Professional Documents
Culture Documents
Introduction
1. Introduction:
A supermarket, also called a grocery store in some parts of North America, is a self-service store offering a wide variety of food and household merchandise, organized into departments. It is larger in size and has a wider selection than a traditional grocery store and it is smaller than a hypermarket or superstore. The supermarket typically comprises meat, fresh produce, dairy, and baked goods departments along with shelf space reserved for canned and packaged goods as well as for various nonfood items such as household cleaners, pharmacy products, and pet supplies. Most supermarkets also sell a variety of other household products that are consumed regularly, such as alcohol household cleaning products, medicine, clothes, and some sell a much wider range of nonfood products. Supermarkets usually offer products at low prices by reducing their economic margins. Certain products (typically staple foods such as bread, milk and sugar) are occasionally sold as loss leaders, that is, with negative profit margins.. At present, many supermarket chains are attempting to further reduce labor costs by shifting to self-service checkout machines, where a single employee can oversee a group of four or five machines at once, assisting multiple customers at a time. However the social and economic impacts of supermarkets on the economy of developing countries like Bangladesh is huge. This study will help to realize the social and economic impacts of supermarkets in the economy of Bangladesh.
There are two types of objective. One is broad and other one is specific objective:
Broad Objective-
To understand the context of the supermarkets trade of Bangladesh & the performance of the various supermarkets.
Specific ObjectiveTo determine the specific variables or aspects of supermarkets which have direct or indirect influence on the society? To examine the aspect of supermarkets which have direct or indirect impact on the economy of Bangladesh? To measure the trend of emergence of supermarkets in Bangladesh. To identify major strength and weakness of supermarket in respect to traditional shop To provide a guidelines to the supermarkets policy makers.
Chapter Two
-The Literature Review -Model Development/Specification - Development of Hypothesis
shopping (large scale of requirement fulfillment; grocery and animal foods, pharmaceutical products, video rentals, and general merchandise as clothing), which is an attributable factor behind the success of supermarkets. And this success can also be expressed in numerical terms, as supermarkets accounted foe over 70 percent of total store sales and 72 percent in grocery store sales in 1992 (U.S. Department of Agriculture).Packaging technology and refrigeration, which provided longer shelf life and led to weekly versus daily shopping (Levy and Weitz, 1992) Stock assortment (the combination of different trades and enrichment of stock assortment within particular trade ensures economies of scale) and self service (customers have access to the goods and may inspect them without the mediation of sales persons and having assembled her requirements from anywhere in the shop, and pays once only, at the exit) defined as major attributes of supermarkets (W.G.McClelland, 1962) Hence the main difference from the traditional grocery shops that supermarket is a self-services hassle free food shop and requires one point of sale. But it is clear that this expanding retail formats give consumers more shopping alternatives and also make it more difficult to define market for many of these products (Paul little, 2003).Thats why Jahnathan Pearce (2003) contended that for many people shopping is an extension of leisure activity not only just an exchange process of buying food for the table. He also added that supermarkets made women easier to leave the home and to go into the work. Otherwise shopping would take much more time. According to Messinger and Narasimhan (1997) consumers choice of retailers is primarily influenced by assortment, price, and transactional conveniences relating to shopping time and logistics, and utility or disutility from the shopping experiences. Their empirical examination suggested that greater prevalence of one stop shopping has been a response to growing demand for time saving convenience. Messinger and Narasimhan also acknowledged that transportation and inventory-holding technologies (refrigeration) are prerequisites to one-stop shopping, which ultimately complemented supermarket development. In store promotion facilities of supermarkets is utilized with the hope of increasing sales of their merchandise through impulse buying (Abratt and Goodey, 1990)The term superstore can be said as a store twice as the size of a regular supermarket that carries a large assortment of routinely purchased food and nonfood items and offers services such as dry cleaning, post offices, photo finishing, check cashing, bill paying, lunch counters, car care and pet care(Kotler and Armstrong 2003).And supermarket can be said as a large , low-cost, low margin, high volume, self service store that carries a wide variety of food, laundry, and household products (Kotler and Armstrong 2003).
2-1 .1 Supermarkets:
The concept of a self-service grocery store was developed by American entrepreneur Clarence Saunders and his Piggly Wiggly stores. His first store opened in Memphis, Tennessee, in 1916. Saunders was awarded a number of patents for the ideas he incorporated into his stores. The stores were a financial success and Saunders began to offer franchises. In our country the idea of supermarket was first implied by setting us the retail chain Agora by Rahim-afroz group. From then a number of supermarkets have been established and the profitability is also high. However supermarkets are----A large store that sells a variety of food and household items to customers.( Reardon and
Berdegue 2002)
A self-service food stores with grocery, meat, and produce departments and minimum annual sales of $2 million. This retail category includes conventional supermarkets, food-based superstores, combination stores, box (limited-line) stores, and warehouse stores. (Coe and Hess
2005)
The supermarket is a tool of the pull system that helps signal demand for the product. In a supermarket, a fixed amount of raw material, work in process, or finished material is kept as a buffer to schedule variability or an incapable process.( Gaiha and Sharma 2006)
High
Low
They thus benefit from considerable savings on recurring transaction and logistics costs. There is also a degree of security in selling to the Supermarkets which are known for being consistently responsible and professional in making payments.. Finally, in addition to differences in the volumes, variety and quality of produce sought by Supermarkets, they also have service, logistical, and certification requirements of their suppliers that are uncommon in Traditional Markets. Service and logistical requirements include grading of produce, specialized packaging, and delivery to individual store outlets, unloading of produce, stocking of shelves, and product labels that provide nutrition, customer service and traceability information. Certification requirements are becoming increasingly common, and generally relate to food safety issues. As a result of these differences, there are significant barriers to entry for growers who seek to sell market their produce to the Supermarket Market. These include: 1) Investments to ensure consistent compliance with quality standards, e.g. greenhouses, irrigation, vegetable washers & packing houses, 2) Infrastructure to comply with service and logistical requirements, e.g. delivery trucks, computer and internet access for product orders, 3) High fixed costs of qualifying for supplier registries (even though recurring transaction costs are lower as a result of being on the registry), and 4) Certification and documentation costs which include not only significant initial outlays for certification but also periodic expenditures in testing for adequate water quality, presence of microbes, pesticide residues, etc.
take advantage of the seal of quality implicit in their qualifying to sell to large retail chains in their marketing to other enterprise
Information Characteristics
Structural Characteristics
Figure 2.1: (Adapted from Richard Heeks & Alemayehu Molla, 2008)
This framework shows us that the characteristics of supermarket in Bangladesh are very poor. One foundation for development problems is information failures around transactions, which are rise in developing countries and which fall into five main categories:
a) Information absence: key information that development actors need is not available. b) Information quality: key information that development actors need is available but of poor
quality.
c) Information uncertainty: key information that development actors need is available but its
quality is uncertain.
d) Information asymmetry: some development actors have access to key information that
others lack.
e) Information cost: key information can only be obtained at high cost (often a physical
journey). As a result of these information failures, transactions in developing countries like Bangladesh take on particular process and structural characteristics which, in turn, have negative developmental outcomes. For example, transaction processes in developing countries tend to be slow, costly, and risky. As a result, commerce structures tend to be localized and intermediated (i.e. with the presence of middlemen), and prices fluctuate significantly. As a result, the development of markets is constrained, investments are suppressed, and the benefits of commerce and business flow to the "haves" more than the "have not" (e.g. limiting the income of small producers). In turn, all of these factors reinforce the initial information failures, creating a negative cycle. This foundation can then be used to assess the impact of The micro-level impact of supermarkets is assessed in terms of its impact on the five information failures; assessing to what extent the technology alters the information characteristics of transactions. Then, in turn, an assessment is made of:
a) Changes to transaction processes: for example, are they becoming faster or less costly? b) Changes to structural characteristics: for example, is there any change in the status of
middlemen?
c) Changes to market development characteristics: for example, is there any growth in
investment in the focal domain? In making such an assessment, it is important to understand those characteristics can supermarkets affect, and also those it cannot. The latter may be tied up in "institutional" issues such as trust, reputation, ongoing need for physical interaction or exchange, and cultural norms.
Figure 2.2 This model supports entrepreneurs by targeting four core barriers to new venture creation: entry, education, financing and management expertise. Key components of the model are practices designed to lower transactions costs, leverage partnerships, provide practical advice and business networks, and create mechanisms that allow capital to flow to the small business sector in poor countries.
Identify
Finding entrepreneurs capable of creating development impact requires working closely with strong local partners government agencies, trade associations, universities and other development organizations to cast as wide a net as possible. A key part of supermarkets strategy to encourage would-be entrepreneurs to launch high impact businesses is to elevate the status of entrepreneurship generally in society. Agora works toward this goal through entrepreneurial education,peer-to-peer networking, and media coverage to celebrate small business entrepreneurs as catalysts of development.
Advise
Supermarket works with select companies to help them identify and overcome constraints to growth. This process involves an in-depth discussion of the key value drivers of the business. The staffs, often working with local and international business school student consultants, seek to answer the question of what is preventing a company from achieving maximum impact in its community. . Often, the issues confronting the business are strategic in nature and require a refocusing of priorities or a re-assessment of fundamental business assumptions. When the constraint is financing, staff works with the entrepreneur to create an execution plan suitable for investment. Supermarket also offers seminars and provides extensive one-on-one consulting to help entrepreneurs understand the pros and cons of equity and quasi-equity finance.
Invest
Because consulting alone is often insufficient to achieve growth, Supermarket strives to provide the right kind of long term, patient capital to select entrepreneurs. Given their extensive interaction during the selection and consulting phases, supermarket staff and the entrepreneurs are able to build a relationship with each other based on trust and respect. Sometimes supermarkets staff can recommend certain entrepreneurs for investment from an affiliated fund that specific supermarkets sponsors and manages. In addition to investing via the fund, supermarket works to develop and implement innovative financing mechanisms and term sheets to help advance the field of micro venture capital.
Support
Supermarket begins to provide strategic guidance and support to businesses receiving investment from their fund. This support includes helping entrepreneurs connect with customers, suppliers, professional service providers, and their Fellows who provide on-site consulting. They also works to ensure good governance and transparency in all portfolio companies and to encourage entrepreneurs to participate actively in building an entrepreneurial society. Through support and monitoring services, supermarket authority strives to ensure that the businesses it supports improve their communities by being environmentally responsible and creating value for all stakeholders: investors, employees, customers, and future generations.
Climate Change and the Environment: Businesses, no matter how small, play a critical
role in fighting climate change and protecting the environment. Supermarket works with companies that are actively trying to improve the environment as well as those that work to minimize their own environmental footprint. Supermarket is particularly interested in supporting companies that increase and protect biodiversity, reduce carbon emissions, and promote
their time. Families are said to be cash rich, time poor and this has led to a demand for meals that are easier to prepare and for retail outlets that offer a wider range of prepared products. This trend has been enhanced by the development of new products that meet the needs of this new market; Demographic trends, with an increasing proportion of young people; Growing use of credit cards, which in developing countries are rarely accepted by corner shops or traditional wet markets;
Changes in family structure with, in Asia, a growing proportion of nuclear families and, even, one-person households, as opposed to extended families;
Reduction of effective food prices for consumers because of supermarkets greater ability to control costs through economies of scale, improved logistics, etc. This may not, however, always apply to fresh produce Growing access to refrigerators, allowing larger quantities of food to be stored, and to cars, allowing shopping to be done away from the immediate vicinity of the home and for larger quantities to be purchased at any one time; Increased travel, exposing people in other regions to modern retailing techniques in the USA and parts of Europe, to a wider range of products and, particularly for fresh fruits and vegetables, to the possibility of being able to consume many products out of season.
Educational Outreach Events which, showcase entrepreneurship in different regions around Bangladesh. Entrepreneur Experiences Exchanges that allow entrepreneurs to share their success and setbacks, network, and build knowledge in specific topics; and Speed Consulting which provides free, personalized business advice to any entrepreneur with general business questions or to just to bounce of ideas.
Growth-focused: Entrepreneurs are committed to launching or growing a company that can make a major impact in their community. They have the skills and the potential to build strong teams, manage people and execute the business plan. They believe they can make a difference, are comfortable with ambiguity, willing to take risks and eager to learn. Most of all, they are hungry to create change and impact and improve their communities through enterprise. Shares values and vision: Entrepreneurs are committed to operating a business in a socially and environmentally responsible manner, no matter how small the business may be. They believe in serving the four key stakeholders of any business: customers, shareholders, employees and future generations. They are committed to using the business as a positive agent of change in society and delivering true blended value. They are willing and able to become role models and to help encourage a culture of socially responsible entrepreneurship.
Prepared to enter into a long term financial partnership: They are looking for trusted
partners, not charity, and understand the need for venture capital investment to grow their company. They are committed to the best interest of the business and the highest standards of financial controls, accountability and transparency. They understand and
appreciate that outside investors eventually need to exit the business with a positive return in order to mobilize additional capital to help more entrepreneurs like themselves.
Company Level
Operate in these sectors where developing countries have a natural competitive advantage such as eco-tourism, sustainable agriculture, value-added manufacturing and agricultural processing, organic foods. Are cash flow positive or can become cash flow positive within 18 months. Are innovative providing a product or service that is new or that reaches out to a new customer base.
Economies of scale in supermarket operations: (excluding the purchasing terms obtained from suppliers). There may be economies of scale in retailing (e.g. in supply chain management) which place supermarkets at a competitive advantage. This is a source of efficiency and gives rise to cost savings which may benefit consumers to the extent that they passed through in retail prices. Vertical economics of scope: This term refers to cost savings arising from the vertical integration of distribution and retailing within one company. The competition implications are similar to those for economies of scale: that is to say, costs may fall, but competitive constraints may fall with the result that not all of the cost savings are passed through into retail prices. In particular, the supply chains of supermarkets are closed to new entrants whereas those of independent buying and wholesaling groups are open, hence the ease of entry into the sector is likely to fall as independent groups are displaced by expanding supermarkets. Brand value: Strong brands can increase barriers to entry, because consumers become less inclined to switch to new entrants. Whether or not supermarket brands are perceived as providing offsetting consumer benefits depends partly on ones view about the role that advertising and brands play in society. Some economists have argued that brands provide benefits to consumers (e.g. by providing a signal of quality. Upstream buyer power: Buyer power refers to the ability of large supermarkets to obtain more favorable buying terms from suppliers than would be expected under competitive conditions. In particular, a large buyer may be able to exert market power by negotiating its buying prices downwards, over and above any reduction that may be justified by any economies of scale that suppliers gain from selling in bulk to a single firm. Below-cost selling: Europe Economics is aware of concerns of some players in the acquire open new convenience stores. If this were the case, it would unambiguously raise competition concerns. In the short-term consumers may gain from lower prices, but the risk is that supermarket outlets will raise prices once rivals have been driven out of business. This could happen at a local level even if supermarkets have only a low share of the convenience retailing market at a national level.
Procurement and distribution Facilities: International and national supermarket chains in Asia are planning to or are already following the practices in several ways, including the use of:
Centralized procurement systems; Specialized/dedicated wholesalers, sometimes acting as sole suppliers; Preferred supplier systems; Concessionaires who lease fruit and vegetable sales space in the stores; Private standards for fresh produce, which are usually more, demanding than national standards and which may include a requirement for traceability. Supermarkets in Bangladesh presently use a wide variety of fresh fruit and vegetable procurement practices. It can be confidently predicted that, in time, there will be some consolidation of these practices. At present, at least the following channels can be seen:
The cost of fitting out a store adds a significant amount to the purchase price and therefore to the cost of entry. It does not necessarily follow, however, that high capital costs represent a barrier to entry. If there is no market distortion, high capital costs simply represent the true economic value of inputs required to compete in the market. It is possible that a substantial number of players are able to finance substantial up-front costs. As the cost of entry increases then the reliance of independent convenience store operators on borrowed finance increases. Lenders will typically charge a higher rate for a sole trader than they would for a large supermarket. As the quantity of borrowing rises the effect of the difference in interest repayments on rates of return is increased.
widening the gap between the buying prices obtained by leading supermarkets and those obtained by others in the sector. (b) Buying groups and wholesalers may lose economies of scale. It seems likely that at least some of the costs of running a wholesaling operation may be fixed (e.g. certain head office and warehouse costs), even in the long run.29 As these groups
lose scale, such fixed costs will have to be recovered over smaller volumes with the result that prices charged in the independent sector will tend to rise.
Consumer Detriment:
Consumers may lose out in the long run from a reduction in competition if upstream buyer power allows a few firms to establish market power in the downstream market. Once firms have established a dominant position, they may be in a position to: (a) Raise prices above competitive levels to increase profitability; (b) Cut back on the range of products on offer or the number of retail outlets, thus increasing profitability at the expense of reduced consumer choice.
examined (Boulding, Kalra, Staelin, & Zeithaml, 1993; Cronin & Taylor, 1992.In their study they focused on:
Supermarkets will be able to create a clear and articulated social impact whether through jobs, protecting the environment, or providing products or services to low income populations. Supermarkets will comply with corporate social responsibility policy and operate in a manner that meets or exceeds the ethical, legal, commercial and public expectation that society has of business.
Supermarkets will not partner with companies on the IFC exclusion list or those that do not support the 10 principles of the UN Global Compact e other type of institutions formal regulatory constraints: rules, laws and contracts.
The supermarkets share of the whole retail market for groceries would be less than their share of one-stop grocery retailing but greater than their share of convenience retailing; and Supermarket acquisitions of convenience stores would have a smaller impact on their share of the whole market.
o It may be argued that wholesalers (and indeed retailers) may then offset some or all of their disadvantages by consolidation among themselves. No doubt some economies can thereby be achieved, but it is for closer examination to determine whether they would be sufficient to sustain an effectively competitive convenience retailing sector.
o
The supermarkets do not appear to have valued the businesses they bought at higher price-earnings ratios than other corporate buyers (although the behavior of other firms in paying these prices could have been influenced by the supermarkets entry).
Chapter Three
Methodology
Primary Source
Secondary Source
Personal investigation with supermarket authority. Personal experience gained by visiting different supermarket direct observations face to face conversation with the customer
Different Procedure published by supermarket Study of features, articles, prospectus. Publications of various Magazines, Newspapers etc. Web site searching data on supermarket Annual & Social impact Report of Agora
Figure 3.1
Target population
Elements: customer of supermarket user Extent: Dhaka Time: 3 month (Oct 2009 to Dec 2009)
sampling frame
sampling technique
Sample size
A preliminary version of the questionnaire was developed in English on the basis of past research and insights from the in-depth qualitative interviews. The measures were translated next into the local language (Bangla) and retranslated until a panel, fluent both in English and Bangla, agreed that the two versions were reasonably comparable. Scale items were rated on five-point Likert scales in a structured format. Each item was anchored at the numeral 1 with the verbal statement Strongly Disagree and at the numeral 5 with the verbal statement Strongly Agree. This format has been recommended for health care surveys (Elbeck 1987; Steiber 1989). Multiple items were used to establish appropriate measurement properties (reliability and validity) of the selected constructs. The questionnaire was pre-tested several times to ensure that the wording, format, length, sequencing of questions, were appropriate.
Chapter - Four
Result of Data Analysis/ Findings and Discussions
Step 2
Step 3
Step 4
Step 5
Step 6
Step 7
Step 8
4.1.2Chi-square Analysis
For the testing of hypothesis statements I used here Chi-Square analysis and four alternative hypothesis statements are tested. The test statistics of these alternative hypotheses statements presented in the following: Chi-square Test Statistics
a 0 cells (.0%) have expected frequencies less than 5. The minimum expected cell frequency is 16.5. b 0 cells (.0%) have expected frequencies less than 5. The minimum expected cell frequency is 20.0
10.300 > 9.488 It is seen from the table that the second null hypothesis is rejected and alternative hypothesis statement is also accepted. The output is conducted at 95% significance level and with 4 degree of freedom the table value of chi-square is 9.488 which are lower than the calculated value (10.300) .So we can say that the alternative hypothesis is accepted. Hypothesis-3 H0: Supermarkets have not positive impact on the Society: H1: Supermarkets have positive impact on the Society: Here, P (z) >.05 12.700 > 9.488 It is seen from the table that the third null hypothesis is rejected and alternative hypothesis statement is accepted. The output is conducted at 95% significance level and with 4 degree of freedom the table value of chi-square is 9.488 which are higher than the calculated value (12.700) .So we can say that the alternative hypothesis is accepted.
Hypothesis-4 H0: Supermarkets have not positive impact on Economy. H1: Supermarkets have positive impact on Economy P (z) <.05 6.5 < 9.488
It is seen from the table that the fourth alternative hypothesis statement is rejected. The output is conducted at 95% significance level and with 4 degree of freedom the table value of chi-square is 9.488 which is lower than the calculated value(6.500) .So we can say that the alternative hypothesis is rejected.
Table 4.3
The mean and standard Deviation of each variable are automatically calculated on SPSS and present such a value to identify the relationship between variables. The result is conducted according to the responses of sample 100.
The Relationship between buying pattern and shopping environment are presented in the following: Buying pattern 1 * Shopping Environment 2 Cross-tabulation Count
Shopping Environment 2 .00 Buying pattern 1 Total Table 4.4 .00 1.00 19 33 52 1.00 21 27 48 Total 40 60 100
The relationship between buying pattern and shopping environment of supermarket shows negative because Bangladesh is poor country and most of the people doesnt have the ability to buy their daily product from the supermarket and their buying pattern didnt match with the supermarket shopping environment.
Table 4.5
The relationship between buying pattern and Culture shows positive because most of the respondent thinks that buying pattern is running with the culture. They think that if the culture is influenced by any variables such as occasion, foreign culture the buying pattern will also be affected and they are trying to buy the best things. When supermarket provides the best their popularity increases.
The relationship between shopping environment and culture shows negative because most of the respondent think that Bangladeshi Culture and the shopping environment of supermarket is not easily adjustable for the average people of Bangladesh because most of the people lead their
lifestyle as a middleclass and as their income is limited so they dont like to go the supermarket shopping environment. Farmer 4 * Economy 6 Cross-tabulation
Count Economy Farme r Total Table 4.7 .00 1.00 .00 29 20 49 1.00 26 25 51 Total 55 45 100
The relationship between farmer and economies shows positive because most of the time it is seen that when farmers are able to produce enough crops or supply the raw-materials then the economy is heavily influenced and economic growth is increased. And for that most of respondent think that farmers are important part of supermarket as well as economy.
The relationship between consumer and economy shows positive most of the respondent feel that when economy in a better positions the purchasing power of consumer increases which also influenced the supermarkets and lots of consumer move to the supermarket instead of traditional
market for that supermarket should provide the better service to consumer which also help them to contribute to the economy. Distributors 8 * Price 5 Cross-tabulation
Count Price 5 .00 Distribut ors 8 Total Table 4.9 .00 1.00 24 20 44 1.00 34 22 56 Total 58 42 100
The relationship between distributors and price shows negative. Most of the respondent said that they suffer from distributors because this middleman increasing the price of the product it is one of the main reasons for not spreading the supermarket at all level and throughout the country .But they also provide various and available product that is needed to consumer in the supermarket so they are important part of it.
Table 4.10
The relationship between society and economy shows positive because if economy is developed it influenced the society and the society will be automatically developed and finally when society is updated and economy is in a strong position the average income of the peoples increasing. As a result the more people go to the supermarket and contribute to spread it throughout the country.
Table 4.11
The relationship between shopping environment and economy shows positive if the economy is strong the shopping environment will be developed and Secured Shopping environment encouraged the consumer to go to the supermarket. Price5 * Farmer 4 Cross-tabulation
Count FARMR .00 PRCE Total .00 1.00 23 32 55 1.00 21 24 45 Total 44 56 100
Table 4.12
The relationship between farmer and price shows negative because most of the consumer think that supermarket reduces the income of farmer and they didnt get the fair price because supermarkets purchase from the farmers at low price and sold to consumer at high price.
Chapter - Five
-Research Implication\Recommendations
-Limitation and Future Scope of Research -References
only be seen as an opportunity for small farmers if they are enabled to participate. Farmers need to have the resources and training to be able to actively participate in the rapidly transforming domestic food market. In particular, the government can work in partnership with the private sector, non-governmental Organizations and international development organizations to provide assistance to the small farmers. The assistance can take the form of helping to organize cooperatives and effective associations in order to be able to meet the scale and volume needed to supply to a supermarket.
Credit schemes need to be introduced for the farmers to be able to obtain the technology
that is required to meet the stringent quality and safety standards 138 demanded by supermarkets.
The third form of assistance could be in the form of knowledge dissemination to place
farmers in a stronger position ahead of complex negotiations. However, with an increase in demand for quality, safety, and other chain-specific requirements, there is a risk of small-scale farmers exclusion. For consumers, there is an improvement in product quality and convenience. For supermarkets, the vertical relationship offers a scope for implementing grades and standards, and other chain-specific requirements in production. It may also have given a scope for monopoly rent appropriation. For farmers, however, there are alternative channels that may help them to sell their products, albeit at a lower price compared to modern channels, and protect them against the monopolistic power of large supermarkets.
Restore or maintain the much needed policy space for agriculture and trade: Important policy tools, such as extension services, marketing boards, price support, subsidies, investment regulation and performance requirements were abolished under pressure by WTO, IMF/World Bank and FTAs.
Slow down of supermarket expansion: stop investment liberalization in the retail sector (services), control of market entry of supermarkets (see Malaysian Committee on Wholesale and Retail Trade), zoning regulations (see Thailand), business licenses etc. Limit the purchasing power of supermarkets: reform or modernize competition laws. Provide targeted and comprehensive support for small farmers: In light of about 388 Million small farmers in developing countries and the obvious limitations of development cooperation, there is a need to reflect about the introduction of new governmental instruments aiming at the enhancement and promotion of food marketing. Involve all actors concerned in the formulation of standards: One might think of the role of governments in defining process criteria for the formulation of standards. Impact assessments of already existing standards on small farmers and the environment are needed. Improve access to market information and transparency: Monitoring of prices by the state. Extension of information to the small producers is necessary. Consumers should get better access to information about origin, production method and content of the food offered. Farmers are price takers and do have little bargaining power in the value chain. At the same time small farmers form the biggest group of people suffering from poverty and hunger.
general competition and regulatory oversight. Simultaneously, farmers organizations may be encouraged so that they can enhance their bargaining power.
Encouraging the fair and orderly development of the industry. The Government does not permit hypermarkets to be established with 3.5 km of housing estates or existing town centers and only one hypermarket is permitted per 350.000 people. New zoning regulations require large retail stores to be located at least 15km from commercial centre of provincial towns. However, much development took place between announcements of the draft regulations and the time they became effective in August 2003. To work with all participants in the supply chain to facilitate linkages between supermarkets and farmers and to assist traditional marketing systems and those farmers unable to meet supermarket requirements to continue to operate in a competitive way. This implies the need to carry out an assessment of the likely rate of supermarket growth in the country as well as a willingness to work in partnership with supermarkets, rather than seeing them as enemies to be controlled, in order to elaborate the respective roles of government and private sector. Consumers who find it difficult to move around or who lack access to reliable transport have lost out because large numbers of small, local shops have closed down and those that remain tend to be more expensive than supermarkets. Farmers are increasingly quoted as saying that they find it impossible to supply supermarket chains profitably. As noted, such complaints from farmers are also already being heard in Asia. Incentives to modernize could be created through enforcement of public regulations, e.g., food safety, weights and measures, taxes, competition, and personal safety, thus making traditional markets more attractive places to shop. Existing public services, such as extension services, must respond to farmers needs. They must be able to assist farmers who wish to deliver top quality, low cost and safe produce to meet the needs of supermarkets and the traditional marketing systems trying to compete with them. Particular attention needs to be given to the capacity of extension services to advice on the proper use of agrochemicals. New services need to be introduced to assist growers and their groups with business management and existing market information services need to be upgraded; The need for finance should be addressed. The standards required by commercial practices of supermarkets necessitate investments by growers. and the
In traditional marketing systems growers often receive finance from traders. Unless contractual arrangements are developed between growers and supermarkets such finance will not be available under new supply-chain modalities. Attention also needs to be paid to the legal and regulatory framework governing the horticulture sector. Governments can advise on contractual arrangements and can set up arbitration schemes. Throughout the world government quality and safety standard have lagged behind the private standards established by supermarket chains but that does not mean that official standards do not need to be established. Supermarkets in Asia usually buy on the basis of their own private standards but where produce may be exported these standards are often backed up by third-party certification.; Laboratories and sampling procedures to meet new safety concerns also need to be established; Small farmers will find it difficult, if not impossible; to compete with large farmers to supply to supermarket they are successful in competing this will probably be achieved through group activities to link either directly with supermarkets or through intermediary wholesalers. A new generation of farmer organizations may need to be developed; Finally, governments can play an important role in bringing together supermarkets and agro processors who are searching for supply with farmers who have the capacity to supply what the buyers need. Ministries of agriculture can be expected to be better informed than company buyers about the production potential of different areas.
gender specific effects of supermarket expansion that is gender specific coping and survival strategies and the way export or supermarket-production impacts on labor division within the household or on food security. Absence of supermarket shoppers list is the main limitation, for which we used nonprobability sampling method. Data were collected only from Agora, Meenabazar and PQS though day-by-day number of supermarkets is increasing in the Dhaka city. Respondents unwillingness to answer the question is another limitation. It is also noted that more females than males responded to the survey. This may be one of cultural impact
that females are more familiar with the low involvement product or grocery items. Thus, judgmental differences because of gender may have reflected in this study.
equipped to help farmers make informed decisions and to provide the kinds of support that farmers require. Governments need to recognize the trends and identify ways of supporting farmers to meet the needs of modern supply chains and also to assist existing marketing systems to compete with the supermarket sector
5.4 References:
1. Berdegue, J.A., Balsevich, F., Flores, L., Mainville, D. and Reardon, T. 2003. Case study
2. Blythman, Joanna (2004) 'Shopped - The shocking power of the British supermarkets', Harper Collins, London
3. Boselie, D. and Buurma, J. 2003. Grades and standards in the Thai horticultural sector. In
Vellema, S. and Boselie, D. (eds) Cooperation and competence in global food chains, Shaker Publishing, Maastricht.
4. Chen, K. 2005. Retail Revolution, Entry Barriers and Emerging Agri-food Supply Chains
in Selected Asian Countries: Determinants, Issues, and Policy Choices. Report on research carried out for FAO (unpublished)
5. Clay, W., Galvez-Nogales, E. & Wall, G. 2004. Meeting consumers needs and
preferences for fruit and vegetables. Paper presented at WHO-FAO Joint Workshop on Fruit and
6. Faiguenbaum, Srgio, Julio Berdegu and Thomas Reardon (2002). The rapid rise of
supermarket. 7. Farina, Elizabeth, Ruben Nunes and Guilherme Monteiro (2005). Supermarkets and Their Impacts on the Agrifood System of Brazil: The Competition Among Retailers. 8. http://www.fao.org/ag/ags/subjects/en/agmarket/supermark.html
9. Internet (search engines and websites)
10. Joel Rickett, Supermarkets (2007) 11. Naresh k.Malhottra Marketing Research5th Edition 12. Reardon T., C.P. Timmer, and J. Berdegu (2004). The Rapid Rise of Supermarkets in Developing Countries: Induced Organizational, Institutional, and Technological Change in Agrifood Systems. e JADE: electronic Journal of Agricultural and Development Economics (www.fao.org/es/esa/eJADE). Vol. 1, No. 2, 2004, pp. 168-183.
13. Reardon, T., Timmer, C.P., Barrett, C.B. & Berdegue, J. 2003. The Rise of Supermarkets
in Africa, Asia, and Latin America. American Journal of Agricultural Economics 85(5). Digal, L.N. & Concepcion, S.B. 2004. Securing Small Producer Participation in Restructure
14. Supermarkets and quality and safety standards for produce in Latin America: food safety
in food security and food trade. (Brief) Washington, D.C.: International Food Policy
AgriculturalEconomics, Vol. 85, Number 5, pp. 1140-1146. 16. Traill, Bruce (2006). The Rapid Rise of Supermarkets? Development Policy Review.Vol. 24 Issue 2, Pp. 163 174.
17. YasminImrana, Uddin Jashim , Parvin Shehely (2005).Emergence of
Supermarket:The Ratoinal for changes in Consumers Shopping Pattern for Household Requirements.Journal of Business Studies,vol,XXVI.No.1.
Appendix
Question 1: Supermarkets have profound impact on the buying pattern of the common people --- to what extent do you agree with this statement? A. Strongly disagree D. Agree B. Disagree E. Strongly agree C. Neither agree nor disagree
Question 2: Supermarkets have positive impact on our society--- to what extent do you agree with this statement? A. Strongly disagree B. Disagree E. Strongly agree C. Neither agree nor disagree D. Agree
Question 3: Shopping environment motivates consumers the most to shop in the supermarkets instead of the traditional grocery shops or markets-- to what extent do you agree with this statement? A. Strongly disagree B. Disagree E. Strongly agree C. Neither agree nor disagree D. Agree
Question 4: The products price of supermarket is higher than the traditional stores-- to what extent do you agree with this statement? A. Strongly disagree B. Disagree E. Strongly agree C. Neither agree nor disagree D. Agree
Question 5: The emergence of supermarkets has positive impact on our farmers--- to what extent do you agree with this statement? A. Strongly disagree B. Disagree C. Neither agree nor disagree D. Agree
E. Strongly agree
Question 6: Supermarkets have positive impact on our culture--- to what extent do you agree with this statement? A. Strongly disagree B. Disagree E. Strongly agree C. Neither agree nor disagree D. Agree
Question 13: Producers are the most beneficiaries for the emergence of supermarkets in Bangladesh-- to what extent do you agree with this statement? A. Strongly disagree B. Disagree E. Strongly agree C. Neither agree nor disagree D. Agree
Question 14: Consumers are the most beneficiaries for the emergence of supermarkets in Bangladesh-- to what extent do you agree with this statement? A. Strongly disagree B. Disagree E. Strongly agree C. Neither agree nor disagree D. Agree
Question 7: Distributors are lest beneficiaries for the emergence of supermarkets in Bangladesh-- to what extent do you agree with this statement? A. Strongly disagree B. Disagree E. Strongly agree C. Neither agree nor disagree D. Agree
Question 10: The economy of Bangladesh is favorable for the emergence of supermarkets--to what extent do you agree? A. Strongly disagree B. Disagree E. Strongly agree C. Neither agree nor disagree D. Agree
Tables of Hypothesis:
Supermarkets have positive impact on buying pattern
Observed N Expected Residual
N strongly disagree disagree neither disagree nor agree agree strongly agree 12 Total Table 4.13 13 26 15 19 25 1 99 16.5 16.5 16.5 16.5 16.5 16.5 -3.5 9.5 -1.5 2.5 8.5 -15.5
24 25 100
20.0 20.0
4.0 5.0
Descriptive Statistics N BUYPATRN SHOPENV SOCIETY FARMER PRICE ECONOMY MANUFACR DISTRIBUTORS CONSUMER CULTURE Valid N (listwise) 100 100 100 100 99 100 100 100 100 100 99 Minimum 1 1 1 1 1 1 1 1 1 1 Maximum 5 5 5 5 5 5 5 5 5 5 Mean 3.42 2.94 3.14 2.88 3.26 2.83 2.99 2.99 2.72 3.16 Std. Deviation 1.357 1.406 1.378 1.458 1.397 1.484 1.418 1.396 1.296 1.354