Final answer:
High-performing stores succeed due to strategic production models, cost structures, and the ability to set competitive pricing, as illustrated by Amazon's business model. The Huff Model further explains customer behavior, indicating the importance of store size, product appeal, and competition in predicting retail success.
Step-by-step explanation:
The drivers for the good performance of high-performing stores, like Amazon, can largely be attributed to their strategic production model and cost structure. Amazon's ability to undercut competitors' prices is a primary factor, even when considering the cost of shipping. Identifying the optimal products to sell, determining the necessary output, and setting competitive pricing are all crucial factors that contribute to a retailer's success. This applies not only to large retailers but also to small, local firms like a corner deli. Although they may not always earn economic profits, these smaller firms often serve niche markets or have personal customer relationships that help them sustain their business. The Huff Model is an analytical tool used to predict customer shopping behaviors, which accounts for store size, product desirability, and competition, helping to inform decisions regarding store feasibility and marketing strategies.