It said while traders provide a great service, they are making use of public places to do business.
A mobile trader includes any person who sells goods and services by foot, from a vehicle or from a stall.
Regent Theatre owner Allan Webb said a line-up of regular food trucks on Alexandra St in Te Awamutu last year had disrupted traffic and parking provision.
The statement says traders parked in popular areas can cause distractions for drivers or take up premium parking spots.
In Te Awamutu mobile traders might be banned from some parts of Alexandra St, Arawata St and Sloane St. They might also be banished from council car parks at Roche St, Māhoe St, Jacobs St, Te Awamutu Events Centre and the Warehouse complex.
In Cambridge it could affect mobile traders on some parts of Victoria St, Alpha St and Duke St as well as council carparks at Hally's Lane, Anzac St, Waipā District Council office/library and Wilson St.
Those parked at one of Waipā's 130 council parks and reserves would also be asked to move on.
Any exceptions like an organised event would require approval from council.
One of the mobile traders using Victoria St is Smooth Vape, a caravan that sells vape products and aims to help people quit smoking tobacco.
Owner Kath Hill is worried she might lose her spot following the proposed changes to the bylaw.
"If we had to move it would hurt us both as a business and personally. I can't afford to rent a shop in town."
Kath says she offers an important service to Cambridge and would be disappointed if she had to move.
She is currently studying towards a Smoking Cessation qualification through NZQA.
"I'm contributing to New Zealand's goal of becoming smokefree by 2025. I want to stay within the town and be there for people who need help quitting smoking."
Cambridge pizza franchise Hell owner Adam Smith said his mobile pizza trailer 'Hell on Wheels' had been parked on Victoria St since March this year.
He said the new restrictions wouldn't affect him as he was opening a Hell shop in the Lakewood development in Cambridge in August.
A Te Awamutu business owner is relieved about the changes to the bylaw.
Regent Theatre owner Allan Webb said a line-up of regular food trucks on Alexandra St in Te Awamutu last year had disrupted traffic and parking provision.
"Pop up stores and mobile traders not only affect permanent operations, but have no ties to the community," he said.
"They can open or leave when they desire, probably without any local input and certainly the costs of being permanent. They can also shift around different locations to maximise their income, picking out the best times and places to make as much as they can.
"They can then select the best places to be and walk away from unprofitable markets."
