‘The potential ahead for big retailers and wholesalers in India is immense and growing’

| Updated on: Jan 08, 2018

Metro India chief on why the retail giant has big plans for the market

Metro Cash & Carry entered the Indian market in 2003 and was a pioneer in the segment. Since then a slew of Indian retailers and international giants like Walmart have entered the category. Prior to joining Metro as MD and CEO last year, Arvind Mediratta had helped Walmart set up its cash-and-carry business in India. He spoke to BusinessLine on Metro’s journey, and what lies ahead for the cash-and-carry segment in India. Excerpts:

How does Metro prioritise India, against the 25 other countries it is present in?

India is among the focus countries for Metro AG. Recently, we revamped our India operations and split it into North-East and South-West to sharpen our regional focus. Metro India has a new leadership team in place to drive this goal. We had no regional heads earlier, but as we scale up we realised that each region is different from the other in terms of consumption, assortment of merchandise, price competitiveness etc. We have been making significant progress under the new management team and look forward to achieving our mission for India — being the champions for independent businesses.

With your plans to double your store count to 50 by 2020, how do you propose to control your costs?

We usually use the lease model — built to suit — for our new stores.

Metro follows an extremely robust valuation process and we ensure that each and every property taken goes through a vigorous due-diligence process.

What kind of business do you generate from online channels?

We are primarily an offline player. Our brick-and-mortar wholesale stores provide everything under one roof, most competitive prices in town, friendly service and a broad range of products in various pack sizes. Our However, we do recognise the importance of being an omni-channel. We have recently introduced an ordering platform for our trader customers. Considering how important relationships are in the B2B space, under this programme, we have our sales team visiting customers, taking their orders on iPads, collecting payments and delivering orders. We expect to scale up the programme in the coming years.

With GST, FMCG companies are staying away from wholesale trade. Do you foresee the contribution from cash-and- carry increasing for companies such as HUL, Godrej and P&G?

From the perspective of modern wholesalers like Metro, the GST regime is structured to playing a transformative role in the Indian wholesale and retail markets. While the unorganised wholesale business might crack under the pressure of compliance, and the transparency that it brings, the organised market will be happy to step in and fill that gap, at least in the urban markets. The GST regime definitely provides us with greater opportunities and we are ready to leverage the same.

How does the future look for the cash-and-carry segment in India? Do you think Indian retailers like Future Group and Reliance Retail can be equally successful as their MNC counterparts?

India presents a sound opportunity, with 1.2 billion people and 10 million kirana store owners. Out of the 450 million internet users in the country, over 300 million are smartphone users.

These trends point to the fact that the Indian economy is brimming with growth potential. Policy makers are creating a conducive environment by relaxing norms, so as to invite foreign funds and speed up infrastructure development.

The government’s decision to allow 100 per cent FDI in food retail is one such welcome step in this direction. Against this backdrop, the potential ahead for big retailers and wholesalers is immense and growing.

The Indian retail and wholesale markets offer great potential and prospects for international and domestic players.

Metro is celebrating the second edition of its ‘Own Your Business Day’. What has been the traders’ response post GST?

This year’s Own Your Business Day has seen very enthusiastic response from both Metro and non-Metro customers across the country.

More than 8,000 merchants registered themselves at the Own Business Day online hub.

Metro has been making consistent efforts in educating and training kirana owners to make them compliant with GST, help them digitise successfully and gainfully — these have reinforced their trust in the brand, which has translated into increased participation.

Published on October 17, 2017
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