Navigating the Challenges Experienced by Informal Retailers in Managing Supply Chain Practice

Purpose: This study aimed to explore the challenges encountered by informal retailers in managing their supply chain practices. Design/methodology approach: South African informal retail sector (spaza shop and street venders) is reported to have a significant contribution on GDP and low-income households. The role of this sector is not limited to the distribution of goods to low-income households but also plays a major role in alleviating poverty. Despite this contribution, the sector is marked with challenges in professional management to drive supply chain efficiency. The qualitative method and an exploratory research design were employed to collect primary data through semi-structured interviews. Findings: The findings reveal that demand fluctuations, high transportation costs, and limited access to technological innovations account for supply chain inefficiency in informal retailers. These challenges impact inventory management, customer service delivery, and overall business sustainability. Practical implications: This study suggests that the sector should adopt advanced demand forecasting tools to accurately predict both online and in-store demand, particularly during peak times such as pay days. Enhanced demand forecasting could optimise inventory levels, minimise the risk of stockouts or overstocking, and improve overall supply chain efficiency. Originality value: Thematic analysis of data was conducted using NVivo software. The study has the potential to contribute to theory, practice and strengthening municipal policy guiding the development and support given to spaza shops and street vendors.