Israeli Geographic Market Study and the Food Law

Prof. David Gilo

Director General

The Israeli Antitrust Authority

Aim of Study

Definition of geographic markets:• Supermarkets throughout Israel

To support the Food Law

The Problem

Many concentrated Large chains often filled an area

• Differentiation: Unilateral, coordinated, and exclusionary effects

Main Findings

Mapped all markets 2013 data:

• 40% of branches market share above 30%• 79% of population:

Supersol above 30%• 21% of population:

Mega above 30%• 8% of branches market share above 50%

Main Findings

• Phenomenon of filling an area widespread• Supersol:

140 out of 153 branches:• Stem from at least 3 branches

• Mega: 34 out of 37

• Supersol and Mega: 11 branches per area

Advocacy Efforts

Used preliminary results to advocate the food law:

• Market share above 30%: Prior approval for new branch

• Market share above 50% + 3 branches: Possible divestiture

Methodology

For each branch:• Catchment area• Sample of 15,000 consumers and 430 branches:

What better explains driving time?• Size of branch • Density of population

Classified all branches

Sketch catchment area• Using road maps and GIS software

Cathcment area

Who are a branch’s competitors?

Thank you!