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Saturday, June 13, 2015

Review of Small Business

One of the exciting things that we have gotten to do during our trip is take stops at local markets and other small businesses to buy souvenirs or any other strange object that we decide we just have to bring back to the United States. For me this was an especially interesting chance whenever we would stop at these locations because of my research into the Ugandan Economy, and how these shops function and also market is definitely a point of focus for my paper.
First thing that I noticed was that a lot of the shops would some times be selling similar or even identical products, yet the price would change in increments up and down the line of the small shops. I took this to mean that these shop keepers will sometimes trade among themselves in order to get product, if they see that one shop is selling a lot of a certain product and will then just play the game of chance that customers will stop at their shop and buy at a profitable price. Also bargaining is just part of the fun when you go to these craft markets, sometimes they are willing to play a little with the prices, but they also very rarely play nice about them though. It is much more common for them to press their own price, especially in Kampala compared to the other markets we visited, and the amount of consumers they sell to is considerably higher.
The final thing to be noted is that shops like this are very rarely registered with the government, which means that they are operating with little to no regulation and also no taxation. The overall effects range from the benefit of not losing any money taxes, but also removing yourself from the ability of any kind of government aid that could be available from being a registered business.
In terms of sustainable development, these small shops may not make it out if they do become formalized businesses. If taxes are levied on them they can't be a large amount of money because a lot of the money coming into these shops go back to buying more product in order to sell them and very little is kept as actual profit. Also if there is a movement for more formal small businesses to take hold in Kampala or other larger cities in Uganda these kinds of shops may be pushed out to more of the tourist locations such as the equator or other natural parks.
This a picture of all the guys with Patrick Bitature

1 comment:

  1. Leviathan, it was very interesting to see the various small businesses in Uganda. Specifically talking about the craft markets, i found it intriguing that many of them sold the exact same products as each other just varied in price a dollar or two. Also, people are way more aggressive about coming into their shops and buying their products. For example, almost every craft shop i walked by, the owner would say "come in and take a look' and once you were in there you almost felt obligated to buy something because of how pushy they were. It way a completely different experience compared to the small businesses in the united states.