Executive Summary

The concept of Supermarkets has not been too old in the context of Bangladesh. Even in the

late 1990’s we hardly have any super markets in our country like we have today. At that

time local “Bazaars” were the only source where people could buy their necessary

household items. Nowadays, we have so many supermarkets in our country especially in

Dhaka city which have made life easier, faster and less stressful. The four main

supermarkets that exist now in the city are Nandon, Meena Bazar, Agora, and Shopno.

These shops have their own blends of offerings to attract different segments of consumers.

Our research project’s main objective was to find out whether customers preferred

supermarkets over local bazaar. If they did, what may be the reason for their preference?

Now a days household shopping is done mostly by any adult member of the family, our

target sample was basically adults consisting of housewives, working moms/dads and adult

students. We emphasized on four main factors that might be responsible for the preference

of a supermarkets over local bazaars. Those were, price, hygiene, value added services and

variety of products. Apart from these main factors we also inquired about some other

factors such as behavior of employees, parking facility, membership facility, and returns and

compensations.

We did not carry out our research for any particular above mentioned supermarket. But any

supermarket can use the result of this research to have a better understanding of consumer

preference and also as to what problems they might have, so that they can work on them

and increase the number of their customers and also increase their satisfaction and loyalty.

Our sample size was 100 as determined by our course instructor, Mr. Sayed Kamrul Islam.

We chose our sample units conveniently on the basis of non-probability sampling. We tried

to have access to as much of the actual target sample as possible. In some cases

questionnaires were provided to people so that they could complete them at their home.

We used a blend of different types of questions in our research like Simple Attitude Scale,

Category Scale, Likert Scale, and Paired comparisons.

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As a summarized recommendation, we would state that people have a positive perception

about supermarkets. This is mainly because supermarkets provide lots of good brands and

better hygiene compared to local kaacha bazaars. Supermarkets should look to maintain

their good service and value added services over a long run to attract more customers.

Super marlets must maintain their quality and provide the best products because price is

not the important factor when choosing between supermarkets and local kaacha bazaar.

Background

The concept of supermarkets in Bangladesh has been a revolutionary one since its inception

in the late 1990s. Earlier, when there were no such markets available, local “Bazaars” were

the only means of household shopping for people. Shopping there meant a lot of hassle,

bargaining and not to mention the untidy and unhealthy environment. After the

supermarkets were introduced, things became so much easy for the consumers. They could

get varieties of things, all under the same roof, at a price that is not too much more than the

usual local Bazaar price. People’s attitude toward shopping changed drastically and more

people started to become interested in these markets.

Supermarkets are set to boom in the country as the current market players are planning to

open several hundred more outlets in the next few years to cope with the rising demand

from the consumers. With a strong 15-20 per cent annual sales growth, about 30 companies

with more than 200 outlets have already made foray into the industry since Rahimafrooz,

one of the largest business groups in Bangladesh, introduced Agora, a chain supermarket, in

the capital a decade ago. The annual turnover of the supermarkets now stands at around Tk

15.0 billion (1500 crore), according to Bangladesh Supermarket Owners Association (BSOA).

According to the supermarket employees, hassle-free shopping environment, hygienic

commodities, fresh vegetables, meat and fish at the supermarkets are earning appreciation

of the customers. The supermarket biggies have attempted the massive expansion drive to

attract the shoppers, who still depend on unplanned wet markets to buy their daily

essentials.

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The first super shop to be established in Dhaka city was ‘Agora’ in the year 2000. Agora is a

super shop that offers a wide variety of food and household merchandise. It is larger in size

and has a wider selection than a traditional grocery store. Agora comprises meat, produce,

dairy and baked goods departments along with shelf space reserved for canned and

packaged goods as well as for various nonfood items such as household cleaners, pharmacy

products, and pet supplies. Agora is reported to provide quality service to the consumers

but the price level is complained to be high. The outlets of Agora are found in the posh

areas of the city which suggests its differentiation strategy.

Nandan Megashop and Meena Bazar are other two super markets of the city that focus on

differentiation strategy. They try to provide quality products to the consumers and as a

result the price charged is a bit high.

Shopno, a relatively new player in the market, focuses on a different strategy. It claims that

it offers ‘Everyday Low Price’ policy to consumers and believes that in this way they will be

able to attract significant market share within a short span of time. The locations of

Shopno’s outlets symbolize this strategy. They are located in the ‘not so posh’ areas of the

city so that they can cover for the low prices offered.

Exploratory Research

For initial study, we went through the exploratory research by doing survey on a group of

100 people. This sample size was determined by our course instructor Mr. Sayed Kamrul

Islam. We selected the adults in a family as our respondents as they mostly shop for the

household goods. We also studied through the secondary data we collected from the

website and booklets provided by the super markets.

Problem Definition

Basically we wanted to find out the underlying factors that cause customers to choose

supermarkets over local bazaars. The problems of the super markets, as well as, the local

bazaars can well be found out by the results of this research as to why it is not being chosen.

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Research Hypothesis

We had a number of hypotheses which we tried to assess through the survey results.

Hypothesis 1: There is association between people’s income level and the frequency of

supermarket.

Hypothesis 2: There is association between people’s gender and the frequency of

supermarket visit.

Hypothesis 3: Price is an important factor for the decision of going to super markets.

Hypothesis 4: Super markets do provide better quality of products than local bazaars do.

Research Objective

To find out if supermarkets are preferred over local bazaars.

To find out if income level has anything to do with the selection of the type of

market being chosen to buy household goods.

To find out the most important factors for choosing super market over local bazaars.

To find out the supplementary factors that aids in the decision making for choosing

super market over local bazaars.

Research Methodology

We chose our respondents on the basis of non-probability sampling. Mostly the

convenience method was used. Since our research was based on the preference of the type

of market being chosen to buy household goods, all adults in a family were our target

sample. We went to different super markets, as well as local bazaars for our respondents.

Some of them were helpful while others were not. We couldn’t manage to fill all the

questionnaires there. So we gave some questionnaires to our friends so that they could be

filled in by their family members. The sample size was 100 and it was determined by our

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course instructor. After the data had been collected, we input them in SPSS software and

carried out some analyses based on pre-determined hypotheses.

Operational Definition

We tried to make our sample as diversified as possible. So we selected respondents from

different parts of Dhaka city. As our report states, the respondents were chosen from over

10 different areas of the city. Also, since the super markets are situated all over Dhaka city, a

diverse sample was necessary for more reliable results.

Research Design

As explained earlier, the design of the research is basically based on exploratory research.

Primary research is the main mode of collecting raw data. Collecting raw data from various

sources was required to process, tabulate, edit for the purpose of the study. After

processing the data, we applied few statistical tools, wherever required we came up with

meaningful results. Besides, some graphical presentations such as pie chart, bar chart and

so on were used. At last we gave some recommendations.

Measurement Scales

We used 16 questions in the questionnaire to have a pretty good idea about consumer’s

thoughts regarding choosing a super shop. We mainly used closed ended questions with a

blend of different types of questions in our research like Simple Attitude Scale, Category

Scale, Likert Scale, Paired comparisons etc. The choices of answers a,b,c,d,e were assigned

with numerical values, as in 1 for a, 2 for b, 3 for c and so on.

Design of Recording Forms

We designed our questionnaire which has 16 multiple choice questions. At first we included

simple question just to have idea about the respondents. Among those we had some time,

frequency and risk specific questions. While designing our questionnaire we focused on

criteria like- simple, straightforward, concise and easily understandable. We tried to make

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the respondents as convenient as possible. This helped us to minimize the error while

gathering data.

Sampling Method

Actually our sampling method depended on the expectation of the direction of the faculty.

We were expected to have 100 samples. In a sense we took respondents conveniently and

relationally. Although there are different stoical methods of doing sampling but to keep the

research with the scope of academic purpose we had to use this method. We did not have

any refusal.

Sample Size

We had a sample size of hundred people with different age, race marital status, occupation

and so on. Our target was to take one respondent, who are relevant to the topic and who is

suppose to respond on the topic or the questioner. So, before asking anyone to fill out the

questioner we had and kind of good observation about the subject or the respondent. It

really helped us to have an efficient survey and savings of time. Instead of sorting the

questioner we had sorted the respondent as a result none of the filled out questioner we

found irrelevant. Still we know and believe that this sort of research requires a huge sample

size, but because of various limitations we could not consider a sample greater than 100

respondents.

Editing and Clearing Survey Data

We edited and cleared data on the basis of completeness, legibility and consistency to make

the data ready for coding and transfer to storage. First we checked the consistency of the

responses in different questions. Secondly, tired to figure out the attitude of the person,

whether he or she is doing it in a hurry or not. Sometimes they did not understand some of

the questions in such cases we explained them the questions. One of the methods which we

used for editing was pre-testing editing. Although it is not the most efficient method, it

helped us to have an overall fitness of data.

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Data Summarization

We have used some analysis techniques in order to fulfill the objectives of the report. The

techniques which we have used are described below:

Table- Tables are used to arrange data orderly. Different types of tabulation method can be

used to input data and work in SPSS which are described below.

Frequency – Is one of the most common means of summarizing a set of data. This

process begins with recording the number of time particular value of a variable

occurs.

Percentages - When data is tabulated by computer, percentages, cumulative

percentage and frequency distributions are useful. When a frequency distribution

portrays only a single characteristic as a percentage of the total, the proportion of

occurrence is defined. It can be expressed as a percentage, a fraction, or a decimal

value.

Cross-Tabulation – We organized our data in cross tabulation process where we

have organized data by groups, categories, or classes to facilitate comparisons; a

joint frequency distribution of observation on two or more sets of variables.

Data Sample Analysis

We used quantitative way to analyze data. At first we collected primary data from the

questionnaires we used for survey. After that we coded the alternatives of the questionnaire

along with the variables with SPSS. We entered all our responses by using SPSS to make a

database. This database became the source of further analysis. With the help of the data

sheets we analyze data using various methods like frequency, percentage count and cross

tabulation.

Each question was being coded to a computer readable form for using in the SPSS. Then the

data were entered from the questionnaires. This was time consuming and needed much

skill.

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After entering all the responses from each question, the data entering part was done. Then

we proceeded forward for the final job, which was analysis. Manually we entered data.

By using SPSS, we put the formula, and then the software automatically gave us the result.

We could get a number of tables, charts by this process. Then we proceeded for the data

conversion and interpretation part. All the SPSS result sheets had to be converted into

managerially understandable form. We converted them to word documents, made tables,

graphs and wrote the analysis.

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Survey Research Results

1. Ho: There is no association between people’s income level and the frequency of supermarket visit.

H1: There is association between people’s income level and the frequency of supermarket visit.

OnewayDescriptives

How often do you visit the super market for your household needs?

N Mean Std. Deviation Std. Error

95% Confidence Interval for Mean

Minimum MaximumLower Bound Upper Bound

<8000 14 2.86 1.460 .390 2.01 3.70 1 5

8000-15000 25 2.60 1.118 .224 2.14 3.06 1 5

15000-30000 25 2.84 1.106 .221 2.38 3.30 1 5

30000-50000 9 2.56 1.014 .338 1.78 3.33 1 4

>50000 7 1.71 .756 .286 1.02 2.41 1 3

Total 80 2.64 1.161 .130 2.38 2.90 1 5

ANOVA

How often do you visit the super market for your household needs?

Sum of Squares df Mean Square F Sig.

Between Groups 7.762 4 1.941 1.474 .219

Within Groups 98.725 75 1.316

Total 106.488 79

The significance level is 0.219. Since it is greater than 0.05 (95% confidence level), null is not rejected. So there is no association between people’s income level and the frequency of supermarket visit.

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2. Ho: There is no association between people’s gender and the frequency of supermarket visit.

H2: There is association between people’s gender and the frequency of supermarket visit.

Oneway

Descriptives

How often do you visit the super market for your household needs?

N Mean Std. Deviation Std. Error

95% Confidence Interval for Mean

Minimum MaximumLower Bound Upper Bound

Male 37 2.78 1.182 .194 2.39 3.18 1 5

Female 43 2.51 1.142 .174 2.16 2.86 1 5

Total 80 2.64 1.161 .130 2.38 2.90 1 5

ANOVA

How often do you visit the super market for your household needs?

Sum of Squares df Mean Square F Sig.

Between Groups 1.473 1 1.473 1.094 .299

Within Groups 105.014 78 1.346

Total 106.488 79

The significance level is 0.299. Since it is greater than 0.05 (95% confidence level), null is not rejected. So there is no association between people’s gender and the frequency of supermarket visit.

3. Ho: Price is not an important factor for the decision of going to super markets.

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H3: Price is an important factor for the decision of going to super markets

T-Test

One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

Importance of price 80 2.51 1.031 .115

One-Sample Test

Test Value = 3

t df Sig. (2-tailed)Mean

Difference

95% Confidence Interval of the Difference

Lower Upper

Importance of price -4.229 79 .000 -.487 -.72 -.26

For this test, we took 3 as the test value. We test whether the calculated mean is less than

the test value or greater than the test value.

The calculated mean is 2.51 which is less than 3. The significance level is 0 which is less than

0.05(95% confidence level). So we can deduce that price is not an important factor for the

decision of going to super markets.

4. Ho: Super markets do not provide better quality of products than local bazaars do.

H3: Super markets do provide better quality of products than local bazaars do.

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T-Test

One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

Super markets provide better quality of products

than local bazaars?

80 4.14 .775 .087

One-Sample Test

Test Value = 3

t df Sig. (2-tailed)Mean

Difference

95% Confidence Interval of the Difference

Lower Upper

Super markets provide better quality of products

than local bazaars?

13.123 79 .000 1.138 .96 1.31

For this test, we took 3 as the test value. We test whether the calculated mean is less than

the test value or greater than the test value.

The calculated mean is 4.14 which is greater than 3. The significance level is 0 which is less

than 0.05(95% confidence level). So we can deduce that super markets do provide better

quality of products than local bazaars do.

5. Regression equation

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Importance given to super market as a part of the society= a (Branded products) + b(Price)

+ c(Parking facilities) + d(Hygiene)+ e(Air condition) +C

Regression

Variables Entered/Removed

ModelVariables Entered

Variables Removed Method

1 Importance of Air

conditioners, Importance of

hygiene, Importance of

Branded products,

Importance of price,

Importance of parking

facilitiesa

. Enter

a. All requested variables entered.

Model Summary

Model R R SquareAdjusted R

SquareStd. Error of the

Estimate

1 .115a .013 -.053 1.119

a. Predictors: (Constant), Importance of Air conditioners, Importance of hygiene, Importance of Branded products, Importance of price, Importance of parking facilities

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ANOVAb

Model Sum of Squares df Mean Square F Sig.

1 Regression 1.251 5 .250 .200 .042a

Residual 92.736 74 1.253

Total 93.987 79

a. Predictors: (Constant), Importance of Air conditioners, Importance of hygiene, Importance of Branded products, Importance of price, Importance of parking facilities

b. Dependent Variable: Super markets have become an important part of the society

Coefficientsa

Model

Unstandardized CoefficientsStandardized Coefficients

t Sig.B Std. Error Beta

1 (Constant) 3.777 .980 3.852 .000

Importance of Branded products

.152 .140 -.043 -.371 .012

Importance of price -.111 .124 -.105 -.894 .374

Importance of parking facilities

.083 .135 .011 .095 .025

Importance of hygiene .074 .113 .014 .124 .002

Importance of Air conditioners

.032 .108 .035 .295 .769

a. Dependent Variable: Super markets have become an important part of the society

For analysis, we carry out both the global and local tests. For the global test

Ho: µ1= µ2= µ3= µ4= µ5=0

Ha: µ1= µ2= µ3= µ4=µ5≠0

In the ANOVA table sig is 0.042 which is less than 0.05. So null is rejected and alternate is accepted. So we can go to the partial tests.

For partial tests:

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Importance of Branded products: Ho: µ1=0

Ha: µ1≠0

For this significance level is 0.012 which is less than 0.05. So null is rejected. So importance

of Branded products is relevant with regards to the dependent variable.

Importance of price: Ho: µ2=0

Ha: µ2≠0

For this significance level is 0.374 which is greater than 0.05. So null is not rejected. So

importance of price is not relevant with regards to the dependent variable.

Importance of parking facilities: Ho: µ3=0

Ha: µ3≠0

For this significance level is 0.025 which is less than 0.05. So null is rejected. So importance

of parking facilities is relevant with regards to the dependent variable. .

Importance of hygiene: Ho: µ4=0

Ha: µ4≠0

For this significance level is 0.002 which is less than 0.05 (95% confidence level). So null is

rejected. So, importance of hygiene is relevant with regards to the dependent variable. .

Importance of Air-conditioners: Ho: µ5=0

Ha: µ5≠0

For this significance level is 0.769 which is greater than 0.05. So null is not rejected. So

importance of air-conditioners is not relevant with regards to the dependent variable.

Now, we re-run the regression equation with the irrelevant factors removed. So the final regression equation is:

Importance given to super market as a part of the society= 0.152 (Branded products) +

0.083(Parking facilities) + 0.074(Hygiene) + 3.77

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Research Findings

Some the findings that we have found out are the product of the several tests that we had

run and also from the surveys that we had conducted. Some of the important points that we

considered to mention are. There is no association between people’s income level and the

frequency of supermarket visit, that is not necessarily an associations between heavy

shoppers and gender, it can vary. That price is not an important factor for the decision of

going to super markets. That super markets do provide better quality of products than local

bazaars do.

Recommendations

We would like to make a few recommendations. that super shops should keep on

progressing in this way, they should offer better quality of products , ensure hyeigine and

availability of products. They should try to build loyalty with customers and owners should

try to increase the number of outlets as per area.

Conclusion

At this moment, there are four chains of super markets in Bangladesh: Agora, Nandan,

Meena Bazar, and Shopno All the chains combines, there are more than 200 outlets in

Bangladesh, thus owners (BSOA) should try to increase this number and thus they can

provide the people with the better services and quality products.

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