Business Research Method

End Term Project

The Effect of Supermarket on

Small Business

Submitted To:
Sir Mohammad Arshad (LBS, UoL)

Submitted By:
Mohd. Muizz Amjad
02113059 - BBA (Hons), LBS, UoL

Acknowledgments:
Im grateful for the respondents who helped in conducting this study through
their feedback.
The research for this study was conducted under guidance of Sir. Mohammad
Arshad, who provided helpful guidance and feedback in the research process.

Abstract:
The buying behavior of a consumer is always different in different places.
This buying behavior of consumer is different on the basis of demographic,
culture and economy. The concept of retailing is important for countrys
economic and social situation. These businesses have a great impact on the
Pakistani consumer and have changed their behavior about shopping. Some
people are taking it as negative while a large number of consumers are
appreciating this convenience. The study is conducted to analyze the impact
of supermarkets on the small businesses in Pakistan. The study style is
descriptive and is concerned with the buying behavior of Pakistani consumer.
Quantitative technique is being used in the study and target is general
audience. This method has no big impact on the buyers income. This
suggests that the decline of trend of shopping through small market is
mostly caused by the buyers convenience.

Introduction:
A supermarket is usually a self-service grocery store with almost everything.
They range from a huge variety of food and non-food items like household,
electronics, toys, personal usage, garments, and beauty section. All are
divided into different departments. The food department includes the fresh
fruits, vegetables, chicken, beef, mutton, fish, canned food, frozen food,
bakery and confectionary. It is larger in all aspects, compared to a normal
grocery store. They have a shelf space for every item.
The normal grocery store is usually located in a residential area or at street
corner. It has been always and forever convenient for the consumer.
The only difference between a supermarket and a normal grocery store is
that a super market sells almost everything at a same place, self-serviced
and convenient. While the grocery store only sells the important food and

non-food items and lacks everything at a same place concept. At

supermarket, even if someone doesnt need a garment or bakery, but its still
there. While a customer who needs vegetables and meat, will go to shop one
and then to shop two. It will spend more time in doing so.
The supermarkets are business and customer oriented and they are usually
part of a corporate business and some; even multi-nationals. They operate
throughout the year and some 24 hours too. To initialize their business, they
spend a lot of money of advertising, marketing, sales and promotion. Once it
becomes successful, they shift their priority to consumer and for consumers
choice promotions. They usually offer the products at low prices. Some
products like bread, meat, bakery etc. usually sold at low price with more
quantity because of their shelf-life. They offer good discounts on garments,
electronics and general household items too. Customers shop by choosing
selected items and placing them into baskets and trolleys and pay at checkout. Some supermarkets are known as hyper-market that include third-party
business too. They include banks, cafes, pharmacies, and play area for
children.
Small businesses have advantages too. They include low costs, zero
advertising, strong customer loyalty, and trust relationships. Some customer
buy products in advance and pay later, its all because of loyalty and trust.
To expand a business, as an owner of small business, it will borrow money,
while the entrepreneurs take loans to capitalize, increase inventory, and
merger to expand business.
Still a small business and supermarkets can never guarantee the success of
the business, no matter how much capital is there. It all depends on
strategies by the policy makers.

Objective:
The objectives of this study is to observe the following:

To analyze the consumer preference.

To evaluate the effect on both businesses by the opposite businesses.
(small to super & super to small)
To find other services to be added in both businesses for their growth.

Problem:

The trend of supermarkets for shopping is increasing in Pakistan. There are

some serious buyers while some people just come here for enjoyment and
self-satisfaction that they have been here too. The purpose of this study is to
analyze the shopping trends among the consumers and their preference.

Literature Review:
The retailers have shown growth in sales and profit by acquiring existing
stores. The supermarket acquire the small-business person at their store and
give them the space. (Mcgurr, 2002). Much of the retailers have become
multinationals, they are not just a retailer of single country and if not; they
have the tendency to become the countrys leading brand.
The supermarkets are usually known as modern and much more organized
while the small markets are totally opposite. But thats the fact that these
terms are being widely used in developing countries. (Sengupta 2008 and
Srivastava 2008).
The concept of supermarket was unfamiliar to almost every Pakistani in the
1960s (Zirram 2011). Some government and military based mini stores were
there since independence, but they were only operational for relevant
departments employees. People in rural areas of Pakistan still uses their
traditional style of shopping while people have a choice of supermarket or
small market in urban areas of Pakistan.
The total retail sector in Pakistan is more than $43 Billion (Baloch, 2011).
While most of it is dominated by small street shops.
The affordable and convenient shopping has greatly changed the buying
behavior of a Pakistani consumer. The consumers seek more quality in more
quantity, everything under one roof. (Bokhari 2013). Moreover by the
researcher, an average consumer spends half of its income on food. The
retail business is profitable but small business or street shops are still
competing.

Purpose of the Study:

Reasons for the shopping from supermarkets by consumers and their impact
on the small businesses.

Methodology:
Sample:
A total of 100 samples was questioned from people.
Method of sampling:
Simple random sampling
Technique of data collection:
Questionnaires were distributed to all selected people and after short time,
all questionnaires were collected.
Questionnaire:
It was comprised of 3 parts. Part one was demographic portion, second was
general opinion about supermarkets, and third is for observing the effect and
impact of supermarkets towards the small businesses.
The objective question is optioned with strongly disagree, disagree, neutral,
agree, strongly agree.

Types of Variables:
There are 2 types of variables:

Dependent Variable
Independent Variable

Independent Variable
Dependent Variable
Price and Discounts
Convenience
Product Availability
Sales and Promotion
Shopping
Environment

Buying Behavior
Of The
Consumer

Or It Can Also Be Interpret As:

Independent Variable
Dependent Variable

Price & Quality

and
Convenience

Buying Behavior
Of The
Consumer

Tables & Charts

Table 1: Demographic
Table 1.1: Gender

Valid

Frequency

Percent

Valid Percent

Cumulative
Percent

Male

40

40.0

40.0

40.0

Female

60

60.0

60.0

100.0

Total

100

100.0

100.0

Table 1: From the above chart, we can analyze that the total respondents are
100, from which 40 are males and 60 are females.
Table 1.2: Age

Frequency
Valid

Percent

Valid Percent

Cumulative Percent

10-19

26

26.0

26.0

26.0

20-29

67

67.0

67.0

93.0

30-39

6.0

6.0

99.0

50-59

1.0

1.0

100.0

100

100.0

100.0

Total

From Table 2: We can conclude that none of our respondent belong to age
group 40-49. While 26 belong to age group 10-19, 67 to 20-29, 6 to 30-39
and only respondent belong to age group of 50-59.

Table 2: Reliability Analysis / Cronbach's Alpha Analysis:

Table 2.1: Section 1
Reliability Statistics

Cronbach's Alpha

Cronbach's Alpha
Based on
Standardized Items

.606

.603

Table 2.2: Section 2

Reliability Statistics

N of Items
7

Cronbach's Alpha
Based on
Standardized Items

Cronbach's Alpha
.433

N of Items

.434

Table 2.3: Section 3

Reliability Statistics

Cronbach's Alpha

Cronbach's Alpha
Based on
Standardized Items

.461

N of Items

.462

The all above Reliability Analysis has been done in section-wise as they were
in the questionnaire of the study. Now following is the reliability analysis of
all the questions together in a questionnaire.

Table 2.4: All Sections Together:

Reliability Statistics

Cronbach's Alpha
Based on
Standardized Items

Cronbach's Alpha
.754

N of Items

.754

13

From the table 2.4, it has been concluded that the Cronbachs Alpha value
is .754 that is significantly good, is acceptable and higher than the error
point. So it can be said that the data collection is reliable for testing and
conducting the survey. Its all about the reliability of all the questions in a
questionnaire, not just a single section, and for all, its reliable.

Table 3: Regression Analysis:

Table 3.1: Model Summary

Model
1

R Square
.636a

.390

Adjusted R Square
-.390

Std. Error of
Estimate
.53877

Table 3.2: Coefficientsa

Model

Unstandardized
Coefficients
B

Standardized
Coefficients

Std. Error

(Constant)

.970

.275

Average
Price

.679

.081

Sig.

Beta

.640

3.690

.000

8.068

.946

In the regression table, it can be said that the dependent variable is the
buying behavior of the consumer because the opinion of the study was
mostly targeted to the consumers as they are to shop based on their choice
and preference. The main independent variable is price. Because price
matters the most in the consumers buying behavior.

Conclusion:
The study concludes that the difference exists in the perception and the
buying behavior when asked about their choice. Some people prefer street
shops because of their convenience that avoids them to go supermarkets
and waste time, they prefer to buy things near to home, & when required
they buy. This case is mostly for all levels of income residing in rural or suburban areas of Pakistan. The second point suggests that the all levels of
income prefer their shopping at supermarket almost once in a month a
specific date. It is convenient, can shop everything collectively and
consumes less time from their busy lives. The third point from the feedback
suggests that the bargaining system still exists in normal street shops

especially of fresh food items like wheat, rice, fruits and vegetables whereas
one cannot bargain at supermarkets.

Recommendations:
There should be a balanced number of supermarkets and small markets in a
city. The superstore chains should initialize their businesses in other big cities
of Pakistan like Sialkot, Peshawar, Multan, Bahawalpur, Hyderabad, & Quetta.
Opening new stores will provide new opportunities, will attract many new
customer and plus it will help in reducing the unemployment rate of that city.
Moreover it may open up the good image of that city. Starting this bulk and
supermarket in other cities will help thousands of small business merchants
of nearby rural backward areas as they can have access to good quality of
items and showcase them in their own small business.

References:
McGurr, P.T. (2002). The Largest Retail Firms: A Comparison of Asia, Europe & US
Based Retailers, International Journal of Retail & Distribution Management, Vol. 30
No. 3
Sengupta, A. (2008). Emergence of Modern Indian Retail: A Historical Perspective,
International Journal of Retail & Distribution Management, Vol. 36 No. 9
Srivastava, R.K, (2008) Changing Retail Scene in India, International Journal of Retail
& Distribution Management, Vol. 36 No. 9.
Zirram (Feb, 2009). Changing Retail in Pakistan Slideshare.Com
Baloch, F. (Oct 2011). Lack of Trained Hand Stops Supermarkets Forward March.
The Express Tribune.
Bokhari, A. (Aug 2013). The New Boom. Inpaper Magazine.

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