This week’s post concentrates on household enterprises from the 2015 IHS dataset. Gambian households ventured into a wide number of enterprises. However, we concentrate on the three that were mostly commonly pursued across the different LGAs. These activities are:
- Retail sale not in store, stalls or market (includes credit traders, hawkers, door-to-door sales retail, bread supplier etc.),
- Retail sale in non-specialized stores (not only food items but also furniture, household appliances, cosmetics, sports product, etc.)
- Manufacturing of wearing apparel (includes tailoring in all material and of all items of clothing).
Our analysis looked into the average monthly revenue of the three activities, the average monthly revenue of the three activities by LGAs and finally we analyze if average monthly income in LGAs differs due to VAT registration.
Figure 1: Average monthly revenue by household enterprise activity
In Figure 1, we see that the median household engaged in retail (non-specialized stores) makes more (D6,500) per month than the median household engages in manufacture (D4,000) or retail (not in stores) (D2,000). Non-specialized retail households also show a larger variation in reported income, with the 75th percentile of households making close to D15,000 per year. Nationally, it seems that engaging in non-specialized retail is a better money earner for Gambian households that manufacture of garments or not-in-stores retail.
Figure 2: Average monthly revenue by Household enterprise activity over LGAs
Figure 2 examines the average monthly revenue of the three activities across LGAs. It is clearly seen that, manufacturers in garments, retailers in non-specialized stores and retailers not in stores in Kanifing received the highest monthly revenue. This is believed to be the case because on average households in Kanifing are expected to be wealthier thus, making it possible for them to have excess from their income to spend on clothes and other non-food items. This implies that household enterprises in Kanifing are expected to earn more revenue as compared to those in other regions. We can see in Figure 2 that manufacturers in garments and retailers in non-specialize store in Banjul receive a higher average monthly revenue as compared to retailers not in stores. Retailers not in store in Banjul received the lowest average monthly income of less than D2,000.
Figure 3: Average monthly revenue by VAT registered enterprises over LGAs
Figure 3 shows that there were no enterprises in Banjul and Kanifing that registered for VAT in the data set. From Figure 3, enterprises that did not register for VAT in Banjul and Kanifing received the highest average monthly revenue of D30,000 and D75,000 respectively. We would like to caution the reader here. The high values for Banjul and Kanifing are due to a very small sample size for both, leading to results which are far from the true value on the ground. The threshold for a business entity to register for VAT is an annual turnover of D500,000. It is interesting to see that households are reporting being VAT registered although their revenue is below D40,000 per month (Mansakonko being the exception).