METRO Cash & Carry Russia METRO Cash & Carry Corporate Marketing

WHAT SHALL WE OFFER THE BUYER

TODAY: HOW WILL THE STORE FORMAT

CHANGE? WHAT GOODS AND WHERE FROM?

PIETER C. BOONE

CEO METRO CASH&CARRY RUSSIA

MOSCOW, SEPTEMBER 25, 2014

METRO Cash & Carry Russia

THE RUSSIAN IMPORT BAN DECREE STRONGLY IMPACTS THE

BUSINESS OF MCC RUSSIA AND THE WHOLE FOOD TRADING

INDUSTRY

Page 2

US and EU sanctions Russian import ban

As of 31st July 2014 7

th August 2014

Mainly affects Reduced access to EU and US finance

markets for selective Russian banks

Export prohibition of military weapons,

vehicles, equipment and technology

Export prohibition of technology and

equipment used for oil production industry

Prohibition of business activities with

defined Russian companies and individuals

Import ban of raw material, agricultural

products and food, like:

- Meat and meat products

- Milk and dairy products

- Fish

- Fruit and vegetables

Sanctioned countries are the EU, USA,

Australia, Canada and Norway

Impact on MCC Russia Minor All trading industry got effected

Impact between 5 – 10% of sales of the

food trading industry

METRO Cash & Carry Russia

FAST REACTION ON THE IMPORT BAN BY THE ESTABLISHMENT OF

THE STEERING COMMITTEE AND THE SET UP OF WORK STREAMS

Page 3

Steering

Committee Board and selected Division Managers

Work

streams

Market

intelligence Communication

Sourcing /

supply chain Pricing

Customer and

supplier financial

monitoring

Banking sector

risks

Financial

analytics

Sales tax

introduction

Sanctions

compliance and

response

Intensified

inspections

Operating cost

optimization

Human

resources

Safety and

emergency

Meetings

Daily meetings

of work stream

groups

Regular update

on Steering

Committee

meetings two

times a week

Comprehensive

update of the

work streams

every two

weeks

METRO Cash & Carry Russia

Meat Fish Fruits Vegetables Dairy

Russia

Belarus

Uruguay

Brazil

Argentina

Serbia

Switzerland

New Zealand

Russia

Chile

Faroe Islands

Turkey

Morocco

Tunisia

India

Thailand

Russia

South Africa

Egypt

China

Iran

Argentina

Serbia

Asia (exotic)

Russia

Azerbaijan

Belarus

Israel

China

Turkey

Chile

Russia

Serbia

Switzerland

Argentina

New Zealand

MCC RUSSIA CONSEQUENTLY SOURCES FROM RUSSIA AND

OTHER COUNTRIES IN ORDER TO MEET CUSTOMERS’ NEEDS

Page 4

METRO Cash & Carry Russia

STRENGTHENING THE WORK WITH GOVERNMENTAL AUTHORITIES TO

PREVENT DRASTIC PRICE INCREASES AND SOURCE SUBSTITUTIONS

PRICES & GOODS AVAILABILITY ASSORTMENT

Work Group participation under the patronage

of the Deputy Prime-Minister:

Daily price monitoring

Producer-Retailer-Memorandum

Logistic cost optimization for Russian fish

Work with administrative bodies and trade offices:

Increase the number of local producers

Meetings with trade representative offices of

“allowed” countries

Certification of new foreign producers

METRO Cash & Carry Russia

THE AVAILABILITY IS IMPORTANT – THE QUALITY IS EVEN MORE

CRUCIAL FOR OUR CUSTOMERS