Evaluating the Prospects of a Horizontal Supermarket Merge: A Configurational Analysis of Commercial Property and Supply Chain Outcomes

This study evaluates the prospective impacts of a horizontal merger between two leading supermarket chains in Hong Kong through a Qualitative Comparative Analysis (QCA) framework. In dense urban economies, supermarkets function as retailers and anchor tenants in commercial property markets and dominant buyers within upstream supply chains. A merger involving a combined network of more than 500 outlets would therefore constitute a structural reconfiguration of retail geography, landlord–tenant relations, and supplier ecosystems rather than a simple consolidation of market share.

Applying configurational logic, the analysis examines two outcome domains:
(1) Commercial Property Stability and Value (CPV), and
(2) Supply Chain Efficiency and Sustainability (SCE). Rather than treating market concentration as a singular causal driver, the study identifies combinations of conditions, including store network overlap, digital substitution pressure, regulatory oversight, procurement centralization, technological integration capacity, and competitive intensity, that shape heterogeneous outcomes.

Findings suggest that commercial property effects are likely to be spatially differentiated. Store rationalization in overlapping districts may generate short-term vacancies and localized disruption, while prime retail nodes could strengthen through enhanced bargaining power. Digital substitution and regulatory responses critically mediate these outcomes, making spatial polarization more probable than systemic decline. In the supply chain domain, procurement centralization alone is insufficient to ensure sustainable gains. Long-term efficiency improvements depend on effective technological integration and synergy realization. Absent these, transitional inefficiencies and supplier concentration risks may offset bargaining advantages.