Starting and running a Matatu business in Kenya is not a walk in the park. There are numerous challenges associated with the business.
It is a risk that very few people are willing to take. But matatu business is lucrative to those who are willing to take the risk and venture into the business.
Starting the Matatu business in Kenya
Acquiring a matatu for the business requires a minimum initial capital of 500,000Ksh. This is money one can use to buy a second hand matatu that has been on the road for 6-8 years.
Acquiring a second hand 33 sitter public service buses costs around 2.7million Ksh.
Such buyer can decide to replace the car engine, which costs at least 300000ksh. This will help to increase the durability of the car.
There are other additional costs that one should incur before the business is operational.
Such costs include: Installation of sound system, Sacco fees (ranging from 100000 – 300000ksh), fueling, tax etc.
One approximately needs 1m ksh to operate the business perfectly.
Best routes for Matatu business in Kenya
If you decide to venture into matatu business, most profitable routes are; Kiserian (Rongai) – Nairobi, Embakasi – Nairobi, Thika – Nairobi, Kikuyu – Nairobi and Donholm – Nairobi.
While choosing the route for matatu business, ensure you avoid routes which generate low profits per day.
The matatu business has a lot of challenges. One of the biggest challenges is cartels and bribes demanded by ‘kanjo askaris’ and policemen from matatu operators.
Main routes affected by such cartels who extort thousands of money daily from matatus owners are Dandora, Kayole etc.
It takes around 2 years to recover the capital invested in the business if it is managed properly.
Installation of GPS tracker in public vehicles helps to keep track of the total distance covered by the vehicle. Servicing of the vehicle is required after every 6000Kms covered by the vehicle. This will help keep the vehicle in check and increase its durability.