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Meru Duo Breaks Through Financial Challenges to Build an Agribusiness Empire

15. Muriithi. Photo by NMG

Access to agricultural financing has always been a problem for most smallholder farmers in sub-Saharan Africa due to the high risks associated with the sector especially in the wake of global climate change.

In fact, financial institutions such as banks do not disburse loans to the growers without surety and most of the time the interests charged are always high limiting many of them.

Because of this, many of these small-scale farmers turn to their friends, family members, relatives, and farmer groups for capital.

This is the situation in which Musa Muriithi and his brother Edward Mucheni found themselves three years ago when they wanted to raise some money to start an agribusiness venture.

According to Muriithi, it all started when he wanted a loan of Sh0.5m from a financial institution and all he had as a surety was a 3.5-acre piece of family land in Meru County.

As the institution delayed taking him through rigorous processes, he decided to look for a private land evaluator who told him that the land had a much higher value than the money he was looking for.

He, therefore, decided to consult with his brother Mucheni and the duo agreed to spend some of their savings to buy 200 banana tissue plants.

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They panted and after the plants did so well, they decided to incorporate poultry, rabbit farming and fish production.

‘’The reason to begin this way was the idea we had to use the rich-in-minerals fish pond water and manure from the livestock to grow arrowroots, passion fruits farm, mangoes and the bananas,” said Muriithi.

They would soon spend the money drawn from poultry, fish and bananas to construct four greenhouses; two that major purely on strawberries, one has garden peas while the last one has assorted crops that range from cucumbers, beetroots and courgettes.

They have so far inter-cropped cassava and mangoes in one part of the farm while the other has tree tomatoes.

‘’The benefit of the tree tomatoes is that once they matured, we can harvest throughout the year and they require little attention,” said Machine.

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According to him, the fruits’ market is also good and the farm cannot even satisfy the demand from Jatomy and Maguna Andu supermarkets in Chuka town they supply to.

These many integrated farm productions cushion us from price fluctuations in that in case of the glut of one commodity the other could be in great demand, he said.

The two have also gone into dairy goat farming to tap into the animals’ rich nutritional milk spiking its demand among consumers to supplement their income.

Beekeeping at the edge of the farm to increase their crops’ pollination besides harvesting honey for income is something the duo have not forgotten.

They have also learnt to turn farm weeds and wastes into valuable products for sale or using within the farm.

For instance, banana trunks are mixed with wastes from the poultry, rabbits and goats’ farm and are all preserved in a pit to make compost manure.

‘’This style of farming is rewarding and before embarking on it, one should do proper research to know what is working and does not besides knowing your markets well,’’ said Muriithi.

The farm they have since named Kagumo-Hort farm is indeed a host of activities, making it a frequented place by customers and learners.


Agripreneur Blog

Homa Bay Youth Discovers Affordable Animal Feed from Lake Victoria’s Water Hyacinth

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The cost of animal feeds in Kenya has become all-time high, raising farmers’ cost and consequently the cost of various commodities.

This, according to the Association of Kenya Feeds Manufacturers (AKEFEMA) is due to the shortage of maize which is the chief raw material in manufacturing the vital product.

The latest figures indicate that the retail price of a 70-kilogramme pack of chick mash, for example, now sells at Sh3,600 from Sh3,300 while that of growers goes at Sh3,100 from Sh2,800.

These high prices pushed Jack Oyugi Omondi, an entrepreneur from Homa Bay County, to research how to make a cheap animal feed from Lake Victoria’s invasive water hyacinth.

“During the dry season when other greens are exhausted, I used to see cows eat the hyacinth but not as much because of an irritating substance in the leaves. This is where the idea of how it could be improved through processing to make it more palatable for animals came,” said Oyugi.

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In 2016, Oyugi, a biotechnologist, started his research and development to make a product that was appealing and safe for animals from the irritating weed.

The resulting product was then sent for testing both at the University of Nairobi and the Netherlands before a pilot study on animals from selected areas in Homa Bay and Meru Counties.

He then discovered that the feed increased milk production by 20 per cent while costing half as much as traditional feeds.

In partnership with SNV Netherlands Development Organisation, Oyugi in 2018 launched Biofit Technologies, a firm through which he now manufacturers the animal feed.

“To be able to push my agenda further, I brought in a veterinarian, a livestock nutritionist, and a crop scientist and together we partnered with government institutions, parastatals, and non-governmental organizations in Kenya and across the world,” said Oyugi.

The Biofit animal feed, which has 55 per cent proteins also boosts the yields of all meat, eggs and other animal products by at least 15 per cent.

Though the hyacinth is the main binding agent besides contributing at least 10 per cent of the protein content, other ingredients are added in.

“We also add dagga and other plant-based ingredients to the meal for a variety of animals’ nutritional needs for productivity and protection against mineral deficiency and diseases,” said the entrepreneur.

Farmers in the region now buy a kilogram of the meal at about Sh25 compared to about Sh40 per kilogram of the common commercial feeds.

Job creation

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From just four people at its launch in 2018, Biofit has grown to eight full-time employees and four other casual workers.

“This team,” says Oyugi, “Consists of four highly skilled individuals with a background of research and entrepreneurship.”

In addition, since water hyacinth impedes fishing activities, Biofit has contracted 20 fishermen to harvest 300 kilograms of the weed daily, creating a new source of income for them.

The enterprise also boosts women’s incomes by hiring them to do sun-drying of the plant.

“Today, we pride ourselves as being the first company in Kenya to harness water hyacinth and convert it into animal feeds.”


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Primary School Teacher Finds Extra Cash from Bread and Cake Bakery Business

Kisii County is very well known for banana production as one can easily find bananas in almost every compound and now Scholar Kerubo, a P1 teacher and entrepreneur in the region is taking advantage of the produce’s abundance to make bread and cakes.

Kerubo who has also been a part-time farmer since the year 2000 growing bananas and other crops discovered a niche in a bakery after noticing that she could make more cash from processing the product and create a ready market for banana farmers in the area.

“Starting a business is a leap of faith and I had longed to invest in the business to avoid overreliance on one source of income,” said Kerubo who is a Teachers Service Commission (TSC) employee, a job which earns her Sh60,000 a month.

Her first trial was in 2017 when she used part of her savings to start a small bakery at her home kitchen after receiving a grinding machine from World Vision, a Christian humanitarian organisation.

The machine helps in grinding the bananas into fine flour before mixing the flour with some wheat flour.

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She started by her own bananas, about three bunches, bought five-kilo packets of wheat flour at Sh600, three kilos of sugar at Sh100 each, yeast at Sh240, and some packaging material at Sh320.

“In my first home operation, I realised 24 kilos of flour which I used to bake about 50 bread and 100 cakes which sold out well. This encouraged me into increasing from time to time,” said Kerubo.

To get into real commercial production, she decided to construct a well-furnished bakery within her compound moving away from her home kitchen.

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She also purchased a baking oven called Solar Five from GoSol Company, a solar energy company. The oven has lowered her production costs as she uses solar energy rather than electricity which is quite expensive.

She has also moved to buying bananas from other growers in the area at between Sh200 and Sh500 a bunch depending on the size.

She explains that after buying the bananas, they are peeled and the flesh is dried in the sun for two to three days depending on the weather conditions before being grounded by the grinder into fine flour.

The flour is then mixed with wheat flour at a ratio and the resultant mixture is used to bake bread and some cakes.

“Currently, I can grind up to 15-20 kilos of banana flour per day giving me 70 400g pieces of bread and 120 cakes.”

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She sells a piece of bread at Sh40 and a cake at Sh20 translating to Sh5,200 per day.

Her markets include local markets such as Kisii Town shops where she distributes the products while others are sold in primary and secondary schools in the area when they are open.

The venture has enabled her to employ three youth who helps with running the bakery and other casuals depending on the day’s workload.

During schools, she ensures all the work is well organised before leaving for school. This has enabled her to balances her official duties and the part-time venture very well.

“During school days, I wake up early and by 6:30 am I report to the bakery where I supervise and give instructions about the day’s work until 7:30 am when I leave for school and after school from 5:00 pm I get back to do final checkups to ensure everything is done,” said the 48 years old teacher.

She, in future, intends to resign from her teaching job so that she can get time to focus on her bakery business with a view of expanding it.


Agripreneur Blog

Former graphic designer tuns dairy goat side hustle into a lucrative venture

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Between 2000 and 2015 Charles Wathobio was a renowned graphic designer producing newspapers and magazines in his small enterprise in Madaraka, Nairobi which used to earn him about Sh60,000 per month.

Unaware of the full potential of dairy goats, in 2005 he decided to keep some two at the backyard of his Rongai home which sat on a 0.25-acre piece of the plot.

‘’Away from my main business, I wanted something which could keep me busy and earn me some income and further reducing my budget on foodstuffs. This is why I settled on the goats when I realised they are easy to rear,’’ said Wathobio.

Luckily enough the goats would multiply very fast and the plot seemed small to accommodate them so he started selling mature bucks of 12 months old at Sh15,000 each. This encouraged him.

‘’I realised that the goats were becoming way more profitable than I had thought. Under proper management, one goat can give birth to triplets and 3-4 litres of milk especially within 4 to 6 weeks after kidding,’’ said Wathobio.

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Other than family consumption, he sold one litre of goat milk at Sh200 and above earning him about Sh50,000 per month out of the six goats he was milking.

He, therefore, decided to move his flock back to his rural home in Othaya, Nyeri County where there is enough space to increase his production.

After some online research and attending farmer events where he could learn more about breeding, feeding and the general management of the animals, he decided, around 2016 to abandon design work in town to concentrate on his dairy goat production.

‘’I came to a decision to invest Sh100,000 of my savings into the farming to increase by building a bigger and proper structure. I was convinced of its viability and the fact that it could also give me time to engage in other farm productions,’’ said Wathobio.

Given goats give birth to twins and triplets, in one year his stock had doubled and in in the subsequent two years, he had over 20 goats.

About five years down the line, he has totally changed from a renowned designer in town to become a renowned breeder in the country and beyond supplying bucks to his customers in Kenya, Tanzania and Uganda.

He rears Alpine breed within his five acres piece of land in Othaya. “Alpine dairy goats are the best to rear because they are resistant to tropical diseases,” he said.

To get healthy goats, Wathobio uses artificial insemination. This makes his bucks to be of high demand by other farmers who are always in need of the males for breeding.

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‘’I rarely keep bucks as they are in constant demand. This is because I have personally mastered the art of breeding the flock to meet market standards,’’ he said.

He sells a mature served does at between Sh20,000 and Sh25,000 each depending on the animal’s pregnancy stage while bucks which are between 12 and 18 months old, he sells at between Sh15,000 and Sh18,000 each.

He markets his animals via Facebook and WhatsApp groups whereby upon payment by his customers, he takes it upon himself to deliver the animals at a fee depending on the delivery points.

Wathobio also sells milk and yoghurt made from goat milk at Sh100 and Sh400 per litre respectively.

Currently, his stock stands at 40 goats out of which he milks about 30. Each gives between 1-3 litres a day.

His venture has so far grown. Today, he never struggles looking for a market because for a long time he has worked tediously to grow his wider customer base and now he estimates that in a month he can earn up to between Sh200,000 and Sh300,000 gross income.

‘’I have since partnered with a group of farmers and agro-entrepreneurs in the area to build a goat milk processing plant to provide market for enterprising farmers in the region,” said the 48-year-old farmer.


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Process of becoming an organic farmer in Kenya

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Since 1950s during the Green Revolution when there was an upsurge in crop yields due to introduction of chemical fertilisers and pesticides to boost crop production, the use of natural means to grow crops have become less popular among farmers.

However, despite the potential of the convectional type of farming in boosting crop production, the use of these synthetic fertilisers and pesticides have been found to be the main cause of environmental degradation and worse of all, food contamination.

It is because of this that many consumers especially from the west are now moving towards organically grown food crops as consumers are shying away from crops laden with pesticides.

The trend is slowly picking up in Kenya due to lack of proper mechanisms to control pesticide use in farms despite concerns of the risks they pose.

This has created increasing demand for organic foods as Kenyans especially of middle class drifting towards consumption of these foodstuffs.

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Even as many farmers are now trying to adopt the use of natural processes, compost manure and biological pest control methods to boost soil fertility or manage pests and diseases to cash in the growing demand of organic foods, there is need for them to follow due process to be able to trade well with their foodstuffs both locally and internationally.

Organic farming certification process

For farmers to be able to sell they organic produce especially in the export market, it is a requirement that they register their enterprises with the world governing body, International Federation of Organic Agriculture Movements (IFOAM) which has its presence in almost every part of the globe.

In Kenya, IFOAM is represented by EnCert Limited.

According to EnCert, the process of certification starts by the producer changing his or her mind-set to go organic then applies for certification by filling a form from EnCert for organic farming. The form is available online.

After submission and verification, EnCert inspectors then come to the respective farm or enterprise of the applicant to verify if the producer adheres with the organic production requirements.

Among the things they check on include record keeping, the surrounding and inside of the farm/enterprise, seed and seed treatments, fertilizer and plant protection scheme, storage facility and finally packaging and labelling of the produce.

If the inspector is satisfied with all the above conditions, he or she presents the findings to the registration committee for approval. 

If the committee approves the enterprise, the owner is issued with an international number and later organic farming certificate is issued.

The certificate is thereafter required to be renewed annually.

Now, because this can be tedious for small-scale farmers, it is recommended that they may come together and produce intensively for domestic markets as they advance to international markets.

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“This can be a good beginning,” said Ronnie Vernooy, a Genetic Resource Policy Specialist at Bioversity International adding that such farmers can work in groups, specialise in producing particular crops and target specific markets.

Meanwhile they can work closely with Kenya Organic Agriculture Network (KOAN) which can help in knowledge building among other support. This is because there has been less recognition of Kenyan organic farmers despite the pick-up of organic farming in recent years.

According to Research Institute of Organic Agriculture (FiBL), one of the world’s leading institutes in the field of organic agriculture, organic farmland in Africa has doubled in area in the last decade, to 2.1m hectares, with the biggest organic centres in East and North Africa and the crops they grow enjoyed the world over.

But, in Kenya, certification of smallholders who avoid synthetic fertilisers and pesticides has remained difficult due to a lack of information, scant government support and the high cost of getting certifying documents.

To become a member of KOAN or Association of Organic Agriculture Practitioners of Kenya, which helps in training of organic farmers and facilitation of the certification process, farmer groups pay a Sh10,000 registration fee.


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With less than Sh10,000 you can start a thriving mechanized maize shelling business

As a youth, you have been longing to get into maize farming but afraid of the tedious planting, weeding and harvesting work, this is your chance to participate in this rewarding venture, make a living and even create employment for others by evolving in mechanized maize shelling business.

This is one of the businesses in Kenya that you can never go wrong since maize is the main staple food crop in the country grew by at least 85 per cent of smallholder farmers who still physically remove the maize from cobs.

According to research dubbed ‘maize production, challenges and experience of smallholder farmers in East Africa by the International Maize and Wheat Improvement Center (CIMMYT), the physical removal of maize grains from cobs is a burdening, tedious, time-wasting and costly exercise that the farmers would be willing to abolish should there be a less expensive option.

And you can provide this option. Though there are different types of maize shelling machines such as electric and diesel-powered, for a start, you can go for a manually operated one which costs Sh8,500 and will not incur other costs on fuel or electricity.

After buying the machine, maybe what you will need is transport to your location which will depend on the distance and since it is manually operated and mobile you will not need much technical training on how to handle it.

The manual maize sheller is fitted with two wheels hence easy to move it to the working place hence no further transport costs incurred.

The machine is compact, efficient and comes in both mobile and stationary versions with a capacity of shelling from 50 to 100 90kg bags of maize per day.

You can charge Sh70 for one 90kg bag shelled and you can do 50-100 of such bags a day translating to Sh3,500-7,000. 

Given the work involves inserting 30 pieces of maize in the equipment and rotating by hand shelling the pieces one after another and separating grains from the comb then sliding the shelled maize into a container before repeating the entire exercise for the rest of the maize, this can be tiring hence the chance to employ one or two people to help.

You can also lease the machine to a farmer who wants to cut down the service costs and charge at a subsidized rate depending on the number of bags shelled.

However, you may not have to limit yourself to the manual sheller. If your pocket allows you can get a diesel sheller at Sh50,000 with a capacity of shelling between 100 and 150 90kg bags of maize grains in a day.

Currently, Kenya is approaching maize harvesting season with some parts like the western region already have the crop matured with harvesting beginning towards the end of July until early September. 

The high season for North Rift, popularly known as the breadbasket of the country due to its high maize production begins towards the end of the year.

The machines come in handy from the month of November all the way to February as some farmers usually store maize in cobs opting to have them shelled once the dry months set in.

This is, therefore, the best time for investing in the business getting yourself ready before the season begins as you will also have to market your service early enough.


Blog Entrepreneurial Stories

Kisumu woman excelling in a male dominated automotive mechanic job

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The rate at which ladies are increasingly daring to venture into careers or jobs that traditionally have been dominated or meant to be men’s is really encouraging, after all, they say ‘what a man can do, a woman can do better.

In fact, according to a recent report by the International Finance Corporation, of the 462,000 jobs created annually since 2000 in Kenya, 445,000 jobs have come from the informal sector, where 85 per cent of women’s businesses are found. 

One of these women who have managed to create a thriving business in a male-dominated field is Josephine Akinyi.

When she completed her Kenya Certificate of Secondary Education at Nyabisawa Girls, Migori county in 2001, she never envisioned that working as a diesel mechanic, an occupation predominantly presumed to be a man’s domain could earn her Sh20,000 to 50,000 a day.

“I was hesitant to join the business because I never wanted to have greasy hands or wear the blue oily aprons. Both my parents being mechanics, it was inevitable that I would be involved in the culture as well,” said Josephine Akinyi co-owner Fedmar Garage and owner Lascope Spare Parts n Kisumu City.

Brought up in a family of mechanics, she had developed an interest in cars at a young age but the brute strength required for heavy lifting, and the gender stereotype discouraged her from following the family’s footsteps. Before technology advancements, mechanics involved a great deal of hands-on work.

After high school, she took a certificate course in Early Childhood Development and Education (ECDE) aspiring to be a pre-school teacher only to drop out after a month to learn how to earn a daily income.

“While in school, I had the mindset that white-collar jobs paid better but after attending the ECDE classes for a month, I got tired of sitting in for lecturers while my parents and brothers were making money every day – I had to get my hands dirty no matter the odds,” Akinyi said.

She later took a computer course and driving lessons but spent most of her free time lazing around the house until 2004 when she decided to make something of herself by joining his family business, Opiyo Garage located in Kisumu.

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Persistent to learn on the job, her father took her on as an apprentice, introduced her to the safety rules, tools, different engine parts, and trained her on how to perform manual diagnostic tests. 

Within a year, she had learned how to service the vehicles, gradually increasing her knowledge of car parts and mechanics.

Her passion to excel in the field exceeded when she serviced the first car, making Sh1,200 in less than an hour. Working with her four brothers and father, she would repair two to three cars in a week making Sh10,000 or more in a day depending on the problem.

In the past, traditional car repair techniques and gender stereotypes discouraged women from involvement in the mechanic’s field. However, today, the physical barriers women faced have reduced following technology advancements.

 New techniques have accelerated car diagnostics and repairs; the work has become light and less greasy- women are invading men’s domain.

Data from WhoCanFixMyCar.com shows that the number of female mechanics in the UK has risen by 125 per cent since 2011.

According to the Kenya Bureau of Statistics, the untapped potential of women has gained greater attention. The 2010 constitution of Kenya provides a framework for addressing gender equality, seeking to remedy the traditional exclusion of women and promote their full involvement in every aspect of growth and development.

“I believe that female mechanics can be successful as or even more successful than male auto mechanics. The gender stereotype deters women from exploring their full potential,” she said.

“I derive my livelihood from this job. It feeds my family, pays school fees for my children and even caters for unforeseen emergencies.”

In 2007, having acquired the skills for the job, including using the digital diagnostic machine, she joined his brother’s business, Fedmar Garage based in Migori to offer her expertise and help manage the business.

The only female in the group of seven- 4 permanent workers and three trainees, works tirelessly to earn a decent living and has created her customer base gaining repeat clients.

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On a good day, she fixes two to three cars earning Sh20,000 to 50,000 depending on the nature of the problem.

Team cohesion has enabled the trainees to learn fast -when one is working on the engine, another the interior of the car, and the other wheel alignment.

“After learning on the job, most male trainees leave to open their businesses. On the other hand, women admire my zeal, but once they join our team, they quit after two days. We don’t have female mechanics at the moment,” said the mother of three children, one graduating primary school this year.

Akinyi continuously empowers women who want to succeed in the male-dominated industry. Apart from repairing vehicles, Josephine invested Sh30,000 and opened Lascope Spare Parts in

March 2011 due to the high equipment demand at the garage. She makes a profit of Sh3,500 per day and anticipates opening another shop in Kisumu by January 2020.


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SMEs’ Take: How to manage cash flow and late payments during these hard-economic times

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Despite being pertinent cogs to economies of developing countries and other economies, offering employments and jobs creation, Small and Medium Enterprises (SMEs) are faced with many challenges one being difficulties in managing cash flow which may end up causing their collapse within the first few months of operation.

According to a 2014 research by Ms Avika Mungal, Lecturer, Department of Management Accounting, Faculty of Accounting and Informatics, Durban University of Technology, South Africa on Cash Management Challenges of Small Businesses in a Developing Community, one aspect that keeps small business owners awake at night is the management of cash flows with nearly 71 per cent of such businesses experiencing cash flow problems.

The research which targeted small retail businesses in the Tongaat area in KwaZulu-Natal, South Africa further indicates that the biggest mistake SME owners make is confusing profits of the business with the cash flowing into the business with lack of bank accounts, bad debts and lack of cash budgeting among other key problems.

For Dickson Mulli, CEO of Synergy Solutions Kenya Limited, a company that deals in real estates, Milele Fresh dairy products, agribusiness consultancy and more, difficulties in managing cash flow by most SMEs is a common challenge but a smart approach to it is what creates the difference.

“We as a company have faced financial problems here and there since December and the COVID-19 pandemic has even made it worse as there are 30 per cent cases of defaults in payment by our clients generally due to these tough economic times,” said Mulli. 

“Wwe have since decided to changed our approach by selling less on credit and employing pay-on-cash policy where we encourage our clients to pay cash upon delivery of goods and services.”

This, according to Mulli, may not go well with some clients as most of them are interested in a longer credit period so that they may use the money to reinvest in their businesses, make profits then pay later unaware of the effect they impose on the supplier.

“Some clients lie on their financial status and when you become strict on cash payment upon delivery, they become reluctant doing business with you and sometimes you may lose them.”

Since late payment causes delay in the company’s settlement of its bills, sometimes Mulli opts for internal borrowing from the company’s savings account or negotiate the best rate of payment by clients whose debts seems overwhelmingly big.

“Because shutting down is not an option, we always call some of these clients for an arbitration meeting where we suggest to them a moderate payment percentage over a given period over which we continue doing business with them and we have seen this work well,” he said.

Since SMEs operations greatly depend on the owner, he advises that such businesses should have about five accounts that include revenue collection, paying creditors, savings, recurring expenditure and reinvesting accounts.

“Even at that, business owners should be careful to draw money from any of the accounts for personal use, paying all staff before earning their share and avoiding spending more than a third of income just in case of any eventualities,” advises Mulli.

Some SMEs like Viffa Consult Limited which deals in consultancy, business process outsourcing, research and analytics to other companies diversify their sources of income as one of the ways of managing their cash flows and late payments from clients during these tough economic periods.

According to Victor Agolla, the company’s managing director, it always occurs that two in ten of their clients pay late and the late payments affect staff salary, office rent, taxes and other statutory obligations.

“Since we know that late payment by clients is almost unavoidable, we have diversified our sources of income by dealing in a number of income-generating activities to raise additional funds besides tightening credit policy by asking bigger deposits of 80 per cent and offering discounts to cash buyers,” said Agolla.

He says in case of problems in cash flow and late payments causing even the loan market becoming expensive and unsustainable, decision to lay off staff and moving to smaller offices are other ways of bouncing back.

Nevertheless, other SMEs strictly abide by their basic budgets and allocating an emergency fund to avoid any future complications as they believe that the lack of proper planning represents a central problem that affects business growth, profitability and sustainability.

Edward Mbogo, Operations Lead at Myride Africa, a company that deals in public transport system, says late payments and cash flow difficulties are always there but being obedient is key.

“Late payments will always be there even from big players. We do get them once in a while but when changing our priorities and adjusting the budget by using cash meant for something else in a different docket all must be done following the company’s procedure,” said Mbogo.

To him, late payments and poor management of cash flows have always thrown the company off-target ending up in debts, however, having an emergency fund and also doing strict agreements with clients in matters payments avoid such inconveniences.

For Crest Fine a Kenyan company that makes and distributes bread, it was forced into asking clients to pay for the products before delivery after accumulating debts amounting to Sh100,000 a day. 

“When faced with late payments, we have to find other sources of funds such as bank loans in order to be able to meet cost of operations. Due to their frequent occurrences, we have had to take measures in order to mitigate them; we outsource debt collectors who we pay a percentage of the fee when the debt is recovered and paying before the service,” said Alex Ndungu, the Managing Director of Crest Fine.

he says that with the expected new normal situation post COVID-19, the majority of small business ventures would require some external funding at some point in the business with banks being the first option many would approach in order to bounce back.


Blog business Entrepreneurial Stories

Love for Cooking Turns into A Lucrative Bakery Business for Graduate

Love for Cooking Turns into A Lucrative Bakery Business for Graduate

Turning what you love doing into a profitable venture can really be enjoyable given the excitement it comes with while operating it.

Sharon Sang is one such entrepreneur who has converted her cooking hobby into a bakery business which is now earning her some tidy sum of money.

The Bachelor of Commerce graduate from the University of Nairobi had learned how to bake cakes when she was a little girl from her mother and elder sisters.

And as she was waiting for her graduation in 2014, she realised she had some free time that she could utilise to earn her some pocket money.

“I did not want to continue asking for some cash from parents or siblings for my personal effects because I was through with my course and I could hustle as well,” said Sharon.

She, therefore, decided to spend Sh50,000 money she had won from a 2015 beauty competition where she became a runner-up to start off the business.

She used part of the money to buy baking equipment and the raw materials she had to start with.

Some of the equipment she bought include measuring cups and spoons, a weighing scale, baking tins, a blender, hand mixer, spatula, leveller, and mixing bowls, among other necessary items.

“My first product was a vanilla cake of two kilos which I sold to a friend at around Sh2,200 and that is how I got motivated,” said Sharon.

The more she continued baking good cakes and selling to people who were well known to her the more she got referrals until it reached a point her customers became her business ambassadors.

In addition, she invested in social media platforms such as Facebook, WhatsApp groups and Instagram to reach her usual and prospective clients.

Soon she started getting orders online which she could deliver in time earning her more trusts.

In 2018 she decided to register the business at a cost of Sh3,000 as Dessert Palace where she now bakes a variety of cakes such as wedding cakes, cupcakes, and birthday cakes among other pastries.

Since baked goods such as cakes are perishable and thus the need for the ready market so that they are sold when they are still fresh, Sharon prefers baking on order.

“I have learnt to execute the business skills I acquired from college very well and I am able to manage the business when I am faced with challenges.

Other than vanilla, Sharon also make banana cakes and carrot cakes and her prices depend on the size and the level of decoration brought about by food colouration if need be.

Nevertheless, her prices per kilo of the cakes ranges between Sh1,600 and Sh2,200 two-kilogramme cakes go for Sh2,500 to Sh3,100 each.

She also sells a packet of cupcakes comprising six pieces at Sh550.

In a week she can receive up to 20 orders of cakes. In this, she is sure of Sh5,000 profit a week.

“My main challenge is the many orders I get per week which when working alone I find it difficult to meet hence I am thinking of employing at least two people in the near future to help in baking,” said Sharon.


Agripreneur Blog Entrepreneurial Stories

Former matatu driver finds comfort in agribusiness

Former matatu driver finds comfort in agribusiness

Not only in Kenya, across East Africa public transport popularly known as matatu sector remains synonymous with chaos and disarray with unpredictable operation system, poor handling of passengers, bad conditions and unreliability.

Especially in major towns and cities such as Nairobi, chaos, impunity and disorder in the sector reign supreme making the lives of commuters and operators daily encounters with the bad and ugly of the public transport.

This is the environment that Alex Macharia found himself in as a matatu driver in Nairobi from 2010 to 2012 earning Sh500 a day. 

Tired with the chaotic culture, he would leave the city to Nakuru Town to work as an employee in a retail shop for another two years. This too would not offer him the comfort he yearned for.

With his little savings from the two jobs, he would soon leave to his rural home at Elburgon in Nakuru County where he leased an acre of land for maize production.

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‘’I was lucky to get ready buyers with Njoro Millers but because I could not produce enough, I formed a group with five other farmers who would bring to me 10 90kg bags each then combine with my 15 90kg bags before supplying to the miller,’’ said Alex.

The group grew up slowly and they started venturing into other crops such as French beans and snow peas as they kept their traditional maize production.

After being trained on safe and effective use of pesticides, in 2017 Alex was chosen by Frigoken Ltd (FKL), a Nairobi-based export-oriented vegetable processing company and which they supplied the produce as a technical assistance (TA) to help farmers with agronomy practices.

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His first big challenges as trainer was how to convince farmers to work with him and transporting them to a place of training but persistence has seen him overcome.

“Farmers always have their reasons to doubt new organisations, Alex says, ‘’But all depends on how you treat both old and new comers to slowly build their trust.’’

He has since increased the number of farmers he is working with from just the five he started with to 3,000 currently.

As a great boost in his business, last year when he first interacted with FarmtoMarket Alliance program by Kuza Biashara and Cereal Growers Association (CGA) where he was further taught on managing farmers and customers, understanding markets, managing income and expenses, making farm budgets and records and savings through SACCOs among others.

The program has turned him into a community agribusiness advisor (AA) by giving farmers proper trainings on the areas that are key in their production such as accessing affordable farm inputs, proper use of the farm inputs, harvesting and marketing of their produce.

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‘’The program has linked us to may agribusiness stakeholders including financiers and buyers through capacity building. Personally, I now own a motorized sprayer courtesy of the connections brought about by the program,’’ said Alex. 

Today, Alex and his team are harvesting 2,000 kilos of French beans twice a week and the same for snow peas. 

He says that at the beginning of the first harvest they can only realise 700 kilos of French beans but as it approaches the peak, they can harvest up to seven tonnes twice a week.

Besides maize, French beans and snow peas, they also grow potatoes. The group sells French beans at Sh50 per kilo, snow peas at Sh65 a kilo while potatoes go at Sh30 per kilo.

Alex’s immediate future plan is to own an agrovet through which he can stock farm inputs such as fertiliser, herbicide and pesticides and supply them to farmers at a subsidised cost.


Agripreneur Blog

Amaranth, a wonder crop that can fetch over Sh300,000 per acre in 45-120 days

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In 2018 the government of Kenya moved to stem over-reliance on maize and subsequent consumption of ugali by introducing a policy to push maize millers to blend maize flour with other local nutritious grains to curb malnutrition.

Among the grains which were recommended for the fortification were amaranth grains and since then the initiative coupled with the health benefits of the grains have seen farmers grow the crop which was previously regarded as a common weed to make quick and good cash.

In fact, according to a 2018 research on Efforts to Promote Amaranth Production and Consumption in Uganda to Fight Malnutrition, amaranth grains have protein content of 12-13 per cent, which is higher than that of most cereal grains making it the most sort after grain globally.

Nutritionists assert that the grains are best for cancer and diabetic patients as it is a good source of fiber, protein, manganese, magnesium, phosphorus and iron, along with several other important micronutrients. It can be used to make animal feeds and skin cosmetics.

The grains can be roasted and eaten as such or grounded to produce flour to make chapati, porridge, cakes, cookies, bread muffins, pasta pancakes, crackers, and fortify maize meal flour.

The green fresh leaves can be cooked and eaten as vegetable as they are good source of good source of protein, pro-vitamin A, vitamin C, and fiber.

Possible returns

Now, grain amaranth has two main varieties, the short and tall varieties recommended for low and high rainfall areas. Maturity occurs in 45 – 60 days for early maturing (short) varieties while late maturing (tall) varieties take 70- 120 days.

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Generally, the two drought tolerant varieties can yield an average of 800 –1200 kilogram per acre and can fetch Sh200-300 per kilo by local companies which process and sell grain amaranth products.

This translates to up to Sh360,000 in 45-120 days whatever the variety a farmer choses to grow.

According to Carolyne Okello, an amaranth farmer from Ringa Kakelo in Homa Bay County, amaranth grains fetched Sh150 a kilo about four years ago when she started the venture but things have since changed.

“In 2016 when I started amaranth farming, I could sell the grains at Sh150 or even less in local markets but following the pickup in demand even by food processors, the price currently is between Sh200 and Sh300 a kilo,” said Carolyne adding that she is now doing six acres from an acre she did previously.

From the acreage she harvests 30-35 90kg bags of amaranth grains translating to 3150kg which if she sells at Sh300 per kilo gives her Sh945,000 gross income.

For Philip Odhiambo, another farmer from the area, the hardy crop can grow almost in any environment, including the wild, after germination.

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“Amaranth is a giant crop, which ‘oppresses’ other plants in farms when it is a weed. Because of this, even with little attention, it is likely to do well,” said Philip. 

When planting, Philip recommends three to four seeds in a very shallow hole at a spacing of 75cm by 25cm.

As a direct competitor to maize flour, amaranth flour has a major advantage: it already contains so many nutrients that it does not need to be fortified, making it a more cost-effective option, not to mention a healthier one.


Agripreneur Blog

High school leaver striking gold with earthworm farming

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As the cost of education continues to rise, many children from poor families in Kenya find it difficult to advance to the higher levels of education due to a lack of school fees.

In fact, the increasing education costs are pushing the global goal of “Education for All” (EFA) beyond the reach of more and more children from less advantaged households, leading to a steady increase in the number of dropouts. 

This is the situation in which George Muturi found himself in 2013 after completing his secondary education and found that he could not proceed to higher levels due to lack of fees.

However, this would not discourage the young man from pursuing other means of becoming successful in life. Poverty seemed to have locked his way to pursuing his education but not his mind to reason.

He, therefore, decided to venture in vermiculture (rearing of earthworms), an idea sold to him in 2015, two years after hustling in poultry farming, by an officer at International Centre for Insect Physiology and Ecology (ICIPE) when he went to buy black soldier eggs to hatch, raise them to larvae stage and feed his chicken. 

Within a portion of family land in Lari, Kiambu County, he would make a structure worth Sh500 before buying some starter worms at Sh2,500 from a fellow farmer.

“This is how cheap I discovered starting off in vermiculture would cost me and I wasted no time,” said Muturi adding that the worms just feed on household or farm wastes which they convert into affordable organic fertiliser called vermicompost that he sells to other farmers for crop production.

“Together with vermiliquid, an organic foliar, the two products are liked by farmers especially those who run kitchen gardens as the dark, rich, earthly smelling fertilizer and foliar amends soils given they are full of both primary and micronutrients readily available to plants,” said the vermiculturist.

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Indeed, worm casting also improves the physical property of the soil by improving the tilt, ferocity and moisture-holding capacity of the soil according to Dr Freddie Acosta, a Senior Lecturer of Technology and Innovation Management at Strathmore Business School.

Besides, adding vermicompost and vermiliquid to the soil reduces insect pests and plant diseases in a certain field and greenhouse crops including corn, wheat, pea, cucumber, and tomato.

Now, one kilogram of earthworms (approx. 1500 worms) fed very well and given the right moisture and protection from predators at the beginning of January, can multiply and increase their number to approximately 4000 kilograms at the end of December.

After a year of rearing, a farmer can produce up to three tonnes of organic fertiliser every day.

For Muturi, he harvests 100-150 kilos of vermicompost and 80-100 litres of vermiliquid a month. He sells a kilo of vermicompost at Sh70 and a litre of vermiliquid at Sh150 resulting to Sh25,500 a month.

He also sells the 10 kilos of the worms to other farmers every month at Sh2,000 making Sh20,000 a month.

Besides red worms, he has also started domesticating African Nightcrawlers which are also excellent vermicomposting and fishing worms.

He has since started his own startup, Agri-Tech Organic Farm through which he is designing a simple three-in-one vermiculture system for kitchen gardeners using three buckets that enable the farmers to rear the worms and collect vermicompost and vermiliquid in separate buckets.

Only three buckets of twenty litres capacity with a wider top and narrow bottom, rabbit manure and five kilos of starter-worms worth Sh2,500 is a good point to start from.

The buckets are inserted into each other in such a way that they do not touch each other at the bottom.

 

21The topmost bucket in which the worms, rabbit manure and fresh organic wastes such as fruit and vegetable remains are placed is covered at the top and some holes made on the upper sides for letting in the fresh air.

The worms, rabbit manure and fresh organic wastes are sandwiched with some dry matter materials such as grass on top and bottom. Some holes of considerable sizes are also made at the bottom of this top bucket to allow vermicompost and vermiliquid pass through to the second bucket.

“Rabbit manure is preferable to any type of manure because it speeds up the worms’ reproduction leading to faster decomposition of the wastes for more compost manure and vermiculture liquid,” said Muturi.

The middle or second bucket is where the vermicompost is collected depending on the activity of the worms on the organic wastes and the manure. The bucket too has some smaller holes than the upper one allows vermiliquid from the worms in the top bucket to pass through to the lats or bottom bucket.

The last bucket which is raised some few inches from the ground using some bricks, stones or wood has a tap at the bottom through which vermiliquid is tapped.

Vermicompost accumulated in the second bucket is used as manure for crops while vermiliquid collected in the bottom bucket acts as organic foliar and it is best for crops such as fruits and vegetables as started in the introduction.

Muturi installs the system for other farmers at Sh4,500 for the 20-litre buckets and Sh6,000 for the 50-litre bin.