Kesko's key strategic objective is healthy, profitable growth. Growth is sought by actively developing store selections and services to meet customer needs, by implementing capital expenditure in a competitive store network and by developing online services and e-commerce.
Capital expenditure in Kesko's business operations in Russia offer significant growth potential for a long time to come.
Kesko's target return on equity is 12%, while the target return on capital employed is 14%. Our objective is to maintain good solvency in all market conditions and to increase our shareholder value.
Growth in russia
In Finland, growth is sought by increasing market shares and by more customer-driven services than those provided by our competitors. In addition, growth is also sought in the Russian market, in particular, which is growing faster than the Nordic or Baltic markets.
The objective is to make capital expenditures of over €600 million in the food trade, building and home improvement trade, and Intersport operations in Russia by 2015. In all divisions, the focus is on the Moscow and St. Petersburg regions. In the food trade, the longer-term objective is to open clusters of 10 stores both in St. Petersburg and Moscow. In the building and home improvement trade, the objective is to open 11 new K-rauta stores by 2015. At the end of 2011, there were 14 K-rauta stores in Russia. Intersport has 36 stores and the aim is to double the network by 2015.
Capital expenditure in the store site network and in strengthening competitive advantages
In the food trade, major capital expenditure is directed at enhancing the store network in Finland and starting business in Russia. The most important project providing competitive advantage in the food trade involves strengthening the selections, the service and the displays of fruit, vegetable and bakery departments and service counters offering meat, fish and ready-to-eat meals.
In the home and speciality goods trade, the strategic emphasis is on increasing retail sales, strengthening the competitive advantages of K-citymarket's and Anttila's concepts and continuing the integration of purchasing and logistics operations. An important project providing competitive advantage is increasing online services and e-commerce.
In the building and home improvement trade, the store network will be considerably expanded over the next few years, particularly in Russia, where the focus is on the Moscow region. Synergy benefits are achieved by investing in centrally directed sourcing and selections development, and in a joint enterprise resource planning system and logistics network.
In the car and machinery trade, the market shares of the brands represented – Volkswagen and Audi, for example – will be increased by developing the retail sales and service network with the focus on a customer-driven approach.
Online services and e-commerce
New online services, wireless solutions and different terminal devices have increased the diversity of customers' needs and purchasing habits. Online shopping and interactive channels will be a key competitive factor in the near future.
The development of online transactions and e-commerce are strategic focal points in all divisions. The projects are coordinated by the electronic marketing and services unit. The objective is to be well present throughout customers' purchase transactions, so that customers will be able, if they wish, to use web services from planning their purchases to using the products.
The development of online services and stores requires significant capital expenditure in various projects related to electronic business models. Kesko has gained a strong position in online sales of home and speciality goods through the netanttila.com, kodin1.com, konebox.fi, cmstore.fi and budgetsport.fi online stores. Electronic services and e-commerce are also actively developed in the building and home improvement trade and the food trade.