The Impact of Competition, Product Prices and Quality on Choice and Supermarket Performance in
North Cyprus: A Comparative Study of Lemar and Kiler Supermarkets.
Authors: Nothando Moyo, Mustafa Avcin, kovand Anwar, Zothile Moyo
Faculty of Economics and Administrative Sciences
Cyprus International University
PhD Researchers
Email: nmoyo@ciu.edu.tr, mavcin@hotmail.com.
zothilemoyo@gmail.com, kofand_anwar@hotmail.com
Abstract
This study compares the role played by competition in the differentiation of the quality of product assortments
presented and the determination of product prices in retail markets in Northern Cyprus. The non-homogenous
offerings across supermarkets in the city of Lefkosa illustrate the interaction between competitive strategy and
consumer behavior. This relationship serves as a framework for measuring retailers’ market share; that is, either
their ability to dominate in the market or prevail in a market equilibrium. Our approach questions how market
power influences price efficiency and quality adjustment.
Keywords:
Product price, Product Quality, Competition, Choice, Lemar Supermarket, Kiler Supermarket,
North Cyprus
Introduction
The aspect of supermarket choice is one that holds relevance and importance in the retail world (Hutcheson &
Moutinho, 2010). As manufacturers come up with various products, they have to consider a variety of factors
that would encourage consumers to purchase their product. Aspects that affect consumer decision making
investigated in the research are product price, which serves to assist a company to determine what they will
receive in exchange for their products, after having considered all the relevant costs factored into making the
product. Product quality is another aspect of supermarket choice investigated in the research that refers to a
perceptual, conditional and somewhat subjective attribute which may be understood differently by different
people (Griva and Vettas, 2011). These attributes and perceptions on product quality are investigated to
determine how much they also influence consumer choice. Competition in the market place has some bearing in
influencing the manufacturer on product price and quality, however, the degree to which this affects supermarket
choice is yet to be determined. The combination of the play of the three noted aspects that affect a consumers
choice, competition, product price and quality has a relevant bearing on the consumer, the degree of the
persuasion power of either or all of these aspects will be established in the research.
Literature Review
Product price
Pricing is the process of determining what a company will receive in exchange for its products. Pricing factors
are manufacturing cost, market place, competition, market condition, and quality of product (McGuigan et al,
2011). Pricing is also a key variable in microeconomic price allocation theory. Pricing is a fundamental aspect of
financial modeling and is one of the four Ps of the marketing mix. The other three aspects are product,
promotion, and place. Price is the only revenue generating element amongst the four Ps, the rest being cost
centers (McGuigan et al, 2011). Research by Gilmore (1999) and Koskinen (1999) has, constantly, defined that
customers value highly the price, choice, quality and convenience provided by supermarkets (as stated by
Chiliya et al., 2009: 73). The policy of the price variation represents supermarkets price position, which could be
ranged from stable pricing, providing price discounts, to a high promotional pricing, featuring common price
discounts. The promotion of price and price variation is a set of pricing and promotional decisions making
planned to connect a price position to customers and the impact of short term period of the responses for sales
overall market performance according to Lal & Rao (1997), (as stated by Chiliya et al., 2009: 72).. Price
promotion advertising capacity is the advertising volume dedicated to communicating the position of the price.
The retailers could elect to advertise prices that promote a reasonable price position or the events of sale which
give emphasis to price discounts. The policy of pricing that is desirable by consumers could motivate repeat
purchases and eventually maximize the profits. Pricing involves asking many questions like:




How much to charge for a product or service? This question is a typical starting point for discussions
about pricing.
What are the pricing objectives?
Do we use profit maximization pricing?
How to set the price?: (fixed pricing, cost-plus pricing, demand-based or value-based pricing, rate of
return pricing, or competitor indexing) (Smith, 2002:48)
According to Cobb and Hoyer (1986), (as stated by Huang & Chen, 2013: 425), most of supermarket in store
factors have limited influence on planned purchasers while supermarket in store factors have significant
influence on impulse customers. Huang & Chen (2013) found out that there is an important link between
customer purchase behavior and whether they have planned a purchase in advance or not. Regarding
characteristics of impacting purchase, previous researchers found that the category of products have huge impact
on consumer purchase behavior and impulse purchases are very high in some category of products, for example,
for jewellery and fashion product it could be up to 62% of impulse purchase, in some category of products like
pharmaceuticals there is a low percentage of impulse purchase. Huang & Chen (2013) determined main reasons
of impulse purchase for instance low prices, the potential mandate for the product, big-scale distribution, selfservice, excellent advertising, in supermarkets and other stores display etc. Ceribeli and Merlo (2012), have
illustrated that there is an aspect of reference pricing which refers to the product price of last purchase, customers
sometimes make decision of brands by the reference price, based on the impact of the reference price, and
customer choice presents loss aversion. Researchers like Barone et al (2000: 250), state that reference price
consists of two classes, namely, the internal reference price and the external reference price. Internal reference
price is mostly determined from memory and purchasing experience of customers. For instance, an internal
reference price forms once a customer think of the last price. External reference price mostly results from
external environmental price incentives, for example the elected highest and lowest price of the products on the
shelves, these prices together establishes the external reference price.
Researchers have different ideas and opinions regarding whether internal reference price or external reference
price has more critical role in shopper purchasing. Barone et al (2000) clarifies that the external reference price
has more significant role than internal reference price. Huang and Chen (2013) proposed that both internal and
external reference prices have impact; strength of each one is different for different market segments. Some
customers are more sensitive to internal reference price, though others are more sensitive to external reference
price.
Ceribeli and Merlo (2012), agreed that the customer purchase process contains of numerous stages that precede
the purchase itself, being essential to recognize each of them. These researchers proposed different models to
clarify the process of consumer purchase. Based on the model of customer purchase process by Wells and
Prensky (1996), (as stated by Ceribeli & Merlo, 2012: 8710), the first step starts with the definition the problem
by the customer/individual as a need or an unsatisfied desire. In the second stage, the customer/individual
observes the problem that is the customer/individual starts a search for more information in the marketplace
regarding of the other choices customer/individual could use to solve the problem. In the third stage, after
looking at more information regarding available choices, the customer/individual achieves an analysis of its
replacements, using the information which has been gathered in second stage. Finally, in the last stage of the
model of Wells and Prensky (1996), the customer selects which product to purchase, where and when to make
the purchase. Baltas et al (2010), states that most customers understand their purchases in more than one retail
supermarket, though, they frequently select a main store, where they can find and purchase most of their
important products. The decision behind shopping from one supermarket reflects customer resistance to abandon
his connection in relation to a major supermarket, as this connection carries economic and cognitive benefits,
related to the decrease of the effort required in order to be able to meet specifications of new stores, for example
customer service layout, low price and assortment (Baltas et al, 2010: 42). Barone et al (2000), state that the
price of product refers to the amount of money given in exchange for goods and services, and is connected to the
features external to the supermarket and to the sensitivity of customers. They continue to state that consumers
choose retailers whose prices are perceived as fairest. According to Chiliya et al (2009: 73), a well chosen price
should do three things:



achieve the financial goals of the company (e.g., profitability)
fit the realities of the marketplace (Will customers buy at that price?)
support a product's positioning and be consistent with the other variables in the marketing mix
Barone et al (2000), underline that the level of price are set by supermarkets. Retailers create important
influence on supermarket’s demand, and Huang and Chen (2013) explain that supermarkets should take into
consideration some pointers linked to the customers to grow one successful pricing policy, for example the
degree and sort of customer needs, the actual effort and spending power of customers, as well as the value added
by the company from the point of view of the customer.
Product Quality
Quality in business, engineering and manufacturing has a pragmatic interpretation as the non-inferiority or
superiority of something; it is also defined as fitness for purpose. Quality is a perceptual, conditional and
somewhat subjective attribute and may be understood differently by different people (Ceribeli & Merlo, 2012:
8714). Consumers may focus on the specification quality of a product/service, or how it compares to competitors
in the marketplace. Producers might measure the conformance quality, or degree to which the product/service
was produced correctly. Support personnel may measure quality in the degree that a product is reliable,
maintainable, or sustainable. In a simple definition, a quality item (an item that has quality) has the ability to
perform satisfactorily in service and is suitable for its intended purpose.
There are five aspects of quality (Smith, 2002: 102) in a business context:
1.
Producing - providing something.
2.
3.
4.
5.
Checking - confirming that something has been done correctly.
Quality Control - controlling a process to ensure that the outcomes are predictable.
Quality Management – directing an organization so that it optimizes its performance through analysis
and improvement.
Quality Assurance – obtaining confidence that a product or service will be satisfactory. (Normally
performed by a purchaser)
One view related with quality is that it is based upon the end user`s evaluation of his or her entire customer
experience. The customer experience is defined as the aggregate of all the interactions that customers have with
the company's products and services. For example, any time one buys a product, one forms an impression based
on how it was sold, delivered, performed and how well it was supported etc (Chiliya et al, 2009). It has been
mentioned that the state that the quality of products sold by retailers is the main point that rates attention,
because consumers are searching for companies with the high quality of products with the assortment of
products and brands available being a key standard in assessment of a specific store (Huang & Chen, 2013).
Consumers desire retailers that compromise a wide variety of products in its assortment, containing newly
launched products in the market (Barone et al, 2000). McGoldrick (2002), (as stated by Ceribeli & Merlo, 2012:
8712) investigating the construct assortment, he came up with the need for retailers to stay in the sales area high
quality products, warrants a good assessment from customers. Thus verification is needed to ascertain that the
assortment of products in retail is evaluated by customers based on the following criteria: variety of products and
brands, newly products availability, quality and freshness of products sold. Barone et al (2000), state that the
retailer would be able to stimulate trust in their consumers, emerging on ethical behavior that is reliable with the
message communicated to the market or, in other words, the retailer should fulfill what it promised, guaranteeing
consistency and the quality of its brand. Carpenter and Moore (2006), (as stated by Huang & Chen, 2013: 426),
highlight that retailers should use the media in order to be able to project an established brand in the market,
what can be done using, among other resources, promotional events at the same time recommending that
consumers select to purchase from retailers whose brand is known and traditional in the market.
Competition
In many economies, the structure of the supermarket industry is extremely concentrated. This is typical in the
North Cyprus retail market. Under scrutiny based on competition theory, this concentration can be described as a
domination of large supermarkets taking advantage of market power through multiple store operations. These
chain stores enjoy large profit margins dependent on consumer choice. In light of the consumer choice variable it
becomes imperative to analyze the competitive strategies employed by different dominant supermarket chains in
securing consumer loyalty (Berges-Sennou et al, 2007: 3). It is widely accepted that retailers offer a variety of
products of comparable quality and price in-order to secure consumer welfare. This assumption is based on the
economic theory that supermarkets are differentiated vertically and horizontally. The vertical dimension is
indicative of discrimination in the quality of goods offered, assuming that higher quality appeals to customers.
The horizontal dimension focuses on price disparities suggesting that consumers are attracted to low priced or
comparatively priced products of desirable quality (Kamakura & Moon, 2008:192).
In a situation where each supermarket offers a variety of products, consumers are tasked with choosing the best
alternative available subject to price and quality attributes. Retailers, therefore, require flexibility in their
competitive strategy such that products are offered at the lowest price at the desired quality level (Januszewski et
al, 2002). Baltas (1997), states that despite the attraction to price advantages, consumers remain quality
conscious and, therefore, search for bargains with a good quality/price ratio (as stated by Berges-Sennou et al,
2007). A common practice in competitive strategies employed by retailers is advertising. Advertising promotes
price efficiency and attracts a large customer base by setting low prices for common products and brands. The
higher quality- high priced brands of low availability become the profit makers. Investment in high-priced, low
availability goods raises the reputation of the store according to consumer perception, which increases the
propensity of consumer utility (Januszewski et al, 2002: 12).
This idea is in tandem with Jones and Hudson’s (1994: 258) discussion on price and quality of products
demanded in a competitive market. According to these academicians, consumer’s perception of quality is rarely
excluded from price; one is dependent on the other. They highlight that high prices in most situations presume
high quality of products and a good reputation for the supplier in his/her provision of such goods neglected by
competing retailers. Consumers are predicted to associate these prices of the products offered with quality, brand
name and shop name (Berges-Sennou et al, 2007). A positive review would create consumer network
recommendations which in turn increase competitive edge and market share for the providing retailer. On the
other hand, stores that gain competitive advantage through discounts and price reductions are presumed to
eliminate the high quality factor and gain market share through high volume sales. These arguments present the
importance of competition and consumer behavior theory which extensively incorporate consumer perceptions
(Jones & Hudson, 1994: 264).
The value generated by consumer network recommendations depends on the number of product users for each
store. Competition amongst supermarkets is, therefore, focused on maximizing the number of users attracted to
each chain store. In a given product-specific market, the retailer’s market share is reliant on consumer utility.
The relationship, as depicted by Griva and Vettas (2010:88) is cyclical. Supermarkets compete to gain large
profit margins and capture a competitive stake in the market. A retailer’s strategy will incorporate product
differentiation horizontally and vertically with emphasis placed on consumer expectation. A good competitive
strategy anticipates consumer expectations and perceptions (Kamakura & Moon, 2008: 195). The products
offered to consumers are viewed by users with respect to their specific attributes such as location, variety,
quality, price and brand name. The comparisons made by users and the subsequent choice of product and store
depict the consumer’s satisfaction and overall welfare and predict future commitment to the store and product.
This development and level of consumer satisfaction, loyalty and commitment serves as a measure of the success
or failure of the supermarket’s competitive strategy. Upon evaluation, these strategies may need to be adjusted
commensurately (Griva & Vettas, 2010: 94). Griva and Vettas (2010), continue to question cases in which
consumer expectations are not influenced by price and quality provided in different stores. Such markets suggest
low competition amongst stores, equal quality and weak consumer network recommendations. The query that
stands is whether the stores would exist in market equilibrium or whether the domination of low quality- lowest
price stores would emerge. Would this be a threshold where the most active or most conveniently located store
captures the larger market share regardless of a lack of competitive strategy? According to Kamakura and Moon
(2008), this would be an appropriate case to apply an extended view of quality. In recent economic theory,
quality is defined to include quality of customer service and is not restricted to product quality. Services
provided in supermarkets has gained importance in empirical study including availability of products, product
popularity, convenience in store location, short queues at check-out points, friendly customer representatives,
and so forth.
This aspect of supermarket behavior is a key element in modern competitive strategy. The adoption of improved
customer service strategies and formats improves consumer welfare. By treating customer service as an explicit
output of supermarket behavior, an avenue is created for assessing quality as a determinant of consumer demand
and loyalty. Ultimately, competition invariably influences retail pricing and quality. The competition becomes
based on high price versus low price, high service quality versus low service quality, and high product quality
versus low product quality (Kamakura and Moon, 2008: 194)
Theory developed by Becker (1965) and Lancaster (1966) as cited in Tomat (2005: 54) posits that changes in the
consumption possibilities of consumers, as per the consumer choice problem, was defined based on product
characteristics. This behavior has been used to study industry competition and can be applied to the supermarket
retail industry. The implications according to Griliches (1971), of product differentiation through quality
adjustment and price determination were initially described to estimate the parameters of consumer preferences
(as stated by Tomat, 2005: 61). Quality adjustment and price determination in this analysis were shown to also
depend on the performance characteristics of all other substitute and rival products in the market. This study
showed that industry competition corresponded with patterns in quality and price change, conforming to the
properties implied by the theory (Tomat, 2005:66).
Choice
Choice is regarded as the act of choosing between two or more possibilities (Hutcheson & Moutinho, 2010).
When people do their shopping they exercise their right of choice in picking the store to the product or service
they are willing to pay for. In micro economics, there is a theory of consumer choice which relates to the
individuals different tastes and preferences for goods and services, which in turn affects how much they will be
willing to pay for that product or service (Hutcheson & Moutinho, 2010: 706). The consumer choice theory is a
tool used to assess how consumers may achieve a balance between their preferences and their expenditure
(Ceribeli & Melo, 2012: 8711). The consumer choice theory focuses mostly on the utility of the product or
service paid for, which is fundamentally the satisfaction the customer has derived from consuming the good or
service. This links the consumer choice theory to the utility theory which however, has been criticized that it
cannot be measured objectively (Ceribeli & Melo 2012: 8713). The criticism of the utility theory is mainly due
to the argument it presents of the consumer as a rational consumer, which is someone who will spend their
income in a way that will maximize their total satisfaction from the goods or service they have paid for. The
choice of consumers is determined by what has been termed the consumer equilibrium which is achieved when
the consumer purchases the combination that gives him the highest level of satisfaction, given their income and
the prices of the goods.
LEMAR SUPERMARKET
Lemar is a supermarket chain that was established in 1997 by opening its new store first in Famagusta Cyprus.
Currently has stores in all cities in Cyprus and has multiple locations at each city. It has stores in Famagusta,
Nicosia, Morphou and Iskele and developed as the number one in grocery and general shopping.
Lemar’s priority is to provide good value for money pricing, product diversity, customer satisfaction and above
all value all customers’ needs and expectations which led to its rapid expansion within the supermarket industry.
Its main suppliers are those companies under the roof of Levent Group of Companies and some local producers
in Cyprus especially fresh vegetables and groceries and also import goods in order to face the demand from its
customers. In all stores provide variety and quality products with sections for freshly produced products such as
baked products and gifts, clothing, footwear and toys. Lemar has nearly 55000 different products. In every store
they have a restaurant that serves freshly cooked food, snacks, cold and hot drinks. Also they strive to be the
number one in the industry aiming to implement new projects in order to adapt to the customer needs and
expectations. In five cities near the stores they also built Cineplex (Cinemas) for customer to entertain
themselves before and after their shopping.
Lemar Nicosia
The Locations of Lemar in all five cities.
Kyrenia Lemar Çatalköy, Lemar Karakum, Lemar Karaoğlanoğlu
Morphou Lemar Morphou, Lemar Kalkanlı (METU Campus)
İskele Lemar İskele
Nicosia Lemar Haspolat (CIU Campus), Lemar Küçük Kaymaklı, Lemar Metehan, Lemar City Center
Famagusta Lemar Famagusta, Lemar Sakarya
KILER SUPERMARKET
Kiler is a supermarket chain that has stores in Nicosia, Kyrenia and Gonyeli. Similar to Lemar, they provide
variety of products to their customers. In their stores they serve fresh greengrocery, freshly baked and also
cooked hot food. Their aim is to strive for further success and expansion. They have recently opened their big
store in Gonyeli that have attracted many customers from all over Cyprus because they have friendly, fast
personnel with excellent customer service.
Kiler Gonyeli
Kiler also have built in restaurants and cafes in their stores. The only difference with its rival company Lemar is
that, they do not provide any entertainment facility such as Cineplex. Kiler first was established in 1998 as a
small greengrocer shop in the town of Yenikent, Nicosia. Now they have many supermarket stores in Nicosia
and Gonyeli. Their aim is to provide the best customer service for their customers and plan to implement new
project in the future such as building entertainment facilities and expand to other cities in Cyprus other than
Nicosia and Gonyeli.
The Locations of Kiler in all four cities.
Nicosia Kiler Yenikent 1, Kiler Gonyeli 1 and Kiler Gonyeli 2 Main.
North Cyprus
Northern Cyprus (or North Cyprus), officially the Turkish Republic of Northern Cyprus (TRNC; Turkish: Kuzey
Kıbrıs Türk Cumhuriyeti), is a self-declared state that comprises the north-eastern part of the Cyprus Island.
Northern Cyprus is considered by the international community as occupied territory of the Republic of Turkey.
Liberal economic system has been adopted in the Turkish Republic of Northern Cyprus. Under this system the
promotion of the private sector with limited government intervention, the rational use of natural resources, the
encouragement of investments that generate high value added and employment preserve their priority and
importance (Cyprus 44, 2012: 1).
North Cyprus is a small island that has massive growth potential with a lot of foreign investors wanting to enter
the market. The variety and increase in players in the retail market provides consumers with a large base from
which their choice on products available on the market is enlarged on a daily basis.
Research Purpose and Model
The main purpose of this study is to model and measure the impact and perceived importance of competition,
product price and quality in influencing the consumer`s supermarket choice and how this relates to the customers
satisfaction level increasing and as a result increasing that supermarket` s performance in the long run. The
specific hypotheses of the study are as follows:
H1:
Supermarket choice is positively related to competition and supermarket performance.
H2:
Product price and quality has a positive impact on supermarket choice.
H3:
Quality has a significant impact on consumer buying behavior.
H4:
Quality has a significant relationship with consumer supermarket choice
H5:
Increases in consumers’ choices will be associated with the intense competition in the
market that leads to increase supermarket performance.
Competitive markets provide competitive prices, more choices and better quality products for
consumers. Therefore, competition will have a positive impact on the supermarkets performance via
price, quality and choice.
H6:
H7:
A supermarket that provides products with good value for money (better prices) in a competitive market
will experience an increase in supermarket performance compared to their competitors.
Figure 1, shows a tentative model of choice criteria hypothesized to be important for supermarket selection as
well as the preferred store. In this model the data that is measured are the variables that influence supermarket
choice these being Product quantity, price and Competition.
Product
Quality
Product
Price
Competition
Lemar
Supermarket
Choice
Preferred
store
Kiler
Figure 1: Proposed Model of the Relationship between Product Quality, Price and Competition with
Supermarket choice.
From the model, it can be seen that the variables representing supermarket choice criteria are general and can
relate to any supermarket in general. However, the assessment of supermarket choice then becomes specific as it
will relate to individual supermarkets this being the preferred store would be seen from the study. In essence, the
supermarket choice then serves as the mediating factor between the supermarket choice criteria and the preferred
store.
Methodology
Sampling
The research was carried out on two supermarkets from North Cyprus, these being Lemar and Kiler
supermarkets. As North Cyprus is a small island people were randomly selected to take part in the survey
through completing questionnaires. A total of 101 questionnaires were completed.
Instrument for measuring (scales)
In order to examine the aspect of supermarket choice, researcher made use of an earlier similar study carried out
by Hutcheson and Moutinho (2010) whereby they were investigating the measuring of preferred store
satisfaction using consumer choice criteria as a mediating factor. The current study deals with supermarket
choice and a number of choice criteria to investigate were identified as competition, price and quality. The
respondents were asked to rate how important they perceived each item on five point ordered scales. The scale
used was modified to suit the current research in terms of adding current supermarket names relevant to this
study. The scale for choice was measured on a five point ordered scale with possible answers ranging from not
important to important. The scales for competition, price and quality were measured as well on a five point
ordered scale which however gave possible answers ranging from strongly disagree to strongly agree.
Analysis
The analysis for this research made use of descriptive statistics to assess the frequency of the scale used, then all
scales were tested using the scale reliability and factor analysis test to assess the suitability of the scales used in
the study at the same time to confirm that the scales would provide a good outcome, and this scale though
commonly used has an acceptable level of reliability and performs with validity in the study. However the
important part of the analysis was done using the regression linear least square analysis method- using 2 variable
case method to find out a linear relationship between the dependent and independent variables. The
unstandardized and standardized beta coefficient values were used in order to measure the dependent variable of
supermarket choice. This study made use of the variance of R to assess the variations between the dependent and
independent variables. The regression analysis was used to examine the effect of competition, price and quality
on supermarket choice and the supermarkets performance. SPSS version 20.0 was used for all analyses.
Data and Results
The scale reliability test was done to assess the validity of the scale to the research. The varimax rotated,
principle component analysis is utilized in this analysis. The value survey
(five-item Likert scale) has above
0.700 Cronbach alpha as reliability in this research as seen below. The scale value of above 0.5 or higher is
considered.
Variable
Choice
Competition
Price
Quality Lemar
Quality Kiler
Component
1
2
3
4
5
6
7
1
1
1
2
1
Scale Reliability
Cronbach Alpha
# of Items
0.760
22
0.949
0.963
0.923
9
11
15
0.962
15
Factor Analysis
Extraction % of
Total
Variance
4.777
21.712
2.705
12.294
1.752
7.694
1.484
6.748
1.337
6.079
1.241
5.639
1.122
5.098
6.379
70.883
8.038
73.071
7.596
50.638
1.403
9.353
9.812
65.415
%
Cumulative
21.712
34.006
41.970
48.717
54.796
60.435
65.534
70.883
73.071
50.638
59.991
65.415
The factor analysis results agreed with the results of the scale reliability assessment as the results revealed that
the factors were usable and had good ratings. Extractions were retrieved using the extraction sum of squared
loadings, all the variables had percentages greater than 50% indicative that the factors and scale used in the
analysis were good at the same time are suitable for the regression analysis that was used for further analysis of
the hypotheses.
Regression Analysis for our model
Product
Quality
Product
Price
Lemar
Supermarket
Choice
Preferred
store
Least Squares
Competition
Kiler
2 variable cases
A linear relationship is expected to exist between variables x and y.
E.g. choice and competition
y is choice and β is competition
y
×
The estimated relationship is
Solving the equation gives the estimators
We would like our estimators to have as low a variance as possible – low variance implies higher accuracy.
Analysis of Variance
One very basic measure of Goodness of fit is R Square. This is defined roughly as the proportion of data that is
in the explained part of the regression rather than the residual (unexplained) part. This is found by the following
equation.
R Square lies between 0 and 1 and indicates the proportion of the variation in y that has been explained in the
regression.
y
×
Regression
H1: Supermarket choice is positively related to competition and supermarket performance.
H5: Increases in consumers’ choices will be associated with the intense competition in the
market
that leads to increase supermarket performance.
H6:
Competitive markets provide competitive prices, more choices and better quality products for
consumers. Therefore, competition will have a positive impact on the supermarkets performance via
price, quality and choice.
Table 1
ANOVAa
Model
1
Regression
Sum of Squares
15,204
df
9
Mean Square
1,689
F
Sig.
1,196
,307b
Residual
128,499
91
1,412
Total
143,703
100
a. Dependent Variable: Choice
b. Predictors: (Constant), moreentertainmentfacilitiesatlemarthankiler, betterinformationonnutritionalproductsatlemarthankiler,
lemarbettereuipedinprovidingcouponsthankiler, lemarprovidingquickerservicethankiler, provisionofownbrandsbetteratlemarthankiler,
betterparkingfacilitiesatlemarthankiler, lemarbetteratmeetingcustomerneedsthankiler,
lemarsalesrepsbetteratpreparingproductsofchoice, lemarhasgoodandfriendlycustomerservicethankiler
The mean squares indicate that the null hypothesis has been rejected and therefore H1 the dependent variable
choice is positively related to competition is confirmed. The F value is 1196 and the value of p is above 0.05
confirming the H1; H5 and H6 partially for choice and firm performance. Later the impact of competition on
price and quality will be tested accordingly.
Table 2
Coefficientsa
Model
Unstandardized Coefficients
B
(Constant)
lemarprovidingquickerservicethan
kiler
lemarhasgoodandfriendlycustomer
servicethankiler
betterinformationonnutritionalpro
ductsatlemarthankiler
Lemarsalesrepsbetteratpreparingpr
oductsofchoice
1
Lemarbettereuipedinprovidingcou
ponsthankiler
provisionofownbrandsbetteratlem
arthankiler
betterparkingfacilitiesatlemarthan
kiler
lemarbetteratmeetingcustomernee
dsthankiler
moreentertainmentfacilitiesatlema
rthankiler
a. Dependent Variable: Choice
Standardized
Coefficients
Std. Error
2,980
,411
,021
,160
,089
t
Sig.
Beta
7,249
,000
,024
,132
,895
,203
,094
,438
,662
-,113
,154
-,117
-,739
,462
,090
,189
,094
,473
,638
,076
,148
,078
,509
,612
,078
,140
,086
,557
,579
,274
,156
,293
1,759
,082
-,354
,170
-,353
-2,078
,041
,007
,171
,008
,044
,965
Table 3
Model Summaryb
Model
R
R Square
Adjusted R Square
Std. Error of the Estimate
1
,325a
,106
,017
1,18831
a. Predictors: (Constant), moreentertainmentfacilitiesatlemarthankiler, betterinformationonnutritionalproductsatlemarthankiler,
lemarbettereuipedinprovidingcouponsthankiler, lemarprovidingquickerservicethankiler, provisionofownbrandsbetteratlemarthankiler,
betterparkingfacilitiesatlemarthankiler, lemarbetteratmeetingcustomerneedsthankiler, lemarsalesrepsbetteratpreparingproductsofchoice,
lemarhasgoodandfriendlycustomerservicethankiler
b. Dependent Variable: Choice and firm performance
In relation to R square the strength of the regression model in explaining the variation between choice and
competition is by 10.6% which is not strong but is positively insignificant. The correlation coefficient value is
0.325 (Sum of all Betas) which is same as the standardized coefficients Beta value.
Using the table 2 looking at the standardized beta coefficients value it will construct the model estimation for
choice therefore the model estimation will be as follow:
Choice and firm performance = 2980 + 0.158 × competition and if competition increases it will positively
increase choice and firm performance. If competition increased by twice as much then, choice and firm
performance will be predicted as (2 × 0.158 + 2980).
Therefore, H1 and H5 are confirmed because the Beta value of competition is positive.
Figure 1: Normal P-P Plot of regression Standardized Residuals
Dependent variable : Choice and firm performance.
Figure 2: Scatterplot
Dependent variable: Choice and firm performance
Testing the following Hypothesis
H2:
Product price and quality has a positive impact on supermarket choice.
H3:
Quality has a significant impact on consumer buying behavior.
H4:
Quality has a significant relationship with consumer supermarket choice
Regression
Table 4
Model
Sum of Squares
39,555
104,148
143,703
df
ANOVAa
Mean Square
26
1,521
74
1,407
100
F
Sig.
Regression
1,081
,385b
1
Residual
Total
a. Dependent Variable: Choice
b. Predictors: (Constant), ratelemarasbestsupermarketinnorthcyprus, lemarisconvenienttouse, risingfoodpricesaffectingchoiceoffoodpurchases,
returngoodsboughtfromlemaroften, loyaltolemarandrecommendit, lemarprovidesthebestproducts, lemarsellsfamiliarbrands,
confidentofqualityofproductsatlemar, produceatlemarfreshandclean, lemarmaintainsbestdailypricethankiler, shopatlemaroften,
lemarsupermarketisattractive, prefershoppingtolemarthanothersupermarkets, lemarprovidesavarietyofproducts,
lemarhasthebestcustomerservice, lemarprovidessecurityforconsumers, lemarlowpricingonfrontpageofpromotionsunlikekiler,
lemarhasbetterpricestrategythankiler, lemarprovidesuniqueproductsthanotherstores, lemarinformationonpriceclearthankiler,
lemarofferslowerpricesonhouseholdessentialsthankiler, lemarusesrebatesbetteroptionthanforkiler,
lemarsinvoicesreflectpriceoftheproductbetterthankiler, lemaroffersmorediscountsthankiler, lemaroffersmorepromotionalpricesthankiler,
lemarconsistentinprovidingvalueformoneythankiler
The mean squares indicate that the null hypothesis has been rejected and therefore H2 and H3 the dependent
variable choice is positively related to price, is confirmed. The F value is 1081 and the value of p is above 0.05
confirming H2
Table 5
Coefficientsa
Model
Unstandardized
Coefficients
B
Std.
Error
(Constant)
lemarinformationonpriceclearthankiler
lemarlowpricingonfrontpageofpromotionsunlikekiler
3,446
,697
,128
,197
St.Coet.
t
Sig.
Beta
4,947
,000
,132
,647
,520
-,100
,199
-,101
-,501
,618
lemaroffersmorepromotionalpricesthankiler
,010
,223
,010
,044
,965
lemarconsistentinprovidingvalueformoneythankiler
,433
,238
,464
1,819
,073
lemarmaintainsbestdailypricethankiler
-,173
,191
-,184
-,906
,368
lemarofferslowerpricesonhouseholdessentialsthankiler
-,060
,200
-,067
-,302
,763
risingfoodpricesaffectingchoiceoffoodpurchases
-,251
,163
-,249
-1,542
,127
,212
,211
,222
1,006
,318
lemarhasbetterpricestrategythankiler
-,226
,228
-,243
-,991
,325
lemaroffersmorediscountsthankiler
,058
,218
,063
,265
,792
lemarusesrebatesbetteroptionthanforkiler
,220
,212
,228
1,038
,303
lemarsinvoicesreflectpriceoftheproductbetterthankiler
1
lemarsupermarketisattractive
,010
,224
,008
,045
,964
-,214
,227
-,172
-,945
,347
,013
,214
,011
,063
,950
-,245
,185
-,223
-1,322
,190
,153
,187
,143
,821
,414
-,289
,234
-,247
-1,237
,220
lemarprovidesavarietyofproducts
,274
,192
,241
1,424
,159
produceatlemarfreshandclean
,115
,199
,100
,579
,564
-,013
,204
-,010
-,063
,950
prefershoppingtolemarthanothersupermarkets
,171
,178
,151
,960
,340
shopatlemaroften
,006
,174
,006
,034
,973
loyaltolemarandrecommendit
,019
,166
,019
,113
,910
lemarisconvenienttouse
lemarprovidessecurityforconsumers
lemarprovidesthebestproducts
lemarhasthebestcustomerservice
lemarprovidesuniqueproductsthanotherstores
lemarsellsfamiliarbrands
confidentofqualityofproductsatlemar
-,072
,157
-,071
-,455
,650
,206
,128
,237
1,615
,111
-,324
,136
-,357
-2,375
,020
returngoodsboughtfromlemaroften
ratelemarasbestsupermarketinnorthcyprus
a. Dependent Variable:Choice
Table 6
Model Summaryb
Model
1
R
R Square
,525a
,275
Adjusted R
Square
Std. Error of the Estimate
,021
1,18634
a. Predictors: (Constant), ratelemarasbestsupermarketinnorthcyprus, lemarisconvenienttouse,
risingfoodpricesaffectingchoiceoffoodpurchases, returngoodsboughtfromlemaroften,
loyaltolemarandrecommendit, lemarprovidesthebestproducts, lemarsellsfamiliarbrands,
confidentofqualityofproductsatlemar, produceatlemarfreshandclean, lemarmaintainsbestdailypricethankiler,
shopatlemaroften, lemarsupermarketisattractive, prefershoppingtolemarthanothersupermarkets,
lemarprovidesavarietyofproducts, lemarhasthebestcustomerservice, lemarprovidessecurityforconsumers,
lemarlowpricingonfrontpageofpromotionsunlikekiler, lemarhasbetterpricestrategythankiler,
lemarprovidesuniqueproductsthanotherstores, lemarinformationonpriceclearthankiler,
lemarofferslowerpricesonhouseholdessentialsthankiler, lemarusesrebatesbetteroptionthanforkiler,
lemarsinvoicesreflectpriceoftheproductbetterthankiler, lemaroffersmorediscountsthankiler,
lemaroffersmorepromotionalpricesthankiler, lemarconsistentinprovidingvalueformoneythankiler
b. Dependent Variable: Choice
In relation to R square the strength of the regression model in explaining the variation between choice, price and
quality is by 27.5% which is not strong but is positively insignificant. The correlation coefficient value is 0.525
(Sum of all Betas) which is same as the standardized coefficients Beta value in Table 5.
Using the table 5 looking at the standardized beta coefficients value, it will construct the model estimation for
choice therefore the model estimation will be as follow:
Choice and firm performance = 3446 (constant) + 0.158 (Price) - 0.164 (Quality) × price or quality. The
estimation results imply that price has a positive impact on choice; however product quality has a negative
impact on product choice. It could be concluded that, price matter but quality does not. Referring to H2; H3 and
H4.
H2:
Product price and quality has a positive impact on supermarket choice.
H3:
Quality has a significant impact on consumer buying behavior.
H4:
Quality has a significant relationship with consumer supermarket choice
Results confirm H2 half and half because price + 0.158 have a positive impact on choice but quality - 0.164 does
not. H3 hypothesis is not rejected although the standardized coefficients result is negative - 0.164 for quality.
This implies that quality has a negative impact on consumer buying behavior. Since quality was found that has a
negative relationship with consumer choice and buying behavior H4 hypothesis is not rejected respectively, thus
there is a negative relationship between quality and choice.
Testing Hypothesis 6:
H6:
Competitive markets provide competitive prices, more choices and better quality products for
consumers. Therefore, competition will have a positive impact on the supermarkets performance via
price, quality and choice.
Table 7
ANOVAa
Model
Sum of
df
Mean
F
Sig.
Squares
Square
Regression
110,337
9
12,260
25,073
,000b
1
Residual
44,495
91
,489
Total
154,832
100
a. Dependent Variable:Prices
b. Predictors: (Constant), moreentertainmentfacilitiesatlemarthankiler,
betterinformationonnutritionalproductsatlemarthankiler,
lemarbettereuipedinprovidingcouponsthankiler, lemarprovidingquickerservicethankiler,
provisionofownbrandsbetteratlemarthankiler, betterparkingfacilitiesatlemarthankiler,
lemarbetteratmeetingcustomerneedsthankiler, lemarsalesrepsbetteratpreparingproductsofchoice,
lemarhasgoodandfriendlycustomerservicethankiler
The mean squares indicate that the null hypothesis has been rejected. The F statistics is 25,072 and the value of p
(sig.) 0.000 imply that changes or variation in prices will be predicted in association to changes or variations in
competition in the market.
Table 8
Coefficientsa
Unstandardized
Coefficients
Model
B
(Constant)
lemarprovidingquickerser
vicethankiler
lemarhasgoodandfriendly
customerservicethankiler
betterinformationonnutrit
ionalproductsatlemarthan
kiler
lemarsalesrepsbetteratpre
paringproductsofchoice
1
lemarbettereuipedinprovi
dingcouponsthankiler
provisionofownbrandsbet
teratlemarthankiler
betterparkingfacilitiesatle
marthankiler
lemarbetteratmeetingcust
omerneedsthankiler
moreentertainmentfaciliti
esatlemarthankiler
a. Dependent Variable: Prices
Standardized
Coefficients
,214
Std. Error
,242
,197
,094
,038
t
Sig.
Beta
,886
,378
,212
2,087
,040
,120
,039
,322
,748
,246
,090
,246
2,724
,008
,039
,111
,039
,350
,727
-,032
,087
-,032
-,364
,717
,013
,083
,014
,157
,875
,144
,092
,148
1,572
,119
,156
,100
,150
1,556
,123
,160
,101
,166
1,593
,115
Table 9
Model Summaryb
Model
1
R
R Square
,844a
,713
Adjusted R
Square
,684
Std. Error of the Estimate
,69925
a. Predictors: (Constant), moreentertainmentfacilitiesatlemarthankiler, betterinformationonnutritionalproductsatlemarthankiler,
lemarbettereuipedinprovidingcouponsthankiler, lemarprovidingquickerservicethankiler,
provisionofownbrandsbetteratlemarthankiler, betterparkingfacilitiesatlemarthankiler,
lemarbetteratmeetingcustomerneedsthankiler, lemarsalesrepsbetteratpreparingproductsofchoice,
lemarhasgoodandfriendlycustomerservicethankiler
b. Dependent Variable: Prices
In relation to R square the strength of the regression model in explaining the variation between price and
competition is by 71.3% which is strong and positively significant. The correlation coefficient value is 0.844
(Sum of all standardized coefficients Betas) in Table 8.
Using the table 8 looking at the unstandardized coefficients beta value, it will construct the model estimation for
choice therefore the model estimation will be as follow:
Prices = 0,214 (constant) + 1,018 (unstandardized betas competition) × competition.
The estimation results imply that competition has a positive impact on prices.
Figure 3: Normal P-P Plot of regression Standardized residual
Dependent variable Price
Figure 4: Scatter plot
Dependent variable: Prices
H6:Testing the impact of competition on quality.
Table 10
ANOVAa
Sum of Squares
df
Mean Square
F
Sig.
Regression
26,117
9
2,902
4,650
1
Residual
56,794
91
,624
Total
82,911
100
a. Dependent Variable: Quality
b. Predictors: (Constant), moreentertainmentfacilitiesatlemarthankiler,
betterinformationonnutritionalproductsatlemarthankiler, lemarbettereuipedinprovidingcouponsthankiler,
lemarprovidingquickerservicethankiler, provisionofownbrandsbetteratlemarthankiler,
betterparkingfacilitiesatlemarthankiler, lemarbetteratmeetingcustomerneedsthankiler,
lemarsalesrepsbetteratpreparingproductsofchoice, lemarhasgoodandfriendlycustomerservicethankiler
Model
,000b
The null hypothesis has been rejected. The F statistics is 4,650 and the value of p (sig.) 0.000 imply that changes
or variation in quality will be predicted in association to changes or variations in competition in the market.
Table 11
Coefficientsa
Model
Unstandardized Coefficients
B
(Constant)
lemarprovidingquickerser
vicethankiler
lemarhasgoodandfriendlyc
ustomerservicethankiler
betterinformationonnutriti
onalproductsatlemarthanki
ler
lemarsalesrepsbetteratprep
aringproductsofchoice
1
lemarbettereuipedinprovid
ingcouponsthankiler
provisionofownbrandsbett
eratlemarthankiler
betterparkingfacilitiesatle
marthankiler
lemarbetteratmeetingcusto
merneedsthankiler
moreentertainmentfacilitie
satlemarthankiler
a. Dependent Variable: Quality
2,417
Std. Error
,273
,043
,107
,064
Standardized
Coefficients
Beta
t
Sig.
8,843
,000
,063
,401
,690
,135
,089
,476
,636
-,038
,102
-,052
-,372
,710
-,089
,126
-,123
-,709
,480
,106
,099
,145
1,079
,283
,038
,093
,055
,403
,688
,065
,104
,092
,630
,530
,196
,113
,258
1,732
,087
,077
,114
,108
,673
,503
Table 12
Model Summaryb
Mode
R
R Square Adjusted R
Std. Error of the Estimate
l
Square
1
,561a
,315
,247
,79000
a. Predictors: (Constant), moreentertainmentfacilitiesatlemarthankiler,
betterinformationonnutritionalproductsatlemarthankiler,
lemarbettereuipedinprovidingcouponsthankiler, lemarprovidingquickerservicethankiler,
provisionofownbrandsbetteratlemarthankiler, betterparkingfacilitiesatlemarthankiler,
lemarbetteratmeetingcustomerneedsthankiler, lemarsalesrepsbetteratpreparingproductsofchoice,
lemarhasgoodandfriendlycustomerservicethankiler
b. Dependent Variable: Quality
The strength of the regression model in explaining the variation between quality and competition is by 31.5%
which is not strong and is positively insignificant. The correlation coefficient value is 0.561 (Sum of all
standardized coefficients Betas) in Table 11. Using the table 11 the unstandardized coefficients beta value, it will
construct the model estimation for quality therefore the model estimation will be as follow: Quality = 2,417
(constant) + 0,538 (unstandardized betas competition) × competition. The estimation results imply that
competition has a positive impact on quality. The test implies that competition has an impact on competition but
it is insignificant, therefore this confirms the H6.
Figure 6: Normal P-Plot of Regression Standardized Residual
Dependent variable: Quality
Figure 7: Scatterplot
Dependent Variable: Quality
Testing the impact better prices on the supermarket performance.
H7:
A supermarket that provides products with good value for money (better prices) in a competitive market
will experience an increase in supermarket performance compared to their competitors.
Table 13
Model
Sum of Squares
df
ANOVAa
Mean Square
F
Sig.
Regression
22,300
11
2,027
1,486
,151b
Residual
121,403
89
1,364
Total
143,703
100
a. Dependent Variable: Choice and firm performance
b. Predictors: (Constant), lemarusesrebatesbetteroptionthanforkiler, risingfoodpricesaffectingchoiceoffoodpurchases,
lemarinformationonpriceclearthankiler, lemarmaintainsbestdailypricethankiler,
lemarlowpricingonfrontpageofpromotionsunlikekiler, lemarhasbetterpricestrategythankiler,
lemarofferslowerpricesonhouseholdessentialsthankiler, lemarsinvoicesreflectpriceoftheproductbetterthankiler,
lemaroffersmorediscountsthankiler, lemaroffersmorepromotionalpricesthankiler,
lemarconsistentinprovidingvalueformoneythankiler
1
The F statistics is 1,486 and the mean sum of squares are not equal therefore the null hypothesis is rejected. The
p value is above (sig) 0.05 which is confirming the H7 where the low prices will positively impact on firm’s
choice of products and an increase in firm performance.
Table 14
Coefficientsa
Model
Unstandardized Coefficients
B
(Constant)
Std. Error
3,256
lemarinformationonpricecle
,146
arthankiler
lemarlowpricingonfrontpag
-,116
eofpromotionsunlikekiler
lemaroffersmorepromotion
-,006
alpricesthankiler
lemarconsistentinproviding
,429
valueformoneythankiler
lemarmaintainsbestdailypri
-,142
cethankiler
1
lemarofferslowerpricesonh
-,190
ouseholdessentialsthankiler
risingfoodpricesaffectingch
-,247
oiceoffoodpurchases
lemarsinvoicesreflectpriceo
,292
ftheproductbetterthankiler
lemarhasbetterpricestrategy
-,223
thankiler
lemaroffersmorediscountst
,016
hankiler
lemarusesrebatesbetteroptio
,158
nthanforkiler
a. Dependent Variable:Choice and firm performance
Standardized
Coefficients
t
Sig.
Beta
,424
7,686
,000
,176
,152
,828
,410
,179
-,118
-,649
,518
,201
-,006
-,030
,976
,205
,460
2,087
,040
,178
-,152
-,798
,427
,172
-,211
-1,108
,271
,145
-,246
-1,701
,093
,182
,305
1,607
,112
,193
-,241
-1,155
,251
,193
,018
,085
,933
,172
,164
,916
,362
Table 15
Model Summaryb
Model
R
R Square
Adjusted R
Std. Error of the Estimate
Square
1
,394a
,155
,051
1,16794
a. Predictors: (Constant), lemarusesrebatesbetteroptionthanforkiler, risingfoodpricesaffectingchoiceoffoodpurchases,
lemarinformationonpriceclearthankiler, lemarmaintainsbestdailypricethankiler,
lemarlowpricingonfrontpageofpromotionsunlikekiler, lemarhasbetterpricestrategythankiler,
lemarofferslowerpricesonhouseholdessentialsthankiler, lemarsinvoicesreflectpriceoftheproductbetterthankiler,
lemaroffersmorediscountsthankiler, lemaroffersmorepromotionalpricesthankiler,
lemarconsistentinprovidingvalueformoneythankiler
b. Dependent Variable: Choice and firm performance
In relation to R square the strength of the regression model in explaining the variation between choice, firm
performance and prices is by 15.5% which is not strong and is positively insignificant. The correlation
coefficient value is 0.394 (Sum of all standardized coefficients Betas) in Table 14.
Using the table 14 the model that predict the impact of prices on firm’s product choice and performance is as
follow:
Choice and firm performance = 3,256 – 0.005 (sum of unstandardized beta coefficients)
An increase in prices will not have a positive impact on product choice and firm performance, therefore the
negative value of the of β coefficient imply that as prices increase will have a negative impact on choice and firm
performance. Moreover H7 is confirmed.
Figure 8: Normal P-P Plot of regression Standardized Residual
Dependent variable Choice and firm performance
Figure 9: Scatterplot
Dependent variable : Choice and Firm performance
Discussion
The overall statistics from the study revealed that both supermarkets perform equally well in North Cyprus, as
the results revealed that neither supermarket performed better than the other. Through the research it was
discovered that the scales prepared for each independent variable plus the dependent variable (choice) presented
the opportunity to make use of the 2 factor regression model to predict variations between the beta coefficients
of the independent variables and the dependent variable choice. For the dependent variable choosing one
question to regress on each independent variable produced valuable results. It was then simpler to create a model
for future analysis,
Thus the researchers created a model to assess the impact of each independent variable on the dependent
variable choice and supermarket performance. For each hypothesis tested the model with values was constructed
based on results that could be used for future testing when there is a variation in the independent variables. The
model constructed implies that any variations in the unstandardized beta coefficients will have an impact on the
dependent variable. An example of the valuable results received in the study, it was noted that hypothesis 1 and
hypothesis 5 based on the questionnaire survey and result analysis, a positive relationship was found to exist
between choice, competition and the supermarket`s performance. The choice and competition relationship was
not strong but positively insignificant meaning that the responsiveness of competition to choice was valued at a
10.6% value rating from the results. The responsiveness of price and quality on choice was by 27.5% combined
meaning that price has a positive impact and quality a negative impact which reflects price as an important factor
while quality does not seem to have an impact to a consumers choice levels in the supermarkets of North Cyprus.
In the research conducted by Hutcheson and Moutinho (2010) they had results that revealed that quality and
value for money were rated particularly highly in terms of perceived importance. They went on to state that these
two factors could be regarded as key determinants in choice criteria for supermarket patronage. These findings
are not altogether similar to the findings of the present research indicating that in North Cyprus price has a
relevant bearing towards customer supermarket choice, unlike quality as the findings of this research revealed
that quality played a menial role in influencing supermarket choice. The regression model showed that the
factors to be considered as important for determining supermarket choice are product price and competition. The
most important managerial implications resulting from Hutcheson and Moutinho`s study were;



Supermarkets should continue to embark on the implementation of special promotion programmes,
ideally within a continuous macro-scheduling framework since marketing communication was rated
highly as criteria for store choice.
Quality of produce and staff is of primary importance in store choice criteria and should remain a
priority concern for attracting and retaining customers.
Supermarkets should continue to pay attention to the price/ quality balance of their total offer in the
market.
(Hutcheson & Moutinho, 2010: 717)
From these given implications it was noted that the present research agreed with two of the implications except
the second one where quality is said to be of primary importance which does not seem to be the case with the
results of the two supermarkets in North Cyprus.
It was noted that the model created could be used for future testing in other studies similar to this research.
However, should the sample be increased and more supermarkets included in the study the results would expand
on this research
Conclusion
Supermarket choice is a concept that involves the interplay of three important factors, competition, product price
and product quality with each factor affecting consumer choice in varying degrees. The important factor for
every supermarket is ensuring that their store is chosen more-so on a repeated basis, it is these factors that at the
end of the day will affect the final performance of supermarkets and as such the decision making process of
consumers deserves consideration. This study has investigated the impact of competition, product prices and
quality on choice and supermarket performance In North Cyprus. Seven hypotheses have been tested using a two
factor linear model using OLS estimation. It was found out that, results confirm H2 half and half because price +
0.158 have a positive impact on choice but quality - 0.164 does not. H3 hypothesis is not rejected although the
standardized coefficients result is negative - 0.164 for quality and does not impact on consumer buying behavior
however there is a negative relationship between choice and quality. Since quality was found that has a negative
impact on consumer choice and buying behavior H4 hypothesis is not rejected respectively too however, there a
negative relationship between quality and choice. H1; H5 are fully confirmed whereas H6 was partially
confirmed for choice and firm performance. For H7 it was found out that an increase in prices will not have a
positive impact on product choice and firm performance, therefore the negative value of the of β coefficient
imply that as prices increase will have a negative impact on choice and firm performance. Moreover H7 is
confirmed.
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