By Kagiso Bonoko
Spaza shops are the small street corner grocery shops or supermarket outlets, predominately found in South Africa’s Black populated areas or townships. The term ‘spaza’ is isiZulu, meaning ‘hidden’, it arose during South Africa’s Apartheid era, when Black people were restricted from running businesses. These shops would sell basic foods and necessities to township residents in secret. Spaza shops have a historical significance because during the Apartheid years, black people were not allowed to move freely in town by the white minority rule, so they became the immediate source of daily necessities for many families and communities. Up to January 1989, spaza shops were considered illegal but later legalised on condition that owners obtained a trading license (Marketing Mix 2000:12).
According to the book “The Journey of the Soweto Township Entrepreneur since 1905”, edited by former anti-Apartheid activist and journalist, Thami Mazwai; when Soweto was established as a township, it went through a series of transformations, activities, policies, and general economic activities which brought about the birth of Black entrepreneurs. They transformed the Black status quo and changed the narrative about business ownership in the townships. However, the dawn of democracy changed things rapidly bringing it the proliferation of immigrant-owned spaza shops in South African townships, villages, and some urban areas. (Ligthelm, 2007 and van Scheers, 2010).
From the 1960’s onwards, black businesses in townships served as an example of success. These businesses depended on a close symbiotic relationship of trust with the community, while their mode of operation and the goods that they sold, both reflected and shaped the changing consumption patterns associated with urban living.
The democratic government relaxed many restrictions enforced by the Apartheid regime to enable Black entrepreneurs to operate legally. Faced with the challenges of unemployment, the government crafted policies and programmes to support and promote the creation of small, medium, and micro-sized enterprises, or SMMEs. However, despite all of these initiatives, the small grocery shops, commonly known as spaza shops, and particularly those owned by South Africans, are still faced with a number of obstacles with respect to their establishment, operation, and growth. (Mukwarami, Josephat; 2017)
The ongoing food poisoning incidents around spaza shops have now added a new dynamic to that symbiotic relationship.
The 2023 research by Accenture highlights that the informal sector, where spaza shops thrive, represents a substantial portion of the nation’s annual food expenditure, estimated at 30% – 40%. This sector signifies a staggering potential market value of R178 billion, offering significant opportunities for businesses.
The research also reveals the challenges encountered by spaza store owners and informal traders. These hurdles include inefficient supply chains, frequent product shortages, significant waste arising from the limited shelf life of fresh produce, and an overreliance on costly branded products. In most cases, spaza shops procure their stock from wholesale retailers, leading to higher prices for consumers.
These informal trading sectors operate beyond the scope of the South African Revenue Service’s (SARS) ability to enforce taxation. Income is often cash-based, and tax officials do not routinely inspect these unregistered businesses or request receipts as their existence, by definition, remains undocumented.
Because of the limited space, spaza shops find themselves in a situation where products are packed into small spaces, resulting in the widespread problems of expiry dates and the use of banned pest control products contaminating food products. This is according to the multidisciplinary team comprising of the South African Police in collaboration with the Department of Health with the support of other government and private entities appointed to conduct raids in the townships.
A recent report by The Citizen stated that spaza shops often sell pesticides, such as aldicarb, also known as two-step, in small packets that the owners make up themselves from containers of pesticides. They also buy snacks, such as chips, in bulk and make up smaller packets to sell at their shops. However, they do not adhere to safety standards and handle the pesticides and the snacks without the necessary training on precautions to prevent contamination. It then explains why in one of the recent food poisoning cases, traces of banned insecticide were found in spazas as inspectors and investigators honed in on what killed the six children in Soweto.
In the wake of growing news reports of children tragically dying from food poisoning allegedly due to products bought at spaza shops owned by foreigners, Minister in the Presidency Khumbudzo Ntshavheni has called on South Africans to be vigilant. She has urged the public to demand proof of registration from these shops where there is suspicion of illegal owners selling counterfeit goods. The City of Joburg’s MMC for Safety, Dr. Mgcini Tshwaku, also reiterated that all spaza shops found to be non-compliant will be closed down temporarily until they are thoroughly checked and are found to be compliant before being the green light to to operate again.
Minister Ntshavheni said that the Department of Small Business Development was working with municipalities to ensure spaza shops complied with regulations. She acknowledged that, while foreign nationals were allowed to operate businesses in South Africa, they must be registered and compliant. She also urged South Africans to prioritise their health and safety over the temptation of cheaper goods sold by illegal spaza shops.
Addressing the multifaceted challenges and opportunities facing thespaza shop sector requires a comprehensive approach that combines regulatory measures with strategies to enhance supply chains, ensure food safety, and provide opportunities for these vital community businesses. The spaza shop phenomenon, is deeply ingrained in our South African society, and deserves both the commitment from the communities to report suspicious shops and the government to ensure the safety of these township dwellers. If operated accordingly, this informal sector presents opportunities for the livelihoods of many who are not in formal employment and provides a greatly needed service to their communities.
Everyone concerned must play their part to ensure that communities are treated with the dignity they deserve while empowering small business owners to thrive and contribute towards economic growth.
Sources:
https://journal.eu-jr.eu/social/article/view/2050
https://www.capeindependent.com/article/south-africas-spaza-shops-a-major-growth-sector-but-also-a-risk-to-public-healthhttps://www.citizen.co.za/business/children-die-spaza-shop-snacks-contaminated-by-pesticides/
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Dr. Mazwai T, 2024, The Journey of the Soweto Entrepreneur Since 1905.
