No business wants to remain small forever. We all look forward to some sort of upgrade, whether we’re running a side hustle, peddling products on the streets or running a business out of an honest-to-goodness store.
But going to that next level takes more than just wishful thinking. You have to figure out where opportunities lie and seize them. And since you’re looking, why not set your sights on Kenya’s neighbouring countries?
With the improvements in transport and communication, regional trade is no longer the preserve of huge companies. Small businesses can easily buy Kenyan products (or import goods from China and India) and sell them across East Africa.
Jared Njaaga, 31, is among entrepreneurs enjoying the spoils of regional trade. He owns a truck that transports cargo from Kenya.
“I got started by asking a friend of mine who owned a truck about how he kept getting business to transport products to shops and companies in Uganda and Tanzania. He offered to get me in touch with the broker he uses,” says Jared.
He already owned a truck that he’d offer up for hire, but he was looking to do something on a larger scale.
“The nature of the cargo business across the region heavily relies on brokers and trust. What tends to happen is that traders from Rwanda or Uganda will come to Kenya, approach manufacturing plants and buy materials in bulk. They then need these products transported back home, which is where local truck owners like myself come in.
“You can try to get the trader directly, but they often require like 20 trucks to deliver the stuff they’ve bought. If you have just one truck, you’re better off dealing with a broker who links you up with business.”
Jared puts the profit margin from a round trip to regional countries at an average of 50 per cent of the total cost.
This is what’s left over after paying for fuel, road-use levies in neighbouring countries, and mileage costs for your driver and turnboy. However, it assumes you don’t face any major fines at weighbridges or mechanical issues.
Still, as the East African Community (EAC) dream gets closer to reality, the movement of goods and people in the region has been made easier. You don’t need to go through the laborious process of applying for visas and passports. All you need to travel to these countries is a national ID card.
Moreover, after the implementation of the Customs Union and free trade, your products into any of the five other EAC member states – Uganda, Tanzania, Rwanda, Burundi or South Sudan – will not be subjected to higher taxes.
Mouth-watering market
The EAC has a market size of 170 million people, a mouth-watering market for those serious about that next level.
“The EAC takes the lead as the destination market for Kenya’s exports, accounting for 25 per cent in 2015. Opportunities for enhanced trade in services are abounding as is evidenced in EAC Partner States’ commitments under the Common Market Protocol,” the Ministry of Trade noted in a past statement.
The Common Market Protocol allows for free movement of goods and services, capital and labour. You are also supposed to easily settle in one of the EAC countries.
Kenya’s biggest trading partner is the East African region, especially Uganda, which exported Kenyan goods worth Sh62 billion, according to the Economic Survey 2017.
So, what can you sell in these markets? Here’s a list of the Kenyan products that are most in demand in neighbouring countries.