Why immigrants succeed in the spaza space – it’s complicated

In February, immigrant shopkeepers were violently targeted by South Africans who claimed they were stealing jobs and bringing down the economy.

On Tuesday, the Institute of Race Relations (IRR) published a contentious research report on how immigrants are contributing to South Africa’s economy. The report found that immigrants dominate the spaza shop industry because they are resourceful and hardworking. Rian Malan, the author of the report, claimed that South Africans were falling behind because they aren’t working hard enough.

The IRR has in the past been accused of acting as “a gatekeeper of white supremacist ideology”. The institute’s CEO, Frans Cronje, made headlines in 2015 when he tweeted that the University of Cape Town may be doomed to become a “bush college”.

The Daily Maverick’s Simon Allison has criticised the report as a lazy attempt at answering a very complex question. Allison described Malan’s implication that immigrants are prospering due to the laziness of South Africans. This is a damaging sentiment shared by racists and xenophobes.

The Daily Vox spoke to immigrants who own spazas in Mamelodi West, Pretoria, about the IRR’s claims.

Sandhu Khuram, 37, owner of Lapologa Supermarket
Khuram fled Pakistan because of the political turmoil in his home country. “We are fighting with terrorists you know. There’s no opportunities. All we do is we are scared. So that’s why I think, let’s go somewhere where you can find some business or some job.”

Khuram opened Lapologa six years ago. “This is not my own property. It’s 25 years old, this shop.” Khuram lives in a room at the back of the shop. When Khuram first approached his landlord, he told Khuram that this was one of the few shops in Mamelodi. But Khuram is competing with the many immigrants opening up shop. “Even now you can check, [on] one street, four or five or six shops. The new people, they come in, they take [a car] garage, they take a small space like a spaza shop. Now there’s many many people.”

“Before, when there [were] not too much peoples [sic]… we are selling lots of stock. But now, for example, before, I’m selling 100 [loaves of] bread. Now I’m selling 20 bread because [there are] lots of shops.”

In a good month Khuram makes R10 000 but lately he’s been making around R2 000. Of his six employees, none of them are South Africans. “I know many places who give South African people jobs, especially guys. I give him jobs. Two, three days he is working and he is watching. When it’s quiet, [he gets] four or five people they come, they rob you. The main reason is this one because the foreigners, they’re scared about South Africans just robbing because, even I know myself, I’ve given one guy a job. So he even also do same thing like that.” He has been robbed many times by his employees. “It’s more than 20 [times].”

He says that there aren’t many customers walking into his shop anymore. “Here they’re only coming for accidentally [sic] now. If they forget to buy something… or if some visitor comes to you and at that time the big places is closed, they came to us for something. Otherwise… they don’t like small shops. They’re going straight for the wholesalers like the big shops like Pick n Pay, Shoprite or Kit Kat.”

Khuram believes that the the reason why immigrants are dominating retail businesses in townships is because they are the only providers for their families. “For example, my family members is seven or eight and if I am here, seven or eight people belong to me. They’re staying in my bad country. If I am doing business here, after, I send him something and he can manage his life. So that’s why we are thinking we are serious with business. We can’t do nothing for wrong [sic]. We can’t use wrong ways because I know, if I send something then my child, my parents, my other family, they can get food.”

Tarik Islam Khan, 25, co-owner of Kings Enterprises
Khan came to South Africa from Bangladesh on a student visa. He was studying business management before he came here. Khan was granted asylum and has been in the country for three years. He lived with his brothers in Mpumalanga who taught him how to run a spaza shop. “I did work for my brother’s spaza shop like [for] almost one year. Then I told myself that I can do something even myself [sic]. So my brother helped me together to make my own shop.”

Khan lived in Kempton Park and Durban before coming to Mamelodi. “Because of different place and different brothers, then I saw the opportunity, where it’s going well and where it’s going bad. That’s the reason.”

Khan opened Kings Enterprises four months ago with his older brother. He rents the shop space from a South African and lives in a room at the back of the shop. “Actually, business is not good and even not bad like this. There’s too much competition like this [shop], too much problems.” Khan doesn’t have any employees, just people who occasionally help him out.

The young business owner doesn’t plan on staying in South Africa. “In South Africa there is a problem political [sic]. I’m waiting for, in my country, for the political problems to end.” Last year, his four uncles went back to Bangladesh. They told him that things are getting better there. “So when I see if everything is ok, I’m going back maybe this year.”

MD Shaddam Hossain, 26, worker at Easy Way Supermarket
The soft-spoken Hossain came to South Africa from Bangladesh to escape the fighting and political problems there. “I ran away from my country. I got to South Africa through the back. It’s not a good story.” He travelled through Kenya, Malawi, and Zimbabwe.

He came to South Africa because he knows people here. “I don’t have any place or friends [in Kenya]. No one to visit in Kenya.”

He heard from a friend that they were looking for people at the shop. “Then I got the job.” He has been working at Easy Way Supermarket for the past five years. “It was hard when I got here. I moved around. For two, three months it was like this.”

South African spaza shop owners were the people who felt the effects of losing out to immigrants dominating the industry. The Daily Vox also spoke to a South African spaza shop owner from Mamelodi.

Daniel Nyathi, 39, owner of Madeni’s
“I opened the shop when I was working at Steers from 2000 until 2006. I felt that the money I was getting from that job was too little and at the shop it was better. So I left that job and I carried on with the spaza.” He runs the spaza, which is next to his family’s home, with his sister.

Since the influx of immigrants, his business hasn’t been doing well. “Things are down. Things are really hard. It’s too low. It’s not how it was in the previous years.” He says the number of customers started decreasing about five years ago.

“There’s somewhere where they’re getting money from. And then they open one, they open two. This happens repeatedly. The other kids don’t get the opportunities to open their own businesses. They then just hang around and end up doing drugs, smoking weed and nyaope, things like that.”

He has been approached by immigrants in Mamelodi with offers to rent his shop. “I said no to each of them. They said they’ll give me R15 000. I said no. Another one came and said that they’ll give me R3 000 a month. I said no every time. I saw that the money would be little. I have to pay rent here at home, you see. And for my needs, it won’t be enough. It would be the same as in the past [when I was working at Steers]. I would just stay at home because there isn’t any work.”

Nyathi has been getting assistance from eSpaza Sum, an organisation that transforms informal businesses into formal establishment. He received a R20 000 loan to buy stock from Big Save, a wholesale trader partnered with eSpaza Sum.

Although immigrants are dominating the spaza industry, they aren’t as prosperous as the report makes it seem. The upsurge in running spazas among immigrants means that no one is making as much money as they used to. Will these shop owners keep at it until they are no longer prosperous? Or will they use their resourcefulness to find another industry that promises success?