Savings as a buffer for the tough times

Hustling is full of ‘dry’ days, but where there’s a will, there’s a way

In Summary

• Entrepreneurs should learn to save for unforeseen developments


One of the biggest drawbacks to getting into business is the erratic income. There are bountiful days followed by plenty of “dry” days.

Many small business proprietors skip meals during periods of poor sales because there simply isn’t any money to buy food. The obvious trick, then, is to set aside some money during the good days so as not to get into a cash flow crisis when sales are low.

Apart from the expected ups and downs of selling, entrepreneurs should save for unforeseen developments. Two years ago, who could have predicted that bars, restaurants and hotels would be closed for several months because of a pandemic?


Set a savings target: When a business is still growing, it may not be possible to save a fixed amount each month. One can instead target to save a percentage of the income. For example, one can set aside 10 per cent as savings regardless of whether the income is Sh10,000 or Sh100,000.

Avoid unnecessary spending: Manu Chandaria, one of Kenya’s billionaire businessmen, revealed on television that he had only five suits and one wallet. Cutting down on extravagant spending helps save money. It is alright going out with friends but does it have to be every day?

Diversify your income: Make use of any opportunity to grow your income as long as you don't get distracted from your main business. For example, a construction company that owns trucks can do transport business on the side.

This story first appeared on Star Sasa, accessible on Sundays for Sh10 on

Edited by T Jalio

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