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If the market is stuck in a durable duopoly, a credible new entrant can force incumbents to compete harder on price, quality, and service. A state-backed operator may be able to absorb initial losses and challenge entrenched pricing power more effectively than a fragile private entrant.
Supermarket retail requires scale, sites, logistics, and supplier relationships that are difficult and expensive to assemble from scratch. If the dominant firms control the best sites and infrastructure, compulsory acquisition could rapidly create a viable footprint instead of waiting for gradual market entry that may never materialize.
A public supermarket could be run with a mandate to lower margins, improve transparency, and anchor competitive behavior, especially if private incumbents are perceived to exploit market power. The policy appeal is strongest if the goal is social welfare rather than fiscal return.
Aggressive public intervention may shift bargaining power toward consumers and suppliers by signaling that persistent market failure will trigger stronger remedies. That could induce private chains to lower prices or make concessions without the state needing to fully replicate their scale.