Date project started:
informal traders project started in 2017 and will conclude in June with the semi-formal traders project commencing in July 2018.
Aim of project and outcomes
The purpose of the study was to get a better understanding of the informal traders, their needs and challenges. It is also to obtain information regarding the requirements for trading structures, the willingness of traders to move to formal structures, their ability to pay rent and servicing costs, their trading and storage requirements, and their source of goods.
Brief description of project
Informal trade forms an integral part of Cape Town’s local economy and the urban landscape of not only the CBD, but other parts of the greater metropolitan. The 2014 State of the Central City Report (SCCR) states that 8 040 people are employed in street trading (informal trade) in Cape Town’s CBD. This shows the thriving economic nature of the sector, compared with the 2 797 employed in CBD shopping malls. In order to keep our public spaces buoyant and economically productive, informal trade is an integral element to these strategies.
Informal trade is a very important part of Cape Town’s economy and offers good employment opportunities for traders, as well as affordable goods and services to locals. The informal sector is the fifth largest employment sector in Cape Town. Many occupations in the informal economy are not only important in their contribution to the GDP but also in their potential to build meaningful livelihoods that can shape the well-being of locals and cities alike. Although difficult to measure, some estimate the informal economy’s value at 28% of South Africa’s GDP.
This project included created a comprehensive survey with the informal traders in the Bellville CBD with this information presented in the below infographic.
A random sample of 263 informal traders participated in the survey from different sections of Bellville CBD to ensure the traders were not all from the exact same location and this was comprised of 52.3% female and 47.7% male.
Below are some of the findings of the survey:
- Although the informal traders sell a variety of goods at the different kiosks, most of the traders operate in the clothing industry. The predominant products sold by the informal traders (36.4%). Besides offering fruit and veg (22.4%) and hairdressing (17.7%), there is not a great variety of products and prices are strategically under-cut much to the delight of the bargain-hunting public. However, this clothing commodity dominates the informal market in the Bellville CBD. There have also been complaints that the competition is so concentrated as to cause some conflict.
- Informal traders generally have a medium to long life span in the Bellville CBD. The highest proportion (32%) of informal traders in the Bellville CBD has been operating in the Bellville CBD for ten years and longer. Approximately 27% of the informal traders have been operating in Bellville CBD for 6-10 years with very few trading here less than a year (12%).
- The informal traders of Bellville CBD appear to agree that this is a prime location to trade in as it is Close to customers (54.6%). Almost nineteen percent (18.7%) of traders consider the reliable public transport as one of the reasons for doing business in the Bellville CBD. Another 18.7% sights the availability of space is a reason for trading in the area.
- The busiest trading time is between 08:00 – 11:00 (45%). The reason for this hours could be the foot traffic when consumers usually travel from home to work. Followed by 14:00 – 17:00 (26%); 11:00 – 14:00 (15%) and after 17:00 (14%).
- The majority of the traders are content with their location and stated they intend on remaining for a long-term period (90,3%), with 197 responded to the question with an answer “forever”. Only 9,7% of respondents stated that they intend to stay on a short-term base. These responses were primarily from those who have not traded in the area for a long time.
- The majority stated No (58%) while 42% of the traders stated that they did made personal investment in their stalls. The investments mainly pertain to the purchasing of metal frames and wooden boards and are relatively small contributions.
- The informal traders were asked if they pay for storage. 75% of the informal traders stated that they pay storage fees. When asked where, they have been somewhat vague about their exact storage space and this is understandable – to maintain that safety.
- Majority of the informal traders stated that their business would not benefit from a card machine (79%). Cash was the overwhelmingly preferred payment options. However, this may be influenced by the familiarity of cash. The informal trade sector has potential to test non-cash payments that are simple and safe. This could provide convenience to consumers and alternative payment methodologies for informal traders.
- The majority of Bellville CBD appear to agree that this is a prime location to trade in, as the majority stated that Bellville CBD is a good area for business (176). The survey show that many informal traders indicated that there are too much crime in the area, however almost all of the 52 informal traders stated crime is a major problem also responded with “…but Bellville has great business opportunities”. From the survey 18 indicated that Bellville is not good for business was mostly illegal traders.
- Finally, the informal traders were asked what they would implement to make Bellville a better place to do business. The most popular answers were Proper shelter (129) and better security (97). As you can see from the graph, proper shelter are a priority for the informal traders. The traders feel that they would experience less difficulty if the structure were sound. This may deter shrinkage as well as reduce storage cost and the transport to storage. The trading structures are part of their business environment and affects their dignity as traders. The informal traders of Bellville CBD are unhappy about the lack of safety for themselves and their customers as well as poor security that plague them daily. Even some of the informal traders themselves (12) tend to agree that there are too many informal traders in this area.
Bellville CBD and Voortrekker Road Corridor