The Impact of Membership in Strategic Alliances on the Profitability of Firms in the Retail Sector

Strategic alliances in the retail sector are based on cooperation in a variety of activities, ranging from supply and marketing to knowledge sharing and branding. For their members, they are a source of sustainable competitive advantage. Ever since the 1990s, a growing number of firms from the retail sector have attempted to improve their performance through participation in strategic alliances. The objective of this paper is to explore how participation in strategic alliances influences profitability of firms in the retail sector. A dynamic panel analysis is applied to the data on nearly 3,700 firms obtained from Amadeus, a large firm-level database, for eight countries (Croatia, Bosnia and Herzegovina, the Czech Republic, Slovakia, Slovenia, Poland, Hungary and Estonia) for the 2007–2012 period. The results of the investigation suggest that participation in strategic alliances positively influences a firm’s performance.