The Effect of Competition on Smaller Retailers

This report explores the impact of competition on smaller retailers, using the case study of CAMERONIAN CONVENIENT STORE. It discusses the challenges faced by the store due to increasing competition and provides strategies to gain a competitive edge.

Applied Business
Research

Table of Contents
INTRODUCTION...........................................................................................................................3
LITERATURE REVIEW................................................................................................................4
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
The current report is based on the CAMERONIAN CONVENIENT STORE, a New
Zealand based business which mainly offers huge variety of dairy products to its customers along
with the giftware and accessories. The convenience store was incorporated in the business with
Mr. Sooraj four months back but was established in the year 1998. The respective company
belongs to retail sector which mainly offers milk based consumable products. The overall
management of the convenience store is handled by its General Manager and two other
permanent store executives. With the passing time, it has been identified that this company is
facing issues related to constantly increasing number of supermarkets and stores at same
marketplace that offers almost equivalent range of dairy products and giftware items to
customers. These increasing numbers of stores have directly influenced customers’ interest
towards themselves and resulted in the quick decline of sales of CAMERONIAN
CONVENIENT STORE. In order to deal with the situation, General Manager of this company
have carried out investigation for exploring various opportunities and threats available at market
place by sales performance of the company can be raised and at the same time also support
company in gaining competitive edge over other enterprises within the same zones.
The chosen topic that is “The effect of competition on smaller retailers”. The topic is
highly important for the respective business as it will aware them about different ways by which
they can easily gain competitive edge over other companies. Along with this, from students’
perspective the chosen topic is highly important as it develops their understanding over business
management and opportunities available at marketplace for attaining competitive edge (Wrigley
and et. al. 2019). This will directly develop their business management knowledge and skills that
will support them in handling their own business in the near future. In addition to this, it will also
develop managerial skill of students that will not only support them in handling their own
business in the future but will also support them in their career if in case they pursue to work as a
manager in any other enterprise.
The scope of the study is highly dense and broad as well because it will open numerous
of opportunities for the CAMERONIAN CONVENIENT STORE through which they can easily
enhance their sales performance and gain competitive edge at the same marketplace. It will also
provide opportunities to other companies belonging to the same sector and market zone by which
they can easily develop their understanding over the available options through which their sales

performance can get upgraded in effective manner. Furthermore, it will develop future business
opportunities for students as they have developed their managerial and business management
skill by conducting investigation on this chosen topic in effective manner.
LITERATURE REVIEW
Literature review section is seen as the scholar paper in which investigator presents different
perception of authors towards the same topic in order to identify all of its phases. This section is
supportive in developing one and all conclusion over the research problem as it has covered in
depth knowledge over the same (Hood, Clarke and Clarke, 2016). With reference to the present
investigation, this section is comprised of information developed by investigator on the retail
industry, how businesses belonging to this sector can increase their sales performance and gain
competitive edge in effective manner. In depth description on research topic with the perception
of different authors is described in the below area:
Retail industry of New Zealand is seen as the constantly growing industry which is
contributing a lot in the economic growth of the nation in effective number. Business enterprises
dealing in this sector are focusing on adopting effective methods for improvising their
productivity in terms of product and services so that they can generate higher level of revenue in
less period of time that ultimately supports them in generating huge revenue and higher level of
profitability in quicker period of time (Trindade, 2015). In order to approach maximum number
of customers, the industry have used the way of opening up their own stores for the sake of
attracting maximum number of customers towards them in effective manner. Business owners of
these stores try to keep huge variety of products of high quality for attracting maximum number
of customers towards them.
Increasing growth of this industry is directly influencing interest of many business
perspective people towards it which is ultimately increasing competition within the industry at
higher level. This increase in the competition is the main reason behind the sales performance of
the existing people as their customers are now moving to the rivalry company or convenience
store that are offering similar sort of products to its customers in effective manner (Friske and
Zachary, 2017). This becomes the major concern of the existing companies as with the increase
in decline of sales performance their profitability as well as sustainability within the industry is
also getting affected. The overall situation can be understood effectively by exploring case of
CAMERONIAN CONVENIENT STORE, New Zealand based convenience store which offers is

dairy products to customers at its store. The company is mainly facing issue related to the
increasing competition within the industry as its customers are getting influenced towards
competitors and make purchase from their respective stores. This results in higher decline in the
sales performance of CAMERONIAN CONVENIENT STORE within New Zealand which
ultimately places impact over their sustainability within the industry in negative manner.
On the basis of views presented by the Wood, Z., (2017), small convenience stores are
now a day’s not having loyal customers as they are meeting new customers every single day. The
main reason behind this decline in number of loyal customers is the higher approach of large
scale supermarket like TESCO, Pak'N Save, Countdown etc. towards customers as they are
offering vast range of products and services to customers at the nominal or same prices that are
offered to same customers in their nearer convenience store (War of convenience as supermarket
chains take on small stores, 2017). Also these customers get more number of products or services
at even lesser prices. As a result, it directly results in decline in sales performance of
convenience stores because customers are moving towards supermarket at frequent basis.
On the contrary another author Dastgheib, S., (2018) has expressed that corner dairy
often named as convenient stores are not able to survive at marketplace because of competition
faced by large scale competitors. It is quite difficult for small convenient stores to deal with
higher rents, frequently changing demands of customers, constantly increasing competition at
marketplace especially from the supermarkets. In addition to this, it can be said sales percentage
of convenient store has been declined with 18 % in between 2012-2017 within New Zealand
(Convenience stores face bleak future unless they change, experts warn, 2018). The respective
percentage is increasing constantly with passing time. This increasing percentage of decline in
sales performance clearly states that convenient stores across the nationwide are shutting down
sooner. The main reason behind this is increasing popularity of large scale supermarkets like
Pak'N Save, countdown etc. which is directly influencing interest of customers and diverts their
mind to start shopping from for daily based products from supermarkets only. It has been
determined that customers feels attracted towards the supermarkets because they are able to get
each required things at single place. This simply attracts them to switch small convenience store
and approach large scale supermarkets in appropriate manner.
The overall analysis states that major influence of increasing competition which is seen
on small retailers of retail industry is the decline of sales performance. This simply means that

decline sales performance directly develops numerous of problems for the company which
ultimately results in dis balance in their sustainability at marketplace as customers are getting
attracted towards rivalry companies (Chen, 2018). As a result, it develops situation of huge loss
for small retailers because they are not able to generate revenue from marketplace for the future
processing of business activities. This makes it difficult for them to execute their business
activities effectively within the industry. As a result it becomes difficult for them to survive
longer in the same industry for longer period of time,
Explore different methods by which sales performance of CAMERONIAN CONVENIENT
STORE can be raised?
As per the perception presented by Turolla, (2016), it has be analysed that sales
performance of the company mainly depicts that how effectively they are working within the
industry and in which manner its customers are perceiving it. This simply provides an overview
of respective companies’ sustainability at marketplace in effective manner. This directly demand
for business belonging retail sector to adopt several ways or methods that helps them out in
increasing their sales performance in effective manner within less period of time. Some of the
main methods among them are described below:
Discounts: It is seen as the effective way which directly influences interest of customers
towards them as they are getting more quantity within the same price range or it can be said that
it saves their proportion of amount at the time of making same purchase in effective manner.
This works as the influencing factor for retail industry as customers belonging to the specific
industry consumes its offering at regular basis (Blake and et. al. (2018). Discount provided to
customers will influence them to enhance their purchase from the same store so that they can
attain higher benefits in terms of discounts.
Loyalty benefits: Loyalty benefits are generally provided to its customers on the basis of
past record of purchasing made from the similar company or store. In context of convenience
store, it can be said that the store dealing in this field are required to provide certain range of
bonus or loyalty points to its customers which are gained by them with their every purchase.
These generated points can be redeemed by the same customers in the near future while making
purchase from the same store (Christophers, 2015). Loyalty benefits are seen as additional
benefits provided to customers apart from the discounts that are provided to every customers.

These benefits are generally given to increase loyalty of customers towards the same store and
also influence them to make purchase from the same for longer period of time.
24*7 delivery at home services: Dairy products are seen as the main consumables are
used by individuals 24*7. In order to increase its sales performance, it is essential for the retail
industry to provide effective services to customers. This simply means that it is required by
convenience store to offer high quality of products to customer all 24*7 and also provide them
home delivery services for the same provided time so that their requirement can get fulfilled
effectively (Aguirregabiria and Suzuki, 2016). Effectiveness in these services directly attracts its
customers towards the particular store or company offering products as they are getting higher
quality of products at their home all time.
Adopt effective promotional techniques: It is considered as the traditional method of
influencing sales performance of the company. The main belief behind initiating this method was
to aware customers about the company as well as its products offering because if they will not
promote their products among customers then these people will not be having any kind of idea
about products or services and their speciality as well. As a result, these customers will not be
able to make purchase from the same sector (Yan, Bastian and Griffin, 2015). Thus, it is required
by business enterprises belonging to retail industry is to acquire right promotional technique like
social media that is cost effective to them as well as makes it easier for them to communicate to
their targeted customers. This will ultimately result in the higher increase in sales performance of
the company in effective manner.
Soft communication skill: In order to influence interest of customers, it is essential for
manager of the respective convenient store to use soft and polite communication skill at the store
while having communication with the customers. This soft speaking skill will directly develop
their positive relationship with the customers. As a result, it will influence these customers to get
loyal to the respective store for longer period of time. Also, it will boost up their sales in the
positive manner.
Increase its number of offering: Business manager of CAMERONIAN CONVENIENT
STORE are required to increase the number of products which are offered to customers. It is
highly important for them to add on some of the popular smaller products as per the requirements
of the customers. They must add new flavours in drinks, candies, etc. which will directly grab
attention of customers and also provide support in boosting up its sales performance.

How increase in sales performance of CAMERONIAN CONVENIENT STORE can result
in the attainment of competitive edge?
According to the view point of Lubis and Palibutan, 2018), gaining competitive edge within
the industry is the preliminary aim of every small as well as large scale organization. In order to
attain competitive edge, it is essential business manager of small convenience store owners
belonging to retail sector in increase their sales performance at regular basis so that they can
easily attain competitive edge in rightful manner. On the basis of perception presented by
Paynter and et. al. (2016), it can be said that increasing sales performance of any company
simply means that they are working effectively and their customers are providing them value and
choosing them for making purchase in comparison of their competitors. This directly depicts that
customers are considering best among all the retail companies belonging to that small retail
sector as they are providing good quality of products to them at feasible prices. Constantly
increasing sales performance of company helps company in generating more revenue from the
same market area in comparative to its customers which ultimately results in gain of competitive
edge as they are perceived by customers in terms of their favorites among rivalry companies.
What are measures can be taken by manager of CAMERONIAN CONVENIENT STORE
to retain its existing customers and attracting new ones towards themselves?
On the basis of views given by Collins and et. al. (2015), It can be said that business
managers are required to take several initiatives in order to develop their understanding over the
customers. For attaining this competitive edge manager or business operator of business
enterprises emphasizes on taking several initiatives and measures by which they can easily
enhance their sales performance and attain competitive edge effectively (Wrigley and et. al.
2019). With reference to convenience store, it can be said that business manager of small
departmental stores mainly focuses on improving their sales performance at marketplace by
influencing interest of its customers so that they can gain competitive edge and enhance their
sustainability at marketplace in rightful manner. As per the Hood, Clarke and Clarke, 2016), the
managers could take feedback from their existing clients in order to check that whether they are
satisfied or not. This feedback also aware manager about the actual perception or behaviour of
customers towards their products. In case customers reveal any misconduct or non effective
services of the store then in this situation they can easily improvise their services according to
the customers’ requirement (Trindade, 2015). For instance: Manager of CAMERONIAN

CONVENIENT STORE provides feedback form to its customer in order to develop their
understanding on the perception of customers towards the respective company. These feedback
will also aware manager about the actual expectation of customers from the company and few
suggestions which these customers wants to give the CAMERONIAN CONVENIENT STORE
so that they can make improvement towards the same. As a result, it supports them in providing
products to customers according to their requirement which will influence sales performance of
the respective convenience store in quicker manner. This will ultimately result in the attainment
of competitive edge by small retail companies belonging to retail industry like CAMERONIAN
CONVENIENT STORE.
CONCLUSION
From the above mentioned report, it has been concluded that sales performance of the
company directly depicts actual performance of the company at marketplace and the way in
which customers perceive it. It has also been identified that if sales performance of the company
is constantly increase in comparison of its competitors that it states that the respective company
is gaining competitive edge in comparison of other companies. Along with this, it has been
observed that feedback is explored as the effective way by which business managers of
convenience store belonging to small scale so that they can easily improvise their performance
by developing its existing offerings according to the requirements of customers. Along with this,
later on it can also be said that feedback aware business managers of convenience store about
their lack areas which are indirectly giving advantages to its competitors. Thus, by taking
feedback small retailers of retail industry can develop their understanding over the customers’
expectation from themselves which can incorporate by them in the near future. This directly
supports them in attaining competitive edge in future. Moreover, the study has also revealed that
business enterprises belonging to retail industry especially from small retailers are required to
adopt effective marketing strategies so that they can effectively influence interest of customers
towards them. Attention of customers directly supports company in improvement of sales
performance as well as quick attainment of competitive edge.

REFERENCES
Books and Journals
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consumers?. Available at SSRN 1878830.
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resource-advantage theory perspective. Journal of Research in Marketing and
Entrepreneurship, 19(1), 26-41.
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Online
Wood, Z., (2017), War of convenience as supermarket chains take on small stores. 2017.
[Online]. Available Through:

<https://www.theguardian.com/business/2017/feb/04/convenience-stores-tesco-booker-
deal>.
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[Online]. Available Through:
<https://www.stuff.co.nz/business/107193424/convenience-stores-face-bleak-future-
unless-they-change-experts-warn>.