Supermarket chain Metro is set to cease its Japanese operations by the end of next month after the company failed to “reach profitability targets and sustainable growth in sales”.

Metro AG’s exit will see the closure of 10 stores and the business in Japan, while the real estate portfolio in the country will be sold.

The company said in its statement that it had analysed alternative options, including adjusting store formats, improving the assortment and expanding the delivery business, but saw no path to profitable growth.

“Metro Japan has been under pressure for quite some time,” said Steffen Greubel, CEO of Metro AG. “We have concluded that Metro Japan is not a strategic fit for the company’s long-term objectives.”

The failure in growing the Japan business was said to result from the lack of scale and highly competitive market characteristics. Entering Japan in 2002 with its first store in Chiba, the chain has opened 10 wholesale stores, all of which is located in the Greater Tokyo area.