With the upscaling of various forms of itinerant retail has come a push for legalization of these vendors—but unfortunately, that process often ends up laden with way too many conditions and caveats. Witness conflicts over supposed expansions of street vending in Chicago and Los Angeles.

In LA, where street vending has been an under-the-table institution seemingly forever, legalization doesn't have all vendors happy. State law decriminalized street vending in 2018 and required cities to come up with regulations that would allow it, but in LA, there’s a real risk that those regulations are actually going to make life harder for vendors who have been operating informally. LAist reports that many vendors are unclear on the new rules, the cost of a permit, in what cases one is required and what conditions it imposes on them. At best, the system does not appear ready for prime time.

At worst, it will eliminate the bottom of the industry—the true “start from nothing” entrepreneurs—and favor those with established success and some capital put aside. Says the California Globe:

However, the lines of carne taco vendors and booths selling everything from clothes to tools to used video games may soon be a thing of the past. Last year the Los Angeles City Council passed the Sidewalk and Park Vending Program unanimously. Under the new law, vendors need proper business licenses, health permits, and perhaps most prohibitively, a $541 fee to operate starting July 1st. A family selling fruit, who did not want to use their name, talked with the Globe, with a member of her family translating Spanish. “Our business is gone,” said the mother of the family. “This is all we had, and now we need to get [$541] from nowhere.” One of their sons said “We probably need to sell our TV for this.” The daughter translating told the Globe “My family gave everything to come here, and now they’re trying to take away what little we have made.”

In Chicago, a "mobile merchants" plan put forth by then-mayor Rahm Emanuel in 2018 was shot down amid concerns from aldermen about competition with established businesses, despite that the plan would already have subjected such vendors to a long list of time, parking, and signage restrictions. The city has allowed only four mobile merchants so far to legally test their concepts.

Food trucks in Chicago are newly allowed up to a 4-hour parking limit in a single spot instead of 2-hour, but still face concerns from elected officials, says the Sun-Times:

Ald. Michael Scott Jr. (24th) said his West Side ward can’t afford to “lose any more brick-and-mortars.” He’s a bit concerned about the competition between stores and mobile boutiques. “If I’m a place that sells wedding dresses and you come out and you buy shoes, that’s a complement. But if we’re both selling dresses or wedding dresses, it’s gonna be more of a competition,” Scott said. “I just want to make sure that a brick-and-mortar store will have the ability to say, ‘I think this is cutting into some of my profits’ and you’ll look at that and adjust kind of where that vehicle can park.”

These concerns are misguided. Truck and sidewalk vendors serve a different niche from incumbent businesses who operate at the much larger scale of a permanent storefront. The role of local government should not be to protect those incumbents from competition, but to foster a healthy economic ecosystem in which businesses can succeed at any scale.

How Should City Officials Think About Street Vendors?