Supermarket Entry and the Survival of Small Stores

We analyze the effect of supermarket entry on the exit of small stores in the food retailing sector in Montevideo between 1998 and 2007. We use detailed geographical information to identify the link between supermarket entry and the exit of nearby small stores. Entry of supermarkets using small- to...

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Bibliographic Details
Published inReview of industrial organization Vol. 44; no. 1; pp. 73 - 93
Main Authors Borraz, Fernando, Dubra, Juan, Ferrés, Daniel, Zipitría, Leandro
Format Journal Article
LanguageEnglish
Published Boston Springer 01.02.2014
Springer US
Springer Nature B.V
Subjects
Bakeries
Business structures
Butcher shops
Butchering
Competition
Competitive advantage
Developing countries
Discount department stores
Economics
Economics and Finance
Grocery stores
Implementation maturity model
Industrial Organization
LDCs
Market entry
Microeconomics
Neighborhoods
Pasta
Private stores
Retail stores
Retail trade
Retailing industry
Shopping
Small & medium sized enterprises-SME
Studies
Supermarkets
Survival
Uruguay
Latin America
Competition
Small store attrition
Supermarket entry
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Summary:We analyze the effect of supermarket entry on the exit of small stores in the food retailing sector in Montevideo between 1998 and 2007. We use detailed geographical information to identify the link between supermarket entry and the exit of nearby small stores. Entry of supermarkets using small- to medium-size formats creates a competitive threat for the existing small stores, decreasing their probability of survival. The result is robust to several model specifications and varying definitions of what constitutes a supermarket. The impact of supermarket entry is unequivocal for groceries, bakeries, fresh pasta shops, and butcher shops.
Bibliography:ObjectType-Article-2
SourceType-Scholarly Journals-1
ObjectType-Feature-1
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ISSN:0889-938X
1573-7160
DOI:10.1007/s11151-013-9379-7