The application of QR code in street vendors management – a case study of Vietnam
THE APPLICATION OF QR CODE IN STREET VENDORS MANAGEMENT – A CASE STUDY OF VIETNAM
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Hoang Huu Son - Tran Thi Phuong Lien - Nguyen Tuan Nam
ABSTRACT: Street vending, an important component of the economy’s informal sector, has existed and
grown strongly in Vietnam in particular and developing countries in general. Literature and practices have
shown that street vending has contributed enormously to the economic and social life, especially in term
of creating job opportunities and provide livelihood option to many poor urban residents. However, the
spontaneous development of street vending under little regulation has brought about several side effects.
Therefore, it is necessary to establish an efficient regulation regime to formalize this informal sector. The
article suggests a solution to apply mobile technology in conjunction with QR code in providing management
system to govern street vendors that could promote the beneficial and reduce advert impacts of this sector.
Keywords: QR code, Street vendor, Mobile technology, E-government, Public policies
1. INTRODUCTION
Street vendors have become an integral part of urban economies all over the globe. A street vendor is
broadly defined as a person who offers access to a wide range of goods and services with low price [1]. In
general, street vendors include three objects: market vendors, pavement sellers and mobile vendors. Thus,
working place of street vendors is highly flexible, that could be either fixed locations or mobile by occupying
pavement, public places, even using carts or bicycles as means of transportation. Street vendors normally
choose places at strategic points with heavy human traffic to attract more pedestrians & motorists [2]. The
prices offered by street vendors are usually decent due to minimize their cost by absence of taxes, work
regulation and operation cost deduction. Due to the advantage of accessibility and price, street vending is
widely recognized ‘to be the most proximate channel to the end consumers’ [3].
Street vending serves as a major source of employment creation and income generation for urban
residents the world over, especially in developing countries [4]. In countries with high rates of population
growth and/or urbanization, the informal sector is capable of absorbing larger proportion of the workforce
in the urban areas whereas the formal sector is unable to cope with the increasing numbers of the poor,
unskilled, and illiterate. Not only increase income, street vending helps to improve skills, expand work
experience, develop the habit of work, through that, boots entrepreneurial opportunities to people that may
be incapable of joining formal economy section at the first place. Street vendors create jobs and income,
not only for themselves but for porters, security guards, transport operators, storage providers, and others.
Bromley (2000) stated that street vending forms a potential source of income to the government through the
levy of licensing fees, sales and value-added taxes, that contribute directly to the overall economic activity
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Faculty of Economic Information System,Academy of Finance, 58 Le Van Hien Str Bac Tu Liem District, Hanoi, Vietnam
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of a nation. In addition, due to its long history of development, street trade also adds vibrancy to urban life
and is considered as a cornerstone of many cities’ historical and cultural heritage [5].
Street vending contributes a significant part to Vietnam economy. Report on the current situation of
informal employment in Vietnam by Socio-Political research team from the Institute for Economic and
Policy Research (VEPR) estimated the country currently has 4.9 million households (about 60% are in
the informal sector, employing around 8.2 million people). These households mainly operate in the field
of trade in services (80%) and are very limited in terms of labor size (1.7 workers / establishment), capital
(approximately 500 million VND per year) and technology. Hanoi and Ho Chi Minh City are the two
centers with high percentage of hawkers. In Ho Chi Minh City, street vendors account for about 11% of
nonagricultural employment, according to the European Institute for Development and Research (IECD).
According to survey on individual and business households conducted by Dr. Nguyen Tuan Minh, in Hanoi,
there are at least 57,000 people engaged in hawking counting separately in two main districts: Hai Ba Trung
and Cau Giay district during 2014-20151.
It is crucial to note that many scholars considered street vending as a phenomenon that would disappear
due to modernization and the emergence of supermarkets and shopping malls [6] . However, in light of
these undeniable benefits street vendor offering to social and economy life and the actual development of
economy and workforce in developing countries, including Vietnam, street vendors are an integral part of
urban economies. The existence of the sector is necessary and deserves to policy considerations.
What can be observed immediately from street vendors in almost developing countries is that they
operate with the absence of standards, in addition to the lack of regulation. Most street vendors in cities
around the world are not registered as urban residents and/or licensed vendors and are thus denied access to
state services such as public facilities, child care, and shelter. In Vietnam, street vendors are neither urban
resident nor do they have a license. The city authorities had not been able to enforce by laws to control the
activities of the street vendors, thereby, creating chaotic urban environment [7].
Scholars stated that street vendors have been in confrontation with city authorities or regulators over
licensing, working place and safety hazard. Firstly, street vendors play important roles in meeting the food
demands of urban dwellers, but their activities are associated with a number of food quality and safety
hazard. Those street foods expose major public health problems because they often expose their goods to
the sun, air pollution, and contamination by passengers. Secondly, street vending because advert effects on
urbanization as it contributes to vehicular and pedestrian congestion, traffic accident, and environmental
pollution. In addition, street vending often results in the blockage of the routes of egress from crowded
building such as theatres and stadia thus, increasing the scale of tragedy in the event of a major fire,
explosion, or toxic gas escape [8]. He also argued that some street vendors engage in selling contraband,
fake or contaminated goods and disappearing to other locations. As a matter of fact, the street vendors’ease
of mobility gives them the opportunity to swindle their customers and avoid official regulation. Finally,
street vending contributes to underground activities that support and facilitate crime and tax evasion thus,
undermining the fabric of civil society [8].
On the other hand, the fact that there is no clear-cut by-laws guiding street vendors make them
vulnerable to harassment, confiscations, and evictions [3]. It is necessary for the legal framework to
fully integrated them into the economy. As the greater street vendors’ issues become visible, their greater
positive contributions to urban life would be exposed [9] . The legal regime, therefore, should be capable of
managing all kinds of hawkers to maintain fairness along with ensure hawkers to implement rules towards
licensing, work location, hygiene conditions and other regulated issues.
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2. INTERNATIONAL EXPERIENCES OF STREET VENDOR MANAGEMENT
2.1. India
In 2009, India’s National Policy on Urban Street Vendor (NPUSV) 2009 are initial introduced to reduce
congestion and maintaining hygiene conditions, also provide a supportive environment for street vendors to
earn living. In 2014, India passed as the Protection of Livelihood and Regulation of Street Vending Act 4 with
the establishing of Town Vending Committee (TVC). This committee includes Municipal commissioner / chief
executive officer, local authority, planning authority, as well as associations of street vendors, resident welfare
associations / community-based organizations (CBO), and civil society organizations. Representatives of street
vendors’ associations may constitute 40 percent of the members of TVC, and resident welfare associations
and civil society organizations can represent 20%. The TVC oversees designating vending areas, registering
vendors, monitoring the provision of civic facilities and collecting fees. The highlight of India’s regulation is
to set up participatory mechanisms with representation by urban vendors’organizations to give hawkers more
independence in advocating for their rights and issues.
2.2. Singapore
According to the Environmental Public Health Act, all street vendors need to register to legally
operate. Licenses were issued National Environment Agency (NEA). The NEA is also responsible for
formulating regulations and managing hawker areas. Before applying for a hawker’s license, vendors must
secure a location for their stall and obtain approvals from the Urban Redevelopment and other authorities.
They must ensure that the design and layout of their food stall complies with the Code of Practice on
Environmental Health. They must also provide details of at least one registered food handler to NEA as the
person responsible for hygiene in the food stall. Finally, they must ensure that they have no outstanding
liabilities with the Central Provident Fund Board (CPF) Medisave. Singapore’s proactive policy to integrate
street vendors in its city planning has encouraged stakeholders to promote street vending as attraction for
Singapore. Consumer rating of food experience has been marketed on a webpage, and street vending has
been promoted as tourist attraction to Singaporeans and foreigners alike [10].
2.3. Thailand
All vendors must be registered with the Bangkok Metropolitan Administration (BMA). Vendors are issued
licenses that name the owner and helpers (only two names per license). The registered hawkers need to pay
monthly fee to maintain cleanliness and conserve public space (300 Bath/1 month/1m2). There has been a shift
in approach of law enforcement in Thailand: from strict rules to softer approach. BMA tends to accept, support
the existence of street vending and try to keep vendors be ‘informed, advised, consulted and cautioned’ [11].
In this part, 3 countries: India, Singapore and Thailand’regulations are reviewed as these can be seen as
success implementation examples to promote the development and reduce advert effects of street vending.
Street vendors must register to be recognized, protected by law. They are supposed to operate in legitimate
hawking zones with standardized facility for better control of food hygiene, environmental hygiene, fire
safety. Review shows that transparency and stakeholder participation is the key for better governance of
street vendors and can lead to a win-win situation for street vendors, urban residents and municipalities.
2.4. Recommended change in regulation to street vendors in Vietnam
Incorporating the informal economy, including street vendors, in urban plans is essential for good
economic governance and urban management. Therefore, it is important that street vendors are given clear
legal status so they are able to claim their entitlements to pursue their livelihoods and their rights to space.
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However, clear legal status is not yet a sufficient condition to enable street vendors to claim their rights [12].
It is therefore important to set in place market governance that is inclusive of street vendors, stakeholders.
Participatory governance of urban spaces, where street vendors themselves, stakeholders, have a voice in
the decision-making process, will lead to more efficient governance to benefit various people [13].
Street vendors in Vietnam are not yet need to register under Article 3 of Decree No. 37/2009 /
ND-CP. It is recommended that all kinds of street vendors be registered. License are issued whereas
hawkers abide by rules regarding to scope of working space, traded goods and services, and other safety
insurance under the regulation of the Government’s Decree No. 39/2007 / ND-CP of March 16, 2007
on individuals engaged in commercial activities independently, and regularly without having to register
for business must register to legal operate. Market surveillance agency could be vested with power to
register vendors. Street vendors should pay fee, tax in accordance with the tax obligations stipulated in
Article 2 of Circular 92/2015/TT-BTC.
In consideration of policy review, some requirements should be attached to the management regime as
follows. The registration system should be transparent and simple, and encourage street vendors to register
[10]. The information of hawkers needs to be accessed by different involved parties to promote participatory
governance. It is also important to have solution to educate the consciousness of the participants in the sale;
facilitate street vendors, stakeholders to understand the street vending management regulations, thus build
a civilized sales image; raise awareness towards the sense of environmental protection and social security.
In the next part, the application of mobile technology in conjunction with QR code is proposed would adopt
all these requirements.
3. QUICK RESPONSE CODE
Quick Response Code (QR code) is a matrix code (or two-dimensional bar code) developed by Denso
Wave (a subsidiary company of Toyota) in1994. QR code is widely used to encode types of information
such as timeline for events, Intel for communication, location, email, phone numbers, SMS messages,…
QR code, in comparison with traditional bar code, can store more information. Due to a wide variety of
information and easy accessibility, QR code has been being widely utilized in different fields of management
and business.
So far, QR code has currently been utilized in these fields:
Information system management:
QR code is used to store of individuals for the purpose of facilitating the management. Information,
status and activities of individuals will be public and updated with QR readers (POS and cellphones). For
example: QR code in library management or logistics management.
Marketing and E-Commerce:
QR code has completely changed marketing strategies and e-commerce, especially mobile marketing
and mobile shopping. QR code would provide effective solutions which cause no trouble for consumers
when delivering marketing messages on the packages and flyers instead of traditional printing method of
information. In E-commerce websites, QR code is always enclosed with product images, which enables the
websites to deliver concise information of product as well as special payment methods which will be useful
in network marketing. Nowadays, QR code has totally changed purchasing behaviors with an accelerating
percentage of consumers using mobile shopping.
Mobile payment methods:
Mobile payment methods have become developed and increasingly popular thanks to the utilization
of QR code. Mobile banking will integrate payment methods through QR code. Users only have to sign
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in mobile banking and read QR code of the products to purchase goods and services. The system would
provide auto updated payment information of the purchased products, following that, users confirm payment
to complete the process. In Vietnam, payment gate VNPayQR has become popular with 5 million users.
To conclude, QR code has been applied in various fields during 4.0 Industrial Revolution and has
considerably changed the behaviors of the users. Through smartphones, users can approach almost online
services. Therefore, Information Technology could help administrative management for individuals with
low level of income and knowledge who are not inclined to approach services with complicated steps.
The application of QR code in mobile technology will be the solution for Government in management and
supervision; it makes public services more approachable; convenient and efficient. In the next section, we
will show how to apply QR code to street vendors management as a case study in applying Information
Technology in public administration.
4. PROPOSAL FRAMEWORK
4.1. Architecture of Framework
Fig. 1 Proposal framework for Street vendor management system
The management system is designed as a client-server model (Fig. 1). The main server will be
installed and managed by the Market Surveillance Agency of the Ministry of Industry and Trade to manage
the centralized database. The secondary servers will be located in the provincial market management
department to manage the local data and synchronize with the main server. The server system connects
to other information management systems such as the national database of residents to collect personal
information of store owners and the centralized Tax Management System (TMS) for taxation, banking
system and direct payments to pay taxes and fees online.
Clients are applications installed on mobile devices (either phone or POS - point of sale terminal) that
support QR code reading and server connection via the internet. These applications are available on the
App store or Google store for installation on the IOS platform or Android platform. POS equipment will be
specifically programmed to print invoices and accept multiple forms of payment online.
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Users, in terms of access control, are categorized into 4 parts: store owners, customers, market
surveillance staff and senior managers with functions as defined in Table 1.
Table 1 Access control for users
Categorized modules
No Subjects
Access Protocol
1
ü
2
3
4
5
1
2
3
4
Store owners
Personal QR code
Public QR code
Public QR code
Website
ü
ü
ü
ü
ü
(website)
Customers
ü
Market
ü
surveillance staffs
(website)
Senior managers
`
ü
(Module 1: Business Registration and service code, Module 2: Update information and Revenue Declaration,
Module 3: Sales Surveillance, Module 4: Tax and related fees Module 5: Reporting and data synchronization).
4.2. Processing of each module
Module 1: Business Registration and Service Code. People must register to run business by one of
the following methods:
1. Using PC or mobile to access the website and register your personal information, business content
and expected location.
2. Salesperson can register manually with the registration form available at the one-door service of
People’s Committee of Ward,
3. Market management staff can check and support registration for street vendors using specialized
POS equipment.
To ensure the information is consistent and accurate, each street vendor must provide citizen identification
numbers stored in the national database of the citizens. The system will connect to the national database
for population authentication and ensure that every citizen can only registered one store. The module will
automatically check the compulsory registered requirements to comply with laws and local regulations. When
the information is valid, the system will automatically create a street vendor account and generate two QR
codes: 1) personal QR code for salesperson to update information and report revenue, 2) Public QR code for
salesperson to publicly list for inspection and examination as well as paying taxes and fees.
QR codes are sent directly to the vendors through a phone number or registered email. They have to
ensure the privacy of the personal QR code and publicly list the QR code at his street stall.
Module 2: Update Information and Revenue Declaration: Module allows shop owners to edit
business content and report tax through account access using personal QR code. Store owners must manage
and take responsibility for their change. The system will send a message to the registered phone number
to verify the information. The information is updated only when the authenticity of the shop owner is
confirmed through the message. At certain times of the year, the system will automatically send a message
announcing obligation to the store owner for the revenue declaration (total revenue, business duration). The
information is displayed upon access by public QR codes.
Module 3: Sales Surveillance: A module that allows people to browse store information through a
publicly listed QR code. This is a new approach to promote self-regulation and participatory governance
in supervising street vendors. Every single citizen will be a supervisor for information management. At the
bottom of the street store information lies a function to notify (report) so the system will receive comments,
responses from the community to the store. Street stores with sufficient negative messages will be the target
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for investigation and surveillance. In addition, street stores without a QR code, or provides wrong registered
information can be considered as administrative violations and will be fined.
Module 4: Tax and Related Fees: At a specific time of the year, the system connects to TMS
to calculate taxes and combine fee information for each shop owner. The system supports 2 forms of
submitting: 1) indirectly through online payment systems, 2) directly to market surveillance agents through
POS equipment. Paying taxes and fees can be verified through a public QR code, which is the basis for
people to actively detect fraud from street vendors, raising awareness in the community.
Module 5: Report and Data Synchronization: The module will give reports for the required
management. In addition, the module helps to synchronize data with the centralized database to perform
settlement of public services with related agencies including:
• Tax agency: tax collection and calculation
• Management agency on fees related to public services (location fee, environmental protection fee,
security fee…)
• Agencies under the Ministry of Labor, War Invalids and Social Affairs to implement the exemption
and reduction policies.
4.3. The first implementation
The system has been being implemented with the main modules for research and simulation. Both
Centralized and Local Server are developed based on the PHP programming language platform with the
both servers is stored through the MySQL database management system that is built into the tool. Servers
use JSON format to transfer data between servers. The QrCode Library 2.0 developed by Dominik Dzienia
- the open source library suitable for integration and deployment is applied to generate and process QR
code. These QR codes are also encrypted for security assurances.
The designed system is based on Thin-client model, shop owners and customers can download QR
code scanner applications which are available on Apple store or Google Play, a mobile-based application was
developed on Android system for Justtide V7 Handheld Android POS Terminal – a Smart post device (Fig. 2)
Fig. 2 Justtide V7 Handheld Android POS Terminal
Currently modules 1-4 have been installed and validated. Data processing and the interface of the
modules in a particular case (the salesperson Hoang Huu Son with the identification numbers 0183483298
wants to register as a flexible street vendor in Northern District of Tu Liem) will be described Fig. 3:
There are several reasons that make the application of QR code the most promising solution to street
vendor management system. Firstly, the system promotes self-regulation and participatory governance in
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supervising street vendors, thus, raise public awareness towards the sense of environmental protection,
security and related social issues. Also, it shortens the gap between hawkers and public policy, thus, helps
protect them from harassment and evictions. Furthermore, street vendor management aims to boost a fair
business environment, support entrepreneurial opportunities to people that may not be able to join formal
economy sector initially.
Fig.3: Diagram of system processing for specific case study
5. CONCLUSION
In this paper, some aspects of literature review on street vending and street vendor management are
mentioned and discussed. It is apparent that the management of street vendors in large urban areas is very
necessary, which would help the government solve the social security problems associated with economic
development, culture preservation and tourism development. The paper proposes a solution and set up
an experiment to construct a street vendor information system management based on mobile technology
and QR code. It is promised to be the best solution for managing street vendors during the 4.0 Industrial
Revolution. However, the system is still under construction and testing with some restrictions. First of all,
the connection between street vendor system management and other information systems is structured
in a simulating environment; certain functions such as tax calculation or payment method are restricted.
Secondly, in terms of deploying environment, the system still runs in a tested environment with simulating
statistics, which leads to no basis to evaluate the system. Therefore, it is recommended further researches be
focused on specific change in legal framework for deploying system to be established. Also, survey should
be conducted to receive the response from users and evaluate the system.
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