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Monday, July 21, 2008

Want to make money back home in Kenya?

One of the most daunting challenges for many prospective small business entrepreneurs these days is how to run a business from a distance.

Kenyans in the Diaspora trying to invest back home are keenly aware of what I am talking about here. Indeed even those who are employees somewhere and are desperately trying to start a small business on the side will immediately identify with what I am talking about here.

What frustrates many first time entrepreneurs is the fact that they do not seem to be able to replicate what happens at their work place where the business owners never set foot on the premises and yet the business runs and yields good profits year after year.

This is a big mistake. It is ridiculous to compare a start up you are trying to get off the ground to the established business you work for that has time-honored systems that have been in place for years.

Interestingly some successful small business entrepreneurs who still work elsewhere have launched their businesses by taking leave and for a whole month, setting up structures and getting the business off the ground, so that by the time they leave to go back to work, everything is working like clockwork. Admittedly this happens very rarely because anybody with a little experience in running a business will tell you that it takes months and sometimes years before a small business can finally get off its’ feet.

Something really useful to remember when launching your small business is that you should carefully choose what type of business you want to get involved with as a distant investor. This is because if you are not careful you can easily be robbed blind or lose your entire investment.

This is one of the reasons why real estate has been so attractive to most Kenyans in the Diaspora investing back home. All that is needed is to find a close relative to supervise the construction after you have gotten good estimates from professionals. When the rental houses are done rent is then collected and it is virtually impossible for anybody to rob you. To make things even easier, one can simply purchase an apartment or two that has already been constructed in one of the up-market locations in Nairobi. These kind of apartments for sale have been popping up like pop corn all over the place. This explains the current property glut in Nairobi where rentals (especially in high income areas) have dramatically fallen. There are just too many of those houses that have come up in recent years.

This has made such an investment increasingly unattractive for anybody looking for good returns on their investment. The result is that many Kenyans have chosen to avoid this business altogether. What they need to consider is that Kenya has many other very viable places for property investment where anybody who is a little patient can make a killing.

There is Mombasa, Kenya’s second largest city. This writer has been informed of a very interesting development in this costal city. There is massive investment pouring into Mombasa and this has caused a serious shortage of housing. Considering that land in many parts of Mombasa is still so cheap, this is definitely a place worth careful consideration.

Many small towns surrounding Nairobi are yet another viable location to look at. It is pretty obvious that the city is rapidly expanding outwards and infrastructure will soon be in place to make it feasible for people working in the city to live in places as far away as Machakos for example. Anybody purchasing land now and putting up good housing will not have very long to wait.

(To be continued: Tomorrow we look at brilliant small business ideas for distant investors to consider)

1 comment:

Anonymous said...

the best investment inkenya is farming. enuff said !!!

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