India’s largest association of street vendors plans to take to the streets to protest ITC Ltd’s moves to sell fresh produce through pushcarts. The tobacco giant’s move will make it a large, moneyed, and aggressive competitor for traditional pushcart and street vendors.
“Almost 80% of fruits and vegetables in India are sold by hawkers,” said Shaktiman Ghosh, general secretary of the National Hawkers Federation, an umbrella organization representing around 500 hawker groups from across the country. “If a cigarette, hospitality giant is eyeing their daily bread, it’s very dangerous. ITC is trying to take their livelihood from them,” he added.
Ghosh warned of violent reaction from the street vendors the day ITC rolls out its first pushcart.
ITC declined to give the date for the launch of its pushcart-vending operations, but an executive at the company said that the firm was trying to work with, and through, street vendors and that the plan would eventually benefit both parties. He requested that he not be identified given the sensitivity of the issue.
The company has been operating Choupal Fresh grocery stores selling fruits and vegetables in Hyderabad, Pune and Chandigarh. The produce is purchased directly from farmers.
ITC said it plans to roll-out around 150 pushcarts as part of a pilot project in the three cities in the next six months. The pushcarts will bear the ITC logo and the company will hire people to sell the produce (which is, in turn, sourced from ITC).
The company said it was open to selling its pushcarts to existing street vendors, who could purchase it and also have the option of not branding it as ITC. However, if they choose to brand it as ITC, they will be bound by the retailing guidelines of the firm.
“Many of the existing vendors have expressed an interest in a better form of retailing and they are looking at us to grow their income,” said the ITC executive. ITC said it would line up micro-finance for vendors to buy the pushcart that will be designed by the National Institute of Design and cost around Rs20,000, about the same as the country’s per capita income.
The carts will be fitted with an electronic weighing machine, a canopy and a battery-operated lighting system. A no-frills basic cart that is part of India’s street landscape comes for as little as Rs3,000.
But the hawkers association is not impressed.
The episode illustrates a simmering discord among millions of smaller retailers who feel threatened by the emergence of a host of organized retailers queuing up to sell everything from sofas to sugar to India’s consumers. On Thursday, hundreds of hawkers protested outside a Spencer’s Retail store in downtown Kolkata. Last month, small vendors in Chennai’s wholesale vegetable market went on a day-long protest against the Reliance Fresh outlets for bypassing them and procuring directly from farmers.
The outcry is echoed even in India’s corridors of power. Concerns expressed by the head of Congress party-led United Progressive Alliance coalition, Sonia Gandhi, prompted the government to enlist a New Delhi think tank to study the impact of modern retailers on the millions of mom-and-pop stores.
“If they go to every street selling cheap items on a lower price, it will destroy the hawkers,” said Ghosh.
Chains such as Reliance Fresh successfully sell fresh produce at prices lower than street vendors because they’re able to procure it in larger quantities and store it better, preventing wastage.
The National Hawkers Federation is planning a nationwide protest against modern retailers as part of International Hawkers’ Day on 26 May. This will be on top of the planned protest when ITC launches its pushcart vending.
Ghosh said there are more than 40 million hawkers in India. “Even if the organized retailers capture 20% of the business, eight million hawkers will lose their jobs,” he added.
ITC, which is the country’s biggest maker of cigarettes, also produces paper and sells branded food items ranging from biscuits to wheat flour.