Role of Networks and Vendors’ Choice of Trading Location: a Study of Trade on Nairobi-Thika Superhighway

Abstract

Studies have observed that vending has been on the increase in developing countries particularly in urban areas and suburbs. The main contributing factors are rural-urban migration, lack of formal employment leading to self-employment as survival alternative, inability of companies to employ people on permanent basis due to economic challenges. For a greater percentage of urban residents who are not able to get absorbed in formal employment, small scale businesses are the main sources of their livelihood. Vendors have developed networks among themselves to help them do businesses in their trading location and increase daily income. This study aimed at understanding the role of networks in the vendors’ choice of business location along Nairobi-Thika highway. The study examined how networks helps vendors to identify locations conducive for their businesses. Data were collected through survey of sixty highway vendors and five key informant interviews. The findings showed that the number of vendors doing business along Nairobi to Thika superhighway is continuously increasing after the commissioning of the road and the trend is linked to increasing traffic congestion along the highway. This is linked to the fact that infrastructure development attracts population growth along the corridors and this in turn creates new and unplanned economic activities including market sand trading sites. The study revealed that vendors experienced harassment from county government and Kenya National Highway officials. Further, social networks among vendors played a key role in determining trading locations and their survival along the highway. Being a member of a social network helps in getting market information, source of goods and raw materials, where to sell particular type of goods and getting a space for business, and identifying existing market gaps in specific trading location. The study concludes that vendor-to-vendor networks have enabled vendors’ to overcome the challenge they faced while trading along the highway, created opportunities for earning livelihood for the vendors and thereby contributed to poverty alleviation among the vendors.