Street vendors: Survival strategy or entrepreneurship?

Didit Eko Setiawan ,  Jakarta   |  Tue, 03/25/2008 12:44 PM  |  Opinion

In the cold early morning, Matra smokes a cigarette and drinks a cup of coffee before starting his day as a vegetable hawker. In 10 minutes, he is ready to pedal his cart.

He goes to the big traditional market in Pulo Gadung in East Jakarta every 3 am. A jacket, a cap and a cart are the only things he has to accompany him. His wife and children support him by blessing him from a village outside Jakarta. He lives in a modest boarding home.

As usual, he meets retailers selling fruits, fish, meat and chicken. Joking, chatting and bargaining are part of the conversation. Having spent two hours there, he moves to housing blocks in Kelapa Gading subdistrict. He screams loudly, "sayur, sayur..." (vegetables, vegetables...) to attract customers. Sometimes he meets new people, but most of his customers are the regulars who always buy vegetables, fruits, meat and fish from him. Interesting conversations often take place between them.

Sometimes his regular customers owe Matra money, and sometimes Matra owes his customers. There is trust between them. Matra knows it is his opportunity to connect with his customers.

At 12 o'clock when he gets hungry, he stops at a warteg and eats his lunch. He offers the stall owner his goods. Sometimes they will bargain. A meal of rice, tofu and vegetables is his ordinary lunch. After taking a rest for an hour, he continues selling the produce until 3 p.m.

At around 3 p.m. he returns to his modest boarding home. He cleans the cart and keeps the leftover vegetables in the refrigerator provided by the boarding manager. He takes a bath and then chats with friends. The conversation continues in the dining room while they have dinner.

By eight o'clock, he is already asleep, dreaming about his hopes for life. And in the cold early morning, he starts again -- the ordinary life of a hawker living in the informal sector.

Like Matra, most vendors living in urbanized areas are poorly educated and want to improve their lives. They come from outside Jakarta, such as from Bekasi and Karawan in West Java, or Pati and Blora in Central Java, and some are weekly commuters.

Since they cannot afford to buy land in Jakarta, those who are already married usually rent a house, while those who are still single share a room with other vendors.

Research shows some vendors work for a boss and are not individual entrepenuers. They are given a certain amount of money as capital and no time limit in which they have to pay it back. Most of them pay back their loan, with 2 percent interest, within a week, after obtaining a net profit of between Rp 150,000 and Rp 400,000 per two weeks.

Hawkers will also rent their vegetable carts from a boss, which is better for them as weekly commuters. Who will take care of the carts if they go back to their hometowns?

It does mean though they will have to pay interest rates on their loan at the end of the week. If they cannot pay within a week, they will pay the following week. Those who can pay will borrow money again. It is a recurring cycle, and Matra is only one of many who live it. He has been in the business for 10 years now.

It seems he and his friends have no other choice. There are no jobs for low-educated people like him, and Matra does not have a rice field in his village where he could work. Fortunately his neighbor and boss, who built up his own wealth in Jakarta, offered him a job as a hawker.

Matra wants his children to have a good education and good jobs. He is ready to work hard, and by doing so he can save at least Rp 600,000 per month to deliver to his family. It is a large amount of money for people living in their village.

But for the hawkers who live with their family in Jakarta, Rp 600,000 is not enough. Fortunately, they have their own strategy to deal with hardship. Some of their wives open stalls or small shops, while others work as maids or housekeepers.

There are lessons to be learnt from hawkers. There are many "Matras" in big cities like Jakarta. As vegetable vendors, their work can be considered a form of self employment that the government should support by creating incentives for them.

Do hawkers know about the micro-finance credit scheme for small entrepreneurs? If so, why do not use the government-funded scheme? Why do they prefer to loan money from their boss?

These are questions the government should answer to empower small entrepreneurs, in order to reduce unemployment in the country. Otherwise, their routine activity is just a survival strategy to live.

The writer is a civil servant who is currently studying for a master's in urban management and development at Erasmus University in Rotterdam.

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