final report of internship on supermarket

7/29/2019 Final Report of Internship on Supermarket

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Chapter - One

Socioeconomic impact

Of

Supermarket

With a different service


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1. Introduction:

A supermarket, also called a grocery store in some parts ofNorth 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 ahypermarket or superstore. The supermarket typically comprises meat, freshproduce, dairy, and

baked goods departments along with shelf space reserved forcanned and packaged goods as well

as for various nonfood items such as household cleaners,pharmacy products, andpet 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 check-

out 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.

1.1 Aims and objectives:
http://en.wikipedia.org/wiki/North_Americahttp://en.wikipedia.org/wiki/Self-servicehttp://en.wikipedia.org/wiki/Retailing#Retail_typeshttp://en.wikipedia.org/wiki/Foodhttp://en.wikipedia.org/wiki/Merchandisehttp://en.wikipedia.org/wiki/Departmentalizationhttp://en.wikipedia.org/wiki/Grocery_storehttp://en.wikipedia.org/wiki/Hypermarkethttp://en.wikipedia.org/wiki/Meathttp://en.wikipedia.org/wiki/Producehttp://en.wikipedia.org/wiki/Dairyhttp://en.wikipedia.org/wiki/Canninghttp://en.wikipedia.org/wiki/Pharmacyhttp://en.wikipedia.org/wiki/Pethttp://en.wikipedia.org/wiki/Alcoholic_beveragehttp://en.wikipedia.org/wiki/Medicinehttp://en.wikipedia.org/wiki/Clothinghttp://en.wikipedia.org/wiki/Marginhttp://en.wikipedia.org/wiki/Staple_foodshttp://en.wikipedia.org/wiki/Breadhttp://en.wikipedia.org/wiki/Milkhttp://en.wikipedia.org/wiki/Sugarhttp://en.wikipedia.org/wiki/Loss_leaderhttp://en.wikipedia.org/wiki/Profit_marginhttp://en.wikipedia.org/wiki/Labor_theory_of_valuehttp://en.wikipedia.org/wiki/Self_checkouthttp://en.wikipedia.org/wiki/Self_checkouthttp://en.wikipedia.org/wiki/North_Americahttp://en.wikipedia.org/wiki/Self-servicehttp://en.wikipedia.org/wiki/Retailing#Retail_typeshttp://en.wikipedia.org/wiki/Foodhttp://en.wikipedia.org/wiki/Merchandisehttp://en.wikipedia.org/wiki/Departmentalizationhttp://en.wikipedia.org/wiki/Grocery_storehttp://en.wikipedia.org/wiki/Hypermarkethttp://en.wikipedia.org/wiki/Meathttp://en.wikipedia.org/wiki/Producehttp://en.wikipedia.org/wiki/Dairyhttp://en.wikipedia.org/wiki/Canninghttp://en.wikipedia.org/wiki/Pharmacyhttp://en.wikipedia.org/wiki/Pethttp://en.wikipedia.org/wiki/Alcoholic_beveragehttp://en.wikipedia.org/wiki/Medicinehttp://en.wikipedia.org/wiki/Clothinghttp://en.wikipedia.org/wiki/Marginhttp://en.wikipedia.org/wiki/Staple_foodshttp://en.wikipedia.org/wiki/Breadhttp://en.wikipedia.org/wiki/Milkhttp://en.wikipedia.org/wiki/Sugarhttp://en.wikipedia.org/wiki/Loss_leaderhttp://en.wikipedia.org/wiki/Profit_marginhttp://en.wikipedia.org/wiki/Labor_theory_of_valuehttp://en.wikipedia.org/wiki/Self_checkouthttp://en.wikipedia.org/wiki/Self_checkout


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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 Objective-

To 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.

1.2Broad Research Question:

To what extent supermarkets influence the social and economic condition from the

perspective of Bangladesh?


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Chapter Two


OfSupermarket



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2.1 Literature Review:

The traditional stores for grocery shopping can be said as the small business (whose sale and

assets are not large enough to influence its environment; Griffin 2002) that generally offer

limited merchandise and provide services mostly by untrained shop workers. On the other hand

bazar is a location centric concept where many sellers gather with their limited variety of

merchandise (mostly perishable) for sales and customers are required to transact in every point of

sale, which means more time consumption for purchasing full-scale groceries.

The evolution of supermarket started in the United States and several economical, social,political, technological, and educational changes had complemented to the revolution of

supermarket. This change has logically involved diverse professional to think about the issues

behind this revolution mostly in the developed world. At the same time developing nations also

felt the shake of it, as the felicitation of globalization, though in limited scale till now. Our

expedition toward the contributing factors behind the change in grocery shopping will bring

clarity to the analyses.

The change in retail formats came from the concept of open shelves, where public could be let

into the stock room and would not create havoc (George Wedd, 1998). He also focused that

tradition shops were highly specialized; stationers sold stationary; greengrocers sold vegetables-so that a shopping trip had to be carefully planned (George Wedd, 1998).

Two terms appeared as unorganized sector (traditional stores) and organized sector

(supermarket/superstore) and it has been as a shift f retail stores are characterized by large

professionally managed format stores providing goods and services that appeal to customers, in

an ambience that is conducive for shopping and agreeable to customers. She has focused on

liberalization, more spending power (to particular income group), more educated population, and

most importantly, exposed to brands and products through television behind the development of

organized sector. She also cited that division of joint families giving way to nuclear families,

and the increasing number pf working couples also contributed to the acceptability of

supermarket shopping. Moreover, shopping convenience becoming more demandable by rising

number of two income families Riche, 1987).

Social and economical factors like, increase in multiple career households (means more

disposable income) and demand for convenience, quality, and time savings (Doris J.Newton,

2003) made positive correlation to supermarket sales. He also outlined the concept of one stop


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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 examinationsuggested 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 widevariety of food, laundry, and household products (Kotler and Armstrong 2003).


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2-1 .1 Supermarkets:

The concept of a self-service grocery store was developed by American entrepreneurClarence

Saunders and his Piggly Wiggly stores. His first store opened in Memphis,Tennessee, in 1916.

Saunders was awarded a number ofpatents 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 andBerdegue 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 Hess2005)

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)

2-1.2 Transaction Characteristics of Supermarket vs. Traditional

Market Channels

Supermarket Channel Traditional Market Channel

Volume High Medium/Low

Organoleptic quality High Medium

Price Regular w/discounts Regular

Transaction costs Low recurring High/Medium

Service & logistics

requirements

High Low
http://en.wikipedia.org/wiki/Self-servicehttp://en.wikipedia.org/wiki/United_Stateshttp://en.wikipedia.org/wiki/Entrepreneurhttp://en.wikipedia.org/wiki/Clarence_Saundershttp://en.wikipedia.org/wiki/Clarence_Saundershttp://en.wikipedia.org/wiki/Piggly_Wigglyhttp://en.wikipedia.org/wiki/Memphis,_Tennesseehttp://en.wikipedia.org/wiki/Tennesseehttp://en.wikipedia.org/wiki/Patenthttp://www.businessdictionary.com/definition/store.htmlhttp://www.businessdictionary.com/definition/sell.htmlhttp://www.businessdictionary.com/definition/food.htmlhttp://www.businessdictionary.com/definition/household.htmlhttp://www.businessdictionary.com/definition/item.htmlhttp://www.businessdictionary.com/definition/customer.htmlhttp://en.wikipedia.org/wiki/Self-servicehttp://en.wikipedia.org/wiki/United_Stateshttp://en.wikipedia.org/wiki/Entrepreneurhttp://en.wikipedia.org/wiki/Clarence_Saundershttp://en.wikipedia.org/wiki/Clarence_Saundershttp://en.wikipedia.org/wiki/Piggly_Wigglyhttp://en.wikipedia.org/wiki/Memphis,_Tennesseehttp://en.wikipedia.org/wiki/Tennesseehttp://en.wikipedia.org/wiki/Patenthttp://www.businessdictionary.com/definition/store.htmlhttp://www.businessdictionary.com/definition/sell.htmlhttp://www.businessdictionary.com/definition/food.htmlhttp://www.businessdictionary.com/definition/household.htmlhttp://www.businessdictionary.com/definition/item.htmlhttp://www.businessdictionary.com/definition/customer.html


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Certification & documentation

requirements

High Low

Table: 2.1

They thus benefit from considerable savings on recurring transaction and logistics costs. There isalso 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 ofmicrobes, pesticide residues, etc.

2-1.3 Trends of Supermarket

Supermarkets are viewed as markets for rich consumers. For a long time, they were only found

in large cities of the developed world and middle-income countries. However, urbanization and

increasing incomes in the developing world, Supermarkets have been spreading rapidly in Asia

as well as Bangladesh.

The first stage is the development of supermarkets in richest country within the region.The second stage involves the flow of foreign direct investment (FDI) from the rich country,

leading to the establishment of supermarkets in poorer countries within the region.

The third is the extension of the supermarkets into poor neighborhoods of large cities and towns

in all the countries.


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2-1.4 Strategic Response to the SupermarketThere are two main elements to the strategic aspects of selling to Supermarket Markets. First is

the need to participate effectively in terms of meeting the Supermarkets requirements for

product quality, volumes and services. The second is for a firm to protect its own interests in

terms of the stability of their own enterprise, for example by maintaining a diversified income

portfolio, etc. even as they make investments to participate effectively in the Supermarket

Market. These can require strategic decisions on the part of the firm to alter their product mix,

marketing portfolios, or use of technology.

The requirements of Supermarkets, detailed above, have intensified over the past few

years as the farming industry has evolved and growers have emerged who can meet their

requirements. It is hypothesized that in order for growers to participate effectively in

Supermarket Markets they must be increasingly responsive to the requirements detailed

above, while protecting the overall vitality of their businesses. Strategic responses that

are expected to be seen include:

Increases in the scale of operations

Increased specialization in vegetable production in their overall revenue stream

An increased reliance on skilled labor

Diversification of buyer portfolios to be less reliant on a limited number of buyers, and to

take advantage of the seal of quality implicit in their qualifying to sell to large retail

chains in their marketing to other enterprise


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2-1.5 The Framework & structural analyses of supermarket in

Bangladesh:

Information takes an information-centric approach to assessment of supermarkets rooted in the

information-oriented work of economists such as Stiglitz (1988). This sees development activity in terms

of transactions some interchange of goods or services and it sees information as required to support

the decisions and actions integral to all transactions.

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.

Information

Characteristics

Transaction

Process

Characteristics

Structural

Characteristics

Market

Development

Characteristics

Supermarket (&

other

information use

resources)

Changed

Characteristics:

- Information

- Process

- Structure


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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.


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2-1.6 Social Impact

Social impact of supermarket defined when they take the risks, create the jobs and provide

the innovation and example needed to build a sustainable society through too big for micro-

finance and too small to attract conventional investment, they usually have strategy,networks,& access to capital to grow their businesses. (Fbrica Pochi-2008)

2-1.7 Business Model of Supermarket

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 strategyto 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.


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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 providethe 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.
http://www.agorapartnerships.org/community/consultants/consultantshttp://www.agorapartnerships.org/community/consultants/consultants


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2-1.8 Social Impact Areas

Supermarkets create social changes by helping early stage entrepreneur succeed. Successful

entrepreneurs in poor communities create the best anti-poverty program of all, generating jobs,

inspiring others to enter the entrepreneurial market, and creating a various cycle of economicgrowth. Supermarket does not focus specific industries, but instead works with companies that

can create impact in four focus areas.

1. Job Creation

2. Role Models-Bases of the Pyramid entrepreneurs

3. Product and services for low income consumers or the Base of the Pyramid

4. Climate Change and the Environment

Creating and Sustaining Employment:

Supermarket works with companies that have high growth potential and can create new, formal-

sector job opportunities in their communities. Formal economy jobs provide better benefits and

protections such as health care maternity leave than informal economy jobs.

Products and Services for Low Income Consumers:

Supermarket aims to support enterprises that produce goods and services that benefit low-income

consumers who constitute thebase of then pyramid making under 200tk each day. These

consumers often dont have access to many of the products and services that middle and higher-

income individuals take for granted.

Role Models-Base of the pyramid Entrepreneurs:

Supermarket will work with anyone who has entrepreneurial energy and a passion to grow their

business; including entrepreneurs from socioeconomic backgrounds where opportunities to

create a successful business are constrained. Supermarket helps these entrepreneurs enter the

formal sector, and hopefully through their success, serve as role models for other entrepreneur.

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


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2-1.9 Positive Impact of Supermarket in the Society

The growth of supermarket can be related to increased demand for the services they can provide,resulting from:

Rapid urbanization;

Per capita income growth and the growth of a middle class;

Increasing employment of women, with a consequent increase in the opportunity cost of

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.


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2-1.10 Negative Impact of Supermarket in the Society

Shopping at supermarkets is destroying agriculture and ruining the countryside:

Agriculture faces the enormous problem of supermarket. This came after an equally damning

series of programs about the way supermarkets were providing poor quality food high in sugar,

salt and saturated fats, including fruit picked early from the far corners of the world and bread

made with enzymes to increase shelf life.

Many of the chickens ending up on supermarket shelves had a miserable life suffering in large

sheds or in cramped cages and so overfed that their legs cannot support their own weight. There

is even greater animal cruelty involved with meat sourced by supermarkets from abroad,

produced under conditions which would be illegal. It is the long distance haulage of livestock,

brought about by the insistence of supermarkets on using just a handful of mega-abattoirs, which

was a major contributing factor to the spread of foot and mouth disease.

Shopping at supermarkets supports factory farming, poor animal welfare and the spread

of disease:

People can only eat so much food, so logic dictates that shopping at supermarkets puts village

shops and high street stores out of business. Every supermarket that opens results in a net loss of

200-300 jobs, as a whole network of local shops and their suppliers is destroyed. Whereas money

spent in independent shops tends to stay in the local economy, supermarkets act as giant vacuum

cleaners; sucking money out of an area and putting it into the bank accounts of distant

shareholders.

Shopping at supermarkets dismantles communities and undermines local economies:

In 2003 a House of Commons Committee blamed supermarkets for fostering an environment that

allows gang masters to recruit foreign casual workers to pick fruit and vegetables for a pittance.

The exploitation is even greater in relation to third world suppliers and this can make one of the

biggest contributions to supermarket profits.

Shopping at supermarkets exploits both the people and the land of developing countries:

Supermarkets aim to maximize profits on a national scale and tell farmers to grow two or three

varieties of crops in large enough quantities to supply all their stores. The result of this is more

use of chemicals (less varieties equals greater threat from pests and diseases) and a subsequent

loss of wildlife and threat to health.


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2-1.11 Impact on Culture

Business cannot grow if there is not a culture to support them to support them. To that end,

Supermarket works to educate and inspire entrepreneurs. Supermarket normally organized:

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.

2-1.12 Impact on entrepreneur and Company Level

Entrepreneur level

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 tolearn. 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


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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.

2-1.13 Economic Impact:Supermarkets compete with other smaller stores for convenience shopping, and that the market

definition therefore needs to encompass convenience retailing both in convenience stores and in

supermarkets. The Institute of Grocery Distribution (IGD), along with others in the industry, uses

the ore restricted definition of retailing in convenience stores.

The criteria that IGD uses in deciding whether a retail outlet counts as a convenience store are as

follows:

(a) First, the store must be below 280 sq m (3,000 sq ft), as stores greater than this size

are prohibited by law from opening for more than 6 hours on a Sunday;(b) Second, the store must sell retail food and drink, for consumption off the premises, as its

main business activity;

(c) Third, the store must sell at least eight out of a list of fifteen core product categories.

2-1.14 Positive Impact of Supermarket in the Economy

There are a range of possible commercial advantages that supermarkets may enjoy in the

convenience retailing sector. These are discussed below, starting with those which would raise

the least competition concerns.

Superior management: If supermarkets expanding share of the convenience market results

simply from superior management, this would not raise any competition concerns.

In any event, we would expect to see examples of good and bad management among both

supermarkets and other convenience retailers, without the supermarket players having a

systematic advantage.


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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 ofindependent 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 morefavorable 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.


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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 besome consolidation of these practices. At present, at least the following channels can be

seen:

2-1.15 Negative Impact of Supermarket in the Economy

The Costs of Entry:

The cost of entry into the convenience store sector, and the extent to which it has been affected

by the entry into the sector of the supermarkets, was one of the central issues because of the

heady prices being paid by groups to acquire competitor chains, independent c-store operators

have been given an inflated idea of the value of their stores. Acquisitive corporate operators are

prepared to pay a higher price per store in order to acquire groups and thereby secure a

significant increase in market share.

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.


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Constraints Facing Local Suppliers:

The fact that supermarkets are slowly taking over the high-value segments of the food retailmarkets in Bangladesh offers great opportunities for local suppliers to broaden and deepen their

markets and to increase their incomes. However, selling to supermarkets is not as easy as selling

to open markets in the neighborhoods of large cities and small towns. Local suppliers face many

challenges as they supply fresh fruit and vegetables to supermarkets in Bangladesh.

First, local suppliers have to adhere to strict food safety and quality standards that are demanded

by supermarkets. Unlike supplying to the open market, suppliers to the supermarkets have to

ensure that the quality of their products is compatible with the needs of the high-income

customers. This pose as a big challenge because the suppliers, mainly small and medium-scale

fresh fruit and vegetable producers

Second, in the supermarket supply channel, suppliers are expected to deliver the agricultural

produce directly at the backdoor of the supermarkets. However, with poor private infrastructure,

such as packing houses and lack of pre-cooling and cooled transportation, post-harvest losses

among local suppliers are very high.

The third factor that is undermining local suppliers ability to participate in the supermarkets

channel is their ability to remain consistent in their supply to the markets. the supermarket at

Under such conditions, suppliers need a high level of professionalism to be able to consistently

produce high-quality products..

Independent buying groups and wholesalers:

Some in the industry have voiced concern that the acquisition of convenience stores by

supermarkets may undermine the viability of the buying groups and wholesalers serving other

remaining convenience stores. This might happen because these groups will lose members and

hence scale advantages. If this is the case, then continued expansion by the supermarkets will

have the effect of further weakening the competitive constraints on supermarket behavior in the

convenience retailing sector. This reduction in viability might happen in at least two ways:

(a) Buying groups and wholesalers may lose bargaining power with suppliers, further

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


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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.

Impact of buyer power:

The buyer power of supermarkets already distorts competition and creates a barrier to entry in

the grocery sector, and may give rise to detrimental effects on consumers.

The expansion of supermarkets into the convenience store sector is likely to exacerbate the

problem, for two reasons:

(a) A greater proportion of grocery sales will be subject to distorted competition;

(b) As supermarkets increase their share of grocery sales their buyer power is likely to increase

further.

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.


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2.3Model Specification:

I use a graphical model to measure the impact of supermarket in the society and the economy of

Bangladesh. The model is designed to provide or leverage comprehensive and integrated services

to help identify, advise, invest and support entrepreneurs working to build companies thatimprove their communities.

Figure 2.3 (Adapted by Richard Heeks & Alemayehu

Molla-2008)

2-3.1 The Framework

In the broadest sense, this draws from new institutionalism. From this perspective, "Institutions

are the rules of the game in a society or, more formally, are the humanly devised constraints that

shape human interaction." (North1990:3). They may be formal sanctions (regulations such as

rules, laws or contracts) or they may be informal sanctions (such as the norms, values and

meanings bound up in the notion of culture). We can summarize the relationship to technology

and human behavior in the following way (adapted from Orlikowski 1992):

Impact assessment could therefore use these frameworks but might need to extend them in two

ways.

First, Looking a broader range of cultural norms and values.

Second, Adding impacts on the other type of institutions formal regulatory constraints: rules,

laws and contracts.

Impact of

supermark

et:

Economy

Society

Society

ImpactsInfluences

Invents, Designs, Uses

Constrains, Enables


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2-3.2 Relationship Between supermarket and social impact:

In various studies the relationship between service quality and customer preference Loyalty had been

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 formalregulatory constraints: rules, laws and contracts.

2-3.3 Relationship Between supermarket and Economic impact:

The important point here is recognition that supermarkets compete with other smaller

Stores for convenience shopping, and that the market definition therefore needs to encompass

convenience retailing both in convenience stores and in supermarkets.

o 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

o 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 competitiveconvenience 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).


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2.4 Development of Hypothesis:

Alternative Hypotheses Statements

H-1 Emergence of supermarkets have positive impact on society

H-2 Supermarkets have positive impact on buying pattern

H-3 Supermarkets have positive impact on shopping environment

H-4 Emergence of supermarkets have positive impact on our economy


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Chapter Three


OfSupermarket



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3.1 Nature of the study:

This research will be descriptive in nature. The reason of choosing this type of research is the

basic objective of research is to describe something, especially about the impact of the present

situation of the supermarket in the society and economy.

3.2 Sources of Data:

In conducting this report basically, there have been two types of data and information

used such as primary and secondary data.

3.3 Method of data collection:

For completing this research data will be collected in two ways.

Figure 3.1

Data &

Primary Source Secondary

Source

(Originate from)

Personal investigation withsupermarket authority.

Personal experience gained byvisiting different supermarket

direct observations

face to face conversation withthe customer

Different Procedurepublished by supermarket

Study of features, articles,prospectus.

Publications of variousMagazines, Newspapersetc.

Web site searching data onsupermarket

Annual & Social impact

Report of Agora


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3.4 Sampling Distribution:

Probability sampling method will be used with simple random sampling so that samples are

externally homogeneous and internally heteronymous.

Our study zone was the Dhaka area. Because of resource and time constraints, and the preliminary nature

of this investigation, Data have been collected from 50 customers of a major supermarkets in Bangladesh

and the response rate was 90%. The average age of the respondents was 23-50 years 61 % respondents

were male and 39% were female. To obtain a probability sample, considerable effort was devoted to

selecting the appropriate sampling plan. The population was defined as customers of available

supermarkets for at least 1 year. We identified and interviewed the person mainly in charge of food

purchasing. Data were collected inNovember and December of 2009 at the respondent's residence.

Target population Elements: customer of supermarket user

Extent: Dhaka

Time: 3 month (Oct 2009 to Dec 2009)

sampling frame customers who regularly purchase at

supermarket

sampling technique probability sampling (Random probability

sampling

Sample size 100

3.5 Survey Instrument


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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.

3.6 Data Analysis Method:

To conduct data analysis, the collected data and information will processed by survey used in

order to make it more informative and analytical. The questionnaire will used to conduct survey

to know the opinion of customer as well as supermarket operators about the supermarket. And

Finally Cross-tabulation on SPSS method is used to find out the output of data and Chi-square

analysis is used to test the effectiveness of hypothesis.


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Chapter - Four

Result of Data Analysis/

Findings and Discussions

Socioeconomic impactOf

Supermarket


4.1 Statistical Analysis:

The statistical analysis conducted in two ways and both of these analyses is based on the SPSS.

Here the steps, procedure, analysis and result are presented one by one to identify the

relationship between supermarket society and economy with other variables.


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4.1.1The Steps of Hypothesis Testing

The hypothesis has been tested using Chi-square analysis. This analysis is used to assess the

effectiveness of hypothesis statement by eight steps with the statistical analysis. Therefore the

analysis was done with the data gather from the respondents. The following section describes the

detail of the eight steps which I was following in the hypothesis testing.

Step 1 Formulate H0 and H1

Step 2 Select an appropriate test

Step 3 Choose the level of significance

Step 4 Collect data and calculate the test statistic

Step 5 Determine the probability

Associated with the statistic

Step 6 Compare probability with level of significance

Step 7 Reject or do not reject H0.

Step 8 Draw a Marketing research conclusion

Figure 4.1

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


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Buying

pattern

Shopping

environment Society Economy

Chi-

Square(a,b

)

25.667 10.300 12.700 6.500

Df 5 4 4 4Asymp.

Sig..000 .036 .013 .165

Table: 4.1

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

4-1.3 Result of the Test of the Hypothesis:

Hypothesis-1

H0: Supermarkets have not positive impact on buying pattern

H1: Supermarkets have positive impact on buying pattern

Here,

P (z) >.05

25.667 > 11.071

It is seen from the table that the first null hypothesis is rejected and alternative hypothesis

statement is accepted. The output is conducted at 95% significance level and with 5 degree of

freedom the table value of chi-square is 11.071 which are lower than the calculated value

(25.667) .So we can say that the alternative hypothesis is accepted.

Hypothesis-2

H0: Supermarkets have not positive impact on the Shopping Environment

H1: Supermarkets have positive impact on the Shopping Environment.

Here,

P (z) >.05


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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


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


Hypothesis-4

H0: Supermarkets have not positive impact on Economy.

H1: Supermarkets have positive impact on Economy

P (z)


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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.

4-1.3 Summary of the Results of Hypothesis Test:

Path Hypothesis Result

Buying Pattern------Supermarket H1 Accept

Shopping Environment----Supermarket H2 Accept

Society------supermarket H3 Accept

Economy-------Supermarket H4 Reject

Table 4.2

From the above relationships, it is clear that, the each value associated with other variables that

are not same. That means, the null hypothesis can be rejected which means, the alternative

hypothesis is accepted for assessing the effectiveness. So, the hypotheses test can be done in both

ways and the results would be the same; rejection of null hypothesis and acceptance of

alternative hypothesis. So, it can be concluded that, there are some relationships among the

variables.

4.2 Cross-Tabulation analysis:

Cross-tabulation analysis describes two or more variables simultaneously. A cross-tabulation is

the merging of the frequency distribution of two or more variables in a single. It helps us tounderstand one variable such as buying pattern relates to another variable such as shopping

environment.

In these analysis among the many variables of supermarket most effective variables are chooses

to identify to what extent they relate to the supermarket, society, and economy. The data analysis

was made based on Cross-Tabulation analysis for assessing the effectiveness of supermarket.


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4.2.1 Cross-tabulation Analysis: Model Summery

Descriptive Statistics

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

Total.00 1.00

Buying

pattern 1

.00 19 21 40

1.00 33 27 60

Total 52 48 100

Table 4.4

Variables Mean Standard

Deviation

Buying Pattern

Shopping Envm

Society

Farmer

Price

Economy

Manufacturer

Distributors

ConsumerCulture

3.42

2.94

3.14

2.88

3.26

2.83

2.99

2.99

2.723.16

1.357

1.406

1.378

1.458

1.397

1.484

1.418

1.396

1.2961.354


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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.

Buying pattern 1 * Culture 10 Cross-tabulation

Count

Culture 10

Total.00 1.00

Buying

pattern 1

.00 22 18 40

1.00 25 35 60

Total 47 53 100

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.

Shopping Environment 2 * Culture 10 Cross-tabulation

Count

Culture 10

Total.00 1.00

Shopping

Environment 2

.00 23 29 52

1.00 24 24 48

Total 47 53 100

Table 4.6

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


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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

Total.00 1.00

Farme

r

.00 29 26 55

1.00 20 25 45

Total 49 51 100

Table 4.7

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 theeconomy 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.

Consumer 9 * Economy 6 Cross-tabulation

Count

Economy

Total.00 1.00

Consume

r 9

.00 27 26 53

1.00 22 25 47

Total 49 51 100Table 4.8

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


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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

Total.00 1.00

Distribut

ors 8

.00 24 34 58

1.00 20 22 42

Total 44 56 100

Table 4.9

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.

Society 3 * Economy 6 Cross-tabulation

Count

Economy 6

Total.00 1.00

Societ

y 3

.00 30 25 55

1.00 19 26 45

Total 49 51 100

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.


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Shopping Environment 2 * Economy 6 Cross-tabulation

Count

Economy

Total.00 1.00

ShoppingEnvironment 2

.00 27 25 521.00 22 26 48

Total 49 51 100

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

CountFARMR

Total.00 1.00

PRCE .00 23 21 44

1.00 32 24 56

Total 55 45 100

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


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-Research Implication\Recommendations

-Limitation and Future Scope of Research-References


Of

Supermarket


5.1 Research implication:

5-1.1 Policy Implication

The supermarket sector is slowly rising to have an important and dominant share of food

retailing. The participation of supermarkets in the domestic food market will substantially

change the conditions of farmers. This change will mean new opportunities for farmers who are

able to supply to these supermarkets, but also stiff challenges to those small producers who arenot able to supply what supermarkets demand. It is, therefore, important for the Government of

Bangladesh isabout these changes, as well as the opportunities and challenges facing farmers.

With this kind of information, Government would be able to put in place programs that will help

farmers to upgrade their pre- and post-harvest practices in order to meet the requirements of

these new markets, and do so in win-win ways that will make this inevitable transformation most

advantageous for farmers, consumers, and retailers (Reardon 2004).Supermarket expansion can


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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 placefarmers 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.

5-1.2Guidelines to Supermarket Policy makers

From the business model of supermarketsthe focus is on maximizing returns for shareholders,

demanding increasing flexibility through just-in-time delivery, tighter control over inputs and

safety and quality standards and ever-lower prices. It becomes obvious that political measures

cannot be limited to the compliance with standards or access to resources. Any discussion about

supermarkets has to start with the question how a social and environmentally sustainable food

system would look like. A whole range of measures is necessary to deal with the expansion ofsupermarkets:

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.


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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.

5-1.3Proposed Options for Government

The government of Bangladesh can choose these proposed options for the development of

supermarket which have a great impact on the society and economy of Bangladesh.

There is a need to build institutions and mechanisms to increase small-scale farmers

participation in the modern food value chain. Modern vendors who link farmers to

supermarkets may be used for this purpose. For instance, training and credit can be

channeled through modern vendors.

It is imperative to ensure fair competition so that concentration in retailing does not lead

to the abuse of market power in the form of market foreclosure and other restrictions.

Supermarkets and modern retail chains should be brought under the laws governing


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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 ofsupermarket 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 and the

commercial practices of supermarkets necessitate investments by growers.


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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 beestablished;

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.

5.2 Limitations and Scope of Future Research

5.2.1Limitations

Further analysis is needed especially with regard to sustainability in farming and the

gender specific effects of supermarket expansion that is gender specific coping and

survival strategies and the way export or supermarket-production impacts on labordivision within the household or on food security.

Absence of supermarket shoppers list is the main limitation, for which we used non-

probability 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


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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.

5.2.2 Suggestions for further research

The development of supermarkets is still in a preliminary stage in this country. As this study isfocusing on the some aspect of supermarket shopping in relation to traditional options, there is

still a huge room for study. This study can be done by focusing on the income levels of the

supermarket consumers to find out the correlation between these two variables .There are

multivariate implications of pricing in a developing country and pricing impact on store choice

decisions to various group of consumers will be worthy. The larger and smaller purchase

requirement also correlated with the price format/price variability or vice versa. The utilization

of shelf spaces for a particular product and its generation of profit volume can be very critical to

judge but will provide very in depth findings about profitability.

Consumers shopping pattern is also variable of the standard of living and thus, we are sure thatimpacts of supermarkets also can be a matter study for sociology and other relevant social

science fields. The supermarkets are popularizing more readymade foods in a convenient way,

which can result time saving from cooking and surplus time for recreation, workplace, fulfilling

hobbies, etc. Here i am trying to focus only the socioeconomic impact of supermarket in

Bangladesh but it is not enough to understand the overall perspective of emerging supermarket in

Bangladesh so i suggest further study for the overall aspect of supermarket in Bangladesh

5.3 Concluding remarks

Consumers perception about higher quality of products(including perishable products) is the

contribution of the neat outlook of products, space, allocation for products, and self-selection

facility(which is totally impossible for traditional options).Additional benefits and fulfillment of

all household requirements by supermarkets are incomparable to traditional stores, which

ultimately contributed to the positive image of supermarkets. The additional benefits are actuallythe application of modern marketing strategies, which represent the emergence of professional

touch at the household shopping sector in Bangladesh.

Significant changes are taking place in fresh produce retailing in much of Asia and while

these may be relatively slow to take effect in the whole region they will not be reversed. To date,

most policymakers have had little or no exposure to these trends and are thus ill


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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

5.4References: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


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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 Chainsin 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


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Research Institute (IFPRI), 2 pages.

http://www.ifpri.org/2020/focus/focus10/focus10_12.pdf

15.The Rise of Supermarkets in Africa, Asia, and Latin America. American Journal of

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

Questionnaire for survey


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Name:

Address:

Mobile No:

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 B. Disagree C. Neither agree nor disagree

D. Agree E. Strongly agree

Question 2: Supermarkets have positive impact on oursociety--- 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 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?


E. Strongly agree

Question 4: The products price of supermarket is higher than the traditional stores-- to what

extent do you agree with this statement?


E. Strongly agree

Question 5: The emergence of supermarkets has positive impact on our farmers--- to what

extent do you agree with this statement?



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E. Strongly agree

Question 6: Supermarkets have positive impact on ourculture--- to what extent do you agree

with this statement?


E. Strongly agree

Question 13: Producers are the most beneficiaries for the emergence of supermarkets in

Bangladesh-- to what extent do you agree with this statement?


E. Strongly agree

Question 14: Consumers are the most beneficiaries for the emergence of supermarkets in



E. Strongly agree

Question 7: Distributors are lest beneficiaries for the emergence of supermarkets in



E. Strongly agree

Question 10: The economy of Bangladesh is favorable for the emergence of supermarkets---

to what extent do you agree?

A. Strongly

final report of internship on supermarket

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