Boda boda riders' big investment dream

Jepses United Boda Boda group members transporting farm produce in Hamisi, Vihiga County. [Nanjinia Wamuswa, Standard]

In 2014, a group of youth working as boda boda riders in Hamisi, Vihiga County realised that the business was becoming unsustainable.

This is as new entrants flooded it every day, raising the fight for customers. The sector was the easiest and most accessible means of employment, especially for the rural economy.

Owning a motorcycle had become affordable with companies and dealers now offering motorbikes on credit, especially to youths.

The few boda boda operators who had ventured into the trade early on as pioneers had enjoyed handsome profits. At Hamisi, it was easy for a rider to take home over Sh2,000 in a day, but as more riders joined in, the number of clients shared saw earnings plummet.

This was a moment of reckoning for a group of 12 boda boda riders who teamed up to form a group, Jepses United Boda Boda group. Walter Kegode, the group's chairperson says the number has increased to 31 members.

The group deliberated and agreed that apart from ferrying people, they should also specialise in transporting farm produce to the market. Kegode says markets were always full of farm produce and they could capitalise on providing transport services.

Kegode says they approached several farmers who agreed and hired them to transport their farm produce to various markets on different days. At this point, the group identified and modified one motorbike for the job.

As time went by, the group bagged more tenders to supply bananas, and other fruits and vegetables. However, the immediate challenge was that the modified motorbike could not deliver all the farm produce to the market at once and early as per the client's wish.

"Although we got tenders to supply vegetables and bananas, our one motorbike had a limit. As you know, on market days, everyone wants his or her produce to arrive at the market as early as possible. We couldn't manage," he says.

He says they tried to transport using normal boda bodas, but ended up damaging the fruits. Clients complained when they damaged their produce because that meant throwing them away since no one would purchase bad products.

The unfolding events saw members go back to the drawing board. Kegode shares that when they met, the discussion was about how to get a pickup, since they had noticed a good business in transporting farm produce. They all agreed a pickup was the best idea, but, it stalled after realising they couldn't raise money to get a pickup. They continued using one motorbike to transport farm produce, but other farmers opted for other means due to limited capacity.

Then in 2019, the group got information that an agricultural officer from the Hamisi Sub County had invited the locals to a baraza in the area. There was an agriculture project by the national and county government that could benefit locals.

Kegode says, six members of the group attended and it is here they were linked to the National Agricultural and Rural Inclusive Growth Project (NARIGP), a government project being implemented through the Ministry of Agriculture, Livestock Fisheries and Irrigation (MoALF&I), State Department for Crop Development (SDCD) with funding support from the World Bank.

The project officers shared with them how they could engage and benefit from the project. Kegode recalls they were asked to write a proposal, detailing the aspects they required assistance.

"We met as a group and wrote proposals to get assistance in transporting farm produce. We were clear that our aim was to help transport farm produce from farms or homes to the markets or to buyers anywhere," says Kegode.

The proposal was successful and the group got a grant of Sh200,000, which they planned to purchase a three-wheeler motorcycle, which they believed would be efficient for their business.

The cost of a three-wheeler bike (tuktuk) was Sh260,000. Members agreed to contribute additional money and eventually bought it in November 2020, and embarked on transport work. Since then, the group has seen business expand and now transports various farm produce such as fruits, potatoes, bananas, green maize, potatoes, beans, and vegetables like sukuma wiki, cabbages, onions, tomatoes and yams to the market.

The three-wheeler carries more farm produce compared to an ordinary boda boda. Also, the produce such as banana and fruits get to the market without being damaged as was the case with a two-wheeler motorbike. Kegode shares, prior to getting a three-wheeler bike, the group had Sh68,000 in its Sacco accounts.

It has helped members increase their shares to the current Sh240,238. Last year, they use a three-wheeler as collateral for a Sh800,000 loan.

Loaning committee

With the help of the loaning committee of the group, the chairman says the Sh800,000 was given to members, who in turn invested in their own projects.

Some invested in dairy farming and now produce milk which they use at home and also sell for extra income.

The milk is sold to other group members. And, others bought posho mills and now producing flour. Kegode explains, "With the diversification, members are able to pay their loans with ease and in a month's time, we will complete the Sh800,000 loan. Members are committed and focused on the group's vision."

Apart from loans, members also receive money the business generates for its own use. There's also a merry-go-round where each member contributes Sh1,000, totalling Sh31,000 given to a member each time they meet, twice a month. And, for any member who has an emergency, the group also assists after assessing how much is required.

The three-wheeler makes at least Sh50,000 in a month, out of which, Sh,5000 is used for maintenance.

The rest is deposited onto the group's accounts. Two members are the drivers of the three-wheeler bike.

The group has now set eyes on investing in a petrol station and motorbike spare parts in their area. Kegode says that in Hamisi Sub County, there are over 200,000 boda bodas, and every day, each boda rider uses at least Sh600 on fuel.

Once the petrol station is complete, the majority of boda riders are likely to fuel at their station. The spare parts shop will also make it easy for members to access motorcycle parts, even on credit.