Dynamics of local supply in rural areas

Background and Objective

Particularly in rural areas convenience goods and basic services are not accessible within walking distance for local residents. An analysis of accessibility from 2013 revealed that the distance to the closest grocery store exceeds 1.000m for two thirds of the rural population in Germany (Neumeier 2014). Hence, the local supply – according to the common definition – for this part of the population is not guaranteed. In addition, the number of sales points of food retailers has halved between 1990 and 2010 (Eberhardt, Pollermann, Küpper 2014). Especially smaller shops – those with a sales area up to 400m² – which are vitally important for the provision of local supplies in rural settlements, withdrew from the market. Simultaneously, larger supermarkets and discounters entered the market. More recently, new distribution channels evolved due to the emergence of online- and delivery services. Over the past few years the structural change has intensified due to the closing down of smaller shops.

Against this background, several political initiatives and support programmes centre on the maintenance of local services:

• state programmes such as M.Punkt and MarktTreff
• Programmes from the European Agricultural Fund for Rural Development, such as (M7) basic services and village renewal in rural areas and (M19) LEADER
• Pilot and demonstration projects “regionality and multi-functional houses“ of the Federal Ministry of Food and Agriculture (BMEL).

Furthermore, local supply, within the scheme for “micro-business for local supply“, became eligible for grants from the joint task 'improvement of the agrarian structures and coastal protection’ (GAK), recently.

Despite the political relevance, the scientific interest for local supply with regards to the retail sector and rural regions is surprisingly low. Existing studies are dated and do not grapple with recent trends and phenomena. Due to the complexity of the topic, most studies cover specific aspects only – such as the supply structure of local stores, spatial and (urban) land-use planning – or they are spatially and temporally constrained: they are either based on regional case studies, or the research focuses on a certain point in time. As a consequence, long-term developments, changes of supply structures and patterns of consumption are hardly addressed.

Considering the state of research, an examination of recent developments deems necessary.  This includes the reconsideration of latest technological advancements, new distribution channels, the effects of supply changes on the consumers’ satisfaction and the actual purchasing behaviour. But also the potential of funding instruments, next to the frequently studied planning instruments, for an improved supply situation need to be scrutinised.

Approach

The focus of this research project is on recent developments of supply structures and consumption patterns against the background of technological advancements, new supply forms and political support instruments. The aim is to ascertain and elucidate supply changes in rural areas and to determine strategies of suppliers as well as the political and administrative bodies. Moreover, it will be evaluated how alterations on the supply side have been perceived by consumers and which strategies were developed for coping with the given conditions; e.g. the closure of a local shop. But also the opposite development – the opening of new shops and opportunities for online-shopping – will be considered.

The research project comprises of quantitative and qualitative methods. Secondary data analysis will be complemented by guided interviews as part of expert surveys and qualitative case studies. Standardised phone interviews with shop-managers, quantitative case-studies with household surveys as well as group interviews are also envisaged. Based on the results, we intend to provide suppliers, municipalities and actors in charge of funding policies with recommendations for action. The emphasis is on local supplies and rural development policies.

Our Research Questions

The project responds to the previously identified need for research by addressing the following questions:

• Which alterations of the supply situation can be detected and how much impact have mobile supplies and the digitalisation of the retail segment in this regard; can differences be discerned between rural and non-rural regions, but also within different types of rural regions?
• Which causes for supply changes can be identified? What are the main achievements of public funding with regards to the maintenance of existing services, but also the provision of new services? How has the funding structure changed during the past few years and which effects do new funding opportunities have on the supply-side?
• To what extent have improvements or deteriorations of the supply situation led to changing customers’ behaviour and general (dis-)content with the supply structure?
• How should supplies be conceptualised (and supported) for complying with requirements of the local population and overall social objectives?