View the step-by-step solution to:

Question

Question:


The answer is to include recommendations for Metro grocers overall entry strategy

into Mexico paying particular attention to social, political, cultural, and economic environment of the country, the entry and organizational strategies the company should advance including potential alliances with local firms, and a discussion of the ethical, negotiation, leadership and management challenges associated with your recommendations.


History of Metro Grocers

The company was founded in 1947 in Verdun, Quebec by Rolland Jeanneau. Many independent grocery stores joined the company to form Magasins Lasalle Stores Ltée. In 1952, Magasins Lasalles Stores Ltée change its name to Épiceries Lasalle Groceteria. The company had 43 affiliated grocery stores at the time. In 1955, they were 50 franchised stores and the company with a revenue of $2 million. The company gained fame in 1956 through an advertisement in La Presse which showed turkeys sold for 39 cents. That year, mayor Jean Drapeau was already talking about implementing in Montreal a rapid transit system to be called the Montreal Metro. This inspired the company's division called Metro. Other grocery stores joined the company bringing its number of stores to 73 in 1957 with revenue of $10 million.


Because of the success of the Metro division, the company renamed itself Metro-Lasalle in 1963. In 1972, Metro-Lasalle changed its name to Metro-Ltée. Metro merged with the Marché Richelieu grocery chain in 1975 to become Groupe Metro-Richelieu Inc in 1976.


In the early 1980s, Metro went through harder times due to fierce competition from Provigo and the recession. Metro merged with Epiciers Unis Inc. and took on the name Metro-Richelieu Inc. (dropping the "Groupe" from its name). During the rest of the 1980s, it fared better and entered the Montreal Stock Exchange in 1986.[4]


Metro suffered from the early 1990s recession. A restructuring plan was established, a new logo was created and changes were brought in the management team. Metro acquired 48 of 112 Steinberg supermarkets when that company went bankrupt in 1992. These stores were rebranded as Super C and Metro stores. Metro entered the Toronto Stock Exchange in 1993. It acquired Loeb Stores from Loblaws in 1999. The Metro Plus banner was established in the early 2000s. Some of the stores were converted to Super C, while others continued to operate as Loeb. The Super C stores in Ontario were converted to Food Basics. In 2009, the company converted all Loeb stores to Metro.[5]


Mergers and acquisitions


On July 19, 2005, Metro, Inc. announced that it had reached an agreement with The Great Atlantic & Pacific Tea Company, Inc. and its subsidiary, A&P Luxembourg S.à.r.l., to acquire all of the issued and outstanding common shares of A&P Canada, for an acquisition price of $1.7 billion, consisting of $1.2 billion in cash and $500 million in the form of treasury shares of Metro. The purchase was completed on August 15, 2005,  and after beating out Sobeys in a bidding war, Metro now has a network in Quebec and Ontario of 573 conventional and discount food stores, and 256 pharmacies.

On August 7, 2008, Metro announced it would invest $200 million consolidating the company's conventional food stores under the Metro banner. Over a period of 15 months, all Dominion, A&P, Loeb, the Barn, and Ultra Food & Drug banners were converted to the Metro name. Food Basics stores were not affected as it competes in the discount food segment.


Baker section of a Metro store in Brampton.

Metro now holds the second largest market share in the food distribution and retailing business in Quebec and Ontario with nearly $11 billion in sales and more than 65,000 employees. Its stores operate under the banners Metro, Metro Plus, Super C, Food Basics, Marché Ami, Les 5 Saisons and Marché Adonis.[9] Its pharmacies operate under the banners Brunet, The Pharmacy, Clini-Plus, and Drug Basics.

In 2017, Metro acquired Canadian meal kit service, Miss Fresh.[10]

In May 2018, Metro closed a $4.5 billion (CAD) acquisition of the Quebec drug chain Jean Coutu Group, making it one of Canada's largest retailers and distributors of food and drugs.[11]

Loyalty programs[edit]

Stores under the Metro and Metro Plus banners offer one of the following loyalty programs:

  • Stores in Ontario, excluding those in Thunder Bay, participate in the Air Miles program. Customers earn 1 reward mile for every $20 spent cumulatively each week (Sunday to Saturday). Points may be redeemed for a variety of items, including in-store grocery redemptions (95 miles can be redeemed for $10 in groceries).[12]
  • Due to Metro's Ontario stores (then A&P Canada) joining Air Miles after Safeway, which has locations in Thunder Bay, Metro's locations in that city have their own loyalty program called Thunder Bucks. Similar to Air Miles, customers earn 1 Thunder Point for every $20 spent, and bonus-points promotions are generally equivalent to those offered for Air Miles in the rest of the province. However, points are automatically redeemed for gift certificates at the rate of 125 points per $20 gift certificate.[13]
  • For similar reasons (Air Miles has a partnership with Sobeys/IGA in Quebec), locations in Quebec have their own program, metro&moi (Metro and Me). Customers earn 1 point for every $1 spent; points are automatically converted to rewards vouchers which are mailed every three months at a rate of $1 per 125 points accumulated (with a minimum balance of 500 points required for vouchers to be mailed).[14]

In spring 2015, Metro agreed to drop its exclusivity on the Air Miles program in Ontario; as a result, Sobeys stores throughout that province now offer Air Miles rewards in parallel with Metro. However, Sobeys (which now also owns Safeway Canada) did not reciprocate, and Metro continues to be unable to offer Air Miles in either Quebec or Thunder Bay.


Corporate governance

Members of the board of directors of Metro Inc. are: Réal Raymond (Chair), Marc Guay (Administrateur), Maryse Bertrand, François J. Coutu, Michel Coutu, Stephanie Coyles, Marc DeSerres, Claude Dussault, Russell Goodman, Christian W.E. Haub, Eric R. La Flèche, Christine Magee, Marie-José Nadeau, and Line Rivard.[16]

Recently Asked Questions

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Let our 24/7 Management tutors help you get unstuck! Ask your first question.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes
A+ icon
Ask Expert Tutors