E-commerce Impact on Retail Sector in Thimphu: Assessing Challenges, Willingness and Readiness for E-commerce

Dorji Yuden, Namgay Wangmo, Karma Sherab Lhamo and Younten Lhamo

Bhutan Journal of Business and Management, 2025

Abstract: Despite the global surge in e-commerce, traditional brick-and-mortar retail continues to be the major part of Bhutan’s economy. This qualitative study investigates the growth of online platforms from the perspective of physical retailers in Thimphu, their obstacles, and their readiness and willingness to accept the digital sales channels. The study applied an exploratory design based on the Technology Acceptance Model (TAM) (Davis, 1989) and among the various qualitative methods used, thirty (30) semi-structured in-depth interviews were conducted during the month of May 2025 with a purposely chosen sample of 19 purely physical and 11 hybrid retailers in Thimphu. The interviews were recorded, transcribed, and analyzed by Braun and Clarke ‘s (2006) six-phase reflexive thematic analysis through both manual coding and NVivo 14 software. According to the statements made by the respondents, four key challenges were identified: decline in customer footfall (cited by 28 out of 30), the aggressive strategy of online lowering prices (26/30), and the constant burden of high fixed costs including rent and salaries (24/30), and lastly, the lack of a digital infrastructure together with low digital skills (21/30 and 19/30 respectively). Notwithstanding these obstacles, 22 respondents showed moderate to high willingness for the adoption of e-commerce, provided that they would receive training and financial assistance. The two main concepts of TAM, perceived usefulness, and perceived ease of use, were repeatedly mentioned as the most important factors, while external support (government training, subsidies, and fair taxation policy) came up as a significant moderator of adoption intention. The research supports the Technology Acceptance Model (TAM) by revealing how crucial the cultural and infrastructural moderators are in small and developing economies. Recommendations for practice include nationwide digital literacy programs, subsidized payment gateways, and fair tax treatment between.

Keywords: Physical retail Store; E-commerce adaptation; Online competition; Retailer perceptions; Sustainable business practices; Business model changes (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eoq:bjbmjr:art66

DOI: 10.17102/bjbm.v8.3

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