Welcome to METRO Insights!
Everything remains different. This has rarely been truer than in the last 1.5 years.
Face-to-face meetings, on-site interviews, press conferences – none of that has happened for far too long. To provide talking points, to revisit interesting topics and to inspire you with the world of wholesale, we present the first issue of METRO Insights. What can you expect? Exciting insights, fresh backgrounds and a clear stance.
Let’s start right away...
Instead of professional soccer, professional customers from the gastronomy and trader business: What Dr Steffen Greubel didn’t have in mind as a little boy when he thought about his professional future, now delights the staff of METRO AG. He started as CEO at the headquarters in Düsseldorf at the beginning of May, with passion and a lot of B2B know-how. Read the exclusive interview here.
"Wholesale thrives on passion, competence and trust"
Steffen, what job did you dream of as a little boy?
I started playing soccer as a young boy in my home town of Schweinfurt. The dream of a professional career then accompanied me throughout my youth. I was also quite ambitious. In the end, as you know, nothing came of it. But the choice of engaging in the business industry brought no less excitement.
You ended up in wholesale. You've been with METRO since May. How did that happen?
The key is to enjoy what you do. I've always enjoyed numbers, which is why I picked the bank sector for my training. During my time in the consulting industry, I then explored the B2B business and retail. Wholesale thrives on passion, competence and trust. And strong cooperation. As a company, you can only be successful if you act with the same passion as your customers in the industry and are genuinely enthusiastic about the matters. That's what we do at METRO. Our team puts its heart and soul into it – I'm happy about that every time I'm in our stores or talk to our customers. And just how essential our industry is for the common good and for our society was experienced by each and every one of us during the pandemic. We all associate many positive moments with the hospitality sector and small independent retailers! The industry is colourful, full of energy and has a lot of soul. It's great to be here.
What do you need most as CEO of a wholesaler like METRO?
In recent years, METRO has successfully completed its transformation to a pure wholesaler. Now it's all about implementation. And that means being close to customers and their needs, listening to the employees in the stores and depots. That also applies to the CEO of the company. That's why I'm out on the floor as often as possible. I want to get an impression of our customers, teams and the different market and competition conditions as quickly as possible. Our goal is to restart METRO's growth engine once the pandemic is over.
What don’t you like at all in your job?
There's a saying in Swabian: 'Nicht schwätze, schaffe!' (‘don’t chatter but do it!’). There's a lot of truth in that! It's better to try something out and fail than not to try anything at all for the fear of failure. Mistakes are allowed to happen, the main thing is to talk to each other and learn from them. This is the only way to create room for innovation and to set yourself apart from the competition. There is no such thing as ’it won’t work’. And last but not least: If you announce something, you should fulfill it. This is the only way to create trust among customers and partners.
After about 2 months in the METRO family - what are your first observations?
Of course, I had already visited numerous stores in Germany before I took up my post, and spoke with many employees and customers. In the meantime, I have also been to Italy, Spain and the Netherlands. Further country visits are planned. 3 observations, however, that I was able to make everywhere:
- Firstly, as the Management Board, we can rely on a very committed and motivated team that always stands by our customers' side, especially during the lockdown phases, and is now celebrating the gastro industry’s restart together with them, and doing so properly and with a lot of joy.
- Secondly, the METRO assortment stands for high quality, reliability and sustainability.
- Thirdly, the METRO brand not only has a high profile, but is also connected with our customers with many positive attributes.
In my opinion, these are important prerequisites for us to be able to start the growth engine again.
And what is your goal in the end? How and where do we want to grow?
Please give me some more time before I will talk about our strategy. What I can say right now: We need a strong core business, but also innovations and investments where necessary. I see those f. ex. in the expansion of our delivery business, the further digitization of our customers, and growth in e-commerce. At the end of the day, the market is changing very quickly and our customers expect us to listen to them and provide them with the right offers.
Thank you, Steffen!
Interview conducted by Hülya Dagli
We at METRO, together with our customers, are happy that things are finally getting underway again: #RestartGastro! And we are there, developing new ideas to support our customers even better. Be it by applying artificial intelligence to the purchasing process in our stores or by opening up new markets and strategic partnerships for a more digital gastronomy – such as recently in the UK.
Breaking new ground: How artificial intelligence is speeding up the payment process
Artificial intelligence is on the rise. According to Bitkom study, Germany’s digital association, from April 2021, two thirds of the companies surveyed consider AI to be the most important technology of the future. But only 8% use AI applications so far. The analysts at AIMultiple also see a long-lasting, growing trend – and if you look in Google Analytics, you can also read an increase in the search term from the data. METRO DIGITAL, the IT unit of METRO AG, is responsible for METRO AG's IT needs in 34 countries and is among those 8% that have been focusing on AI processes for a long time, driving technological developments for wholesale. The experts of METRO DIGITAL often use the innovative power of start-ups and develop products further in fruitful symbioses.
Self-check-out and simplified purchasing process – Nomitri
Nomitri is such one example: the young Berlin-based start-up, founded in 2019, has developed an intelligent shopping assistant that enables retailers to offer contact less payment via smartphone. Likewise, by interacting with the smart smartphone camera purchase behaviours can be detected and predicted. It relies on “embedded visual AI” and uses intelligent image recognition, among other things, that runs directly on the smartphone. METRO has supported an initial offline test. In the future, the technology could simply be integrated into already existing apps such as the M|Companion – for example as a mobile application to make the customer's shopping process easier. Through image recognition and the algorithms used, the mobile device registers which products are put in the shopping basket – or taken out again for later payment. But also individual customer behaviour, which can then be converted into concrete personal customer recommendations for the wholesaler.
Timo Salzsieder, CIO METRO AG: “We are developing modern applications internally, but also together with partners such as Google or Nomitri, which now integrate AI and machine learning in almost all areas. The benefits of AI for internal users, but also for our customers, are clearly recognisable. We are continuing to drive innovation forward with partners. For example, in March we founded a Cloud Competence Hub with Google Cloud and Wipro.” For the wholesaler's customers, the M|Companion app and the use of AI is free of charge. Companies who want to offer contact less shopping to their customers pay a licence fee for the solution. “We are an innovative company and are pleased that METRO is providing us with the real shopping environment. This allows us to further develop our product and gather end-customer feedback in tests that have been taking place in a wholesale store in North Rhine-Westphalia since March this year. We want to work quickly towards a large-scale end-customer pilot,” says Trinh Le-Fiedler, CEO of Nomitri. This is also to be carried out in North Rhine-Westphalia and is planned for the second half of 2021.
For the wholesaler's customers, the M|Companion app and the use of AI is free of charge. Companies who want to offer contact less shopping to their customers pay a licence fee for the solution.“We are an innovative company and are pleased that METRO is providing us with the real shopping environment. This allows us to further develop our product and gather end-customer feedback in tests that have been taking place in a wholesale store in North Rhine-Westphalia since March this year. We want to work quickly towards a large-scale end-customer pilot,” says Trinh Le-Fiedler, CEO of Nomitri. This is also to be carried out in North Rhine-Westphalia and is planned for the second half of 2021.
Self-check-out with double security – Supersmart
"In the Czech Republic, we already tested a different check-out solution 2 years ago with an Israeli start-up, which is now being rolled out in other countries such as Turkey, Hungary and Ukraine – Supersmart," says Dragos Rosca, Product Owner at METRO DIGITAL. Here, the customer takes care of the scanning of items in the shopping trolley. The scan-and-go app is developed by Supersmart and adapted to METRO needs. The app is called MAKRO Scan for the Czech Republic, Metro Fast for Turkey and METRO EXPRESSZ KASSZA in Hungary.
Artificial intelligence works in the background, comparing the shopping basket with common shopping patterns as well as with customer data. At the same time, image recognition software checks the captured image against the scanned shopping cart. Unlike Nomitri, however, an additional validation takes place at the end of the shopping process: The customer pushes the shopping trolley onto a scale. Within 3 seconds, the prices of all items in it are recorded and the customer can pay. In case of discrepancies, the customer is discreetly informed that something may have been forgotten to scan. On average, 88% of products are correctly recorded. “When you consider that people spend almost an entire year of their lives standing in the check-out line, solutions like this are simply a must. Supersmart's solution saves our customers an average of 7 minutes of time at the check-out counter.” But the check-out process is just one of many application areas in which the topic of artificial intelligence plays a role at METRO. “With algorithms and data analyses, we can conduct a targeted and personalised dialogue with our professional customers,” explains Salzsieder. “With the help of artificial intelligence and machine learning, we can also tailor our product range to the professional needs of our customers and optimise our pricing strategies. So the topic is already influencing all areas at METRO and will continue to play a major role in the future – whether in the store, online with chatbots or in deliveries to restaurateurs.”
But the check-out process is just one of many application areas in which the topic of artificial intelligence plays a role at METRO. “With algorithms and data analyses, we can conduct a targeted and personalised dialogue with our professional customers,” explains Salzsieder. “With the help of artificial intelligence and machine learning, we can also tailor our product range to the professional needs of our customers and optimise our pricing strategies. So the topic is already influencing all areas at METRO and will continue to play a major role in the future – whether in the store, online with chatbots or in deliveries to restaurateurs.”
COVID-19 and the digital catch-up of the gastronomy industry
Digitalisation in the hospitality industry has accelerated over the past 18 months because of COVID-19. Whether it is in the lockdowns to mitigate the drop in sales through pick-up or own deliveries, or in the re-opening phases using reservation tools or check-in facilities, digital solutions have become indispensable for restaurateurs. “The pandemic has hit us hard. Only with our out-of-home business can we survive as a gastronomy in the crisis. We are very grateful to the many digital possibilities, such as DISH Order, to stay present for our guests," says Georgios Blatsas, owner of the Ludenberger restaurant in Düsseldorf. Hospitality Digital, the unit of METRO AG that drives the digitalisation of the hospitality industry, has not only developed digital tools for restaurateurs in times of pandemic, but also entered into partnerships with technology firms to support the HoReCas (hotels, restaurants, caterers) of the world. In doing so, the company is breaking new international ground, even in countries where METRO is not physically represented.
Strategic partnerships to drive the digitalisation of the catering industry
For example, in Great Britain, the company is joining forces with Molewood Consulting, a technology consultancy and sales organisation, to provide restaurateurs with digital solutions from the online platform DISH: “Digital solutions, such as reservation tools, websites and web listing, are relevant for all restaurateurs, even if there are no METRO stores in the respective country. This allows us to tap into new customers in the digital business and to develop more and more into a platform company. This is an exciting environment for us, because as a digital company we can operate everywhere. Our solutions, which enable restaurateurs to optimise their business, also keep pace with the spirit of the moment and fill a gap in the market," says Dr Volker Glaeser, CEO Hospitality Digital.
As an extended sales arm of Hospitality Digital, Molewood Consulting offers the DISH tools to restaurateurs and bundles various tools in one offer for 69 pounds.
For Great Britain, where METRO was previously only represented through its food service distribution company Classic Fine Foods, the innovative tools of the wholesaler's digital subsidiary, which have already been tested in 16 countries, are also attractive and applied at more than 130,000 restaurateurs in the country. “B2B platforms are highly specialised and often not yet as developed as B2C platforms1 – so this opens up new potential for us. We are internationally active with our solutions, have over 200,000 customers who have already connected with more than 10 million guests via our reservation tool alone. This will also be an asset we can use to score points in the development of the market in Great Britain," continues Glaeser.
Data helps hospitality to survive
Also new in the cosmos of Hospitality Digital's partners: DeepIdeas. A joint venture with Datalogue. DeepIdeas creates a unique information base through intelligent data combination. For this purpose, METRO's own data, for example on markets and customer buying behaviour, data from digital tools, but also external data that is bought in, is evaluated. “We analyse digital menus, for example, and thus collect further information that is important for us and our customers,” explains Glaeser. This not only gives Hospitality Digital a holistic view of the hospitality market, but through smart data evaluation, it can make tailored offers for customers that fit their buying behaviour and develop new digital tools that help restaurateurs. “Independent entrepreneurs can use our data to understand, for example, what other restaurants in their immediate vicinity are offering and thus consider how they can further differentiate their offers.” The Ludenberger, which has made a name for itself in Düsseldorf as a restaurant serving German-Greek food, is not yet using this solution. But Glaeser is certain: “Data and gastronomy not only fit, they now belong together. Especially in times of pandemics, it has been shown: Data helps the gastronomy to survive.”
1 See also study B2B platforms in North Rhine-Westphalia in Germany from December 2020 (German only): www.wirtschaft.nrw/pressemitteilung/studie-b2b-plattformen
The topic of sustainability is moving society more than ever. And for business, the topic is a strategic must. So, there is no question that sustainable business and the considerate, forward-looking use of resources are part of our future. Plastic Bank, Green Consumption Pledge Initiative, Food Waste: The list could go on and on. Rather than enumerate, however, we’d like to offer food for thoughts: Read the commentary by our chief sustainability reporter Anne Linnenbrügger.
How can you offer meat and strive to be sustainable at the same time? How can you fight plastic in the world's oceans and supply an industry that can't do without to-go products? How can you send heavy load trucks on the road every day and demand the phase-out of fossil fuels by 2035?
Not only can you, you have to. We have to. That's our position at METRO.
There are issues that drive us all. Digitalisation, for example. Sustainability, too. Both topics have been incredibly fueled by the Corona pandemic and are being discussed at the crossroads of business, politics and society. These topics will have a major impact on what our lives and the lives of our children will look like tomorrow. It would be fatal not to act in both areas today, but to rely on future generations or technology to do so at some point. What we need now is a fundamental understanding of how we can all contribute to the 1.5°C target – and how to act accordingly.
Sustainability in business is an issue that is either intrinsically understood and implemented by companies because – as in our case – the impact of climate change is a direct business risk, or it is demanded by third parties – financial markets, NGOs, consumers, or activist hedge funds as in the Exxon Mobile case. In most cases, it is an interplay of inside and outside. A Möbius strip made from a shared understanding that we must act. Now.
METRO's core business is trade. We supply restaurateurs and independent retailers. Our USP (Unique Selling Preposition), as they say, is meat and fish, fruits and vegetables. For example, our juice oranges for restaurateurs are so perfectly sorted that they will never block a professional juicer machine.
Meat, fish, fruits and vegetables are resources that are not infinitely available. In fact, their consumption is putting pressure on the planet. Supplying food to a steadily growing world population requires, among other things, an intact environment and soil, biodiversity and controllable weather, the careful management of wild stocks and an ambitious fight against waste, especially avoidable food waste.
Our CEO Steffen Greubel has therefore signed the European "Code of Conduct" on behalf of METRO AG. A manifested agreement that we want to build a more sustainable food supply chain – from farm to fork, driven by different participants from the food industry. With our signature, we voluntarily commit to report transparently and regularly 3 of our existing sustainability goals. First, we are working on a more sustainable assortment in our own brand range. A start has been made with 500 organic products and a growing number of plant-based meat alternatives. In addition, we are reformulating suitable products to reduce the content of salt, fat and sugar or additives, and we are focusing on strict purchasing guidelines and efficient action plans to find answers to issues such as overfishing and deforestation. Second, we will report our food waste target: by 2025, we aim to halve food waste within our own operations. And, third, we have committed with our climate target – and even tightened it: by 2040, we want our global business operations to be climate neutral – predominantly through our own efforts. Based on investment and innovation.
At METRO, we have been working ambitiously on the issue of sustainability for 20 years. Not only because it is our social responsibility, but also because customer needs are changing and we need to anticipate how our professional HoReCA and trader customers will shop tomorrow in order to meet the demands of their very own customers.
Our strategy is to deliberately set high goals and build on partnership and dialog, because we have found that change can be driven more efficiently when we work shoulder to shoulder. We are monitored very closely in this process, and our targets are judged on their ambition – by NGOs and financial market participants, by competitors, by business partners and by our customers and employees – including future ones.
With ambitious goals always comes the risk of not meeting them 100%. But that is no reason in our eyes not to set these goals high with courage and confidence, to grow with the challenges, and to remain in transparent exchange with all those who support us in becoming more sustainable – whether it is the NGO that criticizes us or the customer who praises our vegan meat alternatives.
I propose that we bring you closer to the people who are driving all these initiatives forward at METRO, who are passionate about implementing sustainability in a global corporation. This requires a deep understanding of the challenges that our customers are facing, our company and our society. We will be happy to show you these challenges in the background. Reach out to me – I look forward to our exchange.
Spokeswoman for Sustainability
And last but not least: If you want to hear industry insights, thoughts on the #restart of gastronomy, or even demands for the upcoming fall and winter, the digital kompakt podcast is recommended: Joël Kaczmarek talks to Michael Kuriat, board member at Leader’s Club, restaurateur as well as doctor, and Ivonne Bollow, our Global Director of Public Policy, about what annoys them and what needs to be done now with a view to the future. (German only)
We hope you enjoy reading this issue as much as we enjoyed putting it together for you.
Your METRO Corporate Communications Team
Hülya Dagli, Sirin Emre-Flender, Gerd Koslowski, Katharina Lessenich, Anne Linnebrügger, Leiding Chen
The future is what we make of it. It is the responsibility we take on today. It is the path we take. In the current issue of MPULSE, we take you on a journey where sustainability and innovation go hand in hand.
Politics accompanies us everywhere – as a company but also our customers. You can find out what they have to say, for example, about the new #Reusable obligation or the ban of #SingleUsePlastic in Germany and what they would like to see from #politics via our Public Policy Digital Office.