vendors do not compete with brick-and-mortars

The Daily News recently ran an editorial calling for

research on whether fruit and vegetable vendors are

unfairly competing with brick-and-mortar small

business owners. The Korean Small Business Service

Center, which represents many green grocers, claims

that the Green Cart vendors are driving them out of

business.

We welcome further research, but it is not necessary.

A whole series of scholarly studies has already

documented that street vendors do not compete with

brick-and-mortar establishments. In fact, they help

their businesses.

In New York, Professor John Gaber conducted nine

months of field research on 14th Street during the

early 1990’s.1 He found that the goods sold on the

sidewalk (t-shirts, watches, socks, etc.) were different

from the higher-end and bigger-ticket items sold in

stores (stereos, furniture, etc.) The “vendors

complement the existing array of affordable goods

retailed by store owners with smaller and usually

very inexpensive items (i.e., 3 pairs of socks for $1).”

Beyond a mere lack of harm, Gaber discovered a

“positive synergistic relationship” between the

vendors and their brick-and mortar counterparts. He

found that the vendors drew people to the area and

encouraged them to spend more time there, which

translated into more business for all. For example, he

saw that vendors provide food to hungry shoppers,

enabling them to continue shopping for longer.

Nearly identical results were found in Los Angeles.

Studying vendors in the MacArthur Park area,

Professor Gregg Kettles discovered that there was

little head-to-head competition between vendors and

storefront merchants.2 “Sidewalk vendors avoid

selling from places adjacent to merchants selling the

same product or products,” he found. Indeed, he

observed that the vendors tried to be “good

neighbors” to nearby merchants, by, for example,

sweeping the street near their places of business.

In Chicago, Professors Morales, Balkin and Persky

undertook an economic study of the famous open-air

street market on Maxwell Street, which closed in

1994 before being reopened, later, in a smaller form.3

Combining ethnographic and economic analysis

methods, the professors estimated a $49.3 million

economic loss as a result of the market’s closure.

Many retails shops had gone out of business since the

closing of the market, they observed. Additionally,

with the vendors gone, many wholesale distributors

who supplied them also had to close their doors.

Throughout history, the removal of vendors has led to

a loss of foot traffic that harms brick-and-mortar

small businesses. As Suzanne Wasserman

documented, merchants on Manhattan’s Lower East

Side banded together in 1929 to lobby against street

vendors.4 By 1940, however, “the East Side business

community, which had fought for ten years to remove

the embarrassing pushcarts, now complained that

their removal irreparably damaged their trade.” The

stores, who saw their sales drop as much as 60

percent, “had severely miscalculated the extent to

which their business depended upon that of the

pushcarts outside their doors,” wrote Wasserman.

More recently, City Limits magazine documented the

complaints of brick-and-mortar merchants on Fulton

Street, in Brooklyn, after the street vendors there

were removed in 2001.5 In addition to drawing

customers, and contributing to a vibrant street life,

the vendors served a public safety function. “If

somebody was in trouble, they’d be the first ones

there – even before the cops,” said one merchant,

complaining about the loss of the vendors.

1. Manhattan’s 14th Street Vendors’ Market: Informal Street Peddlers’ Complementary Relationship with New York City’s Economy, John Gaber, Urban Anthropology, Winter 1994. 2. Legal Responses to Sidewalk Vending: The case of Los Angeles, California, Gregg W. Kettles, in Street Entrepreneurs, edited by John Cross and Alfonso Morales, May 2007. 3. The Value of Benefits of Public Street Market: the Case of Maxwell Street, Alfonso Morales, Steven Balkin, Joseph Persky, Economic Development Quarterly, November 1995. 4. The Good Old Days of Poverty: The Battle Over the Fate of New York City’s Lower East Side During the Depression, Suzanne Wasserman (New York University, Department of History: Ph.D. Dissertation, 1990). 5. Sold Out: What happens to the neighborhood when vendors disappear?, Hilary Russ, City Limits Magazine, September 2002.

Studies: Street vendors do not compete

with brick-and-mortar merchants