Scale, Scope, and Specialization Effects on Retailersâ€™ Procurement Strategies: Evidence from the Fresh Produce Markets of SÃ£o Paulo
Worldwide, the emergence of large supermarket chains in food retail markets is often associated with the marginalization of smaller retailers. A notable exception exists in Brazil, however, where small retailers have held their place in the market and recently even gained ground. The literature investigating how retail concentration has affected agrifood chains has focused activities of the largest retail chains, implicitly holding the scale, scope and specialization of retailersâ€™ input needs constant, and overlooking the influence of these factors on retailersâ€™ procurement strategies. This paper tests hypotheses regarding these variablesâ€™ effects on retailersâ€™ fresh produce procurement strategies. Data is drawn from a survey of retailers in metropolitan SÃ£o Paulo. The research results provide insight into factors underlying retailersâ€™ procurement strategy choices and tradeoffs among options. The results support the fundamental hypothesis of the paper that research on the competitive strategies of smaller retailers in a context of market domination by large retailers should not focus exclusively on the degree to which the smaller retailers imitate the larger retailers rather it should account for the possibility that the underlying characteristics of the retailers may make diverse competitive strategies appropriate.
Volume (Year): 46 (2008)
Issue (Month): 1 (March)
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