It is the small shop phenomenon. Many Kenyans run small shops, but the ease of getting into the business has created so many outlets that questions arise whether any of them are profitable.
In some residential areas, there is a shop every few metres. Possibly each shop might serve less than 10 households. Shopkeepers paying rent for their shop premises are at a huge disadvantage because of the tiny profits on consumer items combined with low sales. Shopkeepers owning their premises are better off.
“There is an abundance of opportunity for those who will go with the tide instead of trying to swim against it,” wrote author Wallace Wattles in the book, The Science of Growing Rich. There is something positive about copying a popular business venture. If that many people are doing it, they cannot all be wrong, can they?
The prevalence of a particular type of business is a good sign of strong demand. An increase in roadside car washing services, for example, shows an increase in the number of motor vehicles in the area.
Despite the rise of supermarket chains in Kenya, the humble shop remains a vital part of the economy. Data shows 80 per cent of basic consumer goods in Nairobi are sold through small shops. Starting a shop isn’t a ticket to riches, but the income from it can boost the family budget. The shops are a key source of income for women because it is they who mostly run that business.
This story first appeared on the digital magazine Star Sasa, accessible on Sundays for Sh10 by dialling *550*3#
Edited by T Jalio
