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Porter's Five Forces Analysis: Jeronimo Martins

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The company that will be analyzed in this report is Jeronimo Martins, a company that operates several supermarket, hypermarket, and cash-and-carry stores in Europe and South America. The company is based in Portugal, but gets a majority of its revenues and earnings before interest, taxes, depreciation, and amortization (“EBITDA”) . In order to analyze the supermarket industry, I used Porter’s Five Forces. There is a low threat of new entrants in the supermarket industry. The largest barrier for new entrants is the large initial capital requirement that is needed to start. New entrants must secure a building where they can sell their goods, they must secure a warehouse where they can store their excess inventory, they must enter into deals …show more content…

Customers have numerous options in regards to purchasing produce because of the emergence of the e-commerce industry. Companies such as Amazon are rolling out online grocery stores in the United States. The next step for these businesses is to expand into European countries. This can cause major problems for Jeronimo Martins as consumers shift away from going to supermarkets and go towards online grocery shopping. Consumers can also go to other supermarkets and hypermarkets in the area if they dislike their experience at certain …show more content…

In this country, people want to have the most convenient solution for each part of their everyday life and they are willing to pay for it. People in the United States also want to make everyday tasks such as grocery shopping more efficient. Due to this, they are willing to pay a premium to Whole Foods in order to have their groceries delivered to them. In Portugal, this is not the case. People find joy in everyday activities such as grocery shopping. Whether it’s visiting the local farmers market or the large supermarket, the people of Portugal take pride in finding the best produce and then using that to make their food. This slight difference in culture could help explain why a similar firm, such as Whole Foods, can have such a different business model going

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