---
title: "Metro's Transformation Dilemma: From B2B Dominance to B2C Challenges"
description: "Xia An, a Beijing resident, says she hasn't opened the Metro app in a long time. In 2022, amid the boom in paid membership warehouse clubs, she signed up for both Sam's Club and Metro membership apps. However, Metro's subsequent performance left her dissatisfied, with issues like online stock discrepancies and poor delivery service. Similarly, other consumers and B2B clients have noted a decline in Metro's product range, supply stability, and overall experience since its shift towards individual paid memberships, leading to customer attrition and strategic confusion."
author: "晴山"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
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published: "2025-06-07"
categories: "E-commerce & Instant Retail, Retail Formats"
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citation: "晴山. “Metro's Transformation Dilemma: From B2B Dominance to B2C Challenges.” New Distribution, 2025-06-07. https://xinjignxiao.com/en/articles/metro-s-transformation-dilemma-from-b2b-dominance-to-b2c-challenges-2c5963ff/"
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# Metro's Transformation Dilemma: From B2B Dominance to B2C Challenges

> Xia An, a Beijing resident, says she hasn't opened the Metro app in a long time. In 2022, amid the boom in paid membership warehouse clubs, she signed up for both Sam's Club and Metro membership apps. However, Metro's subsequent performance left her dissatisfied, with issues like online stock discrepancies and poor delivery service. Similarly, other consumers and B2B clients have noted a decline in Metro's product range, supply stability, and overall experience since its shift towards individual paid memberships, leading to customer attrition and strategic confusion.

**Source** | Lingshou
Xia An, a Beijing resident, says she hasn't opened the Metro app on her phone in a long time.
"In 2022, when paid membership warehouse clubs were extremely popular, I added two shopping apps to my phone: Sam's Club and Metro, and bought annual memberships for both," Xia An said.
However, in subsequent experiences, Metro's performance left Xia An quite dissatisfied.
Xia An told the reporter that although Metro's grain, oil, and vegetables were still available for ordering at the time, she had many frustrating shopping experiences over the following year.
She said that online showed items in stock, but after adding them to the cart and checking out, staff would call near the delivery time to inform her that some items were temporarily out of stock.
"Metro's home delivery business and service have shown obvious shortcomings," Xia An said. When her annual membership expired, she decisively gave up renewing it. Although she still keeps the Metro app on her phone, she hasn't bought anything from it since, only occasionally browsing to see if there are any changes.
Besides Xia An, Wang Yang, who lives in Shanghai, has also become dissatisfied with Metro in recent years.
She told the reporter that there is a Metro near her home. Previously, it had a full range of products, and she could buy many things there that weren't available in other large supermarkets. But after they started charging individuals for entry a few years ago, she felt the products were nothing special, and the shopping experience didn't make her a loyal customer.
"Although I often pass by Metro, and now non-members can also shop in-store, it's been several years since I last went in," Wang Yang said.
Qi Qi, who runs a bakery in Shanghai, told the reporter that she had been buying ingredients from Metro since 2016, spending about 20,000 to 30,000 yuan per month. But since 2021, when they opened to individual consumers for a fee, the former 'wholesale atmosphere' disappeared.
"Moreover, the supply of core ingredients like imported cream and chocolate became unstable, and more importantly, some platforms offer the same products at prices as low as 15% of Metro's, with faster delivery. So I gave up buying ingredients from Metro," Qi Qi said.
Of course, these are just individual cases and don't represent the whole, but they do illustrate some issues. Now, Xia An only keeps a Sam's Club membership.
Compared to Costco, which locks in high-net-worth families by 'selling memberships at a loss,' and Sam's Club, which ensures service investment with a model where membership fees account for 60% of profits, Metro, which had a good foundation, has not established truly irreplaceable differentiated value in its membership business model.
In this regard, industry insiders told the reporter that the retail industry should recognize that membership fees are essentially 'service commitment fees.' When the promised value cannot be delivered, customer attrition is inevitable.
Since Wumart Group acquired 80% of Metro China in 2019, it marked the official shift of this German retail giant from foreign-controlled to localized operations. However, it's worth noting that the post-acquisition integration process has not been smooth, facing three core issues: blurred brand positioning, supply chain integration challenges, and intensified market competition, leading to a transformation dilemma.
**Strategic Wavering, Trapped in Transformation**
Six years ago, Metro Group, Wumart Group, and Dmall jointly announced that Wumart had signed a final agreement with Metro Group to acquire controlling stakes in Metro China.
It was stated that after the transaction, Wumart Group would hold 80% of the shares in the joint venture, while Metro would retain 20%. On April 23, 2020, Wumart completed the acquisition of Metro China for 11.9 billion yuan.
After the acquisition, Wumart attempted to expand Metro from B2B to B2C.
At the end of 2020, the paid membership model became popular in the industry. Metro, which originally had a large number of B2B member stores, began to develop individual members on a large scale. In June 2021, Wumart-led Metro launched its first two PLUS member stores in Beijing and Chengdu, with an annual membership fee of 199 yuan. Like Sam's Club, customers had to have a membership card to shop.
In November of the same year, Metro began vigorously promoting the membership store model, announcing a comprehensive rollout and planning to convert all 100 stores in China into membership stores. This meant Metro shifted from primarily serving B2B clients to serving both B2B clients and B2C members.
On November 27, 2021, Metro opened 16 membership stores in eight cities: Beijing, Chengdu, Nanjing, Qingdao, Dalian, Wuxi, Changchun, and Changzhou, catching up with the leading players in the membership store track in one go. By November 2022, it had opened a total of 23 stores.
However, after rapidly developing membership stores, Metro did not announce new renovation progress after 2023. Until January 2024, Metro began closing stores, successively closing four stores in Chengdu, Shanghai, Wuhan, and Beijing, all officially announced as 'renovation closures.'
In June of the same year, existing membership stores also began to change. Some consumers said that Metro had opened free memberships to consumers, allowing them to simply register as free members to shop in-store, and Metro membership stores were once again open to non-members.
In this regard, industry insiders said that such repeated strategic adjustments undoubtedly affected the brand's image and member loyalty. Moreover, Metro had previously built barriers through B2B memberships, but after Wumart took the lead, it attempted to expand to C-end, lowering membership thresholds, which led to a lack of differentiation in B2B customer experience.
From allowing consumers to enter freely and lowering membership thresholds, which weakened the exclusivity for corporate clients, to adjusting the product mix to increase ordinary FMCG products and reduce high-end imported goods, making some consumers feel Metro was 'no longer professional' and increasingly like a regular supermarket, to C-end consumers finding its prices high and less attractive than Sam's Club and Costco, Metro, long known for 'warehouse-style wholesale,' 'corporate customer service,' and 'strict quality control,' saw its original advantages diluted. Its brand positioning and image became blurred, leading to a decline in loyalty among its core customers.
In this regard, some people said that membership stores' To C and To B are two different business models and concepts, and in principle, they are different. For example, C-end consumers and B-end consumers have different procurement needs, product categories, quality requirements, and logistics methods.
It must be said that Metro China is currently facing a transformation dilemma from B-end professional wholesale to C-end market. Moreover, the supply chain advantage of relying on German headquarters resources for stable imported goods has further exposed supply chain integration challenges amid conflicts with localized operations.
**Supply Chain Integration Challenges**
Wumart's acquisition of 80% of Metro China was once regarded as one of the largest foreign M&A cases in China's retail industry. However, after the acquisition, Metro China's operating performance continued to face pressure. According to Euromonitor's 'China Modern Retail Channel Report 2023,' the compound annual growth rate from 2021 to 2023 was only 1.2%. The number of imported SKUs decreased from 5,800 in 2019 to 2,800 in 2023, a reduction of 52%. The core issue directly points to ineffective supply chain integration.
From 2020 to 2023, according to the China Chain Store & Franchise Association's '2023 China B2B Retail Market Development Report,' the average procurement amount of former Metro corporate clients decreased by 35%-40%, mainly shifting to digital procurement platforms. According to Wumart Group's bond prospectus, after 2023, Metro China's inventory turnover days increased from 45 days to 58 days, and imported SKUs decreased by 52%.
Looking back at Metro China's original supply chain advantages, 2019 data showed that direct sourcing from Europe accounted for 35%, especially in alcoholic beverages, dairy products, and industrial goods, which were irreplaceable.
In terms of B-end customized services, it previously supported full-pallet procurement, monthly payment terms, and urgent additional orders, which won Metro many loyal B-end clients. For example, a German restaurant in Shanghai purchased 50,000 euros of German beer monthly, mainly relying on Metro's stable supply.
Comparing after Wumart's localization transformation, according to Metro China's internal operating reports, in 2019, imported goods accounted for 35%, with 210 European suppliers and a procurement decision cycle of 3 days. By 2023, imported goods accounted for 18%, with 89 European suppliers and a procurement decision cycle of 7 days. This led to the loss of many B-end clients.
For example, a five-star hotel in Shenzhen switched to a professional importer after French cheese ran out of stock. Additionally, after the acquisition, conflicts between Metro China's B-end and C-end supply chain systems emerged.
In 2021, Wumart merged Metro's B-end warehouses with its own C-end warehouses. According to a special case study by the China Warehouse and Distribution Association's '2022 China Retail Logistics Operation Report,' which tracked 1,500 orders from three merged warehouses in Beijing and Tianjin, after Wumart completed the integration of the North China warehouse and distribution system in Q3 2021, Metro China's B2B order on-time delivery rate dropped from 94.7% to 76.8%, and fresh food loss rate increased from 3.2% to 11.4%. According to PwC's special audit of Wumart's supply chain (April 2022), after warehouse consolidation, the sorting error rate increased by 12%, and the average daily cold chain interruption time increased by 2.7 hours.
This caused B-end customer satisfaction to decline. According to Metro China's '2021 Supplier Conference Internal Briefing,' customer satisfaction dropped from 82 points in 2020 to 63 points in 2011 (likely a typo for 2021). Tsinghua University's Retail Research Center's '2023 Research on M&A Integration Risks in Retail' showed that the integration of Wumart and Metro's warehouse networks led to a 320% increase in monthly complaints from B-end clients.
This also led to customer loss. According to Meituan Research Institute's '2021 Catering Supply Chain White Paper,' in the North China market, Meituan Kuaitu added 14.3% of new small and medium restaurant clients from Metro users in 2021.
It's worth noting that after the acquisition, Wumart forced the use of the Dmall system, but it couldn't support the VAT invoice splitting function specific to B-end clients.
Additionally, according to the China Chain Store & Franchise Association's '2022 Retail Supply Chain Technology Application White Paper,' Metro China's forecasting and replenishment technology still relies on manual experience plus basic ERP, with an accuracy rate of 68% and cold chain temperature control coverage of 65%. In comparison, Sam's Club uses AI algorithms (SAS platform) with an accuracy rate of 92% and cold chain coverage of 95%. Hema uses a self-developed AI system with an accuracy rate of 89% and cold chain coverage of 98%.
From an industry comparison, Metro China's intelligent technology is clearly insufficient.
Furthermore, in 2021, Wumart split Metro China's retail and supply chain businesses, with the latter renamed Metro Supply Chain.
In June 2024, Metro Supply Chain submitted a listing application to the Hong Kong Stock Exchange. According to its prospectus, it is a food and FMCG supply chain solutions service provider. However, the prospectus lapsed on December 28 due to the six-month validity period expiring.
In December of the same year, Metro Supply Chain updated its prospectus, adding first-half 2024 performance data, and continued its listing plans.
Some industry insiders believe that Metro Supply Chain still hasn't resolved issues such as 60% of revenue relying on the Wumart system and limited growth space for offline retail stores, and that listing is a helpless move under pressure.
In any case, according to current retail trends, the future for Metro and Wumart supermarkets will continue to be difficult. In contrast, the supply chain has become the segment with the most potential for growth.
In this regard, industry insiders told the reporter that from the case of Metro China acquired by Wumart, supply chain integration in retail M&A is by no means a simple '1+1' merger. In the future, deep reforms are needed in customer demand segmentation, differentiated operations, and key technology investment; otherwise, they will continue to face the risk of losing market share.
**Intensified Competition, Squeezed from Both Sides**
China's paid membership store market has seen explosive growth in recent years. According to research reports, the market size exceeded 40 billion yuan in 2023, with an annual growth rate of 25%, and is expected to exceed 80 billion yuan by 2025.
Despite the hot market, competition has intensified. Whether from the B-end, C-end, or online business, Metro is facing all-around pressure from competitors.
First, looking at the B-end market, Metro's customer attrition is accelerating.
Previously, Metro had long served B-end clients, with its product range, store layout, and operating model all designed around corporate procurement needs.
For example, its bulk packaging, warehouse-style store layout, and strict procurement processes were all to meet corporate clients' needs for bulk purchasing and cost control. However, when transforming to expand C-end business with a paid membership model, Metro failed to clearly define and segment its new business.
At the same time, as supply chains across regions continue to transform and optimize, with competitors like Jingxi Cang and Meituan Kuaitu offering lower prices and faster delivery, Metro's B-end market is also being squeezed.
Second, from the C-end market perspective, Metro's membership growth faces challenges.
Currently, Sam's Club and Costco, with their strong global supply chain resources, rich membership operation experience, and brand influence, are accelerating their layout in the Chinese market to compete for mid-to-high-end consumer groups.
In addition, local supermarket brands are also accelerating their layout, such as RT-Mart's M membership store, Hema's X membership store, and Pangdonglai, which doesn't charge membership fees but outperforms membership stores. These local brands leverage their own advantages and local market characteristics for innovation and differentiated competition.
In an environment of intensified market competition, paid membership retail enterprises are continuously upgrading in terms of product prices, membership benefits, service quality, and store environment. For example, from simple discounts initially to now diverse benefits like exclusive services, free parking, points redemption, and birthday perks.
In terms of product prices, brands are optimizing supply chains, reducing costs, and strengthening private labels to offer members products with better value for money.
Compared to Metro, whether in product service innovation, product differentiation, or digital marketing, it has failed to form effective competitive strategies to stimulate C-end demand, gradually losing its way in fierce competition.
Third, from the online business perspective, according to the China Chain Store & Franchise Association's '2023 Warehouse Membership Store Digital Ranking,' Metro China's online business score was 6.5, far below the industry average of 8.2. Key shortcomings include its mini-program users at only 1.2 million, while Sam's Club's mini-program has 3.8 million monthly active users. Additionally, Metro China's online SKU coverage rate is 35%, while Sam's Club's is 85%.
Furthermore, according to QuestMobile's '2023 Retail App Activity Report,' Metro's app MAU (monthly active users) was 1.32 million, ranking 18th in the industry, with users spending 4.2 minutes on average, while Sam's Club users spent 12.6 minutes.
Clearly, compared to Sam's Club's hourly delivery and the faster, smoother delivery experiences of JD.com and Hema, Metro's online home delivery business has no advantage.
Overall, after being acquired by Wumart, Metro China's core contradiction lies in how to balance B-end professionalism with C-end scale, and how to integrate the differentiated genes of foreign and local enterprises to avoid overlap between B-end and C-end markets. If these issues cannot be resolved, Metro may fall into a dilemma of 'pleasing neither side' and 'belonging to neither side,' thereby losing its uniqueness in the fierce market.
Of course, Metro's predicament also reflects the common challenges faced by traditional wholesale and retail enterprises in the new era—having to respond to low-price competition and online trends while balancing heavy-asset models with the need for flexible transformation. And more cruelly, if the transformation fails, it may face further spin-offs or acquisitions.


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## Citation metadata

- Publisher: New Distribution
- Author: 晴山
- Published: 2025-06-07
- Canonical: https://xinjignxiao.com/en/articles/metro-s-transformation-dilemma-from-b2b-dominance-to-b2c-challenges-2c5963ff/
- Original source: https://mp.weixin.qq.com/s/TPA1ybHjukgTmZv6YLSySQ

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