Abstract

Over the last couple of decades, many researchers have tried to understand the growing phenomenon of natural and organic foods across the United States. However, few researchers have tried to understand the motives behind a natural and organic grocery retailer locating in certain areas. This research begs to question which factors determine the number and distribution of locations within the natural and organic specialty grocery sub-industry. The theoretical chapter discusses the theory of industrial organization and its various counterpart theories, which include theories of competition, game theory models, price competition, and location theory. The empirical research pulls out information about the Metropolitan Statistical Areas within the United States; including information about the population, market demographics, and household factors that may influence the location decisions of a natural and organic specialty grocery store. The locations used for the natural and organic competitors examined in this study include Whole Foods Market, Trader Joe's, Earth Fare, and The Fresh Market. Using an OLS regression model, the overall model showed to be significant in explaining the factors that contribute to the number of locations. The model indicated that the population size, individuals between the ages 35-44, divorced, with a high school education, commuted to work by walking, median income, and the percentage of the population with vehicles were significant in explaining the number of locations of natural and organic specialty grocery retailers.

Advisor

Verdon, Lisa

Department

Business Economics

Disciplines

Economics

Publication Date

2013

Degree Granted

Bachelor of Arts

Document Type

Senior Independent Study Thesis

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© Copyright 2013 Alexis Donnorummo