Competition in Supermarket Industry
When trying to capture a large market, especially during the peak periods of the year, most supermarkets tend to lower their prices in comparison to that of their rivals in a bid to retain and get more customers due to the competitive advantages that they seek to leverage within the market.In marking the boundaries in this industry the researcher must note that most supermarkets open up new stores so as to bring their products closer to the customers (i.e. to gain a greater degree of market penetration) (Masso et al 2011, p. 13). This of course has the effect of causing the profit margin to go lower than expected since much of their focus and monetary resources are devoted to the new stores rather than the existing ones (Karakaya et al 2011, p. 175).There are of course a host of problems that arise during entry. or the point in time that a given a supermarket tries to cut a notch for itself in the highly competitive sector of supermarkets. When there is free entry into the market, even the supermarkets which have a high concentration are readily contested (Upton et al 2012, p.94). When a new supermarkets attempts to enter into the this highly competitive territory, it is incumbent upon them to have all of the logistical steps together with their requisite emphasis on supplier networks, employee retention and development programs, and market strategy. As such an entrance is an extraordinarily expensive proposition, these steps are necessary to have perfected so that the unforeseen issues with the competition and the market changes can be solely focused upon (Wang et al 2010, p. 3).During the evaluation of competitiveness in the supermarket sector there are many hiccups that arise as a result of the many delineations within the boundaries of this sector. It is difficult to establish the factors to consider in an attempt to inflate the market share of the industry (Wilkie et al 2012, p. 958). This is because some of the strategies used to delineate the boundaries work for certain supermarkets while for others they did not.