THE EFFECTS OF E-COMMERCE ON THE

STATIONARY MARKET: CHALLENGES AND OPPORTUNITIES IN

ALCALA COMMERCIAL MARKET

A Thesis Presented to the

Faculty of Economics Program,

Department of Social Science, College of Arts and Sciences,

Cagayan State University, Carig, Tuguegarao City

In Partial Fulfillment

of the Requirements for the Degree

Bachelor of Arts in Economics

School Year 2022 -20

By:

DE LEON, MARK ALVIN C.

MARCH 2023
 Chapter 1

THE PROBLEM AND ITS BACKGROUND

Introduction:

E-commerce has revolutionized the way people buy and sell goods and services.
Online shopping has become increasingly popular due to its convenience and ease of use.
With the rise of e-commerce, traditional brick-and-mortar stores are facing challenges in
retaining their customers and staying competitive in the market. This study will focus on the
effects of e-commerce on the local retail market in Alcala commercial market. It will analyze
the challenges and opportunities faced by local retailers due to the growth of e-commerce.

The rise of e-commerce has had a significant impact on traditional retail markets
worldwide. The convenience and accessibility of online shopping have made it a popular
choice for consumers. The COVID-19 pandemic has accelerated the growth of e-commerce,
as more people turned to online shopping to avoid crowded stores and public places. This has
put pressure on local retailers to adapt to the changing market conditions.

Alcala commercial market is a local retail market in a small town that offers a range
of goods and services. It is facing challenges due to the growth of e-commerce. Many local
retailers are struggling to compete with online retailers who offer lower prices, wider product
selections, and faster delivery. Local retailers are also facing challenges in retaining their
customers, who are increasingly turning to online shopping.

The objective of this study is to analyze the effects of e-commerce on the local retail
market in Alcala commercial market. It will identify the challenges and opportunities faced
by local retailers due to the growth of e-commerce. The study will also provide
recommendations on how local retailers can adapt to the changing market conditions and
remain competitive.
STATEMENT OF THE PROBLEM:

This study aimed to assess the effects of e-commerce on the local retail market:
challenges and opportunities in alcala commercial market.

1. What are the key challenges faced by local retailers in the face of the growing
popularity of e-commerce platforms?

2. How has the emergence of e-commerce impacted the consumer behavior of local
shoppers?

3. What is the current state of the local retail market in the face of increased competition
from e-commerce platforms?

4. What are the most effective strategies for local retailers to compete with e-commerce
platforms?

Hypothesis

1. There is a significant difference on the key challenges faced by local retailers in the
face of the growing popularity of e-commerce platforms.
2. There is a significant relationship on the emergence of e-commerce impacted the
consumer behavior of local shoppers.
3. There is a significant relationship on state of the local retail market in the face of
increased competition from e-commerce platforms.
4. There is a significant relation on the most effective strategies for local retailers to
compete with e-commerce
Scope and Limitation of the Study

This study will focus on the impact of e-commerce on the local retail market in Alcala.
firstly, the study will only focus on the retail market in Alcala and may not be generalizable
to other locations. Secondly, the study will only consider the impact of e-commerce on local
retailers and will not explore other factors that may affect the local retail market such as
government policies, consumer behavior, and economic factors. Finally, the study may be
limited by the availability of data, especially on the sales and revenue of local retailers. The
study aims to provide insights into the effects of e-commerce on the local retail market in
Alcala, including the challenges faced by local retailers and the opportunities presented by e-
commerce. The study findings can be useful for policymakers, local retailers, and other
stakeholders in the retail industry to develop strategies to adapt to the changing retail
landscape

Definitions of terms

The terms used in the conduct of the study are all operationally defined.

1. E-commerce: Refers to the buying and selling of goods and services online through
websites or other digital channels.
2. Local retail market: Refers to the market in a particular geographical area where
goods and services are sold by retailers to local consumers.
3. Challenges: Refers to the difficulties or obstacles faced by retailers in adapting to the
changing business environment brought about by e-commerce.
4. Opportunities: Refers to the potential benefits or advantages that retailers can gain
from e-commerce such as new market segments, increased efficiency, and reduced
costs.
5. Alcala commercial market: Refers to a specific local retail market located in the town
of Alcala, which is being studied in relation to the impact of e-commerce on its
business environment.
6. Brick-and-mortar stores: Refers to physical retail stores that have a physical presence
and are open for customers to visit and shop in.
7. Online marketplaces: Refers to digital platforms that allow businesses to sell their
products or services online to customers, such as Amazon, eBay, and Alibaba.
 8. Omnichannel retailing: Refers to the integration of various retail channels such as
brick-and-mortar stores, online marketplaces, and social media platforms to provide
customers with a seamless shopping experience.
9. Customer experience: Refers to the overall experience that customers have when
interacting with a retailer, including factors such as customer service, product quality,
and convenience.
10. Digital transformation: Refers to the process of using digital technologies to
fundamentally change how businesses operate and deliver value to customers. In the
context of retail, this can include things like implementing e-commerce platforms,
using data analytics to optimize operations, and developing mobile apps for
customers.

Significance of the Study

Local retailers: The study will help local retailers in Alcala to understand the impact of e-
commerce on their businesses, including the challenges they face and the opportunities they
can leverage to compete with online retailers.

Consumers: The study will provide insights into the behavior and preferences of consumers
in Alcala regarding e-commerce and traditional retail, which can help retailers to tailor their
offerings to meet their customers' needs.

Policymakers: The study can inform policymakers about the challenges and opportunities
presented by e-commerce on the local retail market, and help them to develop policies that
support the growth and sustainability of the local retail industry.

Academia: The study can contribute to the existing literature on e-commerce and its impact
on traditional retail, especially in the context of small and medium-sized businesses in
developing countries.

Industry stakeholders: The study findings can be useful for industry stakeholders, such as e-
commerce platforms, payment providers, and logistics companies, to understand the
challenges and opportunities presented by e-commerce in the local retail market in Alcala,
and develop strategies to support local retailers.
 Research Paradigm

Figure 1 indicates the model or pattern applied to this research. It contains the input,
process, and output that are followed through this research. Input contains the resources of
this research, specifically the respondents and the data gathering instrument. In the process,
the gathered data were organized, analyzed, and interpreted.

Figure 1.

INPUT
1) 1. What are the key
challenges faced by local
retailers in the face of the PROCESS OUTPUT
growing popularity of e- Gathering of The effects of e-
commerce platforms? Data
commerce on the
2) 2. How has the emergence Interpretation
of e-commerce impacted the and analysis of Stationary market:
data challenges and
consumer behavior of local
shoppers? opportunities in
3) 3. What is the current state
Alcala commercial
of the local retail market in market
the face of increased
competition from e-commerce
platforms?
4) 4. What are the most
effective strategies for local
retailers to compete with e-
commerce platforms?
 CHAPTER II

REVIEW OF RELATED LITERATURE

This research presents the emergence of e-commerce has posed significant

challenges and opportunities for traditional brick-and-mortar retail businesses. This review of
related literature aims to explore the effects of e-commerce on the local retail market in
Alcala Commercial Market, specifically focusing on the challenges and opportunities that
arise from the increasing adoption of e-commerce by consumers.

Foreign Studies

E-commerce and its impact on small businesses: A case study of the United States"

by Kim et al. (2021). This study investigates the effects of e-commerce on small businesses

in the United States, including the challenges and opportunities associated with the adoption

of e-commerce platforms.

The study examines the impact of e-commerce on small businesses in the United
States, with a focus on the challenges and opportunities associated with the adoption of e-
commerce platforms. The researchers conducted a survey of 120 small businesses across
various industries and analyzed the data using descriptive statistics and regression analysis.

The study found that e-commerce adoption among small businesses in the United
States has been increasing rapidly in recent years. However, many small businesses still face
significant challenges in adopting e-commerce platforms, such as lack of technical expertise,
high costs, and concerns about data security and privacy.

Despite these challenges, the study also identified several opportunities for small
businesses to benefit from e-commerce, such as increased sales and revenue, improved
customer engagement and loyalty, and expanded market reach. The researchers also found
that small businesses that invest in e-commerce tend to have higher levels of innovation and
competitiveness compared to those that do not.
Local Study

E-commerce Adoption and Its Impact on Traditional Retailers in the Philippines by

Mary Grace P. Salvador and Leandro P. Alampay (2020) This study aimed to explore the
impact of e-commerce adoption on traditional retailers in the Philippines. The researchers
conducted surveys and interviews with 209 small and medium-sized retailers in the country
to understand their attitudes towards e-commerce and its impact on their businesses.

The findings of the study showed that while many traditional retailers recognized the
benefits of e-commerce, such as increased visibility and accessibility, they also faced
challenges in competing with online marketplaces. These challenges included difficulty in
setting up and maintaining an online store, high costs associated with online marketing, and
the need for upskilling and training.

However, the study also found that some traditional retailers were able to adapt and
leverage e-commerce to enhance their business models. These businesses focused on offering
personalized services, creating unique and differentiated products, and integrating their online
and offline operations.
 Chapter III
RESEARCH METHODOLOGY
This part contains the research design, study sites and respondents, research

instrument, data gathering procedure, data analysis and ethical consideration.

Research design

The design of the study utilized the mixed method of correlational descriptive

research using the quantitative and qualitative approaches.

Study sites and respondents

This study was conducted at alcala commercial market located at Centro Sur, Alcala,

Cagayan. And the respondents are the selected market vendors and consumers of alcala

commercial Market.

Market vendors and consumers who are absent within the day of the floating of

questionnaires will not be included as a respondent hence, the number of respondents will be

based on the number of present on the day of the experiment.

Research instruments

The data gathering instrument was a self-made questionnaire to gather information on

the perceptions of the respondents on the qualities of market vendors collected from the

election results and survey. Self – constructed questionnaire was validated and item analyzed

by a teacher who has an expertise in the said topic.

Data gathering procedures

 A survey questionnaire will be distributed to the selected sample. The questionnaire

will be designed to collect data on the sales, profits, and customer behavior of local retailers

before and after the introduction of e-commerce.