Md. Joynal Abdin
The Financial Express on April 25, 2009
CURRENTLY the world economy is experiencing a serious financial crisis. The largest economies of the world have failed to tackle it. Due to their inherent weaknesses, the smaller economies may face more problems than the highly industrialised and the rich ones.
Bangladesh is a least developed country (LDC) and would like to be a middle income country within 2015. In this regard, it has no alternative, but to become industrialised. After its independence in 1971, its economy has advanced a little compared to that of Malaysia or Vietnam.
To develop an economy, it has to increase production to such a level that it can achieve the economy of scale. Because, the more is the volume of production, the less is the unit cost of goods produced. The total production of a country is not exported. Local consumption plays a vital role in increasing production.
In this case, retail sales are the key indicator of local consumption. If retail sale decreases, it is easy to understand that local consumers are not buying the products in a massive scale. This results is decline in production. This may affect gross domestic product (GDP) of the country and the economy may slow down as a result.
The world is moving fast. The economies that can meet the demand of the competitive market are growing quickly. In this situation, we noticed gradual decline in retail sales, especially during last caretaker government period. It means our GDP is going down. This may hamper our long-term target of becoming a middle-income country within 2015. So immediate research is needed to identify its cause and actions have to be taken to overcome this problem.
Today the economy is becoming more competitive, but our local consumption is declining. If local consumption declines, then local production is bound to go down. So research has to be done to find out the following:
It is to be sure whether sales are decreasing or not. If it is decreasing, then to what extent? Will it hamper our GDP?
If retail sales reduce, then how can it affect local production? Generally, reducing local sales means reducing consumption. If consumption reduces then producers are bound to reduce production. Less production may be the cause of higher cost of production per unit.
The reasons for decreasing sales: this research will help to identify the causes of decreasing sales.
How to solve the problem: there should be some recommendations to overcome this problem.
This research has to be carried out in order to avoid any depression in the economy. This may be a major problem for market operators in the future. In the initial stage, marketers must evaluate the previous data to be sure whether sales are plunging or not.