Enhancing the prospects of small scale and informal retailers in fresh produce value chains : an examination of the developmental impact of public sector market facilities on formal and informal retailers in selected KwaZulu-Natal markets.

Abstract

The aim of the research was to identify the constraints that restrict the development of informal and small formal retailers, and highlight potential opportunities that may assist in strengthening their position within the value chain. It explored the functioning of two municipal-managed static fresh produce markets in KwaZulu-Natal: Durban and Pietermaritzburg. The investigation revealed that informal and small formal retailers have relatively little impact on the fresh produce value chain and that the structure of static markets is not conducive to these groups because of their lack of capital and inability to buy produce in bulk. Predominant constraints to their economic growth include high cost of transport, high prices of produce and competition with other traders. In addition, police harassment was identified in Durban as one of the dominant constraints, but was not reflected in Pietermaritzburg. However, opportunities for small and informal retailers to strengthen their position were identified as increasing the market access for retailers, through the provision of transport, informal training workshops, cold storage facilities in the city, the formation of cooperatives and access to micro-credit. This research argues that attention must be given to enhancing the interests and role of small and informal retailers in governance and operational processes within fresh produce markets. The necessity of the development of social networks (also argued by Meagher 1995) is a critical factor in determining the success of informal and micro enterprises and could contribute to institutional reforms that help address the information and access asymmetries in the fresh produce market environment. Following the completion of this dissertation, it was distributed along with the appended log frames to the management at the Durban and Pietermaritzburg, market agents and informal retailer groups that participated. It will also be disseminated through the Learning, Monitoring and Research Facility, who funded part of the research, and is hoped that the information will aid informal retailers and empower those that were involved.