Perak’s Lack of Vision in Small and Medium Enterprises Precipitates Decline of State

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by Mariam Mokhtar

I have long been an advocate of the sundry shop, the street vendor, the market trader and the small business. These establishments offer good quality and efficient, personal service. They may be slightly more expensive but they offer quality for money, and in the long run, work out cheaper.

The past two issues of the Ipoh Echo have highlighted the proliferation of hypermarkets and supermarkets. When they mushroom, whole shop lots are affected, with devastating effect on the surrounding communities.

Local sundry shops simply cannot survive.

Sundry Shops Demise

Like most Ipoh families, we do our major weekly shopping at the local pasar (market). In the past, various essentials may have been provided by the grocer-on-wheels (cina-sayur), and the roti-man. When we ran out of dried provisions like rice and sugar, a local sundry shop would deliver for a small fee. It was very convenient as we had no means to frequent the shops.

However, the prolife-ration of hypermarkets put an end to all these small businesses and we bade farewell to Ah Hong the grocer-on-wheels who was based in Pasir Puteh, Mutu who was contracted to a bakery in old town and Lian Fatt whose sundry shop was in Jalan Kampar.

Hypermarkets gene-rate job opportunities, development and upgrading of infrastructure, like new roads, and they may help regenerate an area. They are also convenient and may provide a one-stop shop for the busy mother or working individuals. Unlike the sundry shops, they open seven days a week and have longer opening hours.

Hypermarket’s Detrimental Impact

I once did an investigative stint in a hypermarket and discovered that hypermarket chains often have a detrimental impact on the people and businesses they deal with.

Their success is at the expense of the local farmer, suppliers and small local shops. The working conditions of the hypermarket’s own employees, the local community and the environment are all affected. These facts are well documented worldwide; unfortunately, not in Malaysia.

Typically, farmers do not receive a fair share of retail prices. For instance, if the price of chicken goes down, this saving is not passed to the shopper. The farmer is forced to sell his livestock to the supermarket at much reduced prices, but we never see a reduction in the price of chicken on the shelves.

No Benefit for Workers and Public

We assume that hypermarket workers enjoy the benefits of their employer’s success. They don’t.

Hypermarkets exert enormous buying power, that farms and clothes manufacturers are forced to lower their prices, deliver goods ever faster and at short notice. This pressure is passed on to the hypermarket worker in the form of low wages, job insecurity and poor working conditions.

Roads leading to hypermarkets are often congested and polluted. Parking problems also exist.

The aim of hypermarkets to sell food cheaply means processed foods which are high in salt, fat and sugars, are frequently promoted. We are discouraged from inculcating healthy eating habits.

The dominance and sheer buying power of hypermarkets have already forced the closure of many small shopkeepers, local traders and specialist food shops such as bakers.

Protests

In 2007, local shopkeepers in Thailand protested against a foreign-owned hypermarket, whose rapid expansion caused the closure of several local shops and farms.

In the United Kingdom, many townships hold similar protests to protect their communities from the invasion of hyper/supermarkets. France fiercely preserves their small shops over the domineering hypermarkets.

Back home, our local sundry shops give their loyal and regular customers a highly personalised and more dedicated service; something that hypermarkets often disregard and cannot duplicate.

Our local shops only have a limited budget which means limited opening hours and a smaller workforce.

But hypermarkets which open late are not doing you, the customer, a favour. They do it for one reason only – more profit.

Big Business Favoured Over SMEs

One major reason small businesses cannot thrive is because our state government lacks vision in promoting these small businesses.

In practically every country, Small and Medium Enterprises (SMEs) constitute almost 90% of all commercial business activity.

Some benefits of SME’s are: contribution to the economy in terms of output of goods and services; creation of jobs at relatively low capital cost, especially in the fast growing service sector; they provide a vehicle for reducing income disparities; develop a pool of skilled and semi-skilled workers as a basis for the future industrial expansion; provide opportunities for developing and adapting appropriate technology; offer an excellent breeding ground for entrepreneurial and managerial talent. However, the Perak administration tends to favour big and/or international businesses over the SMEs.

Dealing with Challenges and Prejudice

Despite various governmental programmes in SMEs, the small trader in Perak still faces many challenges.

My own experience is the high level of bureaucracy in government agencies. My funding and business plan was all in order, the technical expertise had been sourced and the local labour arranged. But there was always something that prevented the agencies from awarding the appropriate licences/permits. What it boiled down to was that I did not dress conservatively enough for a Malay woman. Others will have their own horror stories.

But like them, I took my expertise and money elsewhere.

2 thoughts on “Perak’s Lack of Vision in Small and Medium Enterprises Precipitates Decline of State

  1. hear ! hear !
    Supermarketization has been allowed to smear our city in the name of progress only to see ourselves regress considerably.

  2. The trouble with Perak is the government servants and its leaders. They are clearly only interested in lining their own pockets, otherwise licences and approvals will be delayed etc.etc. That is why most people would rather invest elsewhere, like Penang where at least Pakatan government is trying to stamp out corruption and save on wasteful spending by previous government officials.

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