The Business of Begging

Friendly neighbourhood beggars are often necessary appendages to society, serving as outlets for altruism. I came across a beggar recently who took my breath away (quite literally), and who, inadvertently, gave me some merry insights into an arcane area – Begging. As I wasn’t polite enough to learn the protagonist’s name, I’ll call him Begga, the Beggar.

I had seen Begga before, begging his time away, patiently waiting for patrons to cross his path. When someone did, Begga would magically assume an appearance that cried out for emancipation from penury. His normally I-don’t-care-a-s**t-about-this-world eyes would suddenly give way to one that oozed penury and pain. A ragged appearance combined with an impression of destitution almost always resulted in an influx of capital. (He tried his charm on me several times, but received little beyond polite smiles).

I think Begga’s Begged Ratio (defined as: Begging Income/No. of people begged) was way above ‘industry’ standards. With the passage of time, Begga’s superior Begged Ratio attracted competition yearning for a piece of the action. Begga, understandably, wasn’t happy with this development. He had been begging for so long that almost everyone in the neighbourhood recognised him. This made him gloomier than before and for once…those eyes reflected his true state of mind.

One fine day he stopped begging and started counting his revenues. Apparently Begga believed that double checking was better than double counting. Then calmly, he ambled up to a bus stop, standing close to me. A bus rumbled in after a few minutes and I got in, pondering over Begga’s behavior. I took a seat at the back and turned around to face…Begga himself.

Begga sat as if he owned the bus. When the ticket collector came up to him, Begga handed him the fare to the next stop. The ticket collector was surprised too but handed him a ticket anyway.

The next stop could be termed a business ‘hub’. People came by the thousands there every day. Begga had a huge market to tap. With little competition.

I almost saluted Begga…

Thanks to Begga, I got some insights on the business of begging. Here’s a brief:

The Begging industry is compulsorily unorganised. Any move to impose a semblance of organisation leads to industry extinction. It is in the interest of the participants to stay poor…or in the very least, appear poor. The degree of visible destitution is often inversely related to the practitioner’s invisible net worth.

The biggest markets are bus/rail stations and places of worship. There are few laws or policies governing players’ behaviour and Begging industry dynamics closely resemble the Law of Diminishing Returns. Begged Ratios tend to be high in the beginning but wane over time, owing to new entrants and growing familiarity. As time passes by and the major practitioners become well-recognised figures, the industry assumes an oligopolistic character, with a few large players dominating the market and setting a Minimum Level of Acceptance (MLA). This sometimes causes embarrassment to the donor.

Attempts at predatory pricing evoke belligerent reactions and/or takeover threats from the largest players. The smaller players either have to follow or perish or acquire new territories. Since the latter frequently involves expensive outlays of scarce capital, smaller players enter into franchisee/royalty arrangements with the larger players. Or choose to perish, which is often the cheapest available option.

However, only a few players consistently make money. Enterprising beggars like Begga are amply rewarded for their ingenuity. Sometimes the industry exhibits wealth disparity with the rich (relatively) beggars growing richer while the poor grow poorer.

The tax-free nature of the business combined with little debt and recurring maintenance capital expenditure, leads to strong cash-flow generation. Inflation exists only to the extent of hiking the MLA and broader economic recessions have little/no effect on the industry.

I wish Beggar Co-operatives were publicly-listed entities…

Disclosure: While Begga himself is real, the associated discourse is a figment of an overworked imagination.