METRO MAGAZINE

WHOLE- SALE

360

4/2019

Services To help our customers achieve their goals, we are breaking new Products ground – and offering financial support, for example. Food and non-food products that make restaurateurs and retailers

successful. With 100% quality and local focus.

Digital tools For us, more than just a nice ‘extra’. Useful tools increase efficiency and create added value. For retailers, restaurateurs and guests.

- THIS IS WHOLE Marketplace SALE Everything restaurateurs need, on 1 platform. From drinking straws to dining sets. METRO MARKETS makes it possible. Equipment 360 Strategic cooperation allows integrated solutions – for example, professional kitchen appliances on preferential terms.

Consulting Prerequisite for good advice: understanding. We know the challenges of our customers – and respond with individual ised consulting. - MPULSE 1 OUR JOURNEY Where do we want to go? To answer 2 Appetizer METRO around the world

that question, we have to understand 4 How METRO is shaping the where we come from. Our origins lie future with Wholesale 360 Olaf Koch, Chief Executive in wholesale. The first METRO wholesale Officer of METRO AG, on challenges, solutions and store opened 55 years ago – in its era, a integrated wholesale revolution. For the first time, commercial MOVING customers could assemble their goods PEOPLE under a single roof and purchase them 8 Different every day immediately. METRO now provides a Entrepreneur Laura Müller shows us her café Birdie & Co. – wide range of services in 34 countries. and her daily challenges As in the past, we remain focused on 14 Liquidity made easy Quick and uncomplicated our main customer group: independent financial solutions, served à la carte by METRO in partnership business owners. Their success is our with the bank BAWAG P.S.K.

business. Their challenges are ours as 16 Taking the pulse on well. For us, wholesale is therefore more sustainability Sustainability is more than current than ever – adapted to profes- just a trend. In a survey, METRO examined what role sional customers’ needs today. it plays for customers Our vision for our business, now and MOVING in the future, is called Wholesale 360. GOODS The following pages provide examples of 18 Big change for small shops this integrated approach – the challenges The Digital Shop app helps traditional Indian faced by our customers and the way kiranas with digitalisation

METRO responds to them. Wholesale – 24 Original – and fast for many more years to come. Our origins. An answer to rising operating and personnel expenses: Our future. Our journey. METRO Chef Gourvenience

MOVING BOUNDARIES 26 A market where things are happening In a double interview, Philipp Blome and Daniel Rebhorn discuss B2B FOR FURTHER ARTICLES, commerce and platform PHOTOS AND economics 30 App(etizing)? VIDEOS, For efficient business processes, digital tools GO TO WWW. are indispensable. MPULSE. 4 tips for restaurateurs. 32 METRO: DE a worldwide portrait 2 MPULSE

USE IT, DON’T LOSE IT

Success in the fight against food waste: jointly 99 with the company Too Good To Go, METRO res- cued more than 12,000 meals from being thrown % away in the Netherlands and Germany between June and September. The partnership is now being expanded to Belgium, France, Italy and Spain. At METRO wholesale stores in the Nether- lands, for example, users of the Too Good To Go app can buy unsold food products at reduced prices shortly before their best-before date. In Germany, METRO uses the app to offer uneaten store restaurant meals for discount prices. Overall in of the food offered Germany, nearly 90% of all food offered via the app was saved through the app in the from the rubbish bin – in the Netherlands it was as high as 99%. Netherlands was saved – the equivalent of more than 10,000 meals.

INVITATION TO THE FUTURE At the METRO Campus in Düsseldorf, the future of wholesale can be experienced today – in the LAB powered by METRO-NOM. In a compact exhibition space of 30 square metres, METRO’s tech unit presents digital innovations that have got the industry buzzing – from the robot assistant that helps with product selection to the smartphone app that points out personal rebates the moment the customer steps in front of the shelves. Rotating thematic focuses are designated, each for up to 3 months at a time. In early 2020, everything will revolve around the smart checkout – that is, technology that lets you pay without waiting at the cash register. Since APPETIZER opening in March 2019, the LAB has proven a real public attraction. The positive response: 90% of visitors say they gained new insights there. 3 times a week, up to 6 tours are offered. Along with METRO employees, interested members of the public are invited to book a free tour. Contact address: [email protected].

MORE ABOUT THE DIGITAL TRENDS 90 IN THE LAB AT: %

WWW.MPULSE.DE/ of visitors MOVINGBOUNDARIES say: I learned something new in the LAB. MPULSE 3

SPRINGBOARD FOR CREATIVE PRODUCT IDEAS

Whether it is cold-brew coffee soda, vegan organic relish or smoky fine-wood vodka: at NX-Food, METRO’s food innovation hub, start-ups are given the opportunity to test their new products – at selected METRO wholesale stores in Germany and Aus- tria. A number of product innovations have already soared above the clouds: as on-board catering fare for flight passengers. To make this possible, NX-Food ran a cooperative programme with Eurowings and the on-board service provider Retail inMotion. From August 2018 to October 2019, passengers were able to choose from creative food innovations like insect bars and vegan corn snacks offered in the ‘Wings Bistro’ magazine. A total of over 70 innovative newcomer articles were available in the stores and in the in-flight magazine. Some of the product ideas proved themselves in their respective 3-month test phase and were taken up in METRO’s permanent assortment. Interested start-ups 70 can apply at www.nx-food.com at any time for a place on the start-up shelves.

product innovations from start-ups have already been promoted by METRO. % OWN BUSINESS OWNERS: VALUED BY ALL, 91 BUT UNDER PRESSURE of entrepreneurs would choose to found their From the popular neighbourhood Italian restaurant to the kiosk own business again. on the corner: people value independent businesses – because they allow an individual lifestyle and offer unique products. 80% of consumers wish for even more independent businesses in their surroundings. This is the result of the third representative Own Business Study by METRO, for which 10,000 people in 10 coun- tries were surveyed. Independent business owners worldwide are HELP confronted with the same challenges – for example, a difficult domestic economic situation and a high tax burden. The shortage WANTED of trained staff is also an urgent problem: 59% of all own business owners who have hired employees have difficulty finding the right personnel for their company. In addition, 81% consider it essential to use digital tools to design work processes more efficiently. The study results were published

by METRO on Own Business Day, which has been 59% of businesses with their own focusing on independent entrepreneurs every year employees have difficulty since 2016. The initiative is intended to support 52 finding suitable personnel. small and medium-sized businesses and further promote their diversity. % of consumers are of the opinion: independent businesses MORE ON THE STUDY AT: offer good quality. WWW.MPULSE.DE/ MOVINGPEOPLE 4 MPULSE HOW METRO IS SHAPING THE FUTURE WITH WHOLESALE 360

Olaf Koch, Chief Executive Officer of METRO AG

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‘Your success is our business. Our entire operating business is geared towards this. Our strategy to fully focus on wholesale is progressing rapidly. Wholesale is our origin. Wholesale is our future – but in a completely new interpretation. Our very clear objective: delivering ever greater value for our customers. That is the foundation for our continuous growth.’

For customers like Laura Müller, METRO is continuously expanding its existing offerings. The story of the Düsseldorf restaurateur: from page 8. MPULSE 5

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‘Restaurateurs cur- rently expend roughly one third of their budgets for goods: food, cleaning supplies, equipment. This means that two thirds of their expenditures are made in areas that lie out- side the core business of METRO. For us at METRO, this means that we are searching for ways to help our cus- tomers in other areas. We are expanding our

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‘We will expand our offerings into complementary areas. services for professional Beside high quality products we will offer services, consulting, customers. We call this digital tools, equipment and a fully fledged online market- place. We have already embarked on this journey.’ Wholesale 360.’

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MARKET DIGITAL PLACE TOOLS OK

‘Our customers are facing major challenges. This is something that we can watch with concern, or we can use it as strong motivation to develop new solutions.’

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‘Growth requires efficiency. It is a key factor for our customers – especially when it comes to the cost of goods sold. In the food service industry, a precise calculation of the cost of goods sold is of decisive importance when it comes to running a profitable business. Even the tini- est mistakes can result in huge costs. We have put ourselves in our customers’ shoes. And there’s good news: Heavy work on calcu- lations will finally be a thing of the past. Our digital tool MenuKit helps restaurateurs perform these calculation.’

Better management with digital tools – find out more: pages 30/31.

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‘How can you maintain outstanding quality when good employees are becoming increasingly scarce? 1 answer: a perfectly orchestrated kitchen. We work with PENTAGAST­ to ensure this. PENTAGAST is the leading network for kitchen equipment. When we work together, we create a win-win-win situation: we are able to provide our custom- ers with new products and services. ­PENTAGAST in turn is able to appeal its customers with METRO products. And more than anything else, it creates greater value for all our customers: they are able to get everything from a single source.’

VIDEO AVAILABLE AT: WWW. MPULSE.DE/EN/ WHOLESALE-360 MPULSE 7

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‘“Everything from a single source” was also the idea that led us to the creation of ­METRO’s B2B marketplace. METRO MARKETS will provide the largest range of products that is available to restaurateurs. The prin- ciple: with METRO MARKETS, we provide our strong METRO brand to other sellers and vendors. Together with them we are able to offer a product range that we would never be able to provide in our stores. How does METRO benefit from this? Well first of all: It’s for the benefit of our customers. Our cus- tomer will be able to access an unbelievable range of products through 1 single platform. This allows us to strengthen the relevance of METRO in customer relationships and create Platform models like the METRO B2B superior growth momentum.’ online marketplace are booming. Experts discuss this trend: from page 26.

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‘All of these activities have a common objective: we want to be the preferred partner of our customers – for all their needs. This means pro- viding great products, but on top being there to advise and assist them. There is something that I would like to make clear here: Whole- sale 360 is an iterative plan and an evolutionary process. That is why Wholesale 360 is not a programme but rather an attitude. It is an attitude that is shaped first and formost by one pas- sion: making our custom- ers more successful. Their success is our business!’

Close to the customer – all around the world: José Homem, sales force manager at MAKRO Portugal, and Carlos Ferreira, owner of Sabores na Travessa, in Lisbon. Get the background story at MPULSE.de. Entrepreneurship: not for late sleepers – or the faint of heart. MPULSE MOVING PEOPLE

DIFFERENT. EVERY DAY.

Thursday, 6.59 a.m. At Birdie & Co., a low light shines from windows that reach to the floor. Inside, a young woman decorates the tables with fresh flowers while her colleague works at the coffee machine. A short way down the street, in Düsseldorf’s Pempelfort district, Laura Müller closes the door to the underground car park behind her. The 31-year-old graduate in special education and social work has a busy day ahead of her, as always. Rising early is part of her routine. Having realised her dream with the launch of Birdie & Co. 3 years ago, Müller is now preparing to open her third deli. 10 MPULSE MOVING PEOPLE

Next, she gets in the car to drive to Alternatives was working as a substitute teacher. the second – the ‘big’ – Birdie. Since meant to taste good At 10 a.m., all of the tables in the 6 o’clock, the kitchen here has been to everyone little Birdie are occupied. A pair of buzzing with the preparations for the young women with tennis bags and day: hummus, pesto, mashed avo- Müller isn’t a vegetarian, but eats fish dressed for sport converse over a flat cado and everything else that will be and meat, in her own words, ‘very white and a latte macchiato. A on offer. Müller and her life partner consciously’. Her goal is to offer deli- mother, with her baby sleeping in the opened their second location in the cious wholefoods for everyone – so carrier at her breast, sits next to 2 summer of 2019. In contrast to the chocolate croissants can be found on young men breakfasting on ginger ‘little’ Birdie, the larger café has an the menu along with salads. ‘We don’t and mint tea and sandwiches. ample kitchen, storage space and want to limit people’s choices, but Müller’s customers include more cold storage – allowing the entrepre- rather offer alternatives,’ says Müller. regulars­ than casual passers-by: the neurs to use the facilities even during ‘And in a way that also tastes good to little Birdie isn’t directly visible from the renovation work, months before meat eaters like me,’ her partner con- the adjacent streets. And the guests the actual opening, to fill catering curs with a wink. don’t only come from the neighbour- orders and prepare dishes for the There is a second factor in the suc- hood, as the founders first expected – little Birdie. cess of Müller’s eateries, at least as but often from other surrounding Because their concept is a hit. For import­ant as the first. It is clear that locations, as far away as Cologne. one, this can surely be attributed to the woman with the shoulder-length ‘Of course, we hoped it would go the menu: coffee specialities, vegan brown hair and dimples means well,’ Müller says. ‘But we didn’t and gluten-free dishes, everything what she says: that she doesn’t serve know that it would take off like this.’ made fresh from high-quality ingre- organic food simply because it is From a 2-person operation, the busi- dients. From the handmade ‘Energy hip, but out of conviction; that she ness has burgeoned into a company Balls’ to the ‘Pulled Salmon Teriyaki honestly stands behind what she does. with more than 30 employees. The Bowl’ and ‘Home-made Peanut But- ‘I think our guests quickly realised daily tasks of the young entrepre- ter’ – with salmon and peanuts that our top priority is quality,’ Müller neur have changed accordingly. ‘My smoked and roasted, respectively, in explains modestly at 7.30 a.m. at the work isn’t any less now, just different.’ the restaurant’s own kitchen – noth- little Birdie, as she unloads the fully Success suddenly put such topics as ing makes it to the table that Müller packed boxes of delicacies from the personnel planning and payroll costs and her partner haven’t first made big kitchen. Both cafés are open from on the agenda. An essential point for themselves, tested and judged to be 8 a.m. to 6 p.m. When they started, Müller: only those who treat the good. ‘That doesn’t mean that every- Müller and her partner were here guests as she would herself have a thing has to match my taste,’ says themselves every day, from early place in her team. For this reason, Müller. ‘But as if I were serving it to morning until the last mopping of the the 31-year-old trains each employee friends and family at home – it has to floor at 7 p.m. until they are fully ready for the job. taste good to them.’ Inspiration from London Efficient processes and New York compensate for costs

Blackboard for café counter, class- Third: if you’re going to do some- room for coffee machine: this poten- thing, do it right. That is the standard tial trade tantalised Müller for years, she sets for herself and her business. but she always dismissed it as a non- The restaurateur works with a single sensical wish. Until the partners dis- traditional bakery – otherwise, she covered the little shop in 2016. ‘It hardly buys anything pre-made. This was 33 square metres; we thought business decision poses challenges. we could handle that,’ Müller says. ‘Making everything yourself is tre- They had drawn inspiration from mendous work,’ Müller admits. And trips to London and New York – and her demand for quality also means after a short period of consideration, that, with the high purchasing costs they turned their dream into reality. for ingredients, the marginal return From the interior design to the per plate is comparatively low. choice of skirting boards, everything Birdie & Co. has to compensate for grew from their own ideas. this through especially efficient pro- Their undertaking met with scep- cesses. ‘We want to support our team ticism – from suppliers to their own with technology that lightens their friends and relatives. ‘Our parents load, but not at the cost of quality.’ weren’t exactly jumping for joy,’ An example of this is the ‘Tropical Müller remembers. She had recently Birdie’ smoothie, a bestselling menu finished her studies, was registered item. Its main ingredients, mango and to begin her practical training and pineapple, are available pre-sliced­ MPULSE MOVING PEOPLE 11

Laura Müller and her team share a workplace – and warm hospitality.

MPULSE MOVING PEOPLE 13 and frozen. ‘But they don’t taste as personal fulfilment,’ says Müller. ‘Our This afternoon, she receives an good that way,’ says Müller with an business model isn’t to drive up sales e-mail from a regular customer seek- apologetic smile. She prefers to buy at all costs. It’s essential to us that ing catering service for a meeting on the fruit fresh, at perfect ready-to-eat we have happy guests who see us as Monday – in just three and a half ripeness, and then peel, slice and their second living room.’ days. Müller phones to clarify open chop it and flash-freeze the portions. questions: How many persons will This ensures quality – while food be needed for? Are there also creating a huge amount of any food intolerances or spe- work. Müller orders pineapple cial requests? After the call, from METRO by the pallet, 300 she draws up an offer, checks pieces at a time, which requires the expected workload against at least a day and a half of the shift schedule and dis- employee labour to cut. A cusses the details with her time-consuming and therefore suppliers. ‘We try to make cost-intensive task – and not everything possible,’ she the most rewarding one. emphasises. Her customers value this – just as they ap- Support from METRO preciate the fact that the boss and PENTAGAST herself tends to their orders. Working at a desk the whole When they received their most day? ‘I couldn’t imagine it any recent delivery, Müller and her more,’ Müller replies while partner related this to their packing her things to run a few METRO sales force manager. errands on the way home. Together they considered ‘The way it is right now is the whether the tedious slicing perfect mix for me.’ With and chopping process could be the 7-day work week, the very handled more efficiently. The early start each morning and sales force manager then con- the unforeseen challenges. nected them with PENTAGAST, And the certainty that every Germany’s largest network of day will end differently. food service outfitters. A pro- fessional pineapple slicing Ready for anything – with machine and other equipment METRO as your partner. were discussed. This is an example of what the Each day is different cooperation between METRO and PENTAGAST creates for restaura- At the big Birdie, the menu is there- Modern technology for teurs: new possibilities for perfectly fore considerably larger, thanks also more efficient processes matched food and technology solu- to the kitchen. Lunchtime brings tions. Equipment that is tailored to intense activity. Operating the large Since September 2019, METRO the needs of the respective business, portafilter machine with fluid ease, has been working in cooper­ from a single source. ‘We’re thrilled Laura Müller serves coffee special­ ation with PENTAGAST, Ger- that METRO is expanding its offer- ities one after another. ‘We work many’s largest network of food service outfitters. With the ings in this direction,’ says Müller. exclusively with small roasting joint solution SMART & EASY, Where multiple contacts and logist­ houses and give great attention to customers can obtain profes- ical connections used to be necessary, the coffee’s quality,’ she says. ‘Fair sional appliances like combi only 1 is now. trade as well as the quality of the cof- steamers and dishwashers at Müller isn’t alone with her chal- fee beans are very important to us.’ attractive prices. This modern lenges. She is well networked, and She explains that she enjoys all kitchen technology makes pro- she knows the difficulties her coun- aspects of her job, but her favourite cesses in restaurant operations terparts in the business face. She place to work is at the coffee even faster and more efficient. attends industry gatherings and machine: ‘I love to be here, greeting maintains an exchange with other the guests right as they come in.’ Due restaurateurs. She doesn’t view to her background as an educator, others who run eateries with similar perhaps, but above all to her person- VIDEO AVAILABLE concepts as competition, saying, ality – even at hectic moments, AT: ‘We’re happy for every individual Müller seems relaxed. ‘Each day, restaurant.’ There it is again, her actually, has a surprise in store,’ she WWW. most important trait: authenticity. says. After the routine start, every MPULSE.DE/EN/ ‘For us, Birdie & Co. is a source of working day unfolds differently. WHOLESALE-360 14 MPULSE MOVING PEOPLE

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New services help restaurateurs in matters of financing.

A café operator needs a new refrigerated Since the start of 2019, METRO Austria has Finances – a perennial issue counter for her cakes – calling for an been offering just such financial solutions. unexpected 4-figure payment. Or a bar- In partnership with the Austrian bank Financing is an abiding theme in the keeper has to pre-finance the goods he BAWAG P.S.K., METRO is making current lives of independent business owners. needs for a planned event. For restaura- accounts and credit cards available exclu- In the current Own Business Study from teurs, financial straits are often a part of sively for restaurateurs. In addition, it is METRO, the 3 biggest challenges entre- doing business. Obtaining bank loans is providing specially developed financial preneurs say they face are all in the difficult, often involving a protracted services like ExpressFinancing: a loan that financial area: as their greatest hurdle, application process. What can be done can be applied for completely online, 44% name the economic conditions in about it? ‘As a solutions provider, we without paperwork. A response comes in their own country; 37%, their insecure want to help HoReCa entrepreneurs stay 24 hours on average, and the principal is income situation; and 36%, the amount stable and solvent in a challenging paid out the following day. This enables of their tax payments. A full 83% of inde- market – with financial services custom- restaurateurs to flexibly secure their pendent business owners also wish for tailored to the needs of our customers,’ liquidity and keep their financial situation financial assistance for staff training. says Michael Zyber, Director of Business well in hand – meaning fewer headaches Model Innovation at METRO AG. due to unexpected expenses. MPULSE MOVING PEOPLE 15

Guido Weber At the inter­ ‘Sometimes business national sympo- partners are really slow sium ‘CHEFDAYS’ to pay their bills – and in Berlin, we asked when they pay late, our restaurateurs liquidity suffers.’ about their experience in the area of finances. Florian Selle

Julian Hansmeier

2 ‘Unfortunately, a lot of bank consultants don’t have ‘ESPECIALLY IN CASES much knowledge of the res- OF SIGNIFICANT taurant business. I’d like DAMAGE – WATER to have contact partners DAMAGE, FOR who are really familiar EXAMPLE – THERE’S A with the industry and offer FINANCIAL SQUEEZE.’ appropriate solutions.’

- ‘WITH ITS AUTHORITY IN THE ‘WHEN AN EXPEN INDUSTRY, YOU CAN IMAGINE SIVE KITCHEN APPLIANCE GIVES UP THE GHOST, IT INSTANTLY PUTS A DENT IN YOUR FINANCES.’

FIND OUT MORE AT: AS A FINANCIAL PARTNER.’ WWW. MPULSE.DE/EN/ WHOLESALE-360 16 MPULSE MOVING PEOPLE

TAKING THE PULSE ON SUSTAINABILITY

Whether the issue is the climate crisis, plastic waste or factory farming – more than ever, it is imperative that not only METRO surveyed over 6,700 customers in 23 countries policymakers but also companies ques- on environmentally friendly and resource-saving busi- tion their own actions with a view to ness practices. The result: on a scale from ‘completely’ the future. METRO wanted to know: to ‘a little’, ‘not really’ and ‘not at all’, 57% of HoReCa customers feel ‘completely’ responsible for the issue of what role does sustainability play in the sustainability, and another 34% ‘somewhat’ respon­ everyday business of restaurateurs and sible. But what is actually being done in practice? Top- independent retailers? Answers are now ping the list of priorities of restaurateurs are waste provided by METRO's first global cus- avoidance, the purchase of local and regional products tomer survey on sustainability. and waste separation and recycling. However, the big- gest obstacles to HoReCa businesses in implementing greater environmental protection are high costs and the large amount of time necessary. Independent retailers worldwide see the lack of interest outside their industry – for example from public authorities – At a glance: as a barrier to sustainable action. who was surveyed? The survey also put the role of METRO up for evalu­ METRO’s international Sustainability ation. The results showed that 20% of restaurateurs Survey was conducted in spring ‘fully agree’ that METRO supports 2019, with 6,723 customers from them in operating their businesses 23 countries worldwide taking part – sustainably. A further 57% ‘partly from Austria, Spain and Turkey to agree’. The possible answers were India, Russia and China. There was a ‘fully agree’, ‘agree (partly)’, ‘dis­ focus on 3 customer groups: HoReCa agree’ and ‘fully disagree’. Those business owners, that is, hotels, res- surveyed view their suppliers – taurants and caterers; Traders, that including METRO – as their most is, independent retailers such as important source for future- kiosk operators and petrol stations; oriented, sustainable solutions. and SCO customers, that is, service companies and offices.

MORE ON THE SUBJECT OF SUSTAINABILITY AT:

WWW. METROAG.DE/ CR-REPORT- 2018-19 MPULSE MOVING PEOPLE 17

‘The customers Sarah Blanchard provide important input for our strategy’

Sarah Blanchard, Head of Corporate Responsibility at METRO, discusses the results of the international customer survey and what METRO can learn from them.

Those surveyed expect their suppliers to pro- vide them with information on sustainability. What does METRO conclude from this?

In most countries our customers view us as an It could be because quality and food safety are important source of information, even above front of mind there. Conversely, in Spain, interest actors like public authorities or non-governmen- seems to be low, at 26%. We don’t know why tal organisations (NGOs). So we have the unique that is, as it doesn’t reflect the situation we see opportunity to support them both with sustain­ in the media. It would be guesswork to say why, able products and solutions and with consultation and a more detailed look at the actual local and advice. situation is needed. This survey provides some first insights and gives us a platform from which What does that mean in practice? to launch more questions.

For one thing, showing our customers why sus- Customers see regional and seasonal tainability is important for them. By making products, especially, as topics with clear, for example, that wasting food incurs future relevance. Eating just turnips all unnecessary costs, which ultimately influence winter – is that realistic? the price the end consumer pays. No one wants to pay unnecessarily. At the same time, we should That depends on how exciting you make turnips! help our customers to communicate their own Joking aside, while there will always be global commitment publicly. Our digital tools allow products like coffee, tea and chocolate, local and restaurants to not only design their operational regional goods are gaining in importance. We procedures more efficiently, but also to draw support local producers and promote seasonal attention to their sustainable offerings, for ex- products as well as innovative solutions like urban ample by partnering with the surplus food tool or indoor vegetable gardens. I can say in general Too Good To Go. that, whether in terms of regionality, energy savings or recycling – the results of the survey are According to the study, how often important input for our sustainability strategy. restaurant guests ask about sustainable products varies considerably from Just 20% of HoReCa customers completely country to country. What are the possible agree that METRO supports them in acting reasons for this? sustainably. There’s room for improvement, isn’t there? Different markets are in different stages of devel- opment, therefore awareness of sustainability Yes, because if we flip it around, 80% don’t yet varies. The perception of what sustainability fully agree. If we can’t help them, those custom- is also varies. For example, in Pakistan, 74% of ers will look elsewhere. For us, that’s a great respondents said they are asked more than once opportunity to improve. a month for information on sustainability.

MPULSE MOVING GOODS 19 BIG CHANGE FOR SMALL SHOPS Kiranas are as omnipresent in India as the scent of spices. These small, owner-operated shops are more than just a presence in the cityscape and urban life – they are an economic force as well. The little neighbourhood stores account for over 90% of the food retail market. What kiranas often lack, however, is digital tools. And this is where METRO can make a difference – with comprehensive consulting, concrete solutions and a new joint venture.

Maddi B. Reddy’s assortment of goods is as colourful as the streets of Bengaluru, Karnataka. On the shelves of his little shop, customers can find ground coffee and snacks, milk and shower gel – everything to meet their daily needs. Reddy’s shop is one of 12 million ‘kirana stores’ in India. The 40-year-old has been operating his business for 10 years – a period in which a great deal has happened in the IT nation of India.

Coins and banknotes, for example, are a relic of bygone times for many people in major cities like the tech metropolis Bengaluru. For kiranas, where customers With a population of around 1.3 billion, traditionally pay with cash, this poses a challenge: India is a land of contrasts: tradition and although the shops are an integral part of India’s cutting-edge technology meet in the world’s society and economy, they aren’t immune to the increas- second-most populous country. In 2018 alone, over 1,200 new start-ups were regis- ing pressure brought by online competition and digital tered, primarily in the areas of logistics advances. Reddy is no stranger to this pressure. ‘My and transport, software and IT, fintech and customers have explicitly asked me about cashless pay- online marketplaces. ment possibilities,’ he says.

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Highly valued in the neighbourhood – and a true economic power: the approximately 12 million­ kirana stores in India make up 90% of the country’s food retail market. Due to their small sales space and relatively low stocks, they are significantly Services that involve purchas- simpler to operate than large stores. But they also ing or maintenance charges, lack size advantages; kiranas’ profit margin on such as card-payment devices, the individual products is traditionally low. pose a problem for kirana owners, who must either bear the incurred costs themselves or pass them on to their cus- tomers as a mark-up. These services don’t offer any advan- tages in goods management or purchasing.

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Credit option for better goods flow METRO collaborated with the fintech start-up ePayLater to develop an Along with the payment function, an essential element integrated solution: Digital Shop is a credit option that’s available to kirana operators enables kirana owners to offer all with just a few taps. With it, METRO customers receive common mobile payment methods via a 14-day credit that they can use for purchases at the QR code and to digitalise their business wholesale store or for online orders directly via the app. operations – free of charge. All they This enables retailers to place orders without having to need is their own smartphone, on which pay immediately – a major relief in a day-to-day business the app is installed. Store owners can then also digitally track their daily and subject to fluctuating revenue, reports Praveen Kumar monthly sales and easily reorder goods Thokla, for example. from METRO. ‘Before this app was available, I didn’t have any way of applying for a credit so easily, and then using it directly to purchase goods,’ explains Thokla, who has been run- ning his shop in Karnataka's Bengaluru district for 16 years. In his kirana, SRI SAI TRADERS, the 45-year-old primarily sells rice and cooking oil. In keeping with tradition, Thokla used to maintain long lists of his stocks and sales. He now takes care of all of that in the Digital Shop. It makes the task of reordering much faster and clearer, slimming down his shop’s processes and raising its availability of goods. ‘I’ve actually registered a 20% to 25% growth in sales,’ he says.

Strengthening Indian entrepreneurship

Partnership with fintech start-up ePayLater 2 months after its launch in August, the number of kirana owners using the app was already at 12,000, and still ris- This is where METRO comes in. With consulting services ing. To keep money and time expenditure to a minimum, like the Kirana Success Center, METRO has provided installation is done on the operator’s own smartphone and digit­alisation support to the small neighbourhood shops takes just 5 minutes. In addition, the integrated ordering for some time now. A new cooperation now seeks to option makes inconvenient purchasing trips unnecessary. lower the transformation threshold even more. Together Analytics and data science played a central role in the with the fintech start-up ePayLater, METRO has devel- app’s development. METRO operates 27 wholesale stores oped the app Digital Shop. With the mobile application, in India, with more than 1 million active customers. Among store operators can track their daily and monthly sales, these, Traders such as kirana owners constitute a core tar- manage their inventories, place orders – and offer digi- get group. tal payment options by QR code conveniently and free of charge. ‘We found a synergy in METRO’s and our approach,’ says ePayLater co-founder Akshat Saxena about the partner- Since he installed Digital Shop in August, it has been a ship. After all, he adds, ‘both companies aim to empower decisive success factor for Maddi B. Reddy. ‘Nearly 30% small and independent kirana businesses, as we believe of daily payments by my customers are now made via that they fuel a culture of entrepreneurship in the coun- the app,’ he says. As a vendor, he doesn’t have to pay try.’ Offers like Digital Shop, in connection with compre- any charges, and neither do his customers. Both the hensive, individual consultation, are intended to help to installation and the use of the app are completely free ensure that this remains the case. May kiranas continue for customers of METRO. And there is no monthly limit to be as ubiquitous in India as the vibrant bustle in the on transactions. nation’s streets.

‘Through this strategic initiative with ePayLater, we aim to facilitate a more level playing field for these small and independent businesses, for their continued success in the competitive retail landscape,’ says Arvind MORE ON THE Mediratta, CEO of METRO India. Up to now, close to TOPIC AT: 2,000 kiranas have already been digitalised through the existing Smart Kirana Programme. The new, very user- WWW. friendly app is intended to significantly expand these MPULSE.DE/EN/ digitalisation efforts. WHOLESALE-360 24 MPULSE MOVING GOODS ORIGINAL – AND FAST

METRO Gourvenience com- pletely redefines convenience. Whether it is fish dishes (upper right), crème brûlée (lower right) or Swabian Maultaschen (left), the restaurateur can further process the products individually, lending them his or her personal touch.

FIND OUT MORE AT: WWW. MPULSE.DE/EN/ WHOLESALE-360 25

Food and technology united

For restaurateurs, it means time sav- ings, as it makes purchasing and prepar- ing numerous ingredients unnecessary. In addition, less waste is produced. This all allows reliable calculations and sig- nificant cost reduction. And the chef It’s a dilemma: on receives high-quality products that he the one hand, profes- can refine for his guests with his distinct­ ive touch. ‘With our new Gourvenience sional chefs seek to range, we offer our HoReCa customers a win their guests over tailor-made solution to help them to optimally meet the challenges of their with quality, flavour day-to-day operations,’ explains Frank and their personal Jäniche, CEO of METRO Germany. style. On the other, METRO goes yet a step further, however. tough competition In September 2019, it launched a co­- operative venture with PENTAGAST (see calls for fast, article from page 8). This collaboration cost-effective meal with ­Germany’s largest association of food service outfitters is intended to preparation. How bring even greater harmonisation of can these needs technical equipment and food products in the future. One example: a combi be reconciled? steamer that will automatically recog- With METRO Chef nise METRO Chef Gourvenience prod- ucts and prepare them at the desired Gourvenience. temperature. Gourvenience means a whole new dimension of convenience: A shortage of trained staff, bureau- fast and efficient professional cuisine cratic requirements and rising operat- of the highest quality for the ultimate ing and payroll costs are putting enjoyment. restaurateurs under pressure. Experts from METRO have therefore put their heads together and developed a pi- oneering solution: METRO Chef Gourveni­ ence. This new professional food service line stands for high-quality con- venience products made exclusively for the HoReCa sector. And it stands apart, because it has nothing to do with con- ventional ready-made foods. Rather, it comprises select items for individual processing in the professional kitchen – sourced from specially chosen pro­ ducers, without preservatives, flavour enhancers or artificial flavours and col- ours. Gourvenience is part of our own brand METRO Chef and encompasses some 200 products at its launch, from sauces, dips and dressings to meat and fish variations, right through to pastries. 26 MPULSE MOVING BOUNDARIES A MARKET WHERE THINGS In the B2C sector, online marketplaces like Zalando, Amazon and Wish are booming. Things are different in the B2B sector: here, platforms are only just starting to emerge and the market has not yet been divided up. An expert discussion with 2 points of view: Philipp Blome, CEO of METRO MARKETS, and e-commerce specialist Daniel Rebhorn in a joint interview about plat- form economics, consumer behaviour, risks and

opportunities. A quick look at the current situation: what is the status of online B2B marketplaces at the moment? Blome: E-commerce has become standard now in the B2C sector, but it is currently on everyone’s lips in the context of B2B, especially in conjunc- ARE tion with platforms. Traditional B2B processes are being improved and restructured by harness- ing digital potential, and value chains are being slimmed down, resulting in large numbers of new HAPPEN- platforms. So I think it is a very fluid market.

Which countries are the pioneers in this area? ING Blome: When it comes to digitalisation, lots of people mention Silicon Valley, but China is at least as active in this field. For instance, if you look at Alibaba.com and the number of products and services being offered on there now – these are completely different procurement processes. India is another good example.

Rebhorn: In India and China, for instance, we can see that they haven’t even created bricks-and-mor- tar structures in some sectors because they opted for digital business models right from the start. MPULSE MOVING BOUNDARIES

Daniel Rebhorn (49), co-founder and Managing Partner of the diconium A MARKET group, a digital consultancy, is an e-commerce expert who advises companies on issues such as innovation strategies, digital brand management WHERE and customer experience. THINGS

ARE

Philipp Blome (37), CEO of METRO HAPPEN- MARKETS, began his career in 2001 at METRO Cash & Carry Germany, before moving to Real SB-Warenhaus GmbH in 2010. He worked in a number of ING areas, including sales and IT, and was in charge of digital marketing. Before moving to METRO MARKETS, he set up the real.de B2C platform. Do platforms function differently from one country to another – or are all consumers wired the same way in the end?

Rebhorn: I think people are not fundamentally dif- ferent. Ultimately, there is a need for the conveni- ence of not having to go anywhere. And for channels that allow feedback. Of course there are cultural dif- ferences, and differences between certain product groups. But the need for convenience, speed and – not least – price savings, exists everywhere.

Nevertheless, B2B platforms differ from B2C platforms.

Rebhorn: Yes, in the B2C area, the aim is often to generate a demand in the first place. A B2B buyer is motivated by completely different factors. They have to make a purchase for their company, so the need is already there, and they are gener- ally repeat buyers. The conversion rate from web- site visitor to buyer is therefore higher for B2B, as is loyalty to the supplier. This has impacts on the customer journey, which means that the user experience has to be designed differently for the platform, the app and online.

What does that mean in practice?

Blome: Platforms like Zalando and About You are all about inspiration. By contrast, if a res­ taurateur wants to order 20 more glasses, he does not want to choose from 100 different designs. He needs exactly the same ones that he ordered last time. My job is to make this journey easy for him or her, from product selection to check-out, payment and invoicing. The basics are the same: an attractive price, a fast and reliable delivery, transparency and the right payment methods – although payment methods are more specialised in the B2B than in the B2C area.

When it comes to companies like Amazon, a small number of big players hold a large share of the market. Do you have to be a market leader to benefit?

Rebhorn: I don’t think you have to be Amazon necessarily, but you do have to be relevant in a specific sector. In my opinion, there is space for up to 3 online marketplaces for each product group. This is a position you can expand from if necessary – even Amazon started with one seg- ment and expanded later. MPULSE 29

Glossary The reputation of platform operators suffers if sellers behave badly, for example by B2B stands for ‘busi- delivering poor quality or customer service. What can they do about it? ness-to-business’ and describes business Rebhorn: Platform operators have to be able to relationships between rely on their partners, but they also have to moni- 2 or more companies, tor them. That means they need systems like text as opposed to, for analysis to identify negative e-mails and assess example, relationships how much feedback comes from the retailer. In between companies and The point of a B2B platform case of doubt, partners are pushed further down consumers (‘B2C’). isn’t so much to inspire as, the list of product results and are eventually above all, to quickly and dropped altogether. It is also important to be B2C stands for ‘busi- precisely meet a clearly transparent with the consumer. ness-to-consumer’ and defined need. The path to describes business the product must therefore Blome: Most partners have their processes well relationships between be as direct as possible. under control though. They know what they are companies and end doing. Of course, you need reporting on cus- consumers. tomer complaints, tracking points in the logistics chain, and quality processes – even when adding Conversion rate indi- new partners. However, as a platform operator, it cates how many visitors is dangerous to manage this issue from a place of to a website carry out fear. If you have too many controls, you will never (‘convert’) a certain become a marketplace. There are some platforms action. If the action is where every potential partner has to bring along defined, for example, and demonstrate their products first. It doesn’t as ‘purchase’, this key work like that. figure represents the ratio of users who visit A prediction for the B2B a website to those who marketplaces of the future? make a purchase during Rebhorn: Technology will be a key driver. In the their visit. future, if a restaurateur has more table reserva- tions than expected, he or she will ‘Buy this basket Customer journey again’ with a single click instead of getting in the describes a custom- car for another shopping trip. This will make a er’s points of contact huge difference to people’s mindsets and working with the brand as environments. well as the – in part cyclical – phases in the Blome: I believe we will see something similar to purchasing process. the B2C situation. Zalando was founded a little This process is roughly over 10 years ago. Everyone thought they were divided into the crazy selling shoes online. Now we see the dis- pre-purchase phase, ruptive power that can be wielded by just a few in which a consumer players and how market share has been redistrib- gathers information, the uted. We will see similar significant shifts in the purchase phase and the B2B sector. The question is: will the big digital post-purchase phase, in players be new companies financed by venture which they evaluate and capital? Or will classic B2B companies manage possibly recommend this transformation better, having learned les- the product to others. sons over the past 10 years, so they can hold their ground in a digital world? For me, that is the User experience, exciting question and our primary objective. abbreviated UX, encompasses all of a user’s experiences and perceptions in their interaction with a product, organisation or service. UX plays a vital role in the design MORE ON METRO’S NEW of websites or apps. ONLINE MARKETPLACE AT: WWW. MPULSE.DE/EN/ WHOLESALE-360 30 MPULSE MOVING BOUNDARIES

MenuKit: App(etizing)? goodbye spreadsheets! What prices can I set for my menu? What are my costs? And how Digital tools are an integral part of every- much profit will I be left with? Calculating the cost of goods sold day life. And it is almost impossible to accurately in a food service business is like walking a tightrope. But it is vital for a company’s success. Tiny mistakes can lead imagine the food service industry with- to enormous costs for café, bar and restaurant owners. This is out them: digital solutions play a key where MenuKit can help. Thanks to the app, which has been role in making business processes and specially developed by METRO and is currently being piloted, workflows efficient and sustainable. This complex Excel spreadsheets are now a thing of the past. It can calculate recipe costs quickly and accurately and scale up or is why METRO’s tech units – Hospitality down to predict the cost of sales. A special feature of the app Digital and METRO-NOM – are busy devel- is that it displays that day’s METRO shelf prices. In just a few oping smart tools. 4 apps that make life seconds it delivers meaningful results for the best sales price and contribution margin. Restaurateurs can use it to make fast easier for restaurateurs. commercial decisions for their menus. Pricing doesn’t get any simpler than this. 31

MORE ABOUT MENUKIT AT: WWW. MPULSE.DE/EN/ WHOLESALE-360

METRO Companion: DISH app: Online reservation tool: with you every step digital efficiency google, book, eat of the way DISH (Digital Innovations and Solutions With over 500,000 reservations in 15 The aim of the new all-round METRO for Hospitality) is a platform that aims to countries, the figures speak for them- app is to make purchasing easier and provide hospitality experts with digital selves. The online reservation tool from give food service providers peace of tools so that they can run their businesses Hospitality Digital is a useful app for mind. METRO Companion combines all more efficiently. For instance, if they restaurateurs, helping them digitise table purchasing steps in 1 application: from want to set up a professional internet reservations. Now linked to ‘Reserve with setting up a digital shopping list, finding presence or digitise their reservations Google’, it enables guests to make table a wholesale store, and checking prod- system, or if they are looking for support reservations via the tool from within uct availability and the latest special with staffing, DISH is the answer. The Google searches. Extending the function- offers to scanning barcodes and paying platform has also been available as a ality has proved successful: participating invoices electronically. Last but not free mobile app since spring 2019. The restaurants report a rise in table reserva- least, it replaces the METRO customer staffing tool, Simple Shift, comes pre- tions of around 20%. card and can be used to check in digit- installed and is free of charge. ally at METRO wholesale stores. 32 MPULSE

countries (including 10 with Food Service Distribution) wholesale stores

About 5.3 million orders Own Business Day in financial year 2019 worldwide: 2018/19 via about 670,000 the M-Shop special offers from PORTRA more than 6,000 LD IT R independent O business owners W

About €

W

O

R

L

D

T

I

Over

P A O R R

27.1billion in sales T in financial year 2018/19 (total sales, METRO AG) 16million customers (HoReCa and Traders)

About 101,000 employees Unless expressly stated otherwise, all figures given refer to continuing operations (excluding the hypermarket business and For the excluding METRO China).

As of September 2019

METRO 5thtime consecutively, Industry FINANCIAL YEAR Leader in Food & Staples 2018/19 AT: Retailing group in Dow Jones REPORTS. Sustainability Index Europe METROAG.DE IMPRINT

Publisher DESSERT METRO AG, Metro-Straße 1, 40235 Düsseldorf, Germany PO box 230361, 40089 Düsseldorf, Germany Useless knowledge from the world of food METRO on the internet www.metroag.de

Corporate Communications T +49 211 6886-4252 F +49 211 6886-2001 [email protected]

Project lead, concept and editorial (same address as publisher) Katharina Meisel

Project management Kim Franziska Lübke, Katrin Mingels

Graphic design Strichpunkt GmbH, Sophienstraße 6, 10178 Berlin, Germany

Editorial support and realisation Ketchum Pleon GmbH, Bahnstraße 2, 40212 Düsseldorf, Germany

Printing Druckstudio GmbH, Professor-Oehler-Straße 10, 40589 Düsseldorf, Germany

Photography Silvio Knezevic: cover, inside front cover, outside back cover, p. 5 Henning Ross: p. 4 top Urban Zintel: p. 4 bottom, 6–13, 26–31

Illustration Holly Wales: pp. 18–23 Strichpunkt GmbH, Sophienstraße 6, 10178 Berlin, Germany

Photo credits METRO AG

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