Shopping malls are mushrooming across Africa but African policy makers are not ensuring that local products dominate those shopping malls. What is the point of building shopping malls that are full of Chinese products when African products are in the streets? On the other hand, the African continent has a lot of abandoned market infrastructure because intended users have not been consulted so that market infrastructure becomes fit for purpose. More important than infrastructure is understanding the users at a granular level in terms of what they trade, the seasonal nature of some businesses and the behaviour of diverse customers.
The devil is in the market operations
Market operations often present the biggest headaches. Some of the key challenges stem from situations where governments hire arrogant corporates to build market infrastructure for smallholder farmers, informal traders and vendors. Assuming they know everything, corporate designers and engineers go on to draw market plans based on their own imaginations of how the market should function.
One of the critical questions not asked is who is going to operate the market? In cases where a build-operate-transfer arrangement does not clearly articulate roles of different actors, the corporate company that builds the market end up trying to operate the market as part of recouping its costs. Ideally the operator should not be the builder but a neutral player to ensure transparency in sharing revenue and other benefits from the market. Allowing the builder to be the operator leads to several conflicts of interest. For instance, the builder-operator can easily inflate figures on the cost of building. The builder-operator can also claim to be collecting less revenue from the rentals in the market in order to prolong the handover period as part of earning more money from the investment. The builder-operator can also suffocate poor informal traders and vendors by increasing market rental charges at will. More importantly, the corporate builder-operator does not care whether local or imported goods dominate in that market because all it cares about is making money at the expense of promoting the Africanness of the market and commodities with a purely African identity.
African markets are more about people not just infrastructure
It is critical for developers and financiers bringing capital into African indigenous mass markets to understand that they are getting into an ecosystem with its own rules and ways of doing business. Like every social system, each mass market has its own unique and self-reinforcing characteristics, practices, and vocabularies. Understanding these boundaries is a prerequisite if new infrastructure is to be transformative. Most mass markets should be understood as public institutions that house private enterprises. That makes them unique and different from other institutions like supermarkets or corporate shopping malls. In addition, mass markets have diverse governance and management systems. On one side is the public system made up of the involvement of government and local authorities mainly responsible for governing space and infrastructure. Within the mass market institution are also different systems such as political structures and governance systems for private enterprises like market committees. Below that are management systems for thousands of individual enterprises with each enterprise having its own different management system. Besides traders, the mass market has actors like farmers, transporters, employees and customers.
This framework of African territorial markets portrays diverse stakeholders with defined but undocumented roles and responsibilities. All these factors should be considered when building an Afrocentric market that is fit for purpose. The market has components of vocational training centre, university, private sector. More than a market, it’s an institution that has not yet been defined from an academic western system – it’s an institution embracing social, economic, political, cultural and business elements all in one. That makes it a unique African institution able to build its own resilience and survive stiff competition from industrial institutions that receive policy support.
Knowledge as a source of resilience and sustainability
What makes African mass markets tick and remain sustainable for years are embedded knowledge and information frameworks. Market infrastructure will become idle if operators do not understand how information and knowledge drive mass markets, especially knowledge around commodities traded in these markets because without commodities there is no market. The information includes understanding the behaviours and payment patterns of diverse actors. Every market has social, political, technological and environmental elements that should not be ignored:
Social aspects – The ethics, culture, tradition and relationships embedded in the markets as well as how these are sustained. What informs building of relationship? Is it political, business, home area, same totem? All these contribute to the identity and characteristics of that market. Conflicts may be difficult to resolve if social aspirations of the market actors are not met.
Political knowledge and information – Mass markets have their own ways of handing politics and political boundaries, including how political information is shared and how commodities are detached from politics.
Technological aspects – This is about existing technologies and how they add value to the mass market as an integrated ecosystem. The way data are collected, processed, shared and consolidated shape the market’s character and performance at different times.
Environmental aspects – mass market actors are always conscious of the environment in terms of waste management and hygiene.
Thriving on indigenous commercial excellence
To avoid wasting resources by building a white elephant, whoever tries to build an African market should make sense of the market as an institution with some soft issues that are critical for effective service delivery. If African mass markets didn’t have in-built frameworks of retaining knowledge and information they wouldn’t have survived for centuries. What is also worth recognizing is the evolution of indigenous commercial excellence in African territorial markets. Mass market actors have learnt to use fragmented trading practices to defy competition from corporates that often benefit from policy protection and support. Some of the best practices are in how knowledge is retained and enriched through generational pass on of knowledge and mindset change. Champions of specific value chains don’t just disappear from the market without passing on knowledge to different age groups and genders. These are some of the key pathways for knowledge preservation.
Charles@knowledgetransafrica.com / charles@emkambo.co.zw /
Website: www.emkambo.co.zw / www.knowledgetransafrica.com
Mobile: 0772 137 717/ 0774 430 309/0712737430