Research On Feasibility Of Grocery Stores Joining In Convenience Stores

In recent years, the living environment for the domestic small and medium-sized retail corporations has increasingly changed with the entrance of foreign retail corporations and the merger and acquisition of large retail corporations. The development of supermarkets and convenience stores threatens the grocery stores.The history of circulation development in Japan reveals that Japanese small and medium-sized retail corporations had ever been challenged by supermarkets. The proprietor of small and medium-sized retail corporations adopted the corporate chain store concept to deal with the competition. As one of the successful stories, seven-eleven expanded rapidly by franchising its chain stores.In the introduction stage of convenience store, Chinese government attempted to improve the traditional small and medium-sized retail corporations through innovating the methods of operation. The reason for success and failure became the main task the scholars face with.The research problem is the feasibility that grocery stores join in convenience stores and the factors that influence the franchising. The research problem is proposed on the basis of study on small and medium-sized retailers by Japanese scholars. The author puts forward four criteria to measure the feasibility of grocery stores joining in convenience stores, (1) mixed feature of the grocery store, (2) basic information of the proprietor, (3) consciousness of the proprietor and (4) operation strategy of the grocery store.One of research results is about the feasibility of criterion (2) the proprietors'personal characteristics. The grocery stores managed by young and full-time couples indicate a positive trend to convenience store franchising. Not-well-educated proprietors feel obstacles in learning advanced management knowledge and the information management system.The second is the feasibility of franchising against the criterion mixed feature. Although the location should be mainly in residential area, a large propotion of grocery stores are located in the main streets, crossings and the neighborhood of schools and institutions. Other features favorable to convenience stores franchising include self-service, the proprietors residing in the store and concentrating on the operation, possessing the ownership of the store, long service hours and abundant management experiences. However, it's unfavourable when the proprietors are managing unscientifically and the investment is not enough and the space of store is limited.The third is that the differentiated operating consciousness of the proprietors is identified. The venture consciousness and location consciousness of the proprietors are stronger than entrepreneurship consciousness but weaker than survival consciousness. The research indicates a slight desire convenience stores franchising that requires high investment, large scale and complicated managerial skills.The fourth is that the feasibility of franchising judged by the operation strategy to which the proprietor attach importance. The grocery stores adopt the strategy of lower price and less service, so the grocery stores are most likely to evolve into the small-sized supermarkets. High investment and completed services are the strategies desired by the proprietors but difficult to be implemented. So it is of high possibility that the scale is expanded with the improvement of the economic condition and operation capability in the grocery stores. The course is rather long for the grocery stores to evolve into special stores and other advanced retailing forms. The course is accomplished by the improvement of knowledge and managerial skills of the proprietors, the improvement of the law, and improvement of people's moralityThe credit strategy is a new common factor educed in the research. Neither tamuramasanori nor nogutitomoo arrived at the factors when they test the small and medium-sized retailers using the same scale. The reason is that China is lack of corresponding laws and codes, resulting in the low trust toward chain store franchising. The credit is absent among the retailers, between retailers and customers, and even within the whole society.The fifth is that the self-appraise and the evaluation on chain store franchising. Most of the grocery stores proprietors are pessimistic at the grocery stores future. They agree that chain store franchising is favourable because they can aid each other in branding, organizing supply, raising capital and improving management. However, a number of the proprietors refuse to join in the convenience store franchising mainly because they are unable to afford the franchise fee, it will weaken their independency, and they are hardly protected by the corresponding laws and codes.The conclusion of the research is that the hardware represented by its storefont and its labor force is a favourable factor for convenience store franchising. The operation habit, operation consciousness and operation strategies are less favourable for convenience store franchising. To evolve into convenience stores, the proprietors need change their operation habit, improve their knowledge and cultivate entrepreneurship consciousness.When evaluating the franchisers, the convenience store should take into account of operation consciousness, besides the location of the grocery, the environment and the competency of the proprietor.Government support should be differentiated to the grocery stores considering the different entrepreneurship consciousness levels of their proprietors. Moreover, the government should exploit not only hardware but also software as evaluation criterion.