The Changing Structure of Retail Industry: Case Studies on Competitive Advantage of Small Companies in Croatia
The Changing Structure of Retail Industry: Case Studies on Competitive Advantage of Small Companies in Croatia

Summary/Abstract: Objective: There are two key trends in retail industry since 1990s till nowadays: rapid internationalization and intensive retail concentration. In such a dynamic environment, small companies are striving to preserve their markets and to maintain their business activity. The objectives of the paper are twofold: (1) to explain trends of retail internationalization and concentration and (2) to highlight the possibilities for improving the competitive ability of small retailers. Research Design & Methods: The paper is based on analysis of secondary data available in research papers, studies and official statistics. Firstly, the consequences of retail internationalization and concentration are described. Then, the literature on competitive advantage creation is systemized. In addition, the case study method is used to illustrate successful strategies of competitive advantage creation. Findings: In a changed retail market, small retailers seek the way to improve their competitiveness. As suitable competitiveness strategies, authors describe: (1) retail alliances and (2) differentiation by assortment. Implications & Recommendations: The key trends and their impact on small companies in retail industry are scrutinized. Recommendations to small retailers how to adjust to new market conditions, together with some practical examples, are given. Contribution & Value Added: The paper gives an insight into dynamics of changes in retail structure. Retail alliances and differentiation by assortment are described as two key streams of competitiveness improvement suitable for small retailers.

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