With agriculture being Kenya's backbone, investing in agribusiness is a profitable business. Animal feeds business is the booming business in most suburban areas. From our experience, we will take you through the process on how you can start a profitable animal business store in Kenya. This is how to start animal feeds business in Kenya from our experience.
Did Feasibility Test
Before venturing into the animal feeds business, we carried out a feasibility test. It was critical and it helped us identify if the business was viable. It also enabled us to write our business plan. One of the things we were looking out for when carrying out the feasibility test was how many people reared livestock and poultry. We talked to farmers and asked them about the problems they faced in farming.
We also considered the number of other businesses that were selling animal feeds within the locality. Luckily, only one business was operating in the area, and we saw that we would have healthy competition. As such, we found out that our business idea was viable.
Read also: How we started a profitable bookshop in Kenya.
Writing Animal Feeds Business Plan Kenya
The feasibility test that we carried out helped us a lot to write our business plan. We had all figures and facts. In a business plan, you need to state startup capital, source of startup capital, business location and business risks.
Our startup capital was from our savings and we wanted to start the business in Kandara. We identified it as a potential area since many people around the Kandara market rear livestock. We didn't have many risks apart from how we would compete with the existing animal feeds wholesale store that was well known in the area. We took it as an opportunity yet. Since the business was wholesale animal feeds, we would venture into the retail business. Luckily, it worked for us.
Find a Good Business Location
Most businesses do well in urban areas, but the animal feeds business thrives well in rural and sub-urban area. You need to set up your animal feeds business in a business location where people rear animals. The area we selected was a small ,market center where residents around reared livestock and chicken. It was the only market center around and was the only place where most farmers bought animal feeds.
Find Reliable and Cheap Animal Feeds Suppliers
When starting our animal feeds business, we had a challenge since there were few animal feed suppliers. We used to buy animal feeds at relatively higher prices leaving us with small profit margins. However, after one year in the business, the suppliers increased and since they were competing, prices reduced. This helped us to make higher profits. Most suppliers provide free transport services to your business premises, thereby reducing transport expenses.
Animal Feeds Business Startup Capital
The animal feeds supply business does not require huge startup capital. We started the business with Ksh 50,000 and have expanded it to over Ksh 400,000. The following was our startup capital breakdown.
- Business licenses – Ksh 5,000 annually
- Store rent – Ksh 16,000 (inclusive of one month upfront)
- Branding – Ksh 5,000
- Dairy meal (5 bags) – Ksh 10,000
- Chick mash (3 bags) – Ksh 15,000
- Growers mash (2 bags) – Ksh 6,000
At the time, we were only focused on dairy and poultry feeds. Right now, we have expanded to start selling pigs' meals. We have also begun an agrovet in the same business entity to boost our revenues.
Is Animal Feeds Business Profitable in Kenya?
With a good business location, the animal feeds supplies business is profitable. You need to locate your business in an area where people practice poultry and dairy farming. The profitability of the business also depends on the number of sales you make per day.
How to Succeed in Animal Feeds Business in Kenya
When we started, we had a challenge. Some of the poultry feeds we were selling had adverse effects on chicks. Whenever farmers fed the feeds to the chicks, they could notice bloodstains in their droppings. Also, the chicks became weak. We didn't know until we started interacting with our customers. It is then that we changed the feeds brand we were welling.
It is good that you ask your customers if they like the feeds. This way, you can easily and quickly know what changes to make to your animal feeds stock. Also, you can start an agrovet and animal feeds business as one entity.