Jun 22, 2007

Globalization and small-shops owners

This interesting article shows an example of Globalization's good and bad effects:
Efficient big companies raising the bar, and on the other hand small-shop owners losing out

Chain Reaction: the story of Jordan's first chain pharmacy

In short, it talks about Pharmacy One, which is a chain-pharmacy in Jordan. In few years, this pharmacy has expanded into 17 branches, and it's taking business away from many pharmacy owners who have been in business for over 30 years.

what is the solution for these small-pharmacy owners?
are they the unavoidable collateral damage of Globalization and modernity?
or should the government enact laws to prevent Chains from providing better service or cheaper prices?
or maybe the government can offer educational programs to help those owners understand the new rules of the game? (but those go only so far)

It's a hard problem. It is even much harder if you are (or know) somebody who is losing his 30-year-old business to one of those efficient chains.

Similarly, an investor chose Hai Nazzal, which is a relatively poor neighborhood in Amman, to build a mall. That was a surprising step at the beginning. But soon it attracted almost all shoppers in the area. Many of the old clothes shops in the neighborhood closed up as a result... what do you do with these people who support usually big families? One can talk as much as he likes about free market, development, and globalization... but, to have a sizable portion of the population lose their livelihood in a short period is a real problem.

I'm not saying flip the laws, raise walls, and halt free market... one must find a solution to ease it on all these unsuspecting citizens who lost their livelihood within few months.

do you guys know/thought of any good solutions for this problem?
I think soon most of the arab world will fall into it soon.

More interesting posts about Globalization & Arab World:

Jordan’s Pharmaceutical Industry and Tomatoes

Industrial Jordan in the Age of Globalization


  1. Lets see how Pharmacy 1 is going to hold up against Walgreen's, rite-aid or Bartel.
    People continue to believe that Globalization is the solution for our poverty! everyone keeps forgetting the "side effects"

  2. I posted this saying on my blog before..

    Every morning in Africa, a gazelle wakes up,
    It knows it must run faster than the fastest lion or it will be killed.
    Every morning a lion wakes up.
    It knows it must outrun the slowest gazelle or it will starve to death.
    It doesn't matter whether you are a lion or a gazelle,
    When the sun comes up, you better start running!!

  3. the solution for businesses, no matter how small, or big for that matter, is focusing on distinctive competencies.
    no matter how big restaurants become, or how many branches they open, Hashim will still be the favorite for a lot of customers.
    Ramadan or not, gatayif Abu Ali are the best no matter how small that shop is or how many steps you have to climb in order to get to it.
    Apple computers have only about 5% market share compared to ~35% of Hp and Dell. However, they have a market capitalization of $107 Billion (how much the company is worth) compared to Dell's $62 Billion and HP's $119B. so how does Apple rival those market share whores. they have a distinctive competency.

    I have never heard of a company that started big. every single business starts with an idea and the determination to bring that Idea to market, and they grow from there.
    I used to own a successful Coffee Shop in San Francisco, where starbucks had a store on every corner. Nobody can convince me that a big company can drive a small one out of business. you have to have determination, innovation (not necessary in tech sense) and stay away from complacency.

  4. Qwaider, agree - we have to move to globalization, but also be ready for it, and help people get accustomed to it.

    Mohannad, very nice quote. what post was that from?

    you had a shop in SF!? we should connect. email me.