based on the following principles:
Focus on professional customers
One-stop shopping
Efficient store concept designed for professional needs
Advanced customer service
Enhanced customers competitiveness
Excellence in supply chain and quality management
Strengthening of local suppliers
Development of national infrastructure
Career opportunities
internationally transferable concept
10 good reasons why you should become a customer of
Metro
Low cost possible prices
Stock availability
One-stop shop
Extensive business house
Quality guarantee
Free parking
After sales services
Promotional activities
Simple but comprehensive billing system
Great value for money

Product range

Each store is tailored to address the needs of professional customers. We offer a

wholesale price that leaves the customer room for healthy margins and provide a
one-stop-shop for the customer.
In the food range, freshness is our first priority. This is guaranteed by the efficient
supply-chain and quality control management we have in-place.
In non-food, we offer only products that are up-to-date in terms of technology
and design, and meet all safety standards.

Food

At the METRO wholesale center you can find a wide range of food products

Dairy, Frozen
 Meat
Fresh Fish & Seafood
Fruits & Vegetables
Edible Groceries, Canned Goods and Bakery
Sweets and Confectionary
General Grocery
Tobacco and Beverages
Detergents
Cosmetics & Toiletries

Non Food
Office Equipment
Media , Radio & Accessories
Home Electronics/House Hold
Household Goods

Pots & Pans (Tefal, Sonex, Majestic, Prestige)

Tableware (Luminarc, Clayworks)
Glass (Pasabache, Bormioli Rocco, Toyonasic, Ocean)
Cutlery & Cutting Tools (Cocktail, Kiwi)
Kitchen Utensils & Serving Articles (Fackleman).
The range also include decoration products (Walther Glass),
Candles
Cleaning items.

Home Improvement/DIY (Do it Yourself)

Lamp fixtures, lamps & bulbs (OSRAM, PHILIPS)

Electrical items (BUSH) Bathroom & Sanitary (Faisal & ICL)
Flooring (Krono Flooring)
Paints and painting accessories (ICI,Master Paints)
 General use and specialized hand tools (Stanley)
Power tools (BOSCH, Black & Decker)
Generators (Honda) and operating equipment.

DIY also offers a wide range of car interior and exterior equipment, car care
solutions (MOTHERS, COSMIC) and good quality tyres at low rates (GOODYEAR,
NEXEN).
Home Textile/Home Decoration
Ladies wear/Mens wear/Childrens wear/Shoes/Luggage
Sports & Seasonal
METRO own brands

In several food and non-food product categories METRO Cash & Carry offers a
wide range of its own brands. These brands are highly popular across the globe.
The availability of these brands allow our customers to save money without
compromising on the quality for which we are famous and feel proud of it.
Their brands are following
Alaska
Fairline
Enhil
All of these three are related to electronics equipments.

SWOT Analysis of Metro:

They have ATM facility at their store, they also offer installment plans in which
bank is involved. (HABIB BANK LIMITED)
IT is also their strength that they do not have strong competitor at their level.
The registered business person can refund GST (General sales tax which he has
paid on metro) when paying the tax to FBR (FEDERAL Board of Revenue).

Competitive analysis:

There are many competitors of Metro in Faisalabad and in other cities

respectively. But focusing on Faisalabad there are Al-Fateh shopping store, SB
store, Family Mart, City Mega Mart, E-Mart, Bambino Mart and Rachana
Departmental Store. Availability of such competitors has created a strong
competitive environment in Faisalabad. Because all of them are providing almost
same type of services so there is a tough competition. There are many
disadvantages that Metro has to face but the main issue with Metro is that it is
situated far away from the center of the city while many of its competitors are
situated in ideal places in potential market so they are taking advantage of this
and providing same facilities as Metro provides. On the other hand Metro has the
advantage of low prices. The potential customers of Metro are wholesalers and
restaurants so other stores targeting the normal grocery customer and competing
Metro in this regard. But due to its low prices it is also attractive for daily based
customer. So it has a strong position in regard of customers having both types of
customers.

Organizational Structure of Metro:

The Metro classifies itself as business to business wholesaler. They are following
vertical organizational structure with proper hierarchy. At each level the authority
and span of control is predefined.
Store Manager

Floor Manager Floor manager Floor manager Floor manager

Department
Department Department Department
Manager
Manager Manager Manager

Assistant
Department Manager

Store Associates
The hierarchy starts with store manager and there are Four Flour managers and
each manager controls 10 Departments and there are total 40 Departments. The
proper authority and moderate Spam of control make it possible to operate
functions efficiently.

Metros Management:

They have almost all famous companies with them. They directly purchase
through companies in very huge bulk quantity. They contract with companies and
get best quality and quantity.
On the other hand the companies also save their cost, because companies put
their stock in METRO at once. And they purchase on debt, the terms of debt vary
company to company.

When they purchase in huge bulk they got reasonable discount as compared to
others. On other Metro is self services wholesaler, so they reduce their cost in
customer services. But most of the companies send their own sale representative
to Metro on their own stall to facilitate the customer I purchasing the product

They have adopted market penetration strategy. They are now working hard to
create more and more business. They are now investing more on their business
retailer.

The Metro is accommodating divers workforce at their working area their training
is carried out to manage them properly.

They evaluate their employs on the basis of their Task. The Monthly performance
reports are prepared. After evaluation the hardworking employs are promoted as
well as rewarded.
Metro also have a teaching staff to train their existing and new staff.

The shop lifting is common all over the world. Metro has created a strategy to
minimize this loss. They place a tag or Sticker on every single piece of product.
When shop lifter try to take any product without billing. The Automatic scanner
on Exit gates are activated and detect the bar code (which is pasted or tagged on
product). The shoplifters have to pay double of the price. Otherwise they are
given in the custody of Police.
Normally incentives are given to them on basis of their performance. The
incentives in the form of bonus are mostly given in Metro store. On quarterly
Basis the performance is analyzed and rewards are given to employees.
Metro says in its management policy:

1. Trust and Respect

Everybody's opinion counts
We treat every person the same way

2. Open Door Policy

We avoid organizational barriers
Two-way communication
We encourage change and sharing of ideas

3. Empowerment to Personal Responsibility

We allow people to take risks
We consider "making mistakes" as part of the game

4. Be a Role Model
We demonstrate commitment and enthusiasm

5. Setting Clear Personal Objectives and Tasks

We have implemented a management-by-objectives concept

6. Recognition and Reward

We consider honest and transparent feedback as a "must"
We reward high performance (not only with money)

7. Team Spirit
We encourage maximum team engagement and knowledge

8. Positive Working Environment

 We guarantee a safe and healthy working environment
We encourage innovation and creativity

9. Corporate Social Responsibility

We are committed to the principles of social responsibility

Questions:

Q: Should Metro continue its business as wholesale only or should they pay
attention to the household customer? Explain your answer.

Q: What steps Metro should take to increase its sales volume?

Q: How does the Metro motivate its employees does it help in retaining them?

Q: In your opinion entrepreneurship is the reason of Metros success or not?