Germany update: Lidl's growth targets, Metro and Rewe

Date : 19 June 2015

As Lidl aims to become a €100bn business, we update on an important disposal at Metro and the growing online and convenience focus at Rewe.

Lidl aiming for €100bn sales by 2020

The Schwarz Group has announced it plans to increase sales by more than 25% to €100bn by the year 2020. Klaus Gehrig, head of the group stated the following three key priorities: "We want Lidl to get stronger in existing markets, we will expand to new countries and we will fundamentally overhaul Kaufland." The group has seen sales in 2014 rise 7% to €79.3bn. Lidl's rapid expansion has increased store numbers in Europe to almost 10,000, and it plans to enter the US by 2018 with an initial investment of $200m. You can find further information on Lidl's strategy in our report Lidl: Five strategic priorities for growth.

Metro to sell Kaufhof and focus on online

Metro Group has announced plans to sell its Galeria Kaufhof banner to Canadian group Hudson's Bay in a €2.83bn deal. Metro will net an expected €1.6bn and use the remaining to lower debt levels. The move will allow the Metro group to focus on its online platforms as well as its Cash & Carry, Real and Media-Saturn banners. Speaking in an interview, Olaf Koch, the group CEO said "We plan an expansion of our investments in digital businesses, modernisation of older stores, more stores for Media Markt and Saturn as well as for Metro Cash & Carry, also in new countries.”

Rewe to expand online presence and revamp own label dairy range

Rewe has confirmed it will continue to expand online operations and will soon introduce an online beauty offer. This will add to its online portfolio, which already includes a wine platform and a pet supplies offer. Alain Caparros, CEO of Rewe, believes the retailer must invest online to stay competitive, especially in light of Amazon potentially launching its 'Fresh' grocery service in Germany. However the group still plans to invest in physical formats, with large investment planned for the convenience format in particular, 'Rewe To Go.' In other news, the group has announced future plans to only stock GMO free dairy products under its own label range. Rewe is also working to offer more local and regional dairy products under the 'REWE regional' range.