The Latvian economy mainly consists of small and medium sized enterprises (SMEs). There are two important moments in the enhancement of their successful development and competitiveness: competition and collaboration. In the modern world collaboration or partnership is starting to play an ever increasing role as is shown by the research carried out. This research analyzes the partnership model which consists of three components: partnership context component, external partner network component, and internal environment component.The following research methodology was used: monographic method based also on literature review; logically constructive method – to formulate conclusions, analyze the results and establish correlations; analytical method – to divide whole into parts and analyze the parts during the research; synthesis method – unification of elements into a system to research their correlations; social research methods – to obtain primary information and to verify it; graphic method – to depict factor interactions.

Retail sector has always played and important role in the national economy. Any business is tendet towards satisfaction of consumer desires and needs, albeit profits. In relationships between companies and consumers both sides have their interests. For a company it, primary, is to increase the turnover and make profits, while the consumers may have several goals – to obtain the goods or services, to receive the necessary information and attitude. These consumer benefits are the basis for loyalty. Thus, the aim of the present paper is to research the loyalty formation process and its characteristics in the retail sector.

Retail sector has always played an important role in the Latvian economy. The success of a profitable retail business depends on meeting the needs of buyers and, in the long run, building relationships with the buyer. Process of attracting new buyers always involves spending more money, time and energy. In order for a company to retain existing buyers, it is necessary to develop a set of marketing activities that promote and ensure customer loyalty. The globalization of the market is also having a greater impact on retail companies, which makes them to look for solutions for competitiveness and development. In order to identify factors for competitiveness, the authors of the study have set out to investigate the customer loyalty-formation activities in Latvian retail companies. To reach a goal the authors of the paper will study theoretical basis of loyalty formation employing the monographic or descriptive method, the next step will be analysis of the retail development tendencies in Latvia and loyalty-creation activity level of the Latvian retail companies. This study will give retailers an understanding of the importance of loyalty and the need to build it for the competitiveness of retail businesses. The authors have summarized these theoretical aspects and have defined a common approach to loyalty building and provisions for it. After completing the research, the authors conclude that by understanding the essence and formation of loyalty, the company can manage this process and maybe loyalty can be one of the tools for ensuring competitiveness.

The sector of the retail trade has always played a significant role in the Latvian economics. The basis for the retail trade is the satisfaction of consumers' needs and the formation of the long-term relationship. To retain the existing consumers and to attract the new buyers, one of the fundamental tasks is to create the according assortment. The Efficient Consumer Response presupposes not only the new approach in creating the assortment, but also influences all business processes in the enterprise and significantly raises the level of assortment. The purpose of the present study is to analyze the level of the ECR application in the retail enterprises in Latvia. Therefore, there were set the following tasks: a) to characterize the retail trade tendencies in Latvia; b) to research the principles of assortment formation. The research methods applied were the expert interviews and consumers' survey. The key result of the research was: the ECR implementation helps to form the assortment of the retail trade enterprises in more responsive to consumers'' needs way.

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