Retailer Metro plans to push into China

World No.4 retailer Metro AG is considering expanding its Metro Cash & Carry (MCC) wholesale unit in China, the unit's chief executive told the Financial Times.

Frans Muller, MCC CEO and a member of the Metro Group board, said the unit had 38 sites and annual sales of €1 billion ($1.3 billion) in China. ''But I think we eventually have to aim for about 100 stores to give us the presence we want,'' he said.

Although he stressed that Metro had scaled back its immediate expansion plans due to the global recession, his words underlined the determination of one of the world's top retailers to raise its profile in the huge Asian market.

Wal-Mart, the world's biggest retailer, operates 99 ''supercentres'' in China, although MCC sees itself less in competition with the US group than with its subsidiary Sam's Club. The wholesale club for retail clients has three units in China.

Muller said the global economic downturn had "now arrived in all our markets", but added the crisis could accelerate the company's expansion plans as weaker local rivals falter. Retailers around the world are tightening their belts in an attempt to keep costs under control amid the global economic downturn.

Muller said MCC had built up ''clusters'' of wholesale stores in three populous cities - Beijing, Shanghai and Guangzhou - and ''wanted to fill out [its] networks in these regions''. Four more stores will open in China this year.

But he stressed that plans there would not eclipse ambitions in India, Pakistan or Vietnam - or Eastern Europe. After success in Russia and the Ukraine, MCC will enter Kazakhstan this year. A first store will also open in Egypt.

MCC started wholesaling to Chinese restaurants, hotel and small-shop owners in 1996. It remains the only one of Metro's three international units - MCC, Real hypermarkets and Media Market electronics - with a presence there.