Informal home-based entrepreneurs in South Africa: ‘How non-South Africans outcompete South Africans’

Abstract

The influx of immigrant entrepreneurs, particularly those involved in various informal economic activities, is a global phenomenon. As in other developing countries, the South African informal business landscape in general has, and to a large degree, been infiltrated by informal immigrant entrepreneurs. Yet, despite the hostile reception of these non-South African entrepreneurs, both by their South African counterparts and the general population particularly in former black township areas the literature and empirical research indicates that non-South Africans move onto alternative and more lucrative businesses much quicker than their local counterparts. To a large extent, the informal home-based township trade is no exception in this respect, with non-South Africans (Bangladeshi and Pakistani in particular), outperforming their South African counterparts. It is, therefore, argued that the immigrant entrepreneurs are more competitive and thus more successful than their local counterparts, and that their success could largely be attributed to their unique and sound business skills and personal characteristics. The paper used the views of adult customers, and current and former informal home-based entrepreneurs, to demonstrate the extent to which non-South Africans trading as informal home-based entrepreneurs in Mangaung Township (Bloemfontein) have outperformed their South African counterparts.