AN EMPIRICAL ANALYSIS OF THE EFFECT OF DIVERSIFICATION ON FINANCIAL PERFORMANCE: THE CASE OF THE US GROCERY STORE INDUSTRY

This paper examines the impact of diversification on the financial performance of publicly traded grocery stores. Using three different approaches, we find that diversification has a positive and significant effect on the financial performance of grocery stores. In addition, multivariate regression analysis shows that while diversification positively impacts financial performance, other factors such as size, market share, and leverage cannot be ignored in explaining financial performance of grocery stores. The results of this paper suggest that diversification into non-food products is a profitable business strategy for grocers.


Issue Date:
Jan 01 2014
Publication Type:
Journal Article
ISSN:
0973-1687
Language:
English
Published in:
Review of Applied Economics, Volume 10, Number 1-2
Page range:
69-81
JEL Codes:
L25; L81; C82




 Record created 2017-11-01, last modified 2017-11-01

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