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A Spatial Analysis of the Effect of Entry by Supercenter and Warehouse Club Retailers on Grocery Sales

Author

Listed:
  • Martens, Bobby J.
  • Dooley, Frank J.
  • Florax, Raymond J.G.M.

Abstract

This research evaluates the effects of entry by supercenters and warehouse club retailers on the location of retail grocery sales. Drawing on location theory and empirical works, spatial econometric convergence models are specifi ed and estimated. Because grocery shopping is generally a local phenomenon, the spatial models are used to capture spillover effects between geographical areas. The results show that supercenter and warehouse club retailers have a signifi cant and large effect on growth of grocery sales, especially in low population areas. The results suggest that the large stores are new grocery distribution channels, which are changing where consumers shop for groceries.

Suggested Citation

  • 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.
    • Handle: RePEc:ags:jlofdr:139056
    DOI: 10.22004/ag.econ.139056
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    References listed on IDEAS

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    1. 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.
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    8. Georgeanne M. Artz & Kenneth E. Stone, 2006. "Analyzing the Impact of Wal-Mart Supercenters on Local Food Store Sales," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(5), pages 1296-1303.
    9. Irwin, Elena G. & Clark, Jill, 2006. "Wall Street vs. Main Street: What are the Benefits and Costs of Wal-Mart to Local Communities?," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 21(2), pages 1-6.
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    Cited by:

    1. Li, Jie & Huddleston, Patricia & Minahan, Stella, 2021. "International retail format transfer: A comparison study of Australian and U.S. warehouse club members," Journal of Retailing and Consumer Services, Elsevier, vol. 59(C).

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