Abstract:
Emergence of supermarkets is a major development in the vegetable
and fruit marketing system in Sri Lanka during the last ten years. The change
that began in early 1990s with the establishment of a handful of supermarkets
in the more affluent areas in Colombo. Since then, the change has created a
major difference in the retail marketing of these commodities and within a span
of about twelve years it has grown to large network with 91 supermarkets
operated by six major companies. The total volume of vegetables handled by
six major supermarkets in Colombo is estimated to be about 60,000 kg/day in
2004.
Most supermarkets have established close direct links with the
producers, bypassing some o f the ‘ middlemen’, enabling the negotiation of
prices to mutual advantage. The sale of vegetable and fruits through the system
of supermarkets has facilitated the process of value addition through better
grading, sorting, processing, improved packaging and transport.
The rapid rise in the supermarket s is caused by a number of factors
including sharp rises in the urban population, market liberalization, improved
income levels, changes in the urban life styles and food consumers and
increased information flows. The growth in consumer demand for supermarket
style trading service has provided a highly competitive environment for the
supermarket operators as well. This competition in turn has led to improved
customer service standards, better accountability and more transparent and
effective pricing mechanisms within the domestic agricultural marketing
system. This study also identifies several areas that the government and other
institutions should focus in improving and expanding the service of the
supermarket system.
