Pop-up shops after dark a big hit in Harare
Sellers and buyers alike are dodging the law
ON Robert Mugabe Street in Harare’s central business district, music blares from two old speakers mounted on Faithmore Maredza’s one-ton truck.
During the day, motorists use the street’s three demarcated lanes, but by nightfall only a single lane is available.
This is because scores of vehicles illegally park on the road and are turned into shops, giving life to a bustling informal trade.
Here, the unwritten rule of business seems to be: the louder the noise, the bigger the attraction for customers. Those without the sophistication of music to accompany their business resort to shouting to attract passers-by.
Fluorescent lights hung on vehicles provide an extra drawcard in addition to giving muchneeded light as darkness sets in. For Maredza, 28, the light shines on the goods he sells from the back of his truck.
His goods, sourced from Musina in South Africa, include 2kg Maq washing powder packets, an assortment of Nivea lotions and 1kg Ellis Brown coffee creamers.
Most of the products he sells are restricted by law, under Statutory Instrument 64 of 2016, from being imported into the country.
Maredza places orders for his products at the Beitbridge border post in order to restock.
But no one here seems to mind what the law says and passers-by — spoilt for choice from the vehicle-run shops — stop briefly and buy from the maze of vendors.
“I bring this truck into the city centre at five o’clock in the evening and it is here up to nine o’clock or even up to 10 o’clock. On a daily basis I get sales of about $700 [about R9 400]. When it is month-end or a holiday like Easter or Christmas I can make $1 000 or more,” said Maredza, who wears a green football Tshirt and jeans, oblivious to the winter chill.
The after-hours informal trade starts at 5pm, when Harare city council police officers knock off work.
Harare’s mayor, Bernard Manyenyeni, admitted that the council was at its wits’ end over how to control the informal sector, with ratepaying formal retail operators often taking him to task over how informal CROSS-BORDER: Faithmore Maredza’s operation imports household and cosmetic products from South Africa traders seem to run their businesses with impunity.
“We have tried to set up informal trading zones, but the experiment has failed.
“We are now looking for space for the formal and informal businesses to coexist together, but there is a need to eliminate the negatives of their operations which include littering, noise pollution, crime and encroachment on pavements,” said Manyenyeni.
Some retail operators in Harare had even engaged the vendors to sell their products in order to proactively deal with the threat posed by the rise of informal trade, Manyenyeni said.
Maredza, who has been without a formal job for seven years and became a vendor in 2010 after he completed high school, said vending was his only means to make a living.
“There is nothing I can do CAR BOOT SALE: Carl, a street vendor, stands beside the cordial he sells at an informal market set up quickly when police officers go home in Harare about this. When you are in business there should be competition,” he said, shrugging off concern over how his trade impacts on formal retailers.
The informal sector has become the source of income for millions of people in Zimbabwe. The National Vendors Union Zimbabwe estimates that there are 5.7 million vendors in the informal sector.
Company closures, largescale deindustrialisation and retrenchments have been cited by economists as contributing to the rise of the informal sector.
Its growth has been a mixed blessing; it provides a lifeline to millions of people, but it disrupts the established retail sector. Denford Mutashu, president of the Confederation of Zimbabwe Retailers, said vendors had become a menace to formal establishments, and scooping up the business of formal players posed the threat of reducing the capacity of formal retailers to contribute to the fiscus. The vendors evade taxes.
Terence Yeatman, MD of Spar Zimbabwe, said: “The informal market certainly is an interesting space and one that we have been following closely. We are working with government in highlighting any issues when they arise.”
The big retail operators in the country are OK Zimbabwe, Pick n Pay, Choppies and Spar Zimbabwe.
They are all locked in a fierce race to increase market share. OK Zimbabwe is currently the largest retail operator with 64 stores, followed by Pick n Pay with 58 and Choppies with 32.
OK Zimbabwe plans to open two new stores, in Houghton Park in Harare and Chipinge, in the second half of this year.
In February, Pick n Pay opened a new store in Borrowdale; it plans to increase its foothold in Zimbabwe to 65 stores. Choppies, which has its headquarters in Botswana, has a target of 50 stores by year-end. In the past 16 months, Spar Zimbabwe opened four stores, with the most recent being Spar Westlea and Spar Ballantyne.
Davison Norupiri, president of the Zimbabwe National Chamber of Commerce, said the aggressive expansion by foreign and local retail operators was a recognition of the potential of Zimbabwe’s retail sector.
“In South Africa and FOOT TRAFFIC: An informal pop-up market for shoes along Julius Nyerere Road is part of the increasingly popular and widespread phenomenon of night shopping from informal vendors on Harare’s streets Botswana the markets and cake there have become smaller and smaller.
“So they are looking to somewhere else where they can get higher profit margins . . . they are seeing an untapped market in Zimbabwe,” said Norupiri.
In its full-year financial results released last month, Pick n Pay, which holds a 49% stake in its local associate, TM Supermarkets, said earnings from its Zimbabwe unit grew 74.7% last year to R80.2-million, a 71.8% growth in local currency terms.
Although expansion is under way, retail operators cite challenges such as a tough macroeconomic environment marked by poor liquidity, rising unemployment and falling consumer confidence as affecting their business.
BMI Research, a Fitch Group company, said it expected the formal retail sector to experience tepid growth over 2017, with the mass grocery retail sector outperforming over this period.
“Underpinning our view, food and nonalcoholic drinks spending will grow at 1.28% in dollar terms — slightly outperforming total household spending growth, which we forecast at 1% over 2017.
“Throughout our forecast period, we expect consumption to be geared around essentials, which we forecast to account for 70% of total household spending. With a large proportion of Zimbabweans either in informal or vulnerable employment, we expect growth to remain tepid,” BMI Research said.
Mike Bimha, the industry and commerce minister, said a formula of coexistence between the informal and formal sector operators had to be found, as both were key players in the economy.
Bimha was upbeat that things are looking up in the retail sector, nearly a year after demonstrations were held in Beitbridge over fears of the impact import restrictions would have — primarily shortages in supermarkets.
“It’s something that people didn’t expect to work, but what seemed like a bitter pill has turned out to be what heals you in the end.
“The growth among other factors can be linked to measures which we put in place such as SI 64 of 2016, and my office has been inundated with calls of gratitude for those measures, with businesses indicating that their sales and market share had gone up,” he said.
All Maredza wants is to expand his business. He cares little for government policies.
“I don’t want to work for someone else like our fathers did. The government must support my business and not try to shut us down.”
The trade starts at 5pm, when Harare council police officers knock off work
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