For one new discount chain opened, 22 grocery stores in the same neighborhood can close down from loss of business, a report said Thursday, supporting views that corporate retail firms end up hurting smaller shops.
The entry of a large discount outlet can also drive out 20.1 small grocery shops in traditional markets on average, according to the report included in the central bank's quarterly publication. The report was based on an analysis of discount chains and smaller stores between 2000 and 2011.
The report showed that the number of grocery stores and those in traditional markets fell 18.6 percent and 12.6 percent on average, respectively, in the five years following the establishment of a large discount store.
"The data lent support to the view that large retail firms are threatening mom-and-pop stores," the report said.
Retail outlets, run by large conglomerates, are blamed for luring away customers from smaller shops and grocery stores, threatening the livelihoods of small-time businesses.
The growing influence of large retail outlets led the government to establish policies to protect struggling mom-and-pop stores, including limits to business days.
Under the new Distribution Industry Development Act that came into effect last year, discount chains operated by giant retailers must close their shops twice a month on Sundays or public holidays, and limit their operations to between 10 a.m. and midnight.