Value Creation Process in the Retail Grocery Chain

Sammanfattning: Introduction: The retail market in the 21st century will be determined on how quickly and efficiently the retailer can respond to shifts in consumer demands. Due to the physical environment of the store (store value) and the interaction with the consumer (shopping trip value), the local retail store has the advantage of generating this tangible and intangible information. It is then of importance that this information will be transferred towards the retailer, who has the opportunity to use this information and generate it into outputs that can be used as negoitables; this value creation process is an unique success indicator for creating a value network within retail supply chain. Purpose: The aim of this research is to present an understanding on the value creation process in the grocery retail chain. Methodology: Having an inductive nature, this thesis tried to bring a new understanding on value creation in grocery retail business, by using hermeneutics as a methodology approach. For empirical study, the qualitative approach was used. Data was collected through open-ended interviews with representatives in grocery retail chains. Conclusion: The main players in the value network were determined in a grocery retail chain as retailer, local retail store and other stores in the chain; and the suppliers. An intensive value exchange between the retail store and the retailer was found and following that, it was concluded that the retailer converts the value input from the local retail store into tangible and intangible value outputs towards suppliers. Combining the conclusions, the research defines that a value network is existing, but on a very low level. But more to the point, the study shows the importance of value creation by the retail chain, and that creating the possibility to share information about products, in-store experience, consumer knowledge, and consumer requirements is one of the biggest advantage the grocery retail chain has to develop this value network further.