Businesses in Kenya: Four years ago, James Muchangi was just another casual labourer working at construction sites and tilling farms in Karatina with a Sh. 250 daily pay.
Although he had always wished to become an entrepreneur, James was convinced that it would take him years to save enough money to start a business.
“I could not picture myself as a businessman. I’d failed to secure a place at the university after sitting for my KCSE and consequently, I feared that I would amount to nothing with my casual jobs,” she says.
Out of the Sh. 250 he made, James began to save Sh. 100 in a wooden piggy bank that he kept under his bed. “I saved Sh. 6,000 in three months,” he says. He used the money to buy a calf and his journey to a successful agribusiness set out.
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Within a year, his calf matured and gave birth to a calf. “I quit the casual jobs and began to supply the ten litres of milk I got from the cow every day to small hotels within Karatina at between Sh. 30 and Sh. 35 per litre.”
Subsequently, he began to make between Sh. 300 and Sh. 350 per day. “I began to feel optimistic. I saw opportunities in agri-business and knew that if I explored more, I could generate more income by venturing into value added farming,” he says.
Unfortunately, James didn’t know how to turn his dairy farming into a successful, profitable and reliable business. This, though, was until he registered for a business mentoring program with the Professional Business Mentors Association (PBMA), that James met his turning point.
Says he: “I got a business mentor who carried a feasibility study on the kind of business I wished for to find out if it was viable or not. It was found to be financially viable, and my mentor and I began to formulate a plan on how I could turn it into a booming enterprise.”
His mentor, Jane Munene, asked him to adopt a high breed of dairy cows to boost his milk supply, start selling milk to a cooling plant to help him gain collateral for a business loan, and venture into fruit farming.
Last year, James bought a half an acre of land and began to farm street tomatoes. This year, he planted purple and yellow passion fruits. Since he began his mentorship program, James has seen his annual turnover rise from Sh. 72,000 to Sh. 2 million.
“I have been able to invest Sh. 500,000 profits in a new house and bought a motorbike at Sh. 100,000 to efficiently help me supply milk. I am now saving to buy a pick-up so that I can ferry my produce to wider markets in Nairobi, Nakuru, and Thika,” he says.
According to James, exposure to an outside market, savings lessons and access to affordable credit have been the ripest fruits I have reaped.
Nonetheless, his agribusiness has not been without challenges. Currently, Mrs. Munene – the chief executive officer at Youth Ventures Initiatives – is helping him devise a value addition mechanism, and access to effective high quality drugs and treatment for his livestock and fruits.
After working with small and medium enterprises, Mrs. Munene observes that many of the upcoming businessmen are unable to separate their personal lives from their businesses in Kenya.
“Many of the start-up owners don’t know that they should count themselves as employees with earning monthly salaries,” she says. Consequently, they mess up their operational capital by jumbling their finances with both business and personal need. Moreover, lack of records is another key problem. Businesses in Kenya.