German wholesale retailer Metro Cash & Carry is gearing up for expansion in India with the addition of five new stores this year and also plans to accelerate its e-commerce play and partnership with kirana stores, according to a top company official.
The wholesale retailer, which has registered profits in the last two years in India, has so far partnered with 2,000 kirana stores in Bengaluru, Hyderabad and Delhi, offering them complete end-to-end retail solutions.
"The company thinks India is a big growth market. The opportunity for growth in India is huge in both physical stores and e-commerce," Metro Cash & Carry India Managing Director and CEO Arvind Mediratta told PTI.
As part of expansion plans, he said, "we have five stores coming up this year in Karnataka, Andhra Pradesh and Telangana."
Metro Cash & Carry currently has 27 cash and carry stores in India in 17 cities.
When asked about investments for the new stores, he declined to comment but said besides the new physical stores, the company has also been focussing on its partnership with local neighbourhood stores through its 'Smart Kirana Programme'.
The whole idea is how to make a kirana store smarter in terms of usage of technology, by running business more efficiently, targeting more customers using data analytics, drive more customer traffic and make it more successful and profitable, he added.
"We believe in helping kiranas in increasing their sell-out, not just sell to them because if their sell-out improves, and if they think Metro can help increase their sell-out, we automatically become their preferred supplier," Mediratta said.
The company has provided point of sale (PoS) devices, which come with a Metro app to kirana owners through which they can order items from Metro online, get daily sales and profit report while also track top customers, the most selling articles and slow moving items.
The device also allows them to accept debit/credit cards and accept wallet payments, which offer customer cashbacks and other offers. It enables passing on of such benefits to the end customer, he added.
"The programme is working well and we believe we now have enough results and have got approval from our global board to expand this programme and take it national. We are now already in the process of scaling it up," he said.
For scaling up its Smart Kirana Programme, Mediratta, said the company is taking it one step at a time.
"Our idea is to first saturate Bangalore, Hyderabad and Delhi before you enter newer cities. You get better returns on investment if you do one market and do it really well, this is one of our big learnings when it comes to profitability. Strengthen your dominance wherever you are," he said.
Metro has partnered with Paytm in Delhi and MSwipe in the rest of the country for digital payments while it has also roped in ePayLater which not only offers credit to kirana stores but also to their end-customers enabling them to shop at specific stores, Mediratta added.
Stating that Indian retail landscape is changing with new-age online players both in business-to-business (B2B) and business-to-consumer (B2C) investing a lot of money, including on pricing which has put a lot of pressure on local kirana stores.
In order to help the small stores keep up with the changes, he said Metro is also helping the kirana owners remodel their stores and convert old closed-loop stores into an open format modern store where customers can come inside and shop thereby increasing customer traffic and impulse buying.
"What we are tying to do is organise loans for these kiranas for remodelling, because it can cost from Rs 75,000 to Rs 2 lakh and the remodelling operations takes only 48 hours," Mediratta said.
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