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SHANGHAI - German retail and wholesale giant Metro AG today announced plans to spend about EUR600 million ($686.2 million) opening 40 more stores in China over the next five years, according to a Dow Jones newswire report.
Metro's expansion plan comes as other global retailers, such as Carrefour S.A. and Wal-Mart Stores Inc., announce their own plans to open stores in China to capitalize on the country's rapidly growing middle class.
Metro's chief executive, Hans-Joachim Koerber, told reporters he doesn't consider the likes of Carrefour and Wal-Mart as competition, however, as they cater mainly to individual customers, while Metro focuses on business customers, such as restaurants and hotels.
Also, Metro uses a membership system. Only members are officially allowed to shop in its stores, and to become a member a business license is required.
Metro opened its first outlet in Shanghai in 1996, and now operates 18 stores in China. Koerber said the base of operations for its new stores in the north of the country would be Beijing, while Guangzhou would be the base in the south.
He added that he expects Metro to become profitable in China within three years, despite the cost of expansion.
Koerber said Metro has no plans to start a retail business in China to serve individual customers, though it has retail and wholesale operations in Europe.