The early closing of supermarkets is a symbol of social development

On my recent trip to Senegal and Mauritania, I found that supermarkets and grocery stores open every day and close late, even during holidays. This observation reminds me of the convenient life back in China, where I could buy a snack at midnight. If this symbolizes social development and convenience, why do supermarkets close on Sundays and early on weekdays in developed European countries like Germany or Switzerland?

Closing on Sundays certainly has a religious reason that God has rested from all his work after creating the world on the seventh day. But this reason alone can not explain everything. Specifically, why do people in Senegal and Mauritania not need to have a day to worship God, yet people there are much more religious than in the European counties? Furthermore, why do not supermarkets in European countries extend the opening hour during the weekday?

It seems that an invisible hand governs this phenomenon in the free market, which a simple microeconomic model can explain well. The central components are marginal revenue and cost. Marginal revenue measures the revenue of an additional store opening hour. The marginal revenue seems to diminish when the opening hours get longer as fewer and fewer people go shopping late at night. Roughly speaking, diminishing marginal revenue means that a store’s revenue from 9 pm to 10 pm is more than that from 10 pm to 11 pm. Similarly, marginal cost measures the cost of an additional store opening hour. The marginal cost seems to increase when the opening hours get longer. For example, the store needs to pay more to convince staff to work in the middle of the night.

What is the best strategy for a store manager to decide the opening hours? Assuming he wants to maximize his profit, the best strategy is to choose the hours that the marginal profit equals the marginal cost. At this point, opening one more additional hour means the store loses money as the additional cost is more than the additional revenue. Similarly, opening one less hour means the store could still earn more, as the additional cost is less than the additional revenue. Thus, the invisible hand will guide the manager to choose the best opening hours.

Of course, the reality is much more complex than this simple model. For example, there is no way to predict a given store’s marginal revenue and cost precisely. Furthermore, the simple model only discusses one store; in reality, multiple stores might compete with the same set of customers. But this model does not prevent us from understanding the social phenomenon broadly. In particular, we can consider what factors cause the gap between African and Western developed countries in terms of opening hours of stores.

The first factor is wages. The minimum hourly salary in Switzerland is around 24 CHF or 26 USD as of Jan 2023, which implies that the wage cost for the additional opening hour is expensive. In contrast, the hourly salary for an employee in a supermarket in Senegal is around 365 CFA or 0.6 USD as of Jan 2023 (calculated from the monthly salary of 75,000 CFA with 12 hours of work for four days a week). Then, a store manager in Switzerland must be aware of the wage costs, if he wants to have more opening hours. In contrast, a manager in Senegal might easily decide on long opening hours and pay little wages to his employees.

The second factor is the contract. In Switzerland, every worker has signed a working contract stating his duties and rights. The weekly working time is 41 hours. Anything more than that needs significant compensation. Whereas in Senegal, many workers do not have contracts, thus, do not benefit from the law. Even if they have, the company might easily circumvent the law and abuse the employees to work more. This factor significantly lowers the marginal cost of opening a store at midnight.

If you are not working at the supermarket and yet the supermarket is open for a long time, it seems that you are benefiting the convenient life from the long opening time without losing anything. Well, most likely, you are not. The total services provided always equals the total services spent. If you are in a country where a supermarket closes late, it might indicate that you are in a society with a long working-hour culture. And you, or future you, might also need to work long hours to offer services to society.

In contrast, if you are in a country where the supermarkets close early, you might feel inconvenienced compared to other countries. Still, with some planning, you can buy everything within shorter opening hours and avoid Sundays. A bit of sacrifice by planning offers everyone a good work-life balance and resting Sundays like God. It is definitely worth it!