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Starting a Matatu Business During Covid-19 Pandemic

Vincent Nyoike
Vincent Nyoike Experience

The matatu business is a profitable venture in Kenya with the right experience and the right employees. Before venturing into the matatu business, you should seek advice from those who have been into it. There are many opportunities and risks that you might not be aware of. Having a person to guide you is a great way to maneuver in the business and mitigate the risks involved. This is what I learned after borrowing a bank loan to start a matatu business.

How I Started My Matatu Business 

The matatu business idea must have come at the wrong time. In December 2019, I borrowed a loan of Ksh 800,000 from a local bank. I topped up the loan with my savings to buy a second-hand matatu at Ksh 1,700,000. I joined a matatu Sacco to operate between Murang’a and Nairobi. I also took a comprehensive insurance cover for the matatu. For the first two months, the business was doing fine until March 2020 when the first case of Covid-19 was reported in Kenya.

After a few weeks, the president announced Covid-19 restrictions not to get in or out of the Nairobi metropolitan area. My business was affected and matatus could not travel past Blue Post or even get into Thika town. I had a loan to service from my matatu revenue. My income was curtailed and I couldn't repay the loan.

Read also: Why you need to be a mechanic if you own a car garage business. 

How I Overcame Challenges Posed by Covid-19

I visited the bank to renegotiate new terms for my business loan. Luckily, the bank extended my repayment duration, which was a great relief to my business. Nevertheless, I need to look for a way to keep my business running during the pandemic. We had to change the route for the matatu so that it would only operate within Murang’a County. Luckily, the matatu was cleared to operate between Kenol, Murang’a, Kangema route.

Challenges I Have Faced in the Matatu Business 

The greatest challenge we faced after movement restrictions were a loss of income for our business. I had a driver and a conductor to pay at the end of the day. Most people who work in Nairobi live in Murang’a County. With the closure of the road, my source of income was curtailed.

Getting approved to change our route was another challenge. We had a lot of challenges to get authorization to change the Murang’a- Nairobi route. Starting to operate between Kenol-Murang’a and Kangema route, we received great hostility from vehicles that were already operating in that route.

Renegotiating new terms for my business loan. I must admit that I started the business at the wrong time. If I knew the risk that was ahead, I wouldn’t have ventured into it. However, the bank was kind to me after renegotiating new terms for the loan. Even after the Nairobi metropolitan area opening, many people had lost their jobs and hence there were very few people travelling. This meant a drop in our regular revenues.

The other challenge I encountered was hiring dishonest conductor and driver. It took me long to realize that my matatu business was making more money than what was being remitted to me. This is after one day I decided to be the conductor. Normally, I would be given Ksh 3,500 and 4,500 at the end of the day. However, on that day, the matatu made Ksh 7,000. This was a huge discrepancy and I had to fire the conductor. 

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Advice to Those Intending to Start Matatu Business

Before you get into a matatu business, you need to find the best matatu Sacco for your business. Also, make sure that your vehicle adheres to the NTSA rules and regulations. Otherwise, you always be in trouble with traffic officers.

Also, make sure to hire a driver and a conductor with integrity. Sometimes the driver and the conductor can agree to keep some money from you. If you can, I would advise you to be the conductor of the matatu. This way, you won’t be losing money to the conductor and driver. Besides, you won’t have an expense of thing a conductor. Again, you will be in charge to make sure that your vehicle complies with the NTSA rules. With a good conductor, your matatu won’t have issues with traffic police officers.