Spillover Effects of Foreign Hypermarkets on Domestic Suppliers in Malaysia

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IJRDM 37,3

Spillover effects of foreign hypermarkets on domestic suppliers in Malaysia
Shivee Ranjanee Kaliappan
Department of Economics, Faculty of Economics and Management, Universiti Putra Malaysia, Serdang, Malaysia

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Received 29 November 2007 Revised 21 April 2008 Accepted 13 June 2008

Rokiah Alavi
Department of Economics, Kulliyyah of Economics and Management Sciences, International Islamic University Malaysia, Kuala Lumpur, Malaysia

Kalthom Abdullah
Department of Business Administration, Kulliyyah of Economics and Management Sciences, International Islamic University Malaysia, Kuala Lumpur, Malaysia, and

Muhammad Arif Zakaullah
Department of Economics, Kulliyyah of Economics and Management Sciences, International Islamic University Malaysia, Kuala Lumpur, Malaysia

Abstract
Purpose – Since the mid-1990s, there has been a rapid expansion of large-scale foreign retailers in many countries across Southeast Asia, Central Europe and Latin America. This emerging trend has triggered a number of research interests on the issue of retail globalization. The research aims to consider the entry of foreign hypermarkets in Malaysia and their impact on the development and growth of domestic suppliers and manufacturers. Design/methodology/approach – This study uses both primary and secondary data. Secondary data were drawn from industry sources which included government departments, economic reports, retailing magazines and companies, web sites. Meanwhile, primary data are collected using mail survey questionnaire and face-to-face interviews. Findings – The findings of this study indicate that foreign hypermarkets play a very important role in the development and growth of the domestic suppliers via backward linkages. The main forms of linkages are product supply, informational linkages, assistance with inventory management, technical...