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Metro Cash & Carry GmbH to Open First Wholesale Markets in Moscow

31.10.2001

Metro Cash & Carry GmbH to Open First Wholesale Markets in Moscow

Moscow, 31 October 2001 - Metro Cash & Carry GmbH, the METRO AG subsidiary that has been successfully operating in as many as 20 countries, is to open its first two wholesale markets in Moscow on 1 November 2001. This makes Metro one of the first foreign trading groups to commit itself to doing business in Russia. The opening ceremony will take place with Moscow’s Lord Mayor Yuri Mikhailovich Luzhkov present.

"We are coming to Russia as fair trading partners. We will strive for very close cooperation with local manufacturers, businesses and tradesmen. The Metro Cash & Carry market entry will benefit all parties concerned – not only the local manufacturers and retailers, the caterers and all other commercial suppliers, but also the employees,” said Dr Hans-Joachim Körber, Chairman of the Executive Board of METRO AG on the occasion of the opening of the first two Cash & Carry wholesale markets in Moscow.

The two wholesale outlets offer an assortment of goods in the food and non-food segments consisting of about 15,000 items each on a selling space of some 10,300 square metres each. The capital expenditure for both stores amounts to a total of around 50 million US dollars. The trading company plans to open three more wholesale outlets in Moscow by late 2002. Metro Cash & Carry GmbH, with a share of 45 percent of group sales the strongest METRO AG sales division, directs its comprehensive, high-quality offer of goods at business customers from retail and catering as well as at institutional large-scale users like canteens and hospitals. These are the types of customers that Metro Cash & Carry also plans to appeal to in Russia.

The company sees one of its major strengths in the fact that the Metro Cash & Carry stores offer customers the possibility of one-stop shopping for a comprehensive range of high-quality products from famous brands as well as an attractive range of proprietary brands at favourable prices. In the food field, Metro Cash & Carry banks on its internationally recognized competence in fresh food: The Moscow outlets will boast large fruit and vegetable sections, rich assortments of fresh meat, delicatessen departments, freshly caught fish straight from the auction and their own bakeries. According to Körber the success of the Cash & Carry concept is also to some extent attributable to the fact that the merchandise offering is adjusted precisely to the wishes and needs of local customers and that local manufacturers are integrated into the distribution system. In the two new Moscow markets 70 percent of the goods on offer already come from Russian production. This percentage is likely to go up to 80 or even 90 percent in the next few years. This, he pointed out, will give new momentum to the local economy and, through Metro‘s international sales network, will open up attractive exporting opportunities for Russian manufacturers.

The trading group’s Chairman of the Executive Board also described the staff at the new stores as beneficiaries of Metro’s involvement. He pointed to the fact that the establishment of the first two outlets in Moscow had created about 1,000 interesting and secure jobs. By late 2002 personnel requirements would be expected to rise to more than 2,500 members of staff in Moscow. Nearly all positions in the Metro Cash & Carry stores, including those in management, would be filled with local staff after a transitional phase.

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