Hot to spot opportunities in a new town

How to Spot Business Opportunities in a New Town

When one finds themselves in a new town, it is usually difficult to make head or tail of the new environment. I have had the chance to visit new towns in the past and I have learned to spot opportunities or tell there is some money in that economy. I visited Kitui Town in Kitui County for the first time on 20th September, 2016. I must say I was impressed. The roads are well done; no potholes. The town is relatively clean. The governor of Nairobi could learn a thing or two on improving our capital city.

I have come up with my own analysis of towns on first visit and I would like to share my thoughts. How do you tell a town has business opportunities?

1)      Number of banks and financial institutions: just as fish love water and hyenas love meat, banks love money and can smell it 100 kilometers away. If you see that a town has more than 10 banks, with KCB Bank, Barclays Bank, Cooperative Bank and Equity Bank in place as well as other financial institutions such as KWFT, Faulu Bank and Family Bank, that town has money. Such an economy is also invariably sustained by mobile money, which is huge among the unbanked.

2)      Petrol stations: if a small town has more than five petrol stations, it means there is a lot of public transportation. The traffic means money is changing hands and there is interconnectivity with nearby towns and market centres.

3)      Construction of new buildings and continuous renovation of old buildings: real estate grows where there is demand. Customers want to be seen in buildings that appear new, stylish and fresh. The county governments have devolved a bit of this construction.

4)      Presence of a university or a large manufacturing outfit: these facilities are big employers. The employees are customers for basic needs; namely housing, food, schools, clothing, Mpesa and banking services. It thus goes without saying that those universities will drive hostels, cereals, bakery and fast moving consumer goods (FMCGs) businesses among others.

5)      Supermarkets: the presence of more than three large supermarkets means there is customer traffic; a large population with purchasing power.

Therefore entrepreneurs, as you trade, look around. Do you see any of these indicators? If so, how do you get enjoined in the economic ecosystem that you have seen? What are you good at? What do customers want? Do you have the capacity to deliver value affordably at a descent profit?  What can you engage in creatively and innovatively that will make you stand out?

Allow me to submit that Kericho and Kitui towns are ripe for business. Why?

a)      They both have more than 10 banks in the central business district (CBD)

b)      They have more than five petrol stations in town

c)       They have an active bus park- always full with people and vehicles

d)      They have several active campuses in the radius of 30 kms from the CBD

Therefore go thee and engage in commerce, use your talent, time and treasure and build thy wealth.

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Vincent OgutuThis email address is being protected from spambots. You need JavaScript enabled to view it. MSc, Ph.D. entrepreneurship (ongoing) is a Business Coach, Author, Trainer and Mentor, working with entrepreneurs to improve their businesses and helps potential entrepreneurs start their business right, grow and succeed. He is a director of Advance Business Consultants.

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Barbershop. Photo: www.enashipai.com

Lessons on Innovation from a Barber Shop

Innovation and creativity are the cornerstones of entrepreneurship. The other characteristic is the need for an entrepreneur to be persistent. Persistence is being obstinate (stubborn) with your belief, your vision. When you are stubborn, visionary, it shows in your talk, facial expression and the like. You are motivated in your world beyond redemption. You cannot give up your dream! Entrepreneurs are known to be action oriented, as Herbert Spenser noted; “The greatest aim of education is not knowledge but ACTION.”

Many people always look at the problems and the challenges they face, and driven by fear, they will postpone pursuing their dream until the time they think they will be ready. This time never comes and one falls prey to the enemy of action called procrastination.

Let’s look at a micro entreprise in the CBD Nairobi run by an entrepreneur called Peter in his late 30’s. He owns a shop dealing in mobile phones and accessories, and a barber shop hidden under a staircase. The shop is located at the building entrance and has two employees; while the barber shop has two employees with a provision of a third person.

The barber shop is in a hidden corner, lacking visibility. It is a state of the art barber shop, its walls adorned with full length mirrors, and it has open cabinets meticulously designed. Peter is absent most of the time. His businesses are opened at 7.30 am every day without fail, six days a week. All proceeds of the day are banked directly to the businesses bank accounts through Mpesa and records kept of each transaction. Peter when around spends his time in the shop.

The barber shop employees are welcoming, professional and highly motivated. They are all ladies aged between 20-30 years in my assessment. Peter has perfected the art of delegation through motivation accompanied with business systems. He doesn’t need to be present for his businesses to run.

Visibility is normally a challenge to many businesses. Being located at a corner behind a stair case does not help matters. To overcome this problem, at the building entrance there is a big simple signage “KINYOZI” in red on a white background. No brand name. His potential customers are busy Nairobi hustles who would like a quick clean shave or beard touch up. This is done quickly, professionally, in a very clean environment.

The establishment has no flowing water. Peter has made it available in water containers. There is a gadget to heat towels. The open cabinets have neatly arranged towels and the UV machine for disinfecting shaving machines is also in place. The drawers help increase space. The mirrors magnify the tiny room giving the impression of a bigger work space.

Employing ladies says two things: one, they have tender hands, engage clients professionally and two, they serve with a smile. I was received well with a smile. They took away my jacket and put it on a hanger. After shaving, washing and cleaning was done. Disinfection was followed by application of a lotion. They use branded products. They know their niche. A beard shave costed me 150 KES. I know of places where I pay 50 KES, others 100 KES; yet my preference goes to Peters’ barber shop.

Lessons:

  1. Be different and focus on your customers
  2. Employ professional employees with desired business skills
  3. Build systems to run your business
  4. Focus on the opportunities, not the challenges you will face
  5. All problems especially business problems have solutions

In my opinion Peter should have uniforms designed for his employees at the barber shop and open more outlets to increase revenue and grow his assets base. Service is a growing industry and customers appreciate good service. I have paid 200 KES and 250KES for a beard shave. Men are good customers so long as they see value in your service.

In the next article I will cover a different form of business and show how innovation and creativity helps drive business. It is a differentiator superior to low prices.

__________________________________________

Vincent OgutuThis email address is being protected from spambots. You need JavaScript enabled to view it." target="_blank">

Did you enjoy this story? Post a comment below, on our Facebook page or Twitter #MKAZICoachVincent and you could win a FREE One-to-One with Coach Vincent. 

Please note that posts with links to other websites will not be considered.

This email address is being protected from spambots. You need JavaScript enabled to view it. MSc, Ph.D. entrepreneurship (ongoing) is a Business Coach, Author, Trainer and Mentor, working with entrepreneurs to improve their businesses and helps potential entrepreneurs start their business right, grow and succeed. He is a director of Advance Business Consultants.