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Local street vendors suffer from lack of systemic support: Study

01 Sep 2021

  • Livelihoods hampered by lack of financing, infrastructure, knowledge, planning, and absence of collective organisation
By Ruwan Laknath Jayakody The livelihood and operations of local street vendors, which includes females, senior citizens, and children, though having a satisfactory level of education, are hampered, a local study found, by constraints such as the lack of financing for working capital and the resultant dependence on informal loans, the lack of infrastructure, the absence of a collective organisation, the lack of knowledge of marketing and accounting practices and their application, and the lack of future planning. These findings were made in “A glance into the life of street vendors in Sri Lanka: An overview”, which was researched and authored by A.C. Karunaratna (attached to the Ruhuna University's Management and Finance Faculty) and N.C. Tjandra (attached to the Edinburgh Napier University's Business School) and published in the Kelaniya University's Sri Lanka Journal of Marketing 7th Volume 2nd Issue on 30 August 2021. Background studies Street vendors or street entrepreneurs are a business category, J.O. Onyango, W.L.A. Olima and L. Onyango noted in “Dynamics of the street vending phenomenon in the Kisumu Municipality, Kenya”, popular among the public, as they provide consumer goods and materials and wares at lower and inexpensive prices compared to formal retail institutions, in convenient locations, for customers with low to moderate income levels. R.M.T.S.K. Rathnayake's “Striking a balance between public rights and the rights of street vendors: An analysis of street vendors in Sri Lanka” notes that the majority of the street vendors provide the main source of income for their households. However, as pointed out by R.B. Recio and J.E.A. Gomez Junior in “Street vendors, their contested spaces, and the policy environment: A view from Caloocan, Metro Manila”, the service rendered by them is not accounted for in the national income, owing to the informal nature of their business activities. Moreover, as S.K. Bhowmik and D. Saha observed in “Street vending in 10 cities in India”, the life of a street vendor is not comfortable and is full of hardships and challenges as trading on the pavement is replete with uncertainties such as constraints and barriers, thus resulting in unstable living standards. For example, as H.M.W. Herath mentioned in “A study of the concept of contested space in the context of street vending in Sri Lanka: A case study”, criticism is levelled against them in the context of the contestation of urban public spaces owing to their activities. This is because, as Rathnayake observes, the majority of street vendors operate in busy streets and are considered a nuisance as they obstruct people. Furthermore, Karunaratna and Tjandra mention that on occasion, Local Government officials take decisions regarding street vendors, such as limiting street vending to certain assigned places and streets, owing sometimes to problems created by the street vendors themselves. It must also be noted that the operations of street vendors are influenced by factors such as seasons, festivals, politics and climatic conditions, and as a result, their sales and income are also subject to fluctuation. Rathnayake has also observed poor infrastructure facilities available to them and minimal attention paid to them by the authorities responsible for the smooth functioning of their activities. Onyango et al. emphasised that street vending provides alternative jobs to a large segment of the urban population who cannot obtain formal employment. As such, N. Wongtada mentioned in “Street vending phenomena: A literature review and research agenda” that street vending is a source of earnings for the unemployed in urban areas. There are various definitions of a street vendor. In S.K. Bhowmik's “Street vendors in Asia: A review”, it is a person who offers goods for sale to the public without having a permanent built-up structure from which to sell, and therefore they occupy space on the pavements of other public or private spaces, or may ply their wares as mobile sellers by carrying their goods from place to place. For Onyango et al., it is informal traders who sell goods or services outside of any enclosed premises or covered workplaces such as streets and sidewalks to passing pedestrians and motorists while Wongtada describes them as those entities selling goods and services in the street without having a permanent built up structure. F. Gamieldien and L.V. Niekerk's “Street vending in South Africa: An entrepreneurial occupation” points out that they are also reliable and competitive. On the reasons for selecting street vending, J. Cross's “Street vendors, and post-modernity: Conflict and compromise in the global economy” and H.M. Kayuni and R.I.C. Tambulasi's “Political transitions and vulnerability of street vending in Malawi” noted that certain street vendors select it as a lifestyle, citing the capacity to enjoy freedom and the flexibility afforded to them. Onyango et al., observe also that it requires little financial input and a low level and volume of skills. According to Bhowmik and Saha, it is selected owing to the lack of gainful employment, poverty, and the lack of skills and education opportunities in rural areas, while Bhowmik further notes that the lack of livelihood-related security and the lack of access to credit become major problems for the smooth functioning of such business operations. However, both Bhowmik and Rathnayake elaborated that compared to the situation in other countries in the region, the status of Lankan street vendors is in a better position, with business activities operated on pavements of major roads, in the sides of streets and certain assigned places which are allocated by the Local Government authorities. There are however instances where street vendors are removed and moved away from their locations and relocated by the authorities as they, according to the authorities, conduct their operations illegally, without having a license, or because they use areas that are not allocated for such business activities, with such activities in turn becoming a nuisance and creating pedestrian-based traffic. Concerning the regulatory and legal aspects of street vending, both R. Austin's “A honest living: Street vendors, municipal regulation, and the black public sphere” and S. K. Bhowmik's “Legal protection for street vendors” noted that in developing countries, street vending activities are, for the most part, unregulated. Data collection criteria Therefore, Karunaratna and Tjandra, using both qualitative and quantitative data collection methods, conducted a survey through which they collected data from 293 street vendors in the Western, Southern, and Sabaragamuwa Provinces. A structured questionnaire using both open-ended and closed-ended questions was used. In-depth interviews were conducted with 33 study subjects. Also, observations and disguised customers were used as qualitative data collection tools. Further, a few Local Government authorities were also interviewed. In terms of the biological sex, the sample included 128 females and 165 males. Age-wise, in the sample, there were 88 respondents between the ages of 40 and 49 years, 64 between the ages of 30 and 39 years, 61 between the ages of 50 and 59 years, 41 between the ages of 60 and 69 years, 33 between the ages of 20 and 29 years, five above the age of 70, and one below the age of 20 years. Accordingly, this included young (in their 20s), middle-aged (between 30 to 50 years, who form the majority), and old (over 60s) individuals. Compared to the young and middle-aged street vendors, the number of elderly street vendors is substantially high. As far as the civil status is considered, the majority were married (262), while 21 were single and 10 females were divorced. The latter females who had separated from their husbands, had selected street vending owing to the lack of other options or livelihood-related alternatives. Regarding the level of education, the majority (158) had studied up to the senior secondary level (Grades 10 to 11, having passed the General Certificate of Education [GCE] Ordinary Level examination), while 65 had studied up to the junior secondary level (Grades 6-9), 40 had studied up to the primary level (Grades 1-5), and 30 had studied up to the GCE Advanced Level (A/L), although two who passed had been unable to find a suitable employment opportunity due to the lack of opportunities. Accordingly, the majority had obtained a fairly good education. However, the two who passed the A/L exam were disappointed, and mentioned that although they were seeking an employment opportunity from the Government, they were unable to find an opportunity due to the lack of political support. They are of the view that education alone, sans political interference, will not qualify one for an employment opportunity in the Government sector. The duo added however that they are grateful to the education system, as the knowledge gained through it has become helpful in managing the business activities. The nature of the operations The main items sold by street vendors are fruits, vegetables, toys, apparel, porridge, fish, curd, cashew, ice cream, fruit juice, lunch packets, books, water bottles, pots, flowers, slippers, incense sticks, school items, and lotteries. The quality of the items sold by street vendors ranged from low to average, even though certain vendors claimed that they sell high quality items. Further, those who sell items with low to average quality at an affordable price have a good demand from customers. While a few street vendors serve as casual labour employees, the majority operate their own businesses. The majority sell the same items, while a quarter of the study population, from time to time, sell different items, owing to seasonal demands. The number of street vendors has increased during recent years due to the lack of employment opportunities, the study noted. In terms of the number of years of service, the majority (102) had five to nine years, followed by 92 who had three to four years, 54 who had 10-15 years, 25 who had one to two years, 13 who had 16-20 years, and seven who had 21-25 years. A total of 219 had entered into this business during the last 10 years, while 117 of them had entered during the last four years. The number of those who have engaged in this for more than 10 years is 74. Around 20 have engaged in this livelihood for over 15 years. Certain vendors have served on the streets for over 25 years, and as one of them, a 62-year-old male described it: “I built my life being on the street. I have suffered many hardships but cannot give up street vending as it has become a part of my life.” Pertaining to the number of hours served per day, the majority (203) spent eight to 10 hours, followed by 49 who spent five to seven hours, 28 who spent 11-15 hours (working till late evening or night on certain days), and 13 who spent two to four hours. Personal and family background On the matter of with whom they partnered up for the operation, the majority (173) worked alone, followed by 110 who involved their family members, six who were accompanied by friends, and four who had business partners. As far as family support was concerned, the majority (129) had a good level of support, while 102 had less support, and 62 had none. The support of children was obtained by 52.  More than half conducted the operations alone, while the others conducted the business activities with their family members, and only a few coupled with business partners and friends. The majority are married and therefore responsible for looking after and fulfilling the needs of the family members. While the sample included young married couples with no children, the majority have two or more children. The majority received good support from the spouse, while some had less spousal support. Children’s assistance to street vending activities (such as by preparing food, assisting parents with cash transactions and promoting food to customers, etc.) is at a minimum level. The majority mentioned that they do not encourage their children to get involved in street vending, since they do not intend their children to select street vending as their career, and instead hope to produce well-educated individuals who find suitable employment in the public or private sector. Hence, they are fully committed to providing a sound education to their children. The majority do not, however, have a plan for their future as they struggle with their current status due to the many daily hardships, problems and challenges, and their main target as a result is survival.  Educational background The majority of those who have obtained only primary education were found to be elders over 50 years. They mentioned that they were not much motivated towards education at the time of their schooling. Regardless, the majority have gained senior secondary education. Social and cultural background The majority do not possess a permanent shelter and instead live in rented houses or small temporary shelters with very basic amenities. Many of these families suffer a lot of hardships, and there is at least a single child who is badly ill or disabled. The majority of female entrepreneurs stated that they operate the business, since their husbands are disabled or seriously ill. Over half of the street vendors in this study have at least a single family member who is disabled or badly ill, and have suffered from these difficulties for a long period of time. Therefore, a considerable amount of their income is spent on medicine. Street vendors in their 60s and 70s have selected this profession as they need to live independently and do not intend to burden their young children and their families, as the majority of the latter families do not have sufficient income to fulfil their own needs. Karunaratna and Tjandra explain that this situation is evidence of the lack of a robust welfare system to look after senior citizens. Also, Karunaratna and Tjandra note that they are not well organised, and are not members of any trade union, society, club, or association formed for the purpose of the protection of their rights, and as a result, their bargaining power is fairly low. Moreover, they also lack awareness of the services provided by any Government institutions and are not registered in any structured databases either in the Government or in the non-Governmental sector. Furthermore, the majority have not received any training to enhance their knowledge, and due to this lack of knowledge, they did not follow marketing or accounting practices. The street vendors are also of the view that they are not well recognised and accepted in the society. Economic background The level of income and profit margin of street vendors is primarily determined by the number of items sold on a particular day. Factors such as the number of hours they operated, the location where the business was conducted, and their business savviness also play a role. They have flexible time schedules. Street vendors who sell perishable items like porridge, curd, fish, and lunch packets work for a few hours with a fair rate of return based on the demand. While some street vendors earn healthy profits, the majority were not satisfied with their income, as it is sufficient only to fulfil their basic needs. The main expenses of street vendors are on food (due to inflation, food consumes the majority of the income), clothing, sanitation, and utilities. After food, the higher percentage of the income goes towards the education of their children to pay for tuition fees and to purchase the necessary educational materials. Male vendors entertain themselves mostly by consuming alcohol. They rarely go to a movie as a family. Female vendors on the other hand tended to save at least a small percentage for the future. Female engagement in street vending Female engagement in street vending has increased during the last few years. In the study sample, the majority of females had recently joined street vending and selected it as an occupation owing to the high cost of living, economic hardships, and the lack of employment opportunities. Dependency on informal loans The lack of financing is a major and severe problem for street vendors, and the majority have working capital-related issues, since a considerable percentage of the income goes towards household consumption. Hence, the main source of financing has become informal loans obtained from a third party, such as money lenders who provide informal personal loans under strict conditions and a high rate of interest. As a result, street vendors earn a low profit margin owing to having to pay a higher percentage of the income as the interest of loans to informal money lenders. Suffering from the lack of infrastructure The majority of street vendors have constructed temporary shelters, huts, and stalls; however, rain and wind almost always destroys their temporary huts and stalls. Thus, external forces such as climatic changes, especially floods and droughts, are a serious issue that adversely impacts their operations. Lack of knowledge of marketing and accounting practices The majority are not aware of accounting and budgeting procedures, even at the basic level, and also do not possess the basic knowledge in marketing. They also have no concern towards customer care. Lack of a plan for the future The majority are not directed by a well-structured plan owing to the lack of knowledge of such a process and the lack of motivation due to the many challenges, problems, and hardships they encounter on a daily basis. And even though some have a growth-oriented motive, they do not have a sound idea on how to achieve such. Types of street vendors -        Regular vs. Erratic The majority regularly conduct street vending-related business activities as their main source of income and occupation, while others engage in it less frequently such as only during seasons like Christmas and the Sinhala and Tamil New Year, with the intent to earn a higher income, and therefore tend to engage in odd jobs at other times. -        Decent/Honest vs. Corrupt/Deceitful Certain vendors engage in the business genuinely without causing harm to customers and do not intend to cheat or exploit customers by selling defective or low quality items. That said, certain other vendors tend to cheat innocent customers and exploit them by selling defective and poor quality items. -        Cool vs. Aggressive While there are vendors who conduct their operations in a cooperative and friendly manner, both with customers and competitors, even helping the latter when required, some vendors tend to exhibit aggressive behaviour where they get into constant disputes with associate vendors and compete with them, and become as a result, criticised by neighbouring vendors who believe that such conduct negatively affects the image of street vendors. -        Growth oriented vs. Survival Certain street vendors aspire to develop their business even if they may be stagnant due to various challenges and issues. However, the majority struggle with their present condition and attempt to balance the income and consumption for survival, as the income is not adequate to fulfil their needs. This latter scenario is due in part to the instability of the economy and high cost of living. -        Independent vs. Politically motivated The majority are independent and engage in this as a means of earning a livelihood. On the other hand, certain street vendors are backed by politicians as per the latter's agenda. As a result, they tend to be more powerful than the other street vendors and also exert pressure on the other street vendors for their own benefit. -        Young vs. Elders The majority of the young actively engage in street vending, whereas senior citizens above 60 or 70 years have a high tendency to engage in street vending, as they are both unable and unqualified to do any other occupation in order to earn their living. Also, while the majority among the elderly vendors have taken up the occupation as they dislike becoming a burden to their children, certain elderly street vendors had selected this option as they had been neglected by their children. -        Low level of income/profit vs. High level of income/profit A high percentage of street vendors fall into the low income and profit category. In this regard, Karunaratna and Tjandra explain that the proper location with a high level of customer traffic could help earn a high income and profit margin. There were also street vendors who earned a considerable income and profit. -        Single location sellers vs. Multiple location sellers Certain vendors are located in a particular place and conduct operations from that place for years. The locations, in most cases, are chosen for high customer traffic and convenience. Other street vendors, especially young ones, prefer to change the location and employ multiple locations in their search for more customers. -        Vendors who sell the same item vs. Vendors who sell different items Some vendors tend to sell the same type of item or items like vegetables, fruits, porridge, curd, and toys while there are others who always sell different items based on the seasonal demand.  


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