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Market Concentration and Profitability of the Grocery Retailers in Central Europe

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  • Jindřich Špička

Abstract

The aim of the article was to internationally compare the market concentration of grocery retailers in the six countries of Central Europe - Austria, Czech Republic, Germany, Hungary, Poland and Slovakia. The market concentration was measured by CR4 ratio, Herfindahl-Hirschman Index and the GRS index. Data covered the period 2010 - 2015. The secondary data came from the Euromonitor International and Bureau van Dijk databases. The results showed that the market structure of the Central European grocery retailers has mostly a character of asymmetric oligopoly. The pairwise correlation did not reveal any strong relationship between the market power and profitability of the grocery retailers. The Central European grocery market is controlled by strong national retail chains and multinational companies which operate modern grocery retail formats. However, traditional grocery retailers are still popular in Hungary while traditional individual grocers in other countries are disappearing or gradually joining the networking system based on franchising.

Suggested Citation

  • Jindřich Špička, 2016. "Market Concentration and Profitability of the Grocery Retailers in Central Europe," Central European Business Review, Prague University of Economics and Business, vol. 2016(3), pages 5-24.
    • Handle: RePEc:prg:jnlcbr:v:2016:y:2016:i:3:id:155:p:5-24
    DOI: 10.18267/j.cebr.155
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    More about this item

    Keywords

    Market concentration; grocery retailers; Central Europe; oligopoly; profitability;
    All these keywords.

    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General

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