Canadian grocery giant Metro is purchasing a majority stake in Marché Adonis as both companies try to expand further into the fast-growing, multibillion-dollar market for ethnic grocery. The purchase will give Metro ownership of 55% of Adonis’ market share. With this purchase, both Metro and Adonis will benefit from each other. The financial backing of Metro will help Adonis reach more consumers. Also, access to Adonis’ expertise will help Metro boost its advance into the ethnic food market.

This is a good tactic for Metro because it is beneficial for the company in the short run and also in the long run. In the short run, Adonis’ supplier network will provide ethnic foods in Metro stores, which could attract more consumers. In the long run, Metro will become more experienced in the ethnic grocery market through the help of Adonis and also knowledge gained for operation in the market. Also, this differentiation strategy will help Metro to standout among its competitors with products appealing to a larger portion of the market. Adonis, on the other hand, should expand in to other provinces like Ontario and British Columbia as currently the company only operates in Quebec.

Source: Globe and Mail       Picture