Metro and Alibaba Join to Sell German Sweets, Coffee Online

  • Chinese consumers can buy goods from Metro's site on Alibaba
  • E-commerce partnership is latest Web foray for Metro

Metro AG struck a deal with Alibaba Group Holding Ltd. to let Chinese consumers snap up German coffee, chocolate and butter cookies over the Web.

Germany’s biggest retailer is hanging a shingle on the Tmall website operated by Alibaba, Asia’s largest e-commerce company. More than 100 coffee, chocolate, canned foods and dairy products will go on sale, and the companies said in a statement they’ll work together on future initiatives around data mining and speeding supply chains from Europe to China. Metro shares rose as much as 3.4 percent.

"Opening the flagship store on Tmall Global again shows our clear confidence in the Chinese market," Metro Chief Executive Officer Olaf Koch said in the statement.

Koch, CEO since 2012, is trying to remake the 50-year-old retailer by divesting underperforming assets and pushing into Web forays to expand online sales. Alibaba, a vast network of e-commerce sites in Asia that went public in a blockbuster $25 billion initial public offering on the New York Stock Exchange last year, has struck deals with other European consumer brands including Inditex SA’s Zara clothing chain. A slowdown in Chinese growth and exports however has battered global markets in recent weeks.

With this alliance, Koch is trying to show investors he’s taking action to modernize the sleepy conglomerate, whose stock price has stagnated the past three years. Metro shares traded 3.2 percent higher at 26.20 euros as of 12:40 p.m. in Frankfurt.

In addition to the Alibaba agreement, Koch has bought small e-commerce companies in Europe and is working with U.S. technology incubator Techstars to back promising entrepreneurs in the hospitality industry.

Metro’s online shop on Alibaba’s tmall.hk site advertises "German quality" and features goods like corn flakes, Goldfish crackers and milk in addition to the java and sweets.

“Alibaba Group and Metro Group will work together to help more European consumer brands establish fast-track solutions for expanding into the Chinese market,” Alibaba Chief Executive Officer Daniel Zhang said in the statement.

Metro has been expanding in Asia and said last month it’s hunting further targets after agreeing to buy Classic Fine Foods Group, a Singapore-based supplier of gourmet products, for as much as $328 million. Metro already has 82 wholesale stores for restaurateurs in China and got 2.3 billion euros ($2.5 billion) in sales last year from that market.

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