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The Impact of Supermarkets on Small Businesses in Carbon Public Market
Allyssa S. Albores
B.S. Computer Science – II
I. Background on Carbon Public Market
(Photo Source: Fisca Plyder. (n.d.) http://tenminutes.ph/join-weekend-shopping-madness-cebu-city/)
“The oldest and largest public market in Cebu City — Carbon Market — is a vibrant conglomeration of all types of vendors and goods.” (Everything Cebu, 2010).
“The wet market area of Carbon is the place to go to when you have to buy fish, seafood and meat products. Vendors of vegetables and fruits are visible at every corner of the market. The handicraft stores and flower vendors are located at the market’s entrance facing the college campus of the University of San Jose Recoletos.” (Everything Cebu, 2010).
“Carbon Public Market is actually divided into three distinct units. All meat and seafood products can be found in Unit One while Unit Two has stalls selling all kinds of vegetables and grains. You can buy any type of fruit at Unit Three of the Carbon Public Market.” (Peanut Browas Blog, April 2016)
“The prices of everything sold at the Carbon Public Market are significantly lower than the prices at a supermarket or department store. In fact, there are instances where the price of an item sold in stores in the city is twice as high as the price in Carbon. In other words, an item priced at PHP 100 in a supermarket is sold at PHP 50 at Carbon.” (Peanut Browas Blog, April 2016)
II. Background on Supermarkets
“A large retail market that sells food and other household goods and that is usually operated on a self-service basis.”
“The supermarket, as it came to be known, was initially a phenomenon of independents and small, regional chains. Eventually, the large chains caught on as well, and they refined the concept, adding a level of sophistication that had been lacking from the spartan stores of the early 1930s. In the late 1930s, A&P began consolidating its thousands of small service stores into larger supermarkets, often replacing as many as five or six stores with one large, new one.”
III. Comparing Supermarkets and Public Markets
According to Ellickson (2015), grocery prices increase with retailer concentration. Also, independent supermarkets charge higher price and the bigger the supermarket, the prices are higher.
Ellickson, P. B. (2015). The Evolution of the Supermarket Industry: From A&P to Walmart. Retrieved from http://paulellickson.com/SMEvolution.pdf.
While you can find really cheap loss leaders in the supermarket, when quality seasonal produce is put head to head there is not much difference in price between the two, with the supermarkets coming in slightly cheaper. This test knocked out the myth that farmers’ markets are a lot more expensive.
Who has the better quality?
If the quality of flavour means a lot, the farmers’ market is for you. You have more chance of buying older varieties based on aroma, taste and flavour. The trouble is, these fruit and vegies were not bred to have thick skins so they don’t transport or last as well, unlike supermarket fruit and vegies. If flavour and aroma are less important than lasting power – shop at a supermarket.
Who is more convenient?
There are more than 170 farmers’ markets around Australia. Some are open for half a day once a month, while others run weekly. Woolworths has 961 supermarkets, Coles 776, Aldi more than 400 supermarkets and IGA has about 1400 stores of various sizes. Almost all are open seven days a week.” (Cornish, 2016)
“A study on local resistance to larger retailers with the example of market towns and the food superstore in the UK highlights that the loyalty card system adopted by large retailers was successful. Though the local retailers protested, they lacked the resources to continue the fight.” Loyalty Card – Marketing Strategy!
Hallsworth, A.G. and Worthington, S. (2000). Local Resistance to Larger Retailers: The Example of Market Towns and the Food Superstore in the UK. International Journal of Retail & Distribution Management. Vol. 28, No. 45, pp. 207-216.
“Malls, supermarkets and hypermarkets are growing rapidly adopting aggressive strategies to attract customers. These strategies in turn affect the existing small players.”
Kokatnur, S. S. (2009). Impact of Supermarkets on Marketing Strategies of Small Stores. he IUP Journal of Management Research. Vol. 8 0 VIII, No. 8.
IV. Economic Effect of the Growth of Supermarkets on Public Markets
A survey of the impacts of supermarkets on wetmarkets was made recently in Java (Suryadarma et al. 2007). Five markets were chosen as the treatment group that are near the supermarkets and two markets as the control group who are far from any supermarkets. The result showed that on average, both group experienced a decline in their business over the past three years. “The respondents revealed that the main causes for the decline were the weakened purchasing power of their customers resulting from fuel price increases and the increased competition with street vendors who occupy the parking spaces and other areas surrounding the markets, even blocking the market entrance.” The survey revealed that the third cause of the decline is the rise of the supermarkets.
Suryadarma, D., A. Poesoro, S. Budiyati, Akhmadi, and M. Rosfadhila. (2007). Impact of supermarkets on traditional markets and retailers in Indonesia’s urban centers. SMERU Research Report. SMERU Research Institute. Retrieved from http://www.smeru.or.id/report/research/supermarket/supermarket_eng.pdf.
“In the Philippines 15 percent of vegetables are said to be sold through supermarkets in Metro Manila but a smaller proportion in the country as a whole.”
Shepherd, A. W. (2005). The implications of supermarket development for horticultural farmers and traditional marketing systems in Asia. FAO. pp. 3.