Metro Jinjiang Cash & Carry Co Ltd, the Chinese joint venture with Germany-based Metro AG, signed a deal with the Dalian municipal government yesterday to open a store in the northeastern city.
The world's third-largest retail group agreed to invest US$13 million in a 35,200-square-meter membership hypermarket in Dalian's Xianglujiao area, Liaoning Province.
The store is expected to open at the end of the year.
"The Dalian store is a key step for Metro to explore China's northeast region," said Jean-Luc Tuzes, president of the Shanghai-based Metro Jinjiang. "Metro will use Dalian as a center to open more stores in the northeast region."
The company is also preparing for new stores in the northeastern cities of Shenyang, Harbin and Changchun.
Since opening its first cash-and-carry store in Shanghai in 1995, the retail group now has 17 outlets throughout the country.
In Shanghai there are four Metro stores, which service company buyers in such businesses as restaurants, hotels and government bodies.
Metro plans to open 40 stores in China during the next three to five years as the domestic retail sector will gradually be opened to foreign investors, Tuzes said.
Most of the new stores will be located in the middle-size cities in the northeast region, according to Huang Zhongjie, Metro Jinjiang spokesman.
"China will allow foreign-branded stores to open in non-capital cities in 2004. We will bring the cash-and-carry business concept to those cities by then," Huang said.
Metro will also procure products in the northeast region for its China stores and for export.
Metro's China expansion falls in line with that of Wal-Mart Stores Inc and Carrefour SA, the world's top two retail groups.
Wal-Mart has signed an agreement with Dalian Wanda Group to open hypermarkets in major cities, such as Shanghai, Nanjing and Ningbo. The company will enter Beijing in the second half of this year.
Carrefour wants to open discount stores and supermarkets in China in the coming years.
It also plans to double the number of hypermarkets to 70 by the end of 2004.
(Shanghai Daily June 25, 2003)
