The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?

2015. Harvard Business Publishing for Educators.

Sergio Olavarrieta S

Abstract:

Rey Holdings Corp. was one of the two leading supermarket chains in Panama, with an estimated 30% market share,39 stores and a five-year aggressive expansion plan. In addition, Rey Holdings held a lower market share in the pharmaceutical and food industries. In 2011, the company was evaluating growth options through: a) point-of-sales and geographical growth; b) expanding product mix and store layout; and c) a strong market entry into the pharmaceutical industry through the acquisition of Metro Corporation.

The case would introduce the students to general elements of analysis and strategy formulation such as environmental analysis, industry attractiveness, resources and capabilities, and value chain. It may also introduce key elements in defining competitive strategy (in the supermarket and/or pharmaceutical industry): choice of competitive advantage, business environment scope (generic strategy). It would help to introduce corporate strategy notions in terms of growth, vertical integration and diversification. To introduce concepts of competitive dynamics and multi-industry or multi-point competition (In this case, in the consumer retail industry), assessing format competition/substitution and the role of other players, in addition to players taken into account in Porter's model which may prove significant in creating or destroying value for the company in the future.

Palabras claves:

Acceder a la publicación completa