The Walmart Effect Comes to Asia: How Big Chains Like Starbucks, Carrefour are Killing Local Shops

Published February 18th, 2020 - 12:24 GMT
The Walmart Effect Comes to Asia: How Big Chains Like Starbucks, Carrefour are Killing Local Shops
Representatives of local neighborhoods voice out their discomfort and start initiatives trying to stop these projects. (Shutterstock)

The big chains are coming. They've actually been on their way for some time. As the likes of Starbucks, McDonald's and Carrefour continue to expand internationally, modest communities fear that their cultural identities are being erased and their small businesses are being threatened.

Often when big businesses break ground in new towns, sometimes in small neighborhoods, local residents will try to fight back by creating campaigns to encourage members of their community to shop local. But they're not always successful.

International chains usually offer the same products or services at competitive rates because they can purchase different materials and goods in bulk and for lower prices than smaller shops.

Mini markets, small cafes, and restaurants established in small communities are the ones most likely to suffer the impact of multi-million international chains opening branches next door.

And they don't only lose out because of competitive prices. At least 40% of the money people spend in small domestic businesses tends to stay within the community, which is not the case with big names like Starbucks or Carrefour.

Despite campaigns to support local shops and businesses, international companies justify their plans to expand by arguing that their business contributes to local communities by creating more jobs.

In 2012, Starbucks was able to open its first branch in India before it could expand to more than 100 shops in six main cities, sending shock waves across the coffee making industry in the country.

Most recently, banners advertising new branches of Starbucks and Carrefour in Al-Lwebdeh, one of Jordan's oldest neighborhoods, prompted local organizations to start a media campaign and a petition signed by more than 2500 people so far, to stop the new businesses from destroying local coffee shops, vegetable vendors, and Jordanian restaurants in the area.

Jordan's Zikra Initiative to stop Carrefour and Starbucks plans to expand in Al-Lwebdeh, Amman, Jordan

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