Chinese cities rush to legalize street vendors to boost consumer spending

Beijing, Kunming and Shanghai passed laws as early as January to support small businesses and stimulate consumer spending. But since Zibo, everyone is joining in.

Photo by Fan Jianlei

Photo by Fan Jianlei



It was not so long ago when hawkers were treated as blemishes on the face of cities aspiring to the style of modernity represented by grand boulevards and shining skyscrapers.

But street food – for many hundreds, or even thousands, of years a Chinese staple – is now evolving once again – this time from pandemic expediency to lifestyle phenomenon.

The well-documented trials and tribulations of the small Shandong city of Zibo in Eastern China have provided a role model for how even the tiniest local novelty can be transformed into a tourist draw. The fuss over Zibo is much more about clever marketing by the local authority than the much-celebrated barbecue on offer there.

Zibo barbecue shot to fame in February thanks to savvy social media operations. The government laid on shuttle bus lines and an express train in less than a month. Train tickets from Beijing to Zibo for the May Day holiday sold out as soon as they went on sale. Hotels are booked out for weeks on end. An estimated 200,000 people visited the city during the holiday.

All over the country, the government’s stance is quickly changing from one of prohibition to one of regulation.

In April, Shenzhen and Lanzhou joined the growing league of cities that have legalized many kinds of street vendors this year.

In Shenzhen’s new environmental health policy, shops are now allowed to set up stalls outside their premises. Street food vendors, which until now were strictly banned, will be approved and regulated on a case-to-case basis “according to the needs of the local community.”

In potentially good news for sellers of Lanzhou’s famous noodles, the capital and largest city of Gansu Province in Northwest China passed a law last week to regulate outdoor vendors in order to make the commercial landscape “more complete” and urban life “more vibrant.”

Beijing, Kunming and Shanghai passed similar laws as early as January to support small businesses and stimulate consumer spending. All included detailed guidelines for street vendors on locations, sanitation and noise control. Hangzhou loosened regulations on street food vendors in March, allowing them more space, more varied menus and longer operating hours.

GUO Xinmei of Beijing Technology and Business University believes that the new laws will create jobs and boost consumer spending.

“Higher employment means higher income, which will increase demand and stimulate spending,” she said. “On the supply side, the goods sold are either impulse purchases, such as snacks, or local crafts, which helps the overall vibe of the community.”

“The vendors are very smart and adaptable. They are good at filling the so-called supply-demand gap. They know what customers want and adjust their products quickly,” she said. They are also cheaper compared to brick-and-mortar shops because of lower overheads.

Retail analyst LAI Yang says the outdoors represents the latest consumer trend.

“In a time when everything can be bought online, consumers enjoy and aspire to the few alternatives that cannot. If the business landscape of a city is diverse, people are happy to be on the streets and take part in the life of the city,” he said.

Both researchers stressed the importance of regulation and infrastructure, pointing to Zibo, as a case study of how the government can work with the private sector to improve public transport, enlarge hotel capacity, and ensure fair pricing.