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Evaluating the Performance of U.S. Supermarkets: Pricing Strategies, Competition from Hypermarkets, and Private Labels

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  • Volpe, Richard J., III

Abstract

This study draws upon literature from the fields of agricultural economics, industrial organization, and business to study the performance of supermarkets in the United States. The empirical work draws from a rich dataset on the characteristics of supermarkets across the U.S. to test several hypotheses. Supermarkets utilizing everyday low pricing operate more efficiently than those using other strategies. Stores increase their performance by using strategies of their closest competitors. Competition with hypermarkets results in decreased supermarket performance, especially for smaller stores. Increases in private label sales relative to national brand sales are not necessarily related to increased performance.

Suggested Citation

  • 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.
    • Handle: RePEc:ags:jlaare:119159
    DOI: 10.22004/ag.econ.119159
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    References listed on IDEAS

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    Cited by:

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    2. 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.
    3. Daniel Toro-Gonzalez & Jia Yan & R. Karina Gallardo & Jill J. McCluskey, 2013. "Estimation of Unobserved Attributes Using a Control Function Approach, Modeling the Demand for Mint Flavored Gum," Working Papers 2013-06, School of Economic Sciences, Washington State University.
    4. Bonfrer, André & Chintagunta, Pradeep & Dhar, Sanjay, 2022. "Retail store formats, competition and shopper behavior: A Systematic review," Journal of Retailing, Elsevier, vol. 98(1), pages 71-91.
    5. Anania, Giovanni & Nisticò, Rosanna, 2014. "Price dispersion and seller heterogeneity in retail food markets," Food Policy, Elsevier, vol. 44(C), pages 190-201.
    6. Brown, James R., 2020. "The competitive structure of restaurant retailing: the impact of hedonic-utilitarian patronage motives," Journal of Business Research, Elsevier, vol. 107(C), pages 233-244.
    7. Luqman Olawale & Okewale Joel, 2017. "Factors Influencing Pricing Decision: Evidence from Non-Financial Firms in Nigeria," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 13(1), pages 157-172, February.

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