Relations between merchandising information orientation, strategic integration and retail performance

Abstract

PurposeThe purpose of this study is to investigate the conditions under which small independent retailers can improve their business performance by adopting a merchandising information orientation and strategically integrating into retailer buying groups.Design/methodology/approachThis study tests hypotheses using a hierarchical multiple regression model and data obtained from 241 supermarket retailers that are existing members of buying groups in Japan.FindingsThe results indicate that merchandising information orientation alone may not be a beneficial strategy for small independent retailers to improve their business performance; however, by combining a merchandising information strategy with strong strategic integration with a buying group, optimal benefits can be achieved.Practical implicationsThe findings highlight the potential benefits small independent retailers can gain from buying groups when pursuing a merchandising information orientation, which may prompt such retailers to actively integrate the policies and activities of the buying group into their business strategy.Originality/valueThe authors conceptualise retailers’ merchandising information in a model that demonstrates the link between a firm’s information strategy and its performance from the perspective of resource-based theory. Thus, this study advances the knowledge of the strategic behaviours of small independent retailers and provides valuable information for buying groups in the retail sector.