Research Academy of Social Sciences
International Journal of Management Sciences
The main goal of this paper is to better understand the low income Brazilian market, supported by two basic concepts: price unfairness and perceived product value. In order to meet the research objective a qualitative approach, based on two methodological procedures – observation and in-depth interviews –, was used. The findings indicate that small neighborhood retailers, despite lacking adequate physical infrastructure and management skills, play an important role in meeting the needs of low-income consumers. They offer convenience, personalized services, easy and uncomplicated credit (on an informal basis), and a product mix that matches the needs and desires of their customers. It was also found that although these small retailers charge higher prices than large supermarket chains, their customers still see value in their offerings and do not consider the prices asked to be unfair: they recognize that the benefits they receive outweigh the higher prices they pay. It was also found that low-income consumers relate with neighborhood retail stores in a basis that goes beyond the mere business, but in a cultural basis too. These small stores function not only as points of sale, but also as places where people can meet and discuss issues related to the local community. The principal contribution of this paper is in providing substantive information about the nuances of a market that has hitherto not been adequately explored but that holds a potential that can no longer be ignored. In Brazil, this market contains nearly 90 million consumers, eager to be included in the world of consumption. The findings presented by this study are of relevance not only to academic organisations and businesses, but also to social organizations and public policymakers responsible for improving the quality of life of the poor.