Dynamics in a Mature Industry: Entry, Exit, and Growth of Big-Box Grocery Retailers
Federal Trade Commission, Bureau of Economics, Working Paper No. 308
39 Pages Posted: 22 Oct 2011
Date Written: September 22, 2011
This paper measures market dynamics within the U.S. grocery industry (defined as supermarket, supercenter and club retailers). We find that the composition of outlets changes substantially, roughly 7%, each year, and that store sizes have increased as the result of growth by supercenter and club retailers. We find significant changes in the relative position of brands in markets over time. These changes are largely the result of expansion (or contraction) by incumbents rather than entry or exit. There is little entry or exit, except by small firms. Moreover, only in small markets do entrants gain substantial market share.
Keywords: Antitrust, Entry, Expansion, Retailing, Supermarkets, Supercenters, Market Dynamics
JEL Classification: D40, L4, L81
Suggested Citation: Suggested Citation