Analyze the competitive environment of the supermarket industry in Hong Kong and the competitive response of the two leading supermarket chains. Does the competition of the two leading chains’ parent companies in multiple market segments have an impact on the competitive environment?
This case describes a hypothetical situation faced by a fictitious international conglomerate, ICL, that intends to enter the retail grocery market in Hong Kong. The conglomerate's interest in the Hong Kong supermarket industry was initially kindled by the plan of Hutchison Whampoa, Ltd. (HWL) to sell its leading supermarket chain PARKnSHOP in August 2013. However, in October 2013, HWL reversed course and decided not to sell PARKnSHOP, saying that the sale would not deliver maximum value to its shareholders. Before embarking into new territory, ICL wanted an in-depth understanding of the Hong Kong grocery
- Analyze the competitive environment of the supermarket industry in Hong Kong and the competitive response of the two leading supermarket chains. Does the competition of the two leading chains’ parent companies in multiple market segments have an impact on the competitive environment?
- Analyze the strategic positions of PARKnSHOP and Wellcome in the market, and in particular, their bargaining power vis-a-vis suppliers and consumers. What are their keys to sustaining leadership in the market?
- What strategies did PARKnSHOP and Wellcome use to overcome the challenges posed by their competitors? Are there legal risks in pursuing such strategies with the Competition Ordinance in place? What is the impact on consumers when supermarkets try to defend their market share?
- Should the international conglomerate enter the retail grocery market in Hong Kong? If so, what could it do to increase the chance of a successful and profitable entry?
Kindly provide a minimum of 7 sources from scholarly articles or business periodicals.
Thank you.
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