재래시장의 상품구성이 활성화에 미치는 영향에 대한 분석과 재래시장 정책에 대한 시사점

Abstract

Usually, economic recession creates a momentum for the emergence of new retail format because consumers become more sensitive to prices because of their decrease in income. The financial crisis in 1997 provided a momentum for structural change in the retail industry from the late 1990s in Korea. As a new retail format, discount stores have rapidly grown in Korea. The financial crisis has caused fierce competition in the retail sectors in Korea. Although traditional markets (also called as conventional markets, open air market, or traditional wet market) have still major portions in Korean retail sector, it is clear that the sale of the traditional market has been decreasing drastically due to the growing penetration of discount stores into the retail sector. While the number of failing traditional markets has been added every year, some markets are doing very well. The purpose of this paper is to investigate a research question : “What makes differentiate successful markets from failing markets?” The research focuses on retail strategy as a starting point to solve the research question. The change in consumption is necessarily linked to a more competitive environment for the retail industry and thus likely to force the industry to try new strategies. The premise of this paper is that the traditional markets should adopt new strategy to obtain sustainable competitiveness. Development of a strategy defines for the store its business relative to its competitors. There are five dimensions of a retail strategy : location, merchandise, price, service, and communications. Each retailer should determine which dimensions will best serve its advantage by examining its own position relative to its competition. Although location strategy is the most important in retail strategy, it is very hard to apply location strategy unless the market is newly developed in a new location. Planning the merchandise mix is one of the most important aspects of operations. The merchandise a retailer carries defines the store for the customer. Thus, the study focuses on the merchandise strategy among retail strategies as a key factor for discriminating successful markets from unsuccessful markets. That is, the study proposes that successful markets have different merchandise compositions from those in unsuccessful markets. The study also attempts to develop strategic implications for traditional markets. The study determines the successful market with the number of visitors to the market. The study assumes that the more customers visit the market, the more sales the market will make. The main dependent measure was the number of visitors of each market. The independent measures are the proportions of classified stores in the market. The observed stores are as follows : agricultural products, stock farm products, marine products, processed food, clothing, household goods, and restaurants. The observed number of classified stores is transformed into the proportions. The research attempts to investigate merchandise composition with the proportion of seven classifications of stores in four types of traditional market including neighborhood market, regional market, metropolitan market, and national market. The four types of traditional markets are classified mainly based on the size of trade area, that is, the travel distance of the customer. The neighborhood market’s trade area is a residence district where the market belongs to. The regional market’s trade area is a small city where the market belongs to. The metropolitan market’s trade area is metropolitan areas. The national market’s trade area is nationwide. Data were collected from a total of 412 markets nationwide including 31 national markets, 47 metropolitan markets, 115 regional markets, 219 neighborhood markets. The average numbers of visitors are 2,214 for neighborhood markets, 2,282 for regional markets, 6,515 for metropolitan markets, and 3,554 for national markets. The average travel distances are 0.91Km for neighborhood markets, 5.28Km for regional markets, 7.93Km for metropolitan markets, and 14.54Km for national markets. Although the correct number of segments is crucial, the proper number of segments is unknown in real-world applications. Mixture regression models have recently received attention from both academics and practitioners due to their considerable potential for the solving this problem. The research has undertaken empirical research using the methodology of a mixture regression modeling in order to investigate merchandise compositions in markets. The analysis procedures are as follows : First, the research used mixture model to discriminate successful markets from unsuccessful markets. Then, the research used mixture regression model to identify merchandise compositions. That is, the research constructed a mixture regression model using the proportions of merchandise categories as explanatory variables and the number of visitors as a dependent variable. The results show that competitive markets have different proportions in merchandise categories from those found in less competitive markets. The Results are summarized as follows : First, 50% is unsuccessful, 45.6% is successful, and 4.4% is very successful in neighborhood markets. The average number of visitors in the unsuccessful neighborhood market is 667, while the number of visitors is 2,889 in the successful market and 12,689 in the very successful market. The proportions of farm stock products and household goods are high in the successful neighborhood markets. Second, 76.2% is unsuccessful, 18.4% is successful, and 5.4% is very successful in regional markets. The average number of visitors in the unsuccessful regional market is 1,218, while the number of visitors is 4,178 in the successful market and 13,481 in the very successful market. The proportions of farm stock products and processed foods are high in the successful neighborhood markets. Third, 73.7% is unsuccessful and 26.3% is successful in metropolitan markets. The average number of visitors in the unsuccessful metropolitan market is 2,402, while the number of visitors is 17,914 in the successful market. Since the number of visitors in the successful markets is 8 times to that of unsuccessful markets, there is a notably huge difference between unsuccessful and successful metropolitan markets. Fourth, national markets failed to be divided into successful and unsuccessful groups due to small samples. Based on the research results, political implications are as follows : First, government supports for traditional markets have previously focused on facility improvement. For renewed markets expect that they can attract more customers with some efforts in better service and more promotion. However, renewal in merchandise in the market is essential to attract customers continuously. Thus, it is recommended that renewal both in facility and merchandise be executed simultaneously. Second, the research found that different types of traditional markets should have different merchandise compositions. Neighborhood markets are recommended to increase the portion of farm stock products and household goods. Regional markets are recommended to increase the portion of farm stock products and processed foods. Third, while the half of neighborhood markets is successful, most regional markets and metropolitan markets are depressed. Thus, government supports should concentrate more on these regional and metropolitan markets.