The hidden strength of small business: Social networks and wet market vendors in China

Abstract

AbstractThroughout contemporary China, consumers have the option of purchasing food products from “traditional” Chinese wet markets or “modern” supermarket chains. Wet market vendors are economically disadvantaged as the operators of small‐scale businesses with limited investment and high labor costs. Nevertheless, wet market vendors continue to thrive in urban China, despite the continued expansion of supermarket chains. This article combines ethnographic data and social network analysis to examine how social networks provide wet market vendors with some important competitive advantages. The article draws on fourteen months of fieldwork in Sanya City, China, and provides an analysis of the composition, structure, and strength of the network ties of 113 wet market vendors. Vendors tend to have strong and dense ties to individuals who help them establish their businesses. Vendors also rely on strong ties with regular suppliers to help them reduce costs and ensure a regular supply of goods. These strong ties are balanced by weaker ties with a diverse range of customers, including small businesses and household consumers. A combination of both strong and weak network ties contributes to the collective resilience of wet market vendors, allowing them to confront crises, reduce risk and uncertainty, and improve performance.