Alternatives for Growth and Internationalization in Retailing

TLDR: In this paper, the authors deal with retail internatinoalization within the more general issue of growth strategies and propose a descriptive model of the set of choices retailers face to sustain growth and, among them, the option of internationalization.

Abstract: The paper deals with retail internatinoalization within the more general issue of growth strategies. Retailers cannot export their products through international trade and, since they cannot protect their know-how with patents, they have problems in using licensing as an alternative to direct investment. The implication is that, unlike most manufacturers, they cannot follow a step-by-step approach to internationlization. Thus, it is usually a major decision which is considered among other alternative to support growth, namely diversification into different store types. The aims of the paper are twofold: first, to offer a descriptive model of the set of choices retailers face to sustain growth and, among them, the option of internationalization. Second, to relate internationalization to the characteristics of the firm's core business, the ownership advantage it has with respect to rivals and the extent of the adaptation costs involved in implanting its type of stores abroad. The model is tested using a sam...