Starting a business in Kenya is every person’s dream. Especially with the growing economy, the unemployment rate continues to increase day in day out.
As of 2018, the unemployment rate in Kenya was about 9.3 per cent. Because of the increasing rates, most Kenyans are turning into business to stabilize financially.
However, most businesses do not survive up to more than two years because of some bottlenecks like poor planning or decision making.
Especially for first-time entrepreneurs, there are so many bottlenecks that may drive entrepreneurs away.
Factors to consider when starting a business in Kenya
The following are factors one should consider before starting a business:
1. Have a Business Idea
Every business starts with an idea. For a business to stand out, an entrepreneur needs an outstanding business idea.
For instance, it has to give solutions to customers needs. Have an idea of how to make it better than others to stay afloat in the market.
You also should figure out if it will be able to grab some market share in this category.
Determine your expectations and evaluate if your idea can meet them.
Have a business plan that can solve such questions as What do I need to make it better, is it going to give anyone solutions, what market share do io need to acquire and by what time frame?
Once you know what business you want to start, you will have to start gaining the required knowledge and expertise to start that business.
To start a business, you need mentors to guide through the business procedures and processes. They are trusted people who have prior experience in the business world and with their mentorship, you will learn how to manage the business better.
3.Have a Business Plan
A business plan is a very important strategic tool when starting a business. As an entrepreneur, it helps you focus on the specific steps necessary for the business to succeed.
It also contains a set of values that can help you steer your business through times of trouble.
4. Start-up Costs
Every business can only operate with funds. Depending on the type of business you are starting. You will have to make sure you have the required funds to take you through the startup phase.
Most small to medium enterprises depend on personal savings and bank loans funding to take them through the initial phase of the business.
Alternatively, funds can be borrowed to start a business either through short-term or long-term loans. Nevertheless, you may have to keep in mind the terms and conditions of borrowing such funds.
This includes the cost of borrowing, the rate of interest, the repayment terms, and the security that is required. Approach a few banks and private lenders, get a few quotes and compare them to identify the most beneficial type of funding.
Depending on the size and type of business, For example, starting a company. Long term loans can be ideal to help you offset initial bills, buy furniture and many more.
This is very important for any aspiring entrepreneur. At the initial stage, you are the anchor business, the boss, the employee and messenger in one.
This means you are the one to hold accountable on every aspect of the business. As an entrepreneur, you’ll have to stick to your business plan, make and respect your budget, dedicate time to developing your business, and meet the goals you’ve set for yourself.
If you find yourself lacking in self-discipline, this might be something to work on before you pursue your entrepreneurial dream.
6. Be flexible
Once you have your business plan and idea firmly set, it can be hard to accept the need to make changes.
At this stage, you cannot feel and resolve your mistakes. Be flexible to be corrected where possible.
Also, invest in listening to investment podcast, TedTalks, read books on entrepreneurship to help you build your confidence.
Be positive throughout the entire process from conceptualizing your business plan to carrying it out. Be ready to make it vulnerable to countless factors that could result in big or small changes to your plan or idea.
Location is one of the most important things needed to start a business.
When opening a business, identify an area your target customers can locate you easily.
For instance, If yours is a retail business you will have to look for a well-populated area that is easily accessible.
8. Market or Demand
Once you are sure of starting your business, your next step would be to explore the market or the demand for your product or service.
Start by analyzing your customers. If you are selling your product or service in Kenya, assess it’s demand before you can confidently launch.
A market survey is mandatory at this stage. A market survey reveals all the details that you may need about the market for your product or service. You are looking for:
The current size of the market, its growth potential. the buying habits of the target audience as well as the different segments of the market.
Alternatively, social media can give best results especially on reaching out to target audience.
Once you identify the type of business you want to set up, identify your competitors and watch their next steps.
This includes figuring out how they have positioned themselves, identifying their pricing and marketing strategies, and evaluating their strengths and weaknesses.
This information helps you position yourself in the market. You can analyse their selling producers and maximize on their weakness. This will be your unique selling point to your target audience.
10.Register the business
Every business requires to have a name and as well adhere to the rules and the regulations of the county government authorities. Registering your business helps you built a significant reputation.
When you register your business you keep abreast with governing laws such as consumer laws, be able to know your rights as a business person. Businesses that don’t register with the government as termed as illegal and can easily be subjected to demotion which may incur losses to you.
Lastly, when you have your own business, unlike working for someone, you’ll have more freedom and independence. You’ll have the flexibility to make sure you don’t miss on things that matter in your life. It also the moments and events that matter most to you in life.