The ATM milk and cooking oil business is booming, especially in Nairobi’s informal settlements, where consumers purchase household products in small quantities due to affordability.

Victor, a Nairobi-West-based businessman, is one of the entrepreneurs raking in a fortune from this business. He runs an ATM machine milk business that makes him a monthly profit of at least Ksh200,000.

Victor revealed he was among the pioneers of the milk ATM machine business in Kenya, adding that setting up the business cost him Sh350,000.

“I started the business in 2014 when milk was in great demand, and ATM machines were only available at supermarkets.”

“The decision to start this business was motivated by the fact that most people in Nairobi are not fond of buying packaged milk from companies like Fresha and Brookside. They believe the price of this milk is exaggerated,’’ he said.

However, he revealed that he almost gave up on the business idea due to the high cost of a milk ATM machine, thanks to a loan from Equity Bank that helped him purchase the machine.

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“I searched for the machine, only to be told it was going for Ksh 200,000 at the time. The shock almost forced me to give up.’’ He said

“After two weeks of figuring out what to do, I decided to take a loan from Equity Bank using my title deed. Luckily, Equity offered me a loan of Ksh 500,000, which I used to set up my business,” added Victor.

According to him, one of the requirements for running such a business is a milk handling license from the Kenya Dairy Board and a trading license from Nairobi County.

While the business took a few months to  break even, Victor revealed milk supply from farmers was a major challenge.

This is because many farmers sell their milk to big companies like KCC and Brookside and convincing them forced him to pay more than what these companies paid.

However, he later found affordable suppliers in Kajiado, Limuru, and Kiambu. He buys a litre of milk at Sh80 and sells it at Sh90, making a profit of Sh 10 per litre.

“I supply the milk to 4 schools and 5 hotels and also sell to individuals who visit my shop. In a single day, I manage to sell 800-100 liters of milk, which yield between Sh8,000 to sh10,000. When I subtract my expenses, I remain with Sh 6,000-Sh7,500,’’ he explained.

He notes that the business is one of the easiest. Victor advises young people with business ideas to implement them regardless of whether they have capital.

“If capital is the major hindrance, simply go for unsecured loan or look for money from friends and family members”. He said.