Small businesses face significant challenges in Kenya’s current economic environment due to rising fuel prices, escalating commodity prices, and inflating currency. But a difficult market also offers room for improvement and reassessment. The purpose of this article is to provide small businesses in Kenya with practical advice on how to weather this economic storm.
Understand Your Cash Flow
Track Expenses and Revenue
If you can afford it, use accounting software to monitor the sources and destinations of your income. Use programs like Microsoft Excel to manage your debtors and track your expenses if you cannot afford accounting software.
Minimize Operational Costs
- Assess your overhead and make any needless spending reductions. It adds up to every shilling saved.
Adapt Your Business Model
- Dependence on just one source of income might be dangerous. Examine your options for diversification in relation to your main line of business.
- Make use of social media sites like Facebook, Instagram, TikTok, WhatsApp, and others for marketing, customer service, and even sales. Being online expands your reach and lowers the cost of running physical operations.
- Consider switching to a just-in-time inventory system to reduce expensive holding costs and the chance of products spoiling or becoming out of date.
- Stock essential items in bulk when prices are low to save costs in the long run.
Fuel and Transportation
- To save money on fuel, try to run large machinery and move cargo during off-peak hours.
Optimize Delivery Routes
- Utilize apps for route planning to determine the most economical routes for product delivery. It can be as easy as utilizing Google Maps for this.
- Promote remote work to cut expenses on utilities and office space for jobs that don’t require physical presence.
- To maximize human resources, train your current staff to perform multiple roles instead of hiring new ones.
Collaborate and Network
- Discuss rates and terms of payment with your suppliers. They are also searching for dependable companions during these hard times.
Join Business Associations
- Joining a business association can provide you access to insightful information and possible cost-saving partnerships.
Engage Your Customer Base
- Create loyalty programs to promote recurring business, which will aid in preserving a consistent flow of income.
- Notify your clients of any changes to the costs or services offered. Openness fosters trust.
Even though Kenya’s current economic problems might seem insurmountable, keep in mind that many prosperous companies were founded and expanded during trying times. You can greatly increase the likelihood that your small business will not only survive these challenges, but also prosper by putting a few of these strategies into practice.
Because of this economic climate, being prepared is your best defense. As they say, fortune favors the prepared. Act right away!