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Effect Of A Mass Merchandiser On Traditional Food Retailers

Author

Listed:
  • Capps, Oral, Jr.
  • Griffin, James M.

Abstract

Non-traditional retailers such as warehouse club stores, discount drug stores, and discount mass merchandisers are new competitors for traditional food retailers. It is expected that non-traditional retailers will account for roughly 14 percent of total grocery sales by the turn of the century. The impact of a particular discount mass merchandiser (Wal-Mart) on the sales of a conventional retail grocery outlet (David's Supermarket, Inc.) located in the rural areas surrounding the Dallas/Ft. Worth metroplex is analyzed. In this case study, Wal-Mart alone is responsible for about a 21 percent reduction in sales.

Suggested Citation

  • Capps, Oral, Jr. & Griffin, James M., 1998. "Effect Of A Mass Merchandiser On Traditional Food Retailers," Journal of Food Distribution Research, Food Distribution Research Society, vol. 29(1), pages 1-7, February.
    • Handle: RePEc:ags:jlofdr:27447
    DOI: 10.22004/ag.econ.27447
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    Cited by:

    1. Richard Volpe, 2014. "Supercenters, Unionized Labor, and Performance in Food Retail," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 53(2), pages 325-355, April.
    2. P. J. Glandon & Matthew Jaremski, 2014. "Sales and Firm Entry: The Case of Wal‐Mart," Southern Economic Journal, John Wiley & Sons, vol. 81(1), pages 168-192, July.
    3. Martens, Bobby J. & Florax, Raymond J.G.M. & Dooley, Frank J., 2005. "The Effect of Entry by Supercenter and Warehouse Club Retailers on Grocery Sales and Small Supermarkets: A Spatial Analysis," 2005 Annual meeting, July 24-27, Providence, RI 19176, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    4. Rebecca Cleary & Rigoberto Lopez, 2014. "Supermarket responses to Wal-Mart Supercenter expansion: a structural approach," Empirical Economics, Springer, vol. 47(3), pages 905-925, November.
    5. Leibtag, Ephraim S. & Barker, Catherine & Dutko, Paula, 2010. "How Much Lower Are Prices at Discount Stores? An Examination of Retail Food Prices," Economic Research Report 96767, United States Department of Agriculture, Economic Research Service.
    6. Volpe, Richard J., III & Lavoie, Nathalie, 2005. "The Effect of Wal-Mart Supercenters on Grocery Prices in New England," 2005 Annual meeting, July 24-27, Providence, RI 19188, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    7. Richard J. Volpe & Nathalie Lavoie, 2008. "The Effect of Wal-Mart Supercenters on Grocery Prices in New England," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 30(1), pages 4-26.
    8. Dooley, Frank J. & Mayberry, Matthew & Wilson, Christine A. & Boehlje, Michael, 2002. "Assessing The Effect Of Ecr On Financial And Operating Performance," 2002 Annual meeting, July 28-31, Long Beach, CA 19788, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    9. Rebecca L. O. Cleary & Rigoberto A. Lopez, 2007. "Is Wal-Mart Good for Competition? Evidence from Milk Prices," Food Marketing Policy Center Research Reports 101, University of Connecticut, Department of Agricultural and Resource Economics, Charles J. Zwick Center for Food and Resource Policy.
    10. Volpe, Richard J., III & Lavoie, Nathalie, 2006. "The Effect of Wal-Mart Supercenters on Grocery Prices in New England," Working Paper Series 14515, University of Massachusetts, Amherst, Department of Resource Economics.
    11. Woo, Byung-Joon & Huang, Chung L. & Epperson, James E. & Cude, Brenda J., 2001. "Effect Of A New Wal-Mart Supercenter On Local Retail Food Prices," Journal of Food Distribution Research, Food Distribution Research Society, vol. 32(1), pages 1-9, March.
    12. Volpe, Richard J., III, 2011. "Evaluating the Performance of U.S. Supermarkets: Pricing Strategies, Competition from Hypermarkets, and Private Labels," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 36(3), pages 1-16, December.
    13. John Fernie & Barbara Hahn & Ulrike Gerhard & Elke Pioch & Stephen J. Arnold, 2006. "The impact of Wal-Mart's entry into the German and UK grocery markets," Agribusiness, John Wiley & Sons, Ltd., vol. 22(2), pages 247-266.
    14. Alessandro Bonanno & Stephan J. Goetz, 2012. "WalMart and Local Economic Development," Economic Development Quarterly, , vol. 26(4), pages 285-297, November.
    15. Martens, Bobby J. & Dooley, Frank J. & Florax, Raymond J.G.M., 2010. "A Spatial Analysis of the Effect of Entry by Supercenter and Warehouse Club Retailers on Grocery Sales," Journal of Food Distribution Research, Food Distribution Research Society, vol. 41(2), pages 1-12, July.
    16. Xiaoou, Liu, 2009. "Rational Addiction Evidence From Carbonated Soft Drinks," 2009 Conference, August 16-22, 2009, Beijing, China 51620, International Association of Agricultural Economists.
    17. Morganosky, Michelle A. & Cude, Brenda J., 2001. "Why Do Consumers Cross-Shop Between Different Types Of Food Retail Outlets?," Journal of Food Distribution Research, Food Distribution Research Society, vol. 32(3), pages 1-10, November.

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    Keywords

    Agribusiness;

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