If you are looking for business ideas to implement this year, we have compiled for you the top ten industries you can invest in for tremendous returns.
Top Ten Best Business Ideas In Kenya 2016
2015 was a year of many business opportunities in Kenya. We saw the Global Entrepreneurship Summit and the World Trade Organization conference get hosted in the country that brought great business opportunities for the country (both large corporate and SMEs). But with a new year comes a change in trend and style of doing business. Here are the top ten best business ideas you can implement in Kenya in 2016.
It is a booming sector that you can invest in for good returns. Statistics favor investors who wish to invest their money in the real estate market in Kenya. The demand for housing in the country is still high, and there is no indicator of things changing anytime soon.
With the introduction of devolution, development in cities and towns is forcing low-income earners to move from the cities and town centers to the outskirts where houses are deemed affordable. It has seen apartment buildings shooting up around cities (e.g. in Nairobi, areas like Embakasi, Umoja, Kayole, etc. are seeing the development of new buildings with ready tenants on the standby). Luxury homes are also a hot market.
Middle-income earners are also hungry for affordable housing and are willing to pay for a good house that falls in their income range. Nairobi, Machakos, Kisumu, Naivasha, Nakuru, and Mombasa are a hot market for luxury homes. You can acquire land either by buying or leasing, and then build housing units and wait to see your money grow.
Land Buying & Selling (Speculation)
If real estate sounds juicy for you this 2016, then you haven’t heard about land speculation. The Kenyan population is not growing any smaller. In fact, each year sees an increase in population and land is becoming scarce by the day. Also, the population is moving from highly populated areas and founding homes in areas with small populations. These factors have presented a booming business for those with a land.
Land buying and selling is a lucrative business that yields high returns. In 1991, a parcel of land measuring 50 X 100 meters cost around Kes 15,000 – 40,000 in areas surrounding Nairobi. The same piece of land has skyrocketed to as high as Kes 500,000 depending on the location the property is situated. Devolution has also made land a hot business since government infrastructure and service delivery is now evenly distributed (e.g. some of the most vital government activities that were centralized are now done in other cities.) County governments have also created many business opportunities and any land owner in any region has seen an increase in their land’s value. You can buy land and wait for the value to rise (probably after 3 – 5 years) which can earn you over 500% profit. It is a wise investment compared to keeping your money in the bank and waiting to receive between 3 – 15% interest.
Ever since the Chinese opened their market gates to Kenya and other African countries, importation has been a hot-cake business for those with money. Thousands of business people are flocking China to buy products (which are very cheap compared to products from many foreign countries) and shipping them back home to sell. With China, you can export almost anything to Kenya and make a kill out of it. Some of the things from China that are selling big in Kenya include mobile phones, electronics, clothing, jewelry, beauty products, and spares.
Apart from China, you can also indulge in the importation of second-hand vehicles from Japan, Used clothing from Europe, Motorcycles, and spares from India, fabrics from Uganda and Western Africa, etc. However, take note of importation rules, regulations, and taxing that are never constant. Always opt for the fastest and most affordable means of importation to maximize your profits.
Every year, Kenya is affected by famine due to the harsh weather conditions found in areas that are arid. But things are taking a new twist in the farming sector. The government is adopting new farming techniques used in arid countries like Israel and Saudi Arabia to mass produce enough food for the country. But still, this is not sufficient. Kenya has to depend on food importation from neighboring countries such as Tanzania & Uganda. The agriculture sector is a hot market you can invest your money and rip good returns every day; people are leaving office jobs and turning to agriculture business that has high yields. You can lease or buy land to farm. However, have enough information about the area you plan to cultivate crops to avoid loss. Also, know which kind of crops are doing well in the market before planting. The government is supportive of farming, and you can get support from the ministry of agriculture offices close to you.
Poultry, Dairy & Beef Farming
Consumption of meat in Kenya is high, and so is the demand for dairy products. Chicken farming is a lucrative field (though it has some challenges when starting) which brings quick returns. Fast food joints, restaurants and hotels have huge orders of chicken meat and eggs. Festive seasons come with many customers who are looking for meat to celebrate the occasions.
The cattle business is also booming in the country. It can be termed as a gold mine. High consumption of meat by the country has seen the price of the commodity skyrocket. A kilo of meat is trading at Kes 400 ($4) and might continue rising. Dairy products like milk are also making a kill in the market. As the prices of packaged milk continue skyrocketing, people are turning to small milk traders to supply them with affordable fresh milk.
The education sector is growing by the day. However, many parents feel that public schools do not offer the best education for their children. Those with a stable income transfer their children to private education centers (but if all parents had the will, all their children would be schooling in private schools). It has seen the pop-up of private academies almost in every estate in the cities. You can join the wagon and set up your own Kindergarten, Preparatory school, primary school, secondary school or even a college or university. Great entrepreneurs manage to grow a single academy into a chain in a couple of years.
Just like many years prior, 2016 is still a great year for the information and Technology sector in Kenya. As we continue to anticipate the launch of Konza and Tetu tech cities, the IT sector is doing great all over the country. Furthermore, it is among the leading sectors that keep producing entrepreneurs in great numbers. Anybody with an IT background or knowledge can set up a cyber café, Website or graphic design, application development, Digital printing, animation, etc. Some of the businesses in this sector require great financing to start while others require small capital. But the returns are saliva drooping, and you are guaranteed to not go to bed hungry.
Kenya is still a young, emerging economy on the global map. The middle class is steadily growing, and many people are starting to afford luxury lifestyles. But the number of low-income earners is still high. Even as the number of personal cars being imported in the countries continues to grow, the transport industry continues to be among the most thriving industries in Kenya. There are success stories of entrepreneurs who started with a single PSV vehicle and grew them to a fleet. It is a wise move to invest in the PSV sector. If you put your vehicle on the right route, with the right vehicle, you are sure to make a kill in the industry. With the devolution of county governments, new travel destinations are popping up, and people are starting new residential places everywhere. Even owning a tuk-tuk or a motorbike has proven to bring good returns.
Amazingly, the furniture industry has seen big growth in the past two years. Surprisingly, demand for luxury lifestyles has seen new modern furniture designs come into play and with it has the price of furniture. A few years back, buying a full set of chairs for your home of just basic design would cost you not more than Kes 15,000. Currently, it is almost impossible to get a basic design set of chairs at the stated price. Home furniture goes as high as 1 million shillings and as low as Kes 25,000.
Furniture business thriving industry that you can take advantage, by starting your company that deals with both office and house furniture. Prices are set to rise higher since urban homes are being built in large numbers across all major cities in Kenya.
It is a business for a person with an entrepreneurial spirit and mindset. It is hard to start because it requires plenty of networking before stabilizing, but it is one area that can make you rich in a short period. Kenya is viewed as a strategic nation in East and Central Africa by many nations. Most foreign countries use Kenya to access regional markets or to test their new products. This year alone, Kenya has hosted two major international events and many more that are either regionally based or local. The events industry, with the right mindset and skills, can turn to be a very lucrative business venture. You can start an events management company that hires out types of equipment like sound systems, tables, chairs, tents, etc. You can also win tenders to organize events for different corporate companies and institutions in the country. Weddings and Occasions are in plenty as well.