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How to Start a Retail Shop in Kenya

Vincent Nyoike
Vincent Nyoike Kenyan SMEs

The retail business in Kenya provides a livelihood for thousands of people. To succeed in the shopkeeper business in Kenya, you need creativity and skills. Retail shops mostly sell general household items like sugar, rice, cooking oil, flour, snacks, etc. They thrive in towns and rural areas. There are many retail shopkeepers that have gained fame from the success of their businesses.

The following are tips on how you can start a retail shop in Kenya.

Read also: How to start a mini supermarket in Kenya. 

A Guide on How to Start Shopkeeper Business in Kenya  

Starting a general shop in Kenya requires one to have a good business plan. Before starting your business, do market research and find out items that in demand and those that are not sold by other retail shops. Find out where you can source those products at a lower price.

Also, understand the market gap within your business location. For instance, many people could be using cooking gas, but there isn't a shop selling. This would boost your business and get customers those customers to buy other items.

Develop a Good Retail Shop Business Plan

Starting a retail shop business in Kenya, you need to have a business plan. A good business plan should have startup costs, revenue projections, business location, strengths, weaknesses and risks of the business. The startup cost for a retail shop will depend on the location of the business and its size.

For instance, if the business is in a rural area, the startup capital will be significantly lower compared to a town due to expenses like rent. List items and products you will be selling in your shop.

Read more: How to write a business plan.  

Find a Suitable Business Location

Finding a suitable place is one step to succeeding in the retail shop business. Look for a high populated location near households. You can also set up your business in a market center or a shopping center. Since there might be other shops surrounding you, ensure that your business is unique. Do not compete on price; instead, compete to offer quality customer service.

Identify Products to Sell in Your Retail Shop

The market needs will significantly determine the products and services your retail shop will be offering to your customers. Therefore, understand what it is that your customers require.

You will realize that most small scale entrepreneurs sell household products. You can stock the following: rice, sugar, flour, cooking oil, snacks, sweets, tissue papers, salt, tea leaves, matchboxes, milk, bread etc.

Read also: How to start a daycare center in Kenya. 

Determine the Amount Startup Capital for a Retail Shop

The items you will be selling and business location will determine how much you will need to start get started. The cost of starting a retail shop in Kenya is at least Ksh 100,000.

You can grow your business and stock it as your business grows. The most expensive part of a retail shop is to pay rent. If you can find a cheaper place to rent, it can significantly reduce your startup capital.

You will also need to set up selves where you will be keeping your stock. Get an experienced carpenter to do this for you.

Secure Business Licenses and Permits

You need to secure business permits and licenses to operate a general shop. You will need a single business permit that goes for roughly Ksh 5,000 every year. You may also need advertisement and signage licenses if your business is in a town center.

Other licenses you will need include trading licenses, fire clearance licenses and food hygiene certificates that cost Ksh 600 every six months.

How to Boost Your Retail Shop Business

You can boost your retail business by selling complementary products and services. For instance, you can start an M-Pesa business just in case your customers need to withdraw or deposit money to their mobile wallets.

Read more: How to start an M-Pesa business in Kenya. 

The best way to go about it is to find a market gap and find ways to fill in. For instance, if people require cooking gas and there are no shops selling, this is a great opportunity. 

Is a Retail Shop Business Profitable in Kenya?

Yes. With a good business location, you can make huge profits from a general shop. Business revenue from your shop is enough to pay retail shop expenses and give you a 30% profit. Getting cheaper suppliers will help you maximize profits. When setting prices for your products, ensure that they are not above those of your competitors.

Final Word

Starting a shop business in Kenya is a profitable venture. It is one of the ventures that employ a majority people in Kenya. To succeed in retail shop business in Kenya, make sure that you offer quality customer service and have a unique business from that of your competitors.