Wednesday, November 26, 2014

Bookpoint shuts down after family dispute

Pedestrians walk past Bookpoint on Nairobi's Moi Avenue on June 25 2013. Bookpoint, one of Nairobi’s oldest bookstores, shuts down after more than seven decades in operation.

Pedestrians walk past Bookpoint on Nairobi's Moi Avenue on June 25 2013. Bookpoint, one of Nairobi’s oldest bookstores, shuts down after more than seven decades in operation. FILE PHOTO | PHOEBE OKALL 

By SIMON CIURI
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One of Nairobi’s oldest bookstores, Bookpoint, has shut down after more than seven decades in operation over what a manager of the shop attributed to a family dispute.

Bookpoint, which is located on the busy Moi Avenue, closed earlier this month.

A former manager of the iconic bookstore, Ashwin Shah, said in an interview Thursday that the shop has been closed indefinitely with no plans to reopen it.

“We have decided to close due to family-related issues that are not important to discuss for now,’’ said Mr Shah, declining to discuss the matter further.

He, however, said that two of his uncles who inherited the stores from their father had relocated from Kenya to seek medical treatment abroad, affecting operations of the business.

CLEARANCE SALE

“My two uncles were the ones who were mainly involved in the running of the business,” said Mr Shah, adding that there were disagreements “on certain issues”.

He said that there are plans to have a clearance sale, but a date has not been set.

The Bookpoint heirs are also said to be the owners of Loan House, which hosted the bookshop, and the adjacent Guilders Centre, which houses K-Rep Bank on the ground floor of Moi Avenue.

Bookpoint is said to have been started way back in 1938 by businessman Jethalal Shah, who opened the shop under the name Hemraj Hirji and Bros, according to an earlier story in The EastAfrican newspaper published in August last year.

He began by selling nuts and fruit juice to movie-goers.

Later, he diversified into Indian magazines and newspapers in Gujarati, Hindi, Punjabi and Urdu.

By 1948, Mr Shah was selling English syllabus books, stationery and greeting cards in Ngara to students close by at the town’s government Indian schools, today’s City Primary and Jamhuri High schools.

His descendants Dipak and Sudhir Shah continued the tradition that later led to the creation of the now collapsed Bookpoint.

The article first appeared in The Business Daily.

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Tuesday, November 25, 2014

Why Internet may soon be the domain for big firms

A mobile phone user browsing the Internet. A debate playing out largely in the United States and Europe could change the way consumers access internet.  FILE PHOTO |  NATION MEDIA GROUP

A mobile phone user browsing the Internet. A debate playing out largely in the United States and Europe could change the way consumers access internet. FILE PHOTO | NATION MEDIA GROUP 

By CHARLES WOKABI
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A debate playing out largely in the United States and Europe could change the way consumers access the Internet.

The big question is whether an Internet user in a cybercafé or on a mobile phone should be treated equally with big firms ready to pay more to have priority in sending their information.

The debate, which has been going on for the past ten years, is now gaining momentum as multinationals spend billions laying high-speed Internet connection.

As more and more processes get automated, speed of delivery of data is increasingly becoming the biggest differentiator for companies.

Thus, the pressure to stay ahead of the competition is threatening to auction the broadband megabytes to the highest bidder. 

“We have held this discussion at the International Telecommunication Union (ITU) but the issues are still fluid.

"As a country we have not taken a stand on the issue but we recognize access to the Internet as a human right. It is an important issue that we are following keenly and studying as a country,” Communications Authority of Kenya Director-General Francis Wangusi told Smart Company in a phone interview.

However, at the ITU level, Mr Wangusi said most of the discussions are driven by political interests.

“But we must not let those interests mature into frustrations for consumers. The Internet is borderless and a necessary tool for development,” Mr Wangusi said.

In the US, the debate on net neutrality — the principle that all traffic on the Internet should be treated equally — has pitted Republicans against Democrats.

TIGHTER REGULATIONS

In the past few days after President Barack Obama called for tighter regulations to safeguard the principle of net neutrality, the Republican-controlled Congress and American telecommunication service providers such as Vodafone, AT&T and Verizon, which are championing for an “open Internet”, hit back, saying it is another instance of Obama championing his "socialist" agenda.

The US service providers, who are backed by Republicans, have held that the whole issue is a free-enterprise question that should be guided by the market forces on the basis of willing buyer willing seller.

Their argument is that because Internet connectivity is a service they provide, they should be able to decide how to deliver it and how to charge customers.

But the net neutrality camp, mainly composed of such giant content providers as Google and Facebook, have termed attempts to introduce open Internet as one of the most blatant web injustices in the history of the Internet.

In Europe, the debate is also heated, with service providers like Vodafone and Orange, the parent companies of Safaricom and Telkom Kenya, respectively, calling for constructive dialogue on the issue. They say resolving the issue amicably could encourage innovation and new business models.

Basically, what the service providers in the West are fighting for is the authority to determine who gets faster Internet access as opposed to the current situation in which all web content is, ideally, treated equally. There is no discrimination on the basis of type, destination, origin or any other criteria.

The conclusion of this debate is likely to determine whether, in future, a consumer could be forced to pay a premium for their content to receive top priority from service providers, such as Safaricom, Airtel, or Orange, or cable providers such as Liquid Telecom. It means that your email or tweet could be delivered faster if you can pay a fee.

CATEGORIES

Big corporates would be well-placed to have faster access to their websites and the content they generate thanks to their financial muscles.

Ultimately, the debate could lead to the splitting of Internet into two categories. On one hand, there would be the high-speed network with smooth connectivity for those with deep pockets. On the other hand, there would be the slow connectivity for those who cannot afford the fast lane.

Locally, demand for pay-for-access could be driven by financial institutions as competition on mobile and online banking takes root. Already more than 50 per cent of Kenyans are accessing mobile financial services, forcing banks to deploy mobile banking riding on Internet connectivity.

Companies that require big Internet bandwidth like Netflix, the American movie streaming service, or Google’s YouTube, would most likely be forced to pay more for faster access. Google is opposed to this.

Safaricom corporate affairs director Nzioka Waita said the same debate should start in the country with a focus on future regulation.

“It needs to be happening everywhere, including here, particularly regarding future regulation approach. Regulation needs to move from just being telecoms-centric to neutral, to include all other providers of connectivity,” Mr Waita said.

“What we are saying is infrastructure developers such as Safaricom need to continue investing in the same and so the content providers need to pay for the same.”

PAY FOR SERVICE

Service providers feel that because of their big investments in telecommunication infrastructure used to carry content to the end users, content providers should begin paying for the service. Currently, the cost is largely borne by the consumer.

Safaricom for example is spending Sh5 billion to deploy 4G, the next-generation Internet connectivity. It is also using Sh10 billion in the first phase of laying fibre-optic cable around the country.

To recoup the investment, Safaricom would be happy to let big firms send and receive their data faster than the non-paying customers. The government has spent over Sh12 billion to connect the 47 counties to high-speed Internet.

The Kenya’s National Optic Fibre Broadband Infrastructure (NOFBI) is being funded by the Exim Bank of China on a concessional loan. NOFBI is currently managed by Telkom Kenya.

Mr Michuki Mwangi, the senior development manager for Africa at the Internet Society — a global organisation that lobbies for proper public policies for the Internet — said the country should take interest in the debate but from the perspective of ensuring open access for the end user.

“Net neutrality is covering a lot of issues ranging from the technical perspective, the business perspective as well as the end user rights. For Kenya, we should mainly concern ourselves with ensuring that consumers have access to the Internet and encourage competition to stir innovation,” Mr Mwangi said.

He said the focus of the country on the debate should be different from that of the US because the two countries are at different levels of development with respect to the Internet.

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Tuesday, November 25, 2014

Neglect, hyacinth ground trade at the Kisumu Port

Fishermen struggle to break through a blanket of water hyacinth at Bala Beach in West Nyakach in Kisumu County on April 10, 2014. FILE PHOTO | TOM OTIENO | NATION MEDIA GROUP

Fishermen struggle to break through a blanket of water hyacinth at Bala Beach in West Nyakach in Kisumu County on April 10, 2014. FILE PHOTO | TOM OTIENO | NATION MEDIA GROUP 

By MOSES ODHIAMBO
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Untapped gold. That is how one would describe the idle Kisumu port. The facility, which ought to be the gateway to the East Africa community member states, is now in a sorry state.

The port’s operations have been choked by the ubiquitous hyacinth weed and heavy siltation. Then there are the bottlenecks associated with legislations touching on the agencies charged with its management.

There is little activity at the port and in the inland container depot set up to facilitate trade through the railway. The facility that could earn the country millions of dollars in freight levies has been converted into a site for local tourists who pay a paltry Sh20 per head as gate entry fee.

The port, rated by shippers as the best in East Africa owing to its strategic location, only receives at most three vessels in a week. Yet if well maintained and utilised, the port would serve Jinja, Mwanza in Tanzania, Entebbe in Uganda and Muhoma Bay in Rwanda.

The port can also provide a shorter and cheaper export route for nations in the Great Lakes region through Lake Victoria.

However, the old railway built in 1901 by the colonial British Government connecting Mombasa port to Kisumu has been neglected. This has adversely affected the lakeside port.

One of the largest ships, Mv Uhuru, that transported cargo between Kisumu, Mwanza, Port Bell and Jinja has not operated since 2006 yet is in good working condition.

The ship cannot be put to use because the port is in a bad condition. The 1,800-tonne ship is currently occupying the dry dock at the port, obstructing operations.

The port’s cargo handling facilities built by the British colonialists are now being eaten up by rust and vandals have run completely down some of them.

Furthermore, debris that find their way into the lake have caused heavy siltation at the port and making it difficult for large vessels to access it.

Mr Edward Ted Odero, a maritime consultant, attributes the poor state of the port to neglect by the national government.

He says the government, through the office of the Attorney General, has not ratified an amendment to the law to allow the Kenya Ports Authority to manage inland waters.

“The Kisumu port is the best so far compared to the ever busy Mwanza port or Jinja. Ours is a case of neglect by the government that has protected hauliers who have invested heavily on road delivery systems regardless of the damage they do to our highways,” Mr Odero said at the port recently.

“At the moment, KPA is busy maintaining facilities in deep seas because of the challenges in the interpretation of the Kenya Railways Amendment Act.

The sad part is that someone is sleeping on the job at the AG’s chambers.”

Another challenge the Kisumu port faces is that Lake Victoria does not have updated navigation maps.

“We have hydrographic maps that were designed in 1957. These don’t consider the fact that the waters have receded a great deal making the lake unsafe for vessels,” Odero said.

Captain Samuel Wabwaya of Mbita Ferries said navigation aids built by the British colonialists have been vandalised.

“You cannot risk having a ship steered by novices on this part of the lake. Beacons that marked danger points have since been vandalised,” Mr Wabwaya said.

Mr Odero said the gulf is also becoming shallower yet the Lake Victoria Basin Commission, formed to instil safety measures on the East African waters following the Bukoba boat tragedy, “is always busy with meetings and conferences”.

In 1996, the steamer, MV Bukoba, sank on Lake Victoria near Bukoba in Tanzania with 600 people on board. About 400 died in the tragedy.

“We want the LVBC to come out of boardrooms and perform its role” he said.

Mr Odero also took issue with the way licensing of traders is done at the port.

“The licensing process is shrouded in mystery and poses unfair competition to investors banking on large vessels. How can we trade fairly when unprofessional users get licensed to operate at par with large ship owners?” Mr Odero posed.

“At that rate, you cannot convince ship owners to work here when they will not make any profits.”

The port’s woes have also been blamed on the concession that led to the railways being handed over to a private investor – the Rift Valley Railways (RVR). Kisumu Port manager Michael Disi said the facility became idle when RVR stopped operating on the route in 2011.

“The situation of the port, railway station and its rotting facilities cannot be blamed on the corporation,” Mr Disi said.

He said RVR, which entered into a concession agreement with the Kenya Railways, ought to take care of the entire facility.

Kisumu port management is banking on the planned modern rail to shore up its fortunes.

“We are expecting the standard gauge railway line here in Kisumu as well. It will be built in the second phase of the works after completion of the Mombasa-Nairobi-Malaba line,” said Mr Ndisi.

“Kenya, Uganda and Rwanda cannot definitely do without Kisumu. The port will actualise its full potential when the railway line is refurbished.”

Dr Ally-Said Matano, LVBC programmes officer for projects development and partnerships, agrees that siltation not only affects transport but also the biodiversity of the lake.

He said sediment in the lake is the result of poor land use practices such as deforestation, poor farming methods, riverine deforestation, roadside erosion, monoculture and destruction of wetlands.

“This phenomenon is similar within the basin and not unique to Kenya. For instance all the cultivated areas in the basin districts of Tanzania, especially in Kwimba, Magu, Misungwi, Musoma and part of Sengerema districts, which lack vegetation cover, have been exposed to different levels of soil erosion risks,” Dr Matano said.

Transport in the lake is also affected a great deal by the proliferation of aquatic weeds such as water hyacinth.

Dr Matano exonerated the commission from blame over sedimentation saying its mandate is to help Lake Victoria Environmental Programme (Lvemp) implement programmes aimed at solving the problem.

On outdated maps, the LVBC said a consultancy formed in 2008 to undertake survey on access routes of the ports in Mwanza, Port Bell and Kisumu did not complete the work due to lack of funds.

SMOOTH SAILING

“This (survey) was supported through a partnership fund. Nonetheless this was not enough and therefore through the Lake Victoria Environmental Management Programmes, the commission intends to map the entire lake. Once this is completed, it will facilitate smooth sailing. Furthermore, under this initiative, aids to navigation equipment will also be installed,” Dr Matano said in an interview with Smart Company.

He, however, added that the dynamics of the lake have not changed significantly to render the existing maps totally useless.

“It is worth noting that most of the reported deaths (about 5,000 people yearly) in the lake are due to bad weather, overloading and mainly involve small vessels that would not otherwise use the navigation charts,” he said.

Furthermore, the commission said it was negotiating with the African Development Bank to fund an investment plan for maritime communication, safety and transport in Lake Victoria.

According to the Kisumu county government, Lake Victoria has the potential to offer mass transport for goods and passengers across the region and beyond. The county is currently negotiating with investors to set up ferry and boat services, construct a shipyard and supporting rail system.

Governor Jack Ranguma said there are also plans to develop a dry dock port in Kisumu city.

“The features of the proposed dry dock will include storage and clearing facilities, as well as offices, banking halls, hotels and restaurants,” he said.

Mr Ranguma said the county has entered into an agreement with the Kenya Ports Authority (KPA) to revamp port facilities in Lake Victoria to ease docking of cargo and passenger ships.

“We have signed an agreement with KPA and the national government through the Kenya Railways to allow KPA to have the mandate of reactivating port facilities in Lake Victoria for enhanced transport,” said Mr Ranguma.

REDUCED WATER LEVELS

The agreement took into account issues such as overall management of lake port systems. The deal would also lead to the acquisition of vessels that can dock up to one metre deep.

“There has been a continuous challenge of reduced water levels making it difficult for ships to dock. Kisumu County is considering buying sea buses that can land at any point on the lakeshore to pick passengers and cargo.”

Mr Ranguma said the county is working on budgetary allocations for building facilities required to handle cargo.

“We are working on a budget that will help us upgrade existing piers and build new ones in collaboration with KPA,” said Mr Ranguma.

Siaya governor Cornel Rasanga said the lake should be handed over to an authority that can marshal the required human resource to manage fishing, transport and overall maintenance.

Mr Rasanga said road transport increases the costs of doing business.

“Think of a situation where someone wants to travel to Migori from Busia. They can take a ship at Sio Port and disembark at Muhuru Bay in fewer minutes than when they use the road,” said Mr Rasanga.

Mr Israel Agina, the chairman of the business community in Kisumu, said the port lost business because of the dilapidated railway and the fact that most hauliers prefer the Nakuru-Eldoret-Malaba highway.

“We are losing millions of shillings in revenue. The situation is no longer the same as it was six years ago when we had an active train transport system,” Mr Agina said.

Agina’s sentiments were echoed by Mr Amin Vipul, a freight consultant, who said a lot of jobs have been lost following the closure of the railway.

“There are many people who were engaged in offloading and loading cargo but now lack meaningful work. The few who have stayed put can go for days without having any cargo to load or offload as a result of the low business through the port of Kisumu,” Mr Vipul said.

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Tuesday, November 25, 2014

Local online stores have bright future if only they learn

Local online stores have bright future  if only they learn. FILE PHOTO |

Local online stores have bright future if only they learn. FILE PHOTO |   NATION MEDIA GROUP

By LUCY KIRUTHU
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I have made online purchases for the last 14 years. My first experience was at amazon.com.

At the time, it claimed to be “the world’s largest bookstore” and Barnes and Noble took them to court. I trust it possibly was because more than 80 per cent of my hard copy books and 100 per cent of my e-books are from amazon.com.

In the current issue of the Harvard Business Review Jeff Bezzo the Amazon.com CEO tops the list of best-performing CEOs.  In addition, the online store is number two on the 2014 Fortune list of most admired companies and has taken the lead for the last five years in the Customer Service Hall of Fame.

Online shopping though goes beyond Amazon.com. Just recently alibaba.com a company that plans to last at least 102years as stipulated it its vision has made headlines. Other online stores that have left a mark are ebay.com and zappos.com. Many have come and gone and others are being set up today.

Closer home is Mamamikes with its trademark Mbuzi delivery. Currently, there is prolific growth of online stores in Kenya and leading supermarkets are also opening up online stores.

As I reviewed the numerous online stores in the past few weeks, I wondered if I could trust all of them as much as I trust Amazon.com.

Would you shop from a local online store? A few years ago many would have been hesitant.  However, today I believe Kenyans are willing to give it a trial.

HOW TO SURVIVE

As the numbers continue to grow there is no doubt that only those that build a reputation of a great shopping experience will survive.

According to the 2014 Customer Service Hall of Fame survey results, amazon.com not only received by far the highest percentage of “excellent” responses but also received the smallest number of negative ratings compared to all sorts of businesses. The online store has keenly focused on the customer experience. Is there something that our local online stores can learn from Amazon.com?

Most of the local online stores I have visited indicate opening hours as 8am to 5pm Monday to Friday and on Saturday 8am to 1pm. An online store is open 24hours and so should be its support services such as telephone, email and chat services.

In one of the stores, I made a call back request and five days after I have not been contacted. I also sent an online request to several and I was impressed that Jumia and Rupu track customer queries and respond; a few others are yet to respond. 

What also caught my attention were the five-seven days return policies with strict conditions such as the item must be in a saleable condition.

One store responded to my query saying item returned must go through a quality check before an exchange is made. 

Most successful stores have kept their return and refund policies simple and clear.

Leading online stores are also reliable in their deliveries, know their customers by keeping track of their purchase history, keep them informed and provide them with product reviews.  In addition, they provide payment options and secure their customers’ information. 

I believe that online stores in Kenya have a bright future if they put the customer experience at the centre of their existence, build trust and create loyal customers.

Lucy Kiruthu is a management consultant. Get in touch with her on: [email protected]; twitter @kiruthulucy

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Tuesday, November 25, 2014

Agency and Hong Kong firm tussle over aviation licence

The Kenya Civil Aviation Authority headquarters at the Kenyatta International Airport. FILE PHOTO | NATION MEDIA GROUP

The Kenya Civil Aviation Authority headquarters at the Kenyatta International Airport. FILE PHOTO | NATION MEDIA GROUP 

By RAMENYA GIBENDI
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The stand-off between Frontier Services Group FSG, a Hong Kong listed company, and Kenya Civil Aviation Authority (KCAA), over an aviation licence is set for the courts.

At the centre of the row between KCAA and the investment firm is an application for the renewal of Kijipwa Aviation’s licence that was declined by the authority.

The investment firm argues that KCAA has on many occasions failed to provide valid reasons for its refusal to renew the licence for the Mombasa-based aviation firm in which it bought a 49 per cent stake.

“We have written seven letters to KCAA requesting for a valid reason but none has been responded to. The option therefore is to proceed to court to have the matter resolved,” FSG chief operating officer Peter Philips said in an interview.

The authority said earlier that its decision had been informed by the uncertainty regarding the ownership of Kijipwa and non-compliance with Kenyan laws that limit foreign ownership of aviation firms to 49 per cent.

“There are shareholding questions about the company,” KCAA acting director-general Joseph Kiptoo said in an October 26 interview.

But FSG says its purchase of stake in Kijipwa strictly complied with the requirement that locals hold a 51 per cent stake in an aviation firm.

“Our lawyers are currently finalizing on the paperwork and soon we shall move to court to initiate a process that will obviously take longer than we anticipated,” said Mr Philips.

HEAVY BLOW

The decision by KCAA, the aviation industry regulator, dealt a heavy blow to the investment firm which had outlined ambitious plans of setting up an aviation training centre for both pilots and certified aeronautical engineers at the coast.

Currently, professional Private Pilot Licence and Commercial Pilot Licence holders have to go overseas, mostly US and Britain, for training. FSG wanted to set up such a facility in Kenya to serve East Africa.

“We had set up a very ambitious business programme but the licensing headwinds have stalled the whole process,” Philips said.

Kijipwa was part of the investments firm’s wider strategy of cashing in on the region’s and country’s nascent extractive industry as well as logistics services.

FSG, whose board chairman is former US Navy Seal Erik Prince, already has a 49 per cent shareholding in Phoenix Aviation, a Kenyan company.

In May, KCAA expanded Phoenix Aviation’s licence allowing it to operate chartered flights to Asia. This gave FSG room to target Chinese mining firms with operations in Africa as major clients for its logistics services.

FSG was formerly known as DVN Holdings Ltd but it changed its name to Frontier Services Group Ltd in March 2014 through regulatory filings to the Hong Kong bourse.

FSG is eyeing a slice of the oil and mineral wealth in Kenya and Africa through provision of passenger and freight services to oil and mining companies transporting staff, machinery and spare parts to remote areas such as Lokichar and Lokichoggio in Turkana.

“Kijipwa was appealing to FSG due to its strategic position near the Port of Mombasa, and the legendary reputation of its founder, Mr Alan Herd,” FSG chief executive Gregg Smith said in a separate interview.

FSG had reportedly lined up 25 aircraft for Kijipwa’s airstrip located on the grounds of Bamburi Cement in Mombasa, to provide specialised aviation services and aerial survey of installations such as oil pipelines to players in the extractive industry.

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Tuesday, November 25, 2014

Some level of stress is good for work but too much of it is harmful

Many employees operate in an environment of constant high levels of stress, often leading to burnout.  FILE ILLUSTRATION | JOSEPH NGARI

Many employees operate in an environment of constant high levels of stress, often leading to burnout. FILE ILLUSTRATION | JOSEPH NGARI  DAILY NATION

By DAVID MUTURI
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The most common complaint in every workplace is about stress.

As a manager this can be a cause for worry. It is important for managers to be aware of the types and levels of stress among the people they lead.

Different forms of stress have different effects on people. Experts tell us of at least four kinds of stress. They talk of hypo stress, eustress, distress, or hyper stress.

Some level of stress is always necessary for work and good results. This is what experts call eustress. It is the stress that awakens you to what must be done. This might be a deadline that must be met, or   the acceptable standards for a particular task. If you do not have eustress, you are likely to take a lackadaisical attitude towards important assignments and tasks. Eustress is therefore good stress. It assists individuals to achieve optimum performance.

Like most things in life, different people handle stress differently. Accordingly, even eustress will receive different reactions from different people.

What is important is to understand that this form of stress is necessary for good results. When you have that understanding you will not panic the moment you hear the word “stress.” For, you know that good results hardly ever come in an environment devoid of stress.

UNABLE TO THRIVE

 Different environments have different levels of eustress. The critical thing is individual adjustment for self-built stability. It is also important for you to know yourself relative to your capacity to handle stress. Some people cannot thrive in some environments without being easily overwhelmed. Other people would not find any satisfaction if they were not working under some pressure.

 The other types of stress have negative consequences. Hypo stress is a very low level of stress. This form of stress may lead to complacency, or to disturbed quietness. This may occur due to a mismatch in job qualification and job placement.

As a manager you will have to consider whether it helps anybody to retain the individual who has too much time, and can only be a disruption to the other employees. It could lead to a situation where it matters little that a certain undertaking is done or not. This is common where people find it necessary to preoccupy themselves by doing things that are not related to work.

When you have little to or almost no work to do, you get disturbed even when your paycheck comes promptly at the end of the month.

Hyper stress is when a person feels completely overwhelmed. You see no end or hope in what is causing you stress. This can be, for example, when you are working with difficult people whom you have not learnt to handle appropriately. It can also arise when you engage in new responsibilities and tasks.

NEGATIVE THOUGHTS

You could also fuel the stress by your own negative thoughts and sense of inadequacy in what you are doing, choosing only to see your limitations and not your strengths. This can lead to a disruption in the flow of life, at times ending in inertia. This stress may become a hindrance to effective performance of given tasks. It could also be manifested in individuals with low stress tolerance levels.

Hyper stress needs professional intervention because it is dangerous and could lead to other bigger problems. It calls for the attention of the manager. People with low stress tolerance are as dangerous as people with hypo stress.

Mentally ill

When you get distressed you cease feeling overwhelmed, you actually become overwhelmed. This is when you have lost it. This is where you are likely to get mentally ill. You must avoid this at all costs.

You must never get into this stress level. If you are not suited for the environment, get out and look for your space elsewhere. The world is big enough for everyone.

Dr Muturi is the executive director, Kenya Institute of Management.

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Tuesday, November 25, 2014

Don’t make investment decision in haste

Before plunging into the waters of a new business, it is wise to carefully think through all possible risks.  No idea is perfect, so be on your guard and work hard at exposing the hidden problem areas.  FILE PHOTO | NATION MEDIA GROUP

Before plunging into the waters of a new business, it is wise to carefully think through all possible risks. No idea is perfect, so be on your guard and work hard at exposing the hidden problem areas. FILE PHOTO | NATION MEDIA GROUP 

By RICHARD BRANSON
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To do, or not to do - that is the question. Business leaders get paid big bucks to make smart, informed decisions about whether or not to take the plunge on a potential venture, yet there is no science or advice anyone can offer that will help new entrepreneurs to make similar choices.

Such decisions could never be programmed into a computer. It’s more like sitting on a jury: All reasonable doubt must be removed before you can pass a verdict one way or the other. (Thankfully, though, corporate decisions seldom involve matters of life and death!) That said, I have found that a few general rules often help me to arrive at a decision within the appropriate timeframe about whether to approve a project.

For me, first impressions always matter a great deal, but I don’t let that thought process influence my decision-making when it comes to business matters.

I’ve learned that even when an idea immediately strikes you as a really good one, you must push aside that first reaction and carefully and objectively weigh the potential new business’s pros and cons. If no significant cons come to mind when you first evaluate an idea, that doesn’t mean that they don’t exist.

UNFORSEEN PROBLEMS

Almost every startup encounters unforeseen problems, so be sure to devote a lot of time to figuring out what they are and assessing solutions before you move forward - if you learn of a major problem after the launch, you’ll be in a much worse position to deal with it.

This kind of caution becomes doubly important if everyone on your team is unanimously in favour of going ahead with a project. No idea is perfect, so be on your guard and work hard at exposing the hidden problem areas. Find and address them, and you’ll only build a better business.

Avoid making a decision in isolation about whether to launch a venture: You must also consider how the project will affect the overall functioning of your company. Every choice you make as an entrepreneur will impact, to some degree, your ability to explore future opportunities - this is what the experts call the “decision stream.”

You might feel that the venture you’re considering might be too good to pass up, but you have to keep in mind how it will affect your other projects down the road. If it appears that now is not be the best time to move forward, consider what risks, if any, there would be in putting the venture on hold for an agreed-upon length of time. In those situations where you cannot take on a project because another is waiting in the wings, think about why one should get the nod and the other not, and what that says about your priorities.

LIMIT EXPOSURE RISK

Finally, do everything you can to limit your exposure to risk - protect the downside. Wise investors go to great lengths to limit their potential losses when it comes to stock portfolios, and you should employ a similar strategy when setting up a new business.

For example, when I was starting up Virgin Atlantic, the only way I got my business partners at Virgin Records to begrudgingly accept the risks involved in running a new airline was by getting Boeing to agree to buy back our 747 airliner after a year if things didn’t work out as we’d hoped.

Ever since then, whenever we are looking into starting up a giant, capital-intensive venture like Virgin Galactic or our upcoming Virgin Cruises, our team always spends a lot of time finding inventive ways to protect the downside.

These are just a few tips that I have used to help me make smart business decisions, and I hope that they will help you too. A final hint: If you have the time to take an approach that involves orchestrated procrastination, then do so. Doing more homework on a project is seldom a bad thing - as long as you don’t let the opportunity pass you by!

(This column was adapted from Richard Branson’s latest book, “The Virgin Way.” For more information, go to virgin.com/richardbranson/books.)

This column is part of a weekly series by Richard Branson in which he responds to reader’s questions from around the world. Questions from readers will be answered in future columns. Send them to RichardBranson@nytimes.

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Tuesday, November 25, 2014

Brewer to release two new brands in bid to shore up earnings

East African Breweries Ltd is set to introduce two premium whisky brands next month in a bid to boost  revenue that has come under heavy assault from tax on its  products that target low-end market. FILE PHOTO |

East African Breweries Ltd is set to introduce two premium whisky brands next month in a bid to boost revenue that has come under heavy assault from tax on its products that target low-end market. FILE PHOTO |   NATION MEDIA GROUP

By RAMENYA GIBENDI
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East African Breweries Ltd is set to introduce two premium whisky brands next month in a bid to boost revenue that has come under heavy assault from tax on its products that target low-end market.

The beer maker will also be distributing Johnnie Walker Odyssey Triple Malt and Bulleit Bourbon Frontier Whisky in Kenya from December on behalf of Diageo, its anchor shareholder.

Johnnie Walker Odyssey Triple Malt is expected to become one of the most expensive alcohol brands, rivaling King George V, Scotch whisky that retails at over Sh100,000.

Speaking on the sidelines of the official launch of Talisker Storm, another premium whisky brand, last week, Diageo luxury brands ambassador Dougie Duncanson said they are targeting the growing appetite for high- end spirits in the country.

“This is being driven by the ever growing middle class as we have witnessed a growing demand for high-end whiskies, spirits and Vodkas,” said Mr Duncanson.

GROW BY 28 PER CENT

Euromonitor International’s data shows that Kenya’s social class is projected to grow by 28 per cent between 2011 and 2020. This is one of the highest forecasts in the world.

Johnnie Walker Odyssey Triple Malt is described as a new luxury blend with an alcohol content of 40 per cent.  It is housed in a swinging decanter to commemorate the 80th anniversary of Sir Alexander’s creation of a whisky vessel capable of staying upright in the sea.

While its retail price for the brand in the Kenya market has not been disclosed, the whisky retails at Sh333,355 (2,299 pounds) per 750ml bottle in the European markets.

Bulleit Bourbon Frontier Whisky on the other hand is distilled in Kentucky, US, from a mixture of corn, rye and malted barley. It retails at Sh3,190 in the Western markets. The local price has not been recommended.

EABL’s current premium whisky include Johnnie Walker Red Label, Smirnoff Vodka and Baileys. The brewer’s reserve products include Johnnie Walker Blue Label, and Don Julio Tequila.

The brewer recorded a double-digit growth in its spirits sales in the year ended June which contributed significantly to its earnings, helping it post a five per cent increase in full-year net profit to Sh6.85 billion from Sh6.52 billion the previous year.

SENATOR KEG

The brewer’s business was severely hit after the introduction of 50 per cent excise tax on Senator Keg beer which caused a 75 per cent drop in sales of the low-end brand.

It is perhaps based on this backdrop that the brewer is paying special attention to the high-end spirits which are currently performing better than the low-end products.

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Tuesday, November 25, 2014

Equity model shows the poor have a lot to offer

The Sim card in contention is paper-thin and is embedded with a chip. Users overlay it on their primary Sim card and can subsequently receive services from two mobile telecom providers simultaneously. PHOTO | PHOEBE OKALL | FILE

The Sim card in contention is paper-thin and is embedded with a chip. Users overlay it on their primary Sim card and can subsequently receive services from two mobile telecom providers simultaneously. PHOTO | PHOEBE OKALL | FILE  NATION MEDIA GROUP

By James Shikwati
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Accessibility and affordability are terms that are expanding horizons of markets.

Systems that enhance access to financial and communication services have transformed the way low income populations are perceived in Africa.

The retail, beverage, mobile telephony and banking industries in Kenya are raking in billions of shillings in profits by turning their attention to the “bottom billion”.

In his book The Bottom Billion Paul Collier raises the alarm about countries and populations at the bottom of the global economic system that are likely to form a “ghetto of misery and discontent” thereby breeding instability. 

Trapped in conflict over natural resources, landlocked with bad neighbours and bad governance, Collier says the bottom billion, 70 per cent of whom are in Africa, are a potential threat to the secure world at the top of global economic system. It is a line that is shared widely by political and policy leaders.

Industry players have a different take on this – they see opportunity in the bottom billion.

One of Kenya’s leading indigenous banks has dived deep at the “bottom” and is raking in profits.  Equity Bank’s model that targets low income market, the unbanked and under-banked populations, demonstrate that the bottom billion are not always full of threats.

The bank opened up its retail and micro-loans of as little as Sh500 to a customer base that other banks were running away from. For the last 14 years its pre-tax profit has been growing at a rate of 65 per cent. The bank has grown to be among Kenya’s pioneering multinational companies with branches in Uganda, Tanzania, Rwanda and South Sudan.

Equity Bank’s model illustrates that the poor are not necessarily beggars. Access and affordability of financial services have upheld the dignity of the low income groups and propel them to be productive. Financial inclusivity model acts as a multiplier force that enables rural communities to increase their productivity and set up enterprises.

THIN SIM CARD

Equity Bank’s entry into mobile banking with a keen eye for low income earners reinforces the view that the bottom billion have a lot to offer innovators.

The thin Sim card technology that the bank is rolling out will scale up numbers that access financial services by riding on the existing mobile phone platforms.

Competition with Safaricom, an old player in the mobile money sector, is likely to benefit low income populations with falling prices of financial services and better customer service.

As innovators turn to the bottom billion for profits, government regulators must keep pace as well. Governments should not focus only on the tax that such innovations generate for the economy but ensure that citizens are not shortchanged through poor services.

With Equity Bank’s move to break Safaricom’s monopoly, the government’s role as a “referee” is going to be keenly scrutinised. Consumers expect the government to play its proper role to foster fair competition.

Equity Bank’s success story should encourage more Kenyans and by extension Africans to venture into business to serve the people.

The bank’s success story is not pegged only to its focus on low income groups, but also its strategy to partner with successful ventures to deliver quality services to its clients.

For Kenya and Africa to succeed, they too have to learn how to manage and navigate strategic partnerships as opposed to the attitude of shunning the rest of the world. The country’s challenges offer opportunities for innovators to step in and reap rewards.

The bottom billion are not a curse or a threat to society, they offer opportunities for innovators to make profits.

Equity Bank has demonstrated that innovations and technology can get rid of “poverty traps” that hold back low income people from connectivity to the global economic system. Instead of fearing the bottom billion, the world should reconfigure and open up restrictions that suffocate low income populations. Market horizons are not cast in stone so as not to be grown!

Mr Shikwati is the founder director, Inter Region Economic Network.

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Wednesday, November 19, 2014

Contact Safaricom to register your M-Pesa agency business

Keep us posted on the progress of your application for a permit. PHOTO | FILE

Keep us posted on the progress of your application for a permit. PHOTO | FILE |  NATION MEDIA GROUP

By YVONE KAWIRA
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My name is Nancy and I have been an M-Pesa sub-agent for over three years now.

An M-Pesa sub-agent means that, I earn less 20 per cent of the total revenue (commissions) on my till.

The 20 per cent is usually pocketed by my agent whose tills I am using to transact with.

On average, I transact credit business worth Sh12 million and debits worth Sh4 million per month.

I have presented my application for agency to Safaricom, Kenya Cinema Office, and every time, I am informed that the telecom is not taking in fresh agency applications.

I would like to earn 100 per cent on my work.

At the moment, some of the expenses incurred are bank charges which add to Sh20,000 per month because one has to exchange float for cash.

For every Sh100,000 float, the charge is Sh100. I transact on average withdrawals (credit) of Sh600,000 daily. This translates to bank charges of Sh600 per day.

However, I end up with little commission because I still have to part with 20 per cent.

Please assist me get an agency permit because I have the all documentation required.

Thank you in advance.

Hello Nancy,

Thank you for trusting that we are in a position to help you bring your suffering to an end.

We have been in communication with Safaricom regarding how it can help you register your M-Pesa agency business.

In its response, the telcom company instructed you to use the documents we attached in the email we sent to you to apply for M-Pesa agency permit.

Safaricom has noted that its team is looking at updating some of its existing and good performing agents. The firm has also asked you to get in touch with it if you need support on the same.

We hope you will soon be in a position to reap the maximum profits from your business. Keep us posted on how your application goes on.

Dear Yvonne,

My name is Jeremiah Mburu and I have a salary account with Family Bank, Sonalux branch Nairobi.

Through your column on Thursday, October 30, 2014, I came across a case that bears similarities to a problem that I have been facing.

On Friday, October 24, at around 6pm, I visited a KCB ATM in Voi town, hoping to withdraw some cash.

After going through the withdrawal prompts, the ATM returned my card, advising that it was under maintenance, and therefore I should seek services at the bank’s nearest ATM. Neither cent was dispensed, and nor print of confirmation was issued either.

Since my card was Kenswitch- and Visa-enabled, I decided to try the withdrawal at a Kenswitch ATM, but to my utter surprise, there wasn’t enough money in my account, the machine informed me.

Curiously, I returned to the KCB ATM and checked my account balance which indicated that it was less than Sh100.

However, knowing very well that I had close to Sh10,800 savings, I suspected that the ATM had considered the first transaction a success.

The banking hall was closed, and there was no guard on sight. Out of frustration, I knocked the door lightly to get attention of the guard on duty, who asked me to wait for 10 minutes before trying the transaction afresh. I did as instructed twice but it was still unsuccessful.

Later when I got in touch with Family Bank, I was told that there was a problem with KCB ATM withdrawals. I was also informed that the hitch would take 24 hours but at the meantime, the transaction would be reversed.

As I write this email to you, the amount has never been wired back. When I visited the bank recently, its answer was not convincing either.

On contacting Family Bank again, it asked me to be patient but when I came across Dishon’s case in your column, I sensed that something was amiss.

Dishon’s suffering in KCB’s ATM happened in July. I fear that I might have to wait for an uncertain period of time.

I need your help to find out the following: are the answers Family Bank is giving me true considering the long wait Dishon endured?

How long does one have to wait for his hard-earned cash, however little, in case of such a frustration?

Who is responsible for this mess between Family Bank and KCB? Will I ever have my money back?

Can I sue whoever is responsible or can the bank be sued for all the stress, tussle, loss, frustrations, which customers suffer for their errors?

Thank you, Jeremiah, for reaching us in search for answers.

We have been in touch with Family Bank on the matter you have raised here and we thank the lender for responding to our queries promptly.

In its response, the bank confirmed that indeed you experienced an erroneous transaction on October 24, 2014 for Sh10,630 at a KCB ATM in Voi town.

However, Family Bank has noted that your money was refunded on November 4.

Further, your bank acknowledged that its customers have been experiencing challenges using KCB ATMs.

This has seen some customers’ accounts debited without the machine dispensing cash.

The bank has therefore noted that these issues have been brought to the attention of the relevant persons and settlement for such disputes usually takes at least seven days.

We hope you are now able to access your money. Kindly get in touch with us if you need further assistance.

Looking for answers?

Send your queries and daytime telephone numbers to Yvonne Kawira:

E-mail: [email protected]

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Wednesday, November 19, 2014

Coffee farming offers retiree rich pickings

“Every week, I receive at least 20 farmers coming to learn best practices in coffee farming,” says coffee farmer Peter Kamunu. PHOTO | CORRESPONDENT

“Every week, I receive at least 20 farmers coming to learn best practices in coffee farming,” says coffee farmer Peter Kamunu. PHOTO | CORRESPONDENT |  NATION MEDIA GROUP

By LILIAN OCHIENG
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It is only in his retirement that coffee farmer Samuel Kamunu has enjoyed the sweat of his hard work.

At 66, Mr Kamunu, smiles with awe at the sight of his expansive coffee farm; the business that has drawn him a life full of peace even as it helped him meet his household needs.

The father-of-five spent his youthful days working at Kenya Bus Service as an oil cleaner. He was later promoted to a decorator before retiring in 2004 as a supervisor.

The highest salary the man from Tetu, Nyeri County, ever earned was Sh18,000. The pay was barely enough for his family upkeep. But as a coffee farmer, he now earns over Sh200,000 an amount he never dreamt of.

NEGLECTED CROP

“Coffee farming just thrills me, during the World Coffee Day celebrations on September 29, I felt part of a wider community that knew the worth of a once neglected crop,” he told Money.

Back in his village, Mr Kamunu’s 4.3-acre farm was used for subsistence farming. The farm, with 200 coffee trees, was neglected.

The coffee was not doing well, small-scale farmers were losing interest due to low-income, coffee berry disease and poor yields.

“Coffee farming was an old man’s job then, but this has since changed as more youth learn the worth of the crop,” he said.

On retiring, Mr Kamunu was rewarded with a Sh152,000 — a package which he invested in his farm to revive the ailing crop.

“My wife used to earn Sh1,500 per year from the 200 trees by then. We weeded, sprayed and pruned,” he noted.

At the end of 2005, they harvested over 700 kilogrammes of coffee.

However, beverage company Nestlé’s intervention in 2011 brought forth better knowledge on coffee farming to Mr Kamunu.

Nestlé partnered with Coffee Management Services to support coffee farmers through co-operatives in the area.

“They employed an agronomist who held training sessions helping us discover how we could maximise our returns,” he said.

They were taught how to prune, manage soil, pests and control diseases as well as fertilisation.

“I would get back home every day to practice the skills and review my notes,” said Mr Kamunu.

By the end of 2011, his yields had increased to 2,300 kilogrammes, an average of 11.5 kilogrammes per tree.

The rewards of his hard work were showing fast, and in 2013, Nestlé featured him in its annual Nescafé Plan report for producing over 3,000 kilogrammes of grade A coffee.

DIVERSIFY

“I have made it at my retirement. Last year, I made over Sh200,000 which I never even dreamt about in my professional life,” he said adding that he regrets why he left the village for Nairobi.

His earnings have helped him diversify his income sources; he now has a dairy cow which produces over 15 litres of milk per day, earning him an extra Sh500 daily.

“I am now in the process of putting electricity in my house,” he told Money.

Mr Kamunu now believes that he would be a lot richer had he not abandoned his land.

“I feel sad for youth who are moving from the village to work as touts or push mkokoteni (carts) in the city,” he said.

“Every week, I receive at least 20 farmers coming to learn best practices in coffee farming, I got the knowledge free of charge and I am happy to pass it over to other farmers,” said Mr Kamunu.

He has plans of adopting high yield coffee varieties being offered by Nestlé and Coffee Management Services; an initiative which he believes will take his farming to greater heights.

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Wednesday, November 19, 2014

Artisan weaves tidy sum from reeds

Mr Tom Omondi who makes sofa sets using papyrus reeds. PHOTO | JARED NYATAYA

Mr Tom Omondi who makes sofa sets using papyrus reeds. PHOTO | JARED NYATAYA |  NATION MEDIA GROUP

By STANLEY KIMUGE
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Along the busy Uganda Road in Eldoret is Westy, a popular marketplace in the town.

It is Friday and the centre is abuzz with business. People from all walks of life are coming to buy household items or second-hand clothes.

About 100 metres from the market, Mr Tom Omondi, is weaving a sofa set using strings of papyrus reed, a plant that grows in swampy areas.

“Many people consider them (reeds) useless but they are important to me. Our products, as you can see, are distinct. They are blend of modern furniture with African finesse,” Mr Omondi said.

Soon, a lorry parks by the roadside, just a few meters from his workshop and the driver dashes out. “I want a pouf stool, how much does it cost?”

Our interview is interrupted. Mr Omondi tells him it costs Sh2,000, a price which the driver says is a lot. Bargaining ensues before the buyer parts with Sh1,500.

“Kenyans love to bargain, it seems as if it is ingrained in our DNA,” Mr Omondi says as he reluctantly gives the buyer a nod to take the stool.

His business location seems ideal. But he thinks otherwise.

“I have sold goods to hundreds of drivers plying this route and other customers. But the biggest challenge has been getting customers from all walks of life since some feel ashamed standing by the roadside.”

The entrepreneur makes seats, shoe rugs, beds, mats, baskets and TV stands, all from reeds. The dried reeds, bought and transported from Busia town, are bundled into rolls which cost him Sh2,000 per each. Once the items are woven, he cushions them with leather or cloth.

To make them more durable, he reinforces them with metal frames. He also varnishes them to ensure they are water and dust proof.

“We make wooden products which are bit cheaper compared to those made of metal frames. For example, a seven-seater leather sofa set goes for Sh40,000.”

He attributes the growth in his business to the rise in real estate in Eldoret and its environs, which is opening windows of opportunity to traders in the informal sector.

“New buildings are set up daily within and around the town. This implies new tenants. Our work is to furnish them with quality and modern furniture.”

So how did he venture into reed weaving business?

“I used to see an old man making furniture and how university students, his main customers, bought all of his products. So, I thought, why don’t I give it a try?” Mr Omondi who is the proprietor of Sahara Homes Expo says.

On interacting with the old man, he got handy tips on what it takes to create good furniture. At first, he made some stools for his house.

BETTER PRODUCTS

And as the golden rule of business dictates, learn the flaws of your competitor and capitalise on it to win his/her customers.

“I realised that though the customers used to stream to his workshop, the furniture was of low quality. I decided to come up with better products,” Mr Omondi told Money.

“From the venture, we make about Sh200,000 in a month when the business is booming,” says the 34-year-old.

His customers come as far as Nairobi, Busia and Kisumu besides Eldoret and its environs.

University students, who form his main market, like trendy items which they can afford, “so I always try hard to match their expectations,” he notes.

Already, his work has generated a lot of interest.

In September, he was invited by organisers of Eldoret Trade Fair to showcase his wares.

The event brought together stakeholders in the housing sector such as cement makers and multi-national companies.

And the artisan is proud to be an employer. “At the moment, I have four permanent workers aged between 20 and 29 years but I occasionally contract welders to design metal frames.”

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Wednesday, November 12, 2014

Plan how you’ll run the salon daily, even in your absence

The success of any business depends on the time you allocate to it as well as your commitment. FILE PHOTO

The success of any business depends on the time you allocate to it as well as your commitment. FILE PHOTO |  NATION MEDIA GROUP

I’m an avid reader of your column.

I want to start a salon and a barber shop using Sh300,000 loan from my Sacco.

From my job, I earn a net salary of Sh25,000.

I don’t have any experience in this type of business either.

However, my cousin is running a similar outfit but he seems to discourage me from joining the trade saying that if I am not going to be there full-time, my workers would pocket much of the income.

Kindly help me out because I am planning to employ a person to run it for me.

— Kenneth

Thank you for your encouraging comment, we are pleased to know that this column is of value to you.

The idea of starting a business that increases your income can be in itself thrilling.

However, it is normal to be careful if you do not have enough experience in the business and in addition the time to run it yourself.

The likelihood of the business being mismanaged, including embezzlement of cash by staff is real, and can be very disheartening especially if there is a loan to be paid.

This is why it is important to make up your mind.

Nonetheless, in all instances when venturing into business, a good starting point is to have a business plan.

This will give you an understanding of your target customers, target revenue, expenses and estimates of how much profit you are likely to make.

It will also give you an estimate of the daily cash flow and enable you put in place checks to eliminate pilferage.

A key area of focus in the business plan is how you will run the shop every day to ensure sustainability, even in your absence.

Having tightened the bolts and nuts required for smooth running of the business, you will need to plan and allocate duties to your staff while retaining a supervisory role.

Although there are other ways of operating the business that can simplify these tasks for you, there are few substitutes to having a sound business plan and effective management skills.

They include acquiring a franchise where you pay to use somebody else’s established business name, systems, processes and structure.

The advantage is that you will be given support and guidelines since the franchise owner have standards on quality and importantly, a reputation to maintain.

You will also gain from their solid reputation and branding.

Another option is buying an established startup. This is tricky approach as you are unlikely to know much about the business until you run it.

The third option is entering into partnership with an established outfit such as your cousin’s where you inject fresh capital to facilitate expansion in order to generate more revenues and therefore earn more profits.

However, the success of the business will largely dependent on the time you allocate to it as well as commitment.

Whichever option you choose your worry of hiring and retaining dedicated staff will keep recurring.

The best way is to hire a manager who can handle the day to day issues on your behalf and report back to you daily.

Despite hiring a manager, you will still have to maintain a close touch with the business so as to know what is going on and understand your customers’ needs and expectations.

Consider taking seriously the following oversight duties yourself, ensuring customer service is your top priority, making financial decisions, checking your inventory, hiring new staff and assessing employee’s performance.

We wish you Godspeed.

NEXT WEEK'S QUESTION

I have been reading your articles religiously. My net salary is Sh35,000.

I have cleared all the debts I had accumulated when I was out of work since January and now I need to save after taking 10 per cent of my net as tithe.

After my bills, I would have Sh10,000 surplus.

I am planning to join a sacco in January 2015 to enable me buy a plot in two years time as I have a daughter who will be joining college next year.

How is this plan? What can I adjust? What should I look out for?

— Ann

Fancy Chepkwony, research analyst, Zimele Research. Write to: [email protected]

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Wednesday, November 12, 2014

How to eliminate the ‘out of stock’ answer for your customer orders

Mr Titus Ireri examines products at his shop at Sokoni Plaza in Nakuru on September 6, 2014. FILE PHOTO | SULEIMAN MBATIAH

Mr Titus Ireri examines products at his shop at Sokoni Plaza in Nakuru on September 6, 2014. FILE PHOTO | SULEIMAN MBATIAH |  NATION MEDIA GROUP

By MUTHONI NGATIA
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For many SME retailers, wholesalers or distributors and manufacturers, the largest asset on the balance sheet is inventory.

Raw materials, goods in process, finished goods and merchandise stock all represent various forms of inventory encountered in a business.

Each type represents money tied up until the inventory leaves the business as a purchased product.

All these inventory contribute to profits only when their sale puts money into the cash register or the bank.

To succeed in business and continuously grow, you must properly manage your inventory.

Otherwise, you will loose money through theft, pay for undelivered good or even release goods that have not been paid for.

Stocks represent a big portion of the business investment and must be well managed in order to maximise profits.

This is one of the biggest pains of many SME owners for sure.

Many businesses have shutdown due to losses arising from poor inventory management.

If you do not control your inventory, you will be unaware of the true state of your business, suffer lots of inefficiencies and this can be very costly.

Many business owners believe keeping high inventory levels is the best way to do inventory control as they will not run our of stock.

However, high stock levels that stay in the shelves for long mean lots of money is held by the stocks.

The stocks provide only a constant profit even over time meaning that the yield will be lower the longer the stock lasts.

Indeed, many business end up suffering losses through clearance sales where they offer uncleared stock at low prices.

Some of the best practices in inventory management include maintaining a good assortment of products but again not too many.

Having an excessive variety may mean keeping very many products covered in dust and even forgetting some products exist.

OBSOLETE ITEMS

Increasing the inventory turnover but to a good profit level.

Some businesses are turning over millions of shillings and making very small profit margins meaning very high volumes are needed for reasonable profits to be realised.

Keep stocks low, but again not very low. Ensure that customers do not always hear the “out of stock” answer to their inquiries.

Consider making volume purchases to obtain lower buying prices. However, don’t over buy and end up over stocked holding lots of capital in stocks. Get rid of obsolete items.

Those items in your stock list that have not had movement in months or years and continue to hold up capital.

Try and balance out the costs of inventory with the benefits of inventory.

This involves analysing the true costs of carrying inventory from direct costs such as storage, insurance, taxes etc and indirect costs such as money tied up in the inventory.

Try reducing small amounts of inventory investment and you will be surprised by changes you can get in your business cash position.

For example, this can ease your cash position and ensure better cash flows without a line of credit.

Successful inventory management requires accurate and disciplined record keeping system. You need proper information to make sound inventory management decisions.

I know that many people use manual record keeping methods. This works wells for small operations.

However, as your number of items, supplies and general importance of inventory increases, it is good to consider the use of a computerised system for inventory control.

Whether you are using a manual or computerised inventory management system, the important thing to know is what and how much do you order, when to order and at what price, effective stock in and out controls, how to ensure that the inventory produces a profit not a loss.

The author is the CEO/Founder of Openworld Ltd

Email: [email protected]

@DorcasMuthoni

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Wednesday, November 12, 2014

Present your NHIF registration form without further delay

The entrance to the National Hospital Insurance Fund building.  FILE PHOTO | NATION MEDIA GROUP

The entrance to the National Hospital Insurance Fund building. FILE PHOTO | NATION MEDIA GROUP 

By YVONE KAWIRA
More by this Author

Dear Capital Letters,

I am a teacher at a secondary school in Kilifi County employed by the institution’s board of management.

Before I landed this job at the coast, I was working as a teacher in the same capacity at Chibwobi Secondary School, in Kisii County.

When I was employed in Kilifi, I was informed that about Sh200 will be deducted from my salary to pay for my National Health Insurance Fund (NHIF), which is an obligation for all new employees.

I then enquired how the employer intends to remit the money without first having to register me.

But I was informed that I will be registered in due time. I worked for one year from May 2012 to May 2013.

Why did my employer deduct money from my salary without registering me with the national health insurer first? Kindly, find out on my behalf.

— Abugake

Hello Abugake,

Thank that you for contacting us seeking to establish the correct position regarding your health cover contributions.

We, however, noted that you failed to provide your contacts and ID number to help us narrow down your case to specific details when contacting the national health insurer.

When we sent you an email requesting for these details, you did not respond.

That be as it may, we got in touch with the National Health Insurance Fund and we thank the organisation’s team for responding promptly.

The national insurer noted that it could not ascertain your contribution history due to lack of these crucial details.

It, however, shared some information that might turn out to be very useful to you.

In its response, the insurer noted that quite often, some new employees delay in filing the National Health Insurance Fund registration form after employment.

This can happen even while the monthly contributions are being deducted from their pay.

You have been informed that it is therefore your responsibility as an employee to submit the registration form.

This is because you are the only one who can ably declare your family members and any other personal details that might be very vital.

The fund also noted that the school was in order to deduct and submit your health insurance monthly contributions.

If you suspect that the school may not have remitted your contributions to the insurer, you can confirm with the organisation’s Kilifi office or contact it through its toll free number which we sent to your email.

We urge you to get in touch with us if you need further assistance in this or any other matter.

POSTBANK SAYS IT’S SOLVING YOUR CASE

Dear Yvonne,

I wish to bring to your attention that over six weeks ago, Sh10,000 was withdrawn from my PostBank account via an ATM transaction.

This happened at a time when I had my ATM card safely tucked in my pocket.

Since then, I have been following up the case with Post Bank Kenya and I have shared with you the copies of email and the formal letter that I posted to the bank tendering my complaint.

Further, I have decided to get the services of a lawyer in order to pursue this case to its logical conclusion although according to the bank, the amount seems insignificant.

It is my considered view that the bank has the responsibility of protecting a customer’s savings at all times.

Interestingly, when I requested the lender to share the report about its investigations as well as my statement since I opened the account, the lender went silent.

I would appreciate if you can come to my aid.

Regards,

Eric.

Thank you, Eric, for seeking our intervention in order to pursue your lost savings.

We sympathise with you for losing your money through such a dubious circumstance and the bank seemingly turning deaf ear to your pleas.

When we contacted PostBank Kenya, the financial institution noted that it has been in touch with you over this complaint with a view to sort it.

We can only hope that the matter has been amicably solved.

We would like you to update us on the conclusion and let us know if our efforts to help have been fruitful.

Feel free to get in touch with us in future.

Looking for answers?

Send your queries and daytime telephone numbers to Yvonne Kawira:

E-mail: [email protected]

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Wednesday, November 12, 2014

Here is how to get career switch right

A section of the large crowd of hopeful youth who turned up for recruitment by Qatar Airways wait to hand in their certificates and application letters at Hotel Intercontinental in Nairobi on April 20, 2014. The airline advertised vacancies for cabin crew personnel. PHOTO | BILLY MUTAI

A section of the large crowd of hopeful youth who turned up for recruitment by Qatar Airways wait to hand in their certificates and application letters at Hotel Intercontinental in Nairobi on April 20, 2014. PHOTO | BILLY MUTAI |  NATION MEDIA GROUP

By YVONE KAWIRA
More by this Author

Making a career switch takes more than just shutting one door and opening another.

How then do you ensure that you have at least sealed all the potential risks?

Money went on a search to establish some of the mistakes to avoid when changing your career.

Ms Kathy Caprino of The Huffington Post says that hanging your career to something more suited to your values, needs, skills and passion is absolutely doable, even in tough economic times.

“But to switch careers effectively and achieve a positive outcome, you need four things: clarity, confidence, courage and commitment. Without these, you’ll most likely struggle and fail,” she says.

Hate-driven decision

You want to change your career because you are struggling with what you currently do and you have hence grown to hate it, hate your colleagues, boss etc.

These are the wrong reasons for changing your career. Before you hang your boots, try and reclaim what drew you into choosing that particular career in the first place. Running away from the problem does not solve it.

Lack of plan

You will need to plan for your exit and make sure you have a sound financial plan that will cushion you from expected shocks as you transition from one career to the other.

If you do not have a financial plan, wait until you have saved enough for this.

Use the time to research on your next career and solicit for as much advice as you possibly can.

It is better to be safe and double sure than sorry. During this time, you will be in a position to know if your next career will present exactly what you are looking for.

Do you have what it takes?

Are you for instance trained in that line of work? If not, during your research, this would be the ideal time to take training sessions that will help you land on your feet in your next career.

Look for mentors and acquire skills.

It is also important to understand what types of challenges you are likely to face in your new career.

You do not want to find the same challenges that made you quit in your next job. It can be very frustrating.

Giving up too quickly

Just remember there is no one single job you will find that does not have its ups and downs.

How you handle challenges determines if you are cut for it or not. It also affects your success or failure.

So if you have moved and things seem to toughen every day, try a different approach.

Not believing in yourself

If you do not believe in yourself, it will be quite difficult for you to make someone else believe in you.

It is important to have a positive attitude towards your move.

This is of course after you have done thorough research and made an informed choice about your move.

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Wednesday, November 12, 2014

How to get the most out of your customers

 

By EDWIN OKOTH
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“A customer is never wrong” so goes an all-time business saying.

Another one borrowed from the Germany “der Kunde ist König” which translates to “customer is king,” is quite popular.

However, the reality on the ground in the conventional business hangs this slogan between truth and a myth depending on who the customer is and the stage of the business transaction in question.

Where did you buy goods or seek services recently and feel like a king?

Recently, when Bungoma senator Moses Wetang’ula failed to produce his national ID at the airport, the flight was reportedly delayed as the stand-off ensued.

You may be wondering just why innocent passengers lost valuable time in what did not concern them.

Ask yourself, what would it have been if it were you who had failed to produce an ID? Were the other passengers handled like bosses?

Here are key areas that you can exploit to get the most out of your customers:

TRANSACTION VS RELATIONSHIP

Peter Macharia is the managing director of Trans Researchers Limited in Nairobi.

Mr Macharia notes that many businesses have chosen to transact and not relate with customers.

“Many of the businesses today are interested with closing a sale and not establishing a relationship with a customer. Relationship management has been left to the elite while the majority of spenders belonging to the bottom of the pyramid are left uncared for.

“What they forget is that more sales is anchored in the big numbers of these customers who spread the customer experiences they get from your businesses. What would happen if you open one morning and no one approaches your shop?” wonders the consultant.

The focus on profit and numbers have made successful businesses value their customers a lot.

However, some business owners are in many cases willing to go any extra mile before a deal is sealed but after the transaction is done, the hunter becomes the hunted.

Take Philip Odondi for instance who went through a rough experience after purchasing an electronic product in town.

“The shopkeepers were very good to me and even tested the gadget to my satisfaction. The warranty was comforting and I left the shop smiling.

“But when I noticed a malfunction three days later, the welcoming attendant who had talked so well three days ago became dumb. He had a frown on his face and I was made to feel like an obstruction to other customers.

“One of the shop attendants even started doubting my receipt,” Mr Odondi, a frustrated university student, told Money.

There is, however, a lot of truth in the old business slogan, customers are the oxygen that keeps your business alive, and the sooner your business adopts it, the better.

That simple man or woman passing by just to know the price of your goods needs your full attention and her ego must be fully massaged to get anything from her purse.

His/her satisfaction is your business continuity and success.

BRAND AMBASSADORS AND FREE MARKETING

In the era where customers are enlightened and business are engaged in cutthroat competition, customers change their trends, tastes and preferences depending on how different providers treat them.

Mr Macharia notes: “In some incidences, the customer may be in the wrong, but it takes intelligence to address the incidence making the customer feel a winner but yet the business meets compliance agenda of its policies and procedures.

“Good language spiced by a nice tone is good to have in such incidences and business must adopt this under any costs for survival purposes. It is called emotional intelligence. It is the same with what charismatic leaders apply.”

One business reality that is hard to ignore is that retaining the customers you have is easier than getting new ones.

Your delighted customers defend a brand in the market against all odds which protects the corporate image of your business.

This actually saves you the burden to market the business since the wow experience spreads fast and woos even more customers for you.

The old ones become repeat customers and your sales targets can never be hard to meet even in tough economic times.

Bad experiences to customers spread even faster and wider. The negative effects is disastrous and the damage is hard to repair.

LITTLE GESTURES MATTER

“A little euphemism goes a long way to create a therapeutic effect to the customer’s soul and is a good ingredient in any business enterprise. Words such as sorry, thank you and please pamper emotions of customers and make them more loyal,” advises Kenneth Amwayi, a banker, in Nairobi.

The father-of-one, who has been in the field scouting for customers for years, at one point in his career believes that businesses must keep the good image even when customers default.

He adds that acts of kindness such as calling the customer to get their feedback makes them feel important and valued.

“I once gave a customer a branded pen and a Christmas card; he not only brought in more people but also became a diehard of the bank. These little gestures work miracles,” says Mr Amwayi.

COMPLAINTS HANDLING

Customer complaints spread like wildfire. Depending on how you handle the situation, you may well be extinguishing fire with petrol.

Sheila Lubia has been a customer service officer for a busy enterprise at the Jomo Kenyatta International Airport.

And she has witnessed how simple complaints that have been poorly handled have caused big losses.

“With the advent of twitter and Facebook, customers can capture the bad experience and take it viral. The spread of bad news in the internet hurts the brand a lot.

“For instance, one customer was ignored by an officer who kept chatting on her phone; little did she know that she was being recorded. Well, the damage it caused the business cannot be compared to the fact that she lost her job,” says Ms Lubia cautiously.

It is most probable that you know the fact that the customer is your boss.

Ignoring your boss, talking harshly to the boss, delaying the boss and making the boss feel less important would only help drive you out of business.

Every focus the business makes must glide towards pleasing the customer and bringing more to the business.

Their perception about your business is the truth and the sooner you realise that, the more you have the chances to grow.

******

Good customer experience action points

  • Keep time. Traffic and loss of direction on the appointment date belong to the Stone Age. Time is money, and money is why you are in business.
  • Make reliable communication channels and please have them managed. Having a round-the-clock call centre is one thing and responding to the calls, emails and tweets is another.
  • Be in a position to rate your product quality. Invest in customer surveys and monitor your customer trends to know whether you are losing or adding customer base. Then act accordingly.
  • Communication is not only verbal. About 55 per cent or more is body language and it is not what you say to the customer but how you say it that matters most.
  • Keep your cool and admit when you are wrong. Apologise and reassure then act. They are your bosses, lest you forget.
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Wednesday, November 12, 2014

City jeans maker sews a new style of fashion success

Mr Andrew Kio at his Blacjack Jeans Company in Jericho Nairobi. PHOTO | PAULINE ONGAJI

Mr Andrew Kio at his Blacjack Jeans Company in Jericho Nairobi. PHOTO | PAULINE ONGAJI |  NATION MEDIA GROUP

By PAULINE ONGAJI
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One thing that strikes you when you get into Jericho market, Nairobi, is the increasing number of jeans designers.

However, in the hustle and bustle that is gripping this zone, one shop stands out, Blacjack Jeans Company, a startup owned by entrepreneur Andrew Kio.

At 33, he has already established himself as a top jeans designer in the area using his seven-year-old company.

His products range from jeans trousers, skirts to handbags, with men’s trousers leading in terms of demand.

In a day, his team is able to make between 12 and 20 pieces of jean trousers, translating to a gross profit of about Sh10,000 a day.

His average net profits ranges from Sh40,000 a month, but this also hinges on the time of the year.

“In a good quarter, say between September and December, the demand is high meaning that the sales also increase thus pushing up the profits,” he says.

But in difficult times, especially at the start of the year, the returns can be disappointing.

It is at this moment that he is sometimes forced to dig deeper into his pockets to keep the business afloat.

But that has not deterred his quest to succeed considering that currently, he has employed five people on piecework basis, a model of job that ensures that everyone benefits.

“If I hire on permanent terms it means that I will suffer during the difficult times while they’ll lose a lot during the high seasons,” he notes.

According to him, this style of payment ensures that the employees work harder, with each earning Sh1,000 a day on average.

Just recently, he had been working on an order of 35 jeans trousers from one of the branches of fast food giant, KFC.

VIRTUAL MARKETING

At the moment, he relies on word of mouth, as well as the social media as his primary marketing platforms, a strategy that has seen him hire a skilled person to drive his virtual marketing arm.

Like any emerging company, Blacjack Jeans is facing its fair share of challenges, with Mr Kio’s main concern being the cost of production.

For instance, nearly all of the materials used are imported, meaning the market price becomes very high. It is a fact that pushes up the cost of production.

“For example, my cost of making a single piece can amount to Sh900. This forces me to raise my price, this makes it nearly impossible to compete, considering that one can get the same pair of jeans in Eastleigh for as little as my cost of production,” he notes.

In an attempt to face the challenge, he has invested in heavy load machines, apart from getting updates on new designs, as means of improving the quality of his products.

However, this again raises another issue given that the high cost of machines is proving to be quite a challenge.

“At the moment, I have managed to get some machines that are able to increase production, but I still need some latest ones which are too costly, with some ranging from Sh250,000,” he says.

Mr Kio’s dream began in 2007 where he ventured into the industry just as a hobby.

During the time, he says, the brand new jeans demand in the country wasn’t high compared to the second hand ones especially in terms of quality.

Also during that time, he says, he did not own even a single machine and had to rely mostly on friends for their equipment as well as storage of his wares.

But that now is in the past, as this father-of-one and a business manager by training, seeks to put his company’s name in the same league as other jeans manufacturing greats such as Levi Strauss.

“However, I have to be realistic in terms of storming the world market at the moment. The demand of these products in the country is very high, yet we have not been able to satisfy the consumer needs. We have to do that before thinking of going overseas,” he says.

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Wednesday, November 12, 2014

Spend wisely to achieve your financial goals

Patrick Wameyo, a financial literacy educator and coach. FILE PHOTO

Patrick Wameyo, a financial literacy educator and coach. FILE PHOTO |  NATION MEDIA GROUP

By PATRICK WAMEYO
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A personal finance plan has several components, but some elements must be taken care of for the others to be realised.

A key part of the reason people go to work or invest to create income is to sustain a certain lifestyle.

Incidentally, the lifestyle is not static. It changes just as quickly as one’s mind, as the income increase.

At the heart of any financial plan is the allocation of income towards maintaining the family subsistence.

Simply put, this the equivalent of funds a family needs every month for food, clothing, medical and housing rent.

The six elements of financial goals are conjoined by the balance between income and the expenses being the only source of surplus required for growth by many households.

Out of the possible eight key elements of the financial plan, spending is the most critical to manage because it can potentially take away the funds needed for other elements of the financial plan if the budget controller is weak at taking hard decisions.

SUBSISTENCE BORROWING

Where the budget controller fails to control spending, borrowing for short-term consumer needs is the first to arrive at the scene.

A series of small subsistence borrowing usually taken to sustain a “false” family lifestyle takes root as income is eroded by gradual, unnoticed increases in key expenses such as rent.

As the family grows in head count and age, certain needs grow exponentially.

Upon arrival of the first baby, a family will almost always afford the needs of the baby comfortably. But the needs are increasing.

Children need new clothes which are more expensive, new bedding, new toys and totally different classes of food.

In the meantime, a house help becomes permanent expense. Let us not forget that we are living in an age where every service our parents used to do for themselves such as cooking, washing clothes, brushing shoes and so on are now procured from third parties for a fee.

To manage the family expenses account, the couple must take a long-term view of their life, agree on certain plans and implement.

This intentional position directs funds to the projects where they are needed most at the expense of regular consumption.

Financial planning is about self-discipline.

— Patrick Wameyo is a financial literacy educator and coach.

[email protected]

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Wednesday, November 12, 2014

Don’t buy Flame Tree yet, Uchumi, Kenya Orchards drop

Flame Tree Group’s George Theobald (left) rings the bell for the group’s listing on the Nairobi Securities Exchange as chief executive Heril Bangera and NSE chairman Eddy Njoroge (centre) witness its entry into the Growth and Enterprise Market Segment.

Flame Tree Group’s George Theobald (left) rings the bell for the group’s listing on the Nairobi Securities Exchange as chief executive Heril Bangera and NSE chairman Eddy Njoroge (centre) witness its entry into the Growth and Enterprise Market Segment. PHOTO | DIANA NGILA |  NATION MEDIA GROUP

By KINUTHIA MBURU
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NSE 20 Share Index: In a bearish week, the 20 Share Index closed at 5,074.93 points on Friday.

This was 0.02 points down from Thursday’s closing stand of 5,075.93 points.

Flame Tree: On its debut at the bourse, Flame Tree shot to Sh14 per share from the listing price of Sh8 a piece.

The climb was attributed to strong demand from institutional investors.

By the end of trading, the counter had moved 497,500 shares.

The following day, though, Flame Tree began to drop, at some point becoming the biggest loser shedding 9.75 per cent to trade at Sh12.50.

Backed by five deals representing a volume of 200,700, the counter closed the day at Sh13.10 on average.

On Monday, Flame Tree opened at Sh12.05 before declining to Sh11.80 per share.

According to Silha Rasugu, a research analyst at Genghis Capital, Flame Tree is going through price discovery rather than a price correction.

“It is a new listing and the market is trying to give it its fair value. In addition, investors who had the stock before listing could also be trying to exit, further derailing any price surge,” he says.

Mr Rasugu advises prospective buyers to wait.

Uchumi: The supermarket was on Monday expected to launch its rights issue to raise at least Sh850 million.

However, in the past one-and-a-half weeks, Uchumi has seen its price swing between Sh9 and Sh8.

Among factors contributing to the wobble has been massive exits by foreign investors.

Says Mr Rasugu: “The price drop to below the Sh9 rights issue price has turned the cash call into premium. Uchumi’s is going to be a hard sell.”

However, that Uchumi has cross listed in other markets could be its silver lining in getting the rights issue rolling successfully.

Mr Rasugu advises investors eyeing Uchumi to be very cautious.

Kenya Orchards: A few weeks ago, analysts in this column advised you to stay away from Kenya Orchards.

This followed the stock’s rise from Sh3 to over Sh190 per share. Very low volumes changed hands during the over 4,000 per cent rise.

According to Eric Munywoki a research analyst at Old Mutual, the volumes and the price surge may have been facilitated by an investor who was trying to move shares from one account to another.

Mr Chambua Ogoti, a securities analyst says the stock had been overvalued that a correction was inevitable.

Well, we hope you heeded. Last week, the stock plummeted from Sh192 to a low of Sh138 per share.

On Monday, it opened at Sh140 per share.

[email protected]

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Wednesday, November 12, 2014

Arrowroots brings smile on farmer’s face

Joshua Otieno displays a giant arrrowroot in his farm in Ombeyi, Muhoroni. Arrowroot farming is gaining popularity because of better returns. PHOTO | TOM OTIENO

Joshua Otieno displays a giant arrrowroot in his farm in Ombeyi, Muhoroni. Arrowroot farming is gaining popularity because of better returns. PHOTO | TOM OTIENO |  NATION MEDIA GROUP

By EVERLINE OKEWO 
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Joshua Otieno used to harvest between eight and 15 bags of rice from his two-acre farm in Ahero, Kisumu County, until two years ago when the produce started contracting.

The huge losses suffered every season hit him hard. He would spend at least Sh40,000 ploughing and buying farm inputs but the income was always disappointing.

Since he did not have a store for his produce, it meant that he had to sell his harvest within a week to avoid wastage.

And it is at this point that rice cartels used take advantage of him. A 90-kilogramme bag of paddy rice which retailed at Sh4,500 at the conventional market would only attract Sh2,000 from the middlemen.

This prompted him to abandon the farm for some time as he considered other crops. “I did not want to continue growing rice because of high expenses and meagre returns,” says the 35-year-old.

ARE RESISTANT

After consulting with area agricultural officers, Mr Otieno turned to arrowroots in 2011, particularly the eddoe variety.

According to the farmer, eddoe is widely grown in the area because it can tolerate excess water.

“I started with 7,000 seedlings which I bought at Sh3 each. I bought them from small-scale farmers in the area,” he says.

Once transplanted, the tubers take about six months to mature but it is recommended to start harvesting in the 10th month.

The harvesting can take up to three consecutive months. Currently, a medium sized tuber retails at Sh250.

According to Kenya Agricultural Research Institute senior researcher Dr Philip Lelei, farmers should embrace arrowroots because they are resistant to drought and many diseases and pests unlike rice, which is highly susceptible to diseases.

“The market has been very promising and I am considering doing large-scale farming now,” says Mr Otieno.

In a half-an-acre of land, the farmer harvested eight bags of arrowroots with each bag fetching him Sh6,000 in the local market.

Mr Otieno says he used Sh4,000 for farm inputs and labour.

According to Mr Otieno, the crop consumes a lot of water hence the reason it can be grown in rice field regions. “As you can see the farm is usually moist,” he told Money at his farm.

He says arrowroots can also be grown along riverbeds and marshlands where the soil is moist. Mr Otieno says that when the crop is ready, the leaves start changing colour and then shrink.

The farmer currently has about 30,000 arrow root seedlings which he sells to local farmers at Sh5 each.

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Wednesday, November 12, 2014

You need to get a piece of Kenya’s creative economy

Musician Avril performs during national youth convention at Safaricom indoor arena, Kasarani on June 6, 2014. PHOTO |  JEFF ANGOTE

Musician Avril performs during national youth convention at Safaricom indoor arena, Kasarani on June 6, 2014. PHOTO | JEFF ANGOTE |  NATION MEDIA GROUP

By JAMES WAMBUA
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If you asked Avril Nyambura, 27, to introduce herself, undoubtedly, she would say, “I am a musician, an entrepreneur, a model and an actress”, while Ian Mbugua would say, “I am a thespian, a TV personality, an actor, a teacher et al”.

Both Avril and Ian represent the face of Kenyans who are earning a living from an industry once perceived as a preserve of “academic dwarfs”.

They are also part of a revolution that is awakening a sector well known as “creative economy”.

Creative economy encompasses films, TV, literature, advertising, art, crafts, design, fashion, music, performing arts, publishing and video games.

“Africa is rich in talent and creativity,” ICT Cabinet Secretary Fred Matiang’i said in Nairobi during the launch of M-Net Maisha Magic. His opinion is an affirmation that the sector’s potential is untapped.

In his LinkedIn profile, a member of creative industries task force Michael Otieno says that the government is committed to double the growth of creative industries.

In 2011, former Information PS Dr Bitange Ndemo established a creative industry task force to understand and define the sector in Kenya; whose end results will be to create 10 per cent of employment by 2017.

This year’s Kenya Economic Survey, reveals that arts, entertainment and recreation segments employed 67,000 Kenyans in 2013, up from 64,000 in 2012.

The study noted that the industry grew to Sh3.4 billion in 2013 from Sh2.9 billion in 2012.

COMMERCIALISE CREATIVE TALENT

It is under this trend that both private and public sector have joined hands to build infrastructure and capacity to commercialise creative talent and reap the vast fortunes.

Already, Multichoice Kenya has invested Sh3 billion in the film and content sub-sector.

“We are investing Sh1.5 billion in content production. Last year, we invested Sh1.5 billion in our new studios at Jamhuri Park,” said M-Net regional boss Michael Ndetei.

The bulk of the new investment will be spent in Kenya where 85 per cent of the content will be generated, as Multichoice builds capacity in Rwanda, Uganda and Tanzania.

In July, StarTimes Media pumped Sh6.9 billion into a project that will see it establish its Africa headquarters in Kenya by the end of 2015.

The firm acquired 20,000 square metres of land in Karen to build office blocks, a film and television dubbing centre, StarTimes broadcast station, Digital TV research and development centre as well as a training centre.

Commenting on the investment, Arts and Culture Cabinet Secretary Dr Hassan Wario said, “It is trend-setting seeing that the headquarters will not only house your Africa operations, but also include a production centre that will see the growth of local productions and talents. The government will continue to initiate efforts geared towards ensuring businesses flourish.”

AFRICA'S SHARE

Even as the private sector is investing heavily, a study by the United Nations Conference on Trade and Development in 2010 indicated that Africa’s share of the global creative economy is less than one per cent.

In its manifesto, the Jubilee Coalition recognises that the industry has long been overlooked.

“The associations between sport and the creative industry have long been overlooked. We believe they should be nurtured and supported.”

In support of the Jubilee manifesto, Dr Ndemo notes, “If you have watched the Kenya Schools Drama Festival, you will understand the unexploited potential that we have. Many of the pupils will dissipate into abject poverty or at best go to college to take careers their parents have chosen, only to tarmac later with concealed talent.”

He adds, “Our failure to develop the creative-economy value chain is hurting. Global content giants are taking advantage of our irrational behaviour, and have started to archive our own cultural material such that in the future we shall buy it from them. At the minimum, we should build digital libraries of our cultural heritage.”

On December 5, 2013, the Guardian published a story titled “Hollywood has blockbuster impact on US economy that tourism fails to match”:

“Creative industries led by Hollywood account for about $504 billion, or at least 3.2 per cent of US goods and services, the government said in its first official measure of how the arts and culture affect the economy.”

The creative economy is serious business. India’s Bollywood contributes over $21 billion to the economy.

Nigeria’s Nollywood, although not well diversified, is ranked third globally in gross earnings, its film industry generated over $800 million revenue in 2013.

“It is time we built the creative economy sector. It is the one that unites us, and has great potential for employment. It must be engaged with differently,” Dr Ndemo argues.

A plan is in the offing that will promote the performing arts by constructing an ultra-modern National Theatre with audio-visual live-links in Nairobi and consolidate the required licenses for artistes-cum-musicians to perform around the country on a single licence.

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Wednesday, November 5, 2014

Feuds threaten family ventures, says report

From left, PricewaterhouseCoopers South Africa private company services leader Andries Brink, country and regional senior partner Anne Eriksson and PwC partner Michael Mugasa during the release of the report in Nairobi on November 5, 2014.

From left, PricewaterhouseCoopers South Africa private company services leader Andries Brink, country and regional senior partner Anne Eriksson and PwC partner Michael Mugasa during the release of the report in Nairobi on November 5, 2014. PHOTO | JEFF ANGOTE |  NATION MEDIA GROUP

By IMMACULATE KARAMBU
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Nearly a third of Kenyan family businesses lack mechanisms to deal with conflicts, posing a threat to their existence, an auditing firm’s study shows.

The research by PricewaterhouseCoopers (PwC) also shows that although 55 per cent of these firms have succession plans for some senior roles, only 23 per cent have sufficient and documented plans.

“The finding was insightful because lack of a formal conflict resolution mechanism is a challenge that can destroy the value of the business,” PwC country and regional senior partner Anne Eriksson said.

The survey was conducted between April and July this year on 62 family businesses in Kenya with a sales turnover of between $5 million and $500 million.

It is the first time the auditing firm has carried out the survey in the country. Globally, PwC has been conducting similar studies every two years since 2002.

The respondents were from manufacturing, retail, transport, agriculture and hospitality sectors.

Nakumatt Holdings, Keroche Breweries, Bidco Oil Refineries and Mount Kenya University are among the institutions surveyed.

The report comes at a time when courts are dealing with conflicts emerging from family businesses which have resulted in the closure of some, and low productivity levels among others.

WITHDRAW INTENTION TO BUY

A recent case in which three brothers were involved in a battle for the control of Naivas Supermarkets was closed last Friday.

The family feud saw South African retail giant Massmart withdraw its intention of acquiring a 51 per cent stake in Naivas.

PwC estimates that family-owned businesses account for 70 per cent of the global gross domestic product.

According to the report, about 61 per cent of such ventures consider attracting and retaining employees in the next one year a major challenge due to competition from multinationals.

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Wednesday, November 5, 2014

Uhuru limits planned ban on 14-seater matatus

President Uhuru Kenyatta (left) and Safaricom CEO Bob Collymore aboard a matatu which took them from State House to KICC Wednesday to attend the launch of universal cashless payment system MY 1963 card. PHOTO | PSCU 

By BD TEAM
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President Uhuru Kenyatta has reined in his Government’s plans to ban the use of 14-seater vans in the country’s public transport sector.

The government will effect the ban in Nairobi and Mombasa, but exceptions will be made to matatus operating in long distance routes and in rural areas.

He also said he saw no reason to continue to prohibit the colourful artwork that once made public service vehicles icons of Kenyan creativity.

The Head of State intervened in the campaign to push the low-capacity vehicles out of the matatu (public taxi) business during the launch of a cashless payment system for public service vehicles in Nairobi on Wednesday.

CASHLESS SYSTEM

“After wide consultation and research involving my Government and stakeholders, it has become clear that a blanket ban on 14-seater PSV, especially for long distance and rural transport, may not be appropriate at this time," Mr Kenyatta said.

The announcement provides a lifeline for industry players who were bracing for changes that would first force the vehicles out of most urban centres and then see the vehicles phased out completely.

The President was speaking at the Matatu Owners Association National Delegates Council meeting. The event saw the launch of the MY 1963 pre-paid card, one of several cashless payment systems to be used on PSVs in the country.

He urged industry players to use the new cashless payment systems to provide better services and improve the lives of both their employees and their passengers.

“We’re going to digital payments so that we can have a regulated industry and create jobs through maximum collections,” Matatu Owners Association chairman Simon Kimutai said. He added that use of cash led to numerous losses and encouraged petty corruption when traffic police stopped matatus.

The president also questioned one of the changes introduced several years ago by then Transport minister John Michuki requiring matatus to have one colour only, marked with a yellow line across the middle.

“To be frank, why are we interfering with graffiti on matatus?” he asked, recalling the days when colourful vans were the norm. “Let us (support) our young people (if they wish to make a living doing such artwork).”

Matatu associations and savings and credit cooperatives have been pushing for the lifting of a freeze on new registration of 14-seaters, which the National Transport and Safety Authority began to enforce in December last year. They were also opposed to plans to force 14-seater matatus already registered as PSVs out of cities and towns, the most lucrative markets in the Sh200 billion public transport sector.

DECONGESTING CBD

Despite significant investment in larger mini-buses and buses in recent years, 14-seater vans account for a significant proportion of the private sector’s investment in a country with a weak public transport system.

The ban was proposed as a traffic decongestion measure following the failure of several unpopular attempts to bar low-capacity matatus from entering the Nairobi Central Business District.

The MY 1963 card, issued by the Matatu Owners Association, is developed by Fabre Space Limited and operated on a point-of-sale terminal installed in compliant vehicles. It can be topped up using Safaricom’s M-Pesa service.

Rival cashless systems include BebaPay (by Equity Bank and Google) and Abiria Pay (from Kenya Commercial Bank, MasterCard and Kenya Bus Services).

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Tuesday, November 4, 2014

Farmers in a tight corner as maize price hits Sh1300 a bag

A sample of yellow hybrid maize growing. As confusion reigns, farmers have been left at the mercy of middlemen, who are capitalising on the absence of NCPB and poor weather conditions to exploit growers. PHOTO | FILE | NATION MEDIA GROUP 

By GERALD ANDAE
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A planned meeting of the Strategic Grain Reserve (SGR) trustees failed to take place yesterday even as maize prices in the grain basket of the North Rift continued to slide for the fourth week in a row, eating away farmers’ profits.

Reports indicated that the price of a 90 kilogramme bag of maize had dropped to Sh1,300 in parts of North Rift from Sh1,500 two weeks ago and Sh2,800 in May as uncertainty remained over the government’s release of the Sh2.7 billion that had been set aside to buy grains for SGR in the current financial year.

Sources within Kilimo House, where the trustees were to meet, told the Business Daily that the meeting was postponed after the principal secretaries for Interior and the Treasury failed to show up. The two PSs (Interior and Treasury) together with their Devolution and Agriculture counterparts form the team of SGR trustees.

“The meeting has been pushed to Thursday as some of the trustees did not show up today,” said the source who requested anonymity.

This came even as the National Cereals and Produce Board (NCPB) faced logistical nightmares in its plan to move about 1.5 million bags of maize from the North Rift depots to create room for purchase of new grains from the current harvesting season.

The board requires up to Sh200 million to move the old stock from Eldoret, Moi’s Bridge and Kitale depots to deficit areas like Turkana and Eastern Kenya silos.

URGENCY TO SELL

As confusion reigns, farmers have been left at the mercy of middlemen, who are capitalising on the absence of NCPB and poor weather conditions to exploit growers.

Western Kenya is experiencing heavy rains that have hindered drying of grains, forcing growers to hurriedly sell their crop to avoid post-harvest losses.

That urgency to sell has opened the room for traders to offer low prices arguing that they incur additional cost in handling the grain with high moisture content.

NCPB accepts maize with a moisture content of up to 13.5 per cent and subjects any produce exceeding this limit to dryers at a cost of Sh28 per every drop of water content in a bag.

Kenya loses up to 30 per cent of the annual maize output to poor post-harvest handling of the crop because a lot of farmers lack proper storage facilities.

The government has indicated that it might not buy maize at Sh3,000 it paid for a 90 kilogramme bag in the past two years, noting that the cost of production fell significantly with the drop in fertilizer prices.

President Uhuru Kenyatta in April reduced the price of a 50 kilogramme bag of planting fertiliser from Sh2,500 to Sh2,000, offering much needed relief to growers.

Kenya Farmers Association has, however, warned the government against reducing the buying price below Sh3,000, arguing that the move would subject farmers to losses.

“Even with the reduction in the price of fertiliser, the cost of production remains high and it would be unwise for the government to buy maize from farmers at less than what has been spent growing it,” said Kipkorir Menjo, a KFA director.

Egerton University-based think tank-Tegemeo Institute, in one of its findings last year, said it would cost a farmer Sh1,741 to produce a bag of maize in Trans Nzoia, while a grower in Uasin Gishu spent Sh1,400 to produce a similar quantity of maize. A fortnight ago, farmers protested in Eldoret, asking the government to open NCPB and purchase maize at Sh3,800 per bag.

Last year, the government released Sh3 billion in September and by the third week of October NCPB had already commenced the buying exercise.

Harvesting in the North Rift, the country’s bread basket, started this month and traders reckon maize prices could fall further.

The falling maize prices have come as a reprieve to households that have been enjoying a drop in price of flour that has in the past three months dropped by Sh12, a move that helped in easing inflation last month to 6.6 from 8.36 in August.

The article first appeared in The Business Daily.

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Wednesday, October 29, 2014

Sharpen your ability to evaluate risk and reward

It is not your ability to speak or write eloquently. It is the business sense you bring out in the form of risk and return in the opportunity, and your abilities, thereby creating a strong ground for the other party to risk their money on you. PHOTO | FILE

It is not your ability to speak or write eloquently. It is the business sense you bring out in the form of risk and return in the opportunity, and your abilities, thereby creating a strong ground for the other party to risk their money on you. PHOTO | FILE 

By PATRICK WAMEYO
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IN “if you have a good deal, the money will find you,” we highlighted the need to know the difference between a good deal and hot air.

We particularly said that this is the capacity that the proposer of the business or investment opportunity must have in order to express an innovation to another party who is coming into contact with it for the first time in a manner that they drop their guns and give you cash.

It is not your ability to speak or write eloquently. It is the business sense you bring out in the form of risk and return in the opportunity, and your abilities, thereby creating a strong ground for the other party to risk their money on you.

Venture capitalist do not fund ideas. They fund their belief in the proposer of the idea to see it through.

LEARNING CURVE

In many cases, very successful people will not take a risk on you if you have never gone through psychological curve of losing a business or turning around a dying one back to life.

The general advice on how to acquire this intelligence is to start with small deals until you create sufficient pool of knowledge to handle big projects, whether you are starting directly in the investment quadrant or ending there through business.

The learning curve can be long or short depending on your relationships (teachers), and the nature of deals you handle in the earlier years. However, the lessons must be taken and there is no standard path to follow.

Some things cannot be learnt through a formal curriculum, but rather through a mix of intuition and facts, trial and sometimes costly errors.

It is an experiential learning that not only changes your ability to repeat the same thing but also permanently changes your perception of self, by revealing more of yourself to you. Business and investing acumen is one of them — a unique set of intelligence that cannot be described by a curriculum.

The seventh and the final basic rule of investing is to develop the ability to evaluate risk and reward.

In the words of my coach, “I believe after going through the seven basic rules of investing, you have realised how crucial financial intelligence is when it comes to investing.”

Fellow parents, investing intelligence school starts after school, father to son or daughter.

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Wednesday, October 29, 2014

Premium remittance by employers needs streamlining

A caring employer will encourage employees to the prudent habit of regular saving and protecting their families such as through life insurance. Indeed, this is the reason why most employers have facilitated check-offs for life insurance premiums. PHOTO | FILE

A caring employer will encourage employees to the prudent habit of regular saving and protecting their families such as through life insurance. Indeed, this is the reason why most employers have facilitated check-offs for life insurance premiums. PHOTO | FILE 

By ISAAC NG’ARU
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Upon taking insurance through the check-off system, normally employers are supposed to remit the deductions to insurers.

Now, a situation has arisen where an employer deducts premium in the pay slip but fails to remit the same to the insurer in time, resulting in arrears on the policy.

This raises disputes between the insured and insurer because the former takes this to mean that the insurance company is scheming to deny him/her rights.

As many policyholders face this dilemma, is there a law that can be applied to compel employers to remit premiums in time?
— Julius K. K., Eldama Ravine

This problem of delayed remittance by employers of the premiums deducted from their employee’s salaries exists in our industry. For civil servants who have life insurance particularly, it has become acute with devolution.

As you rightly point out, many policyholders get affected when insurers intimate possible lapse of cover because they have not received premiums in due time according to the terms of the policy.

I can understand the policyholders’ dilemma.

You see, there are two contracts in this circumstance: the policy itself and the check-off system. The latter facilitates, firstly, the deduction of premium from an employee/policyholder’s salary by the employer and, secondly, provides for the employer to remit the deductions to the respective insurance company.

In essence, the check-off system itself comprises two further contracts: one involving the employee/policyholders signing the salary deduction authorisation, and the second one between the insurance company and the employer for effecting the requisite deduction and remitting the money to the insurer.

LIFE INSURANCE

In the circumstances, the employee/policyholder has fulfilled his/her obligations under the contracts. But under the current situation, it is the employer who is failing to keep their side of the bargain.

Although it is true the employer and insurer have an agreement for co-operation, this is engendered by goodwill with employers facilitating check-off to enhance their employee’s social welfare.

A caring employer will encourage employees to the prudent habit of regular saving and protecting their families such as through life insurance.

Indeed, this is the reason why most employers have facilitated check-offs for life insurance premiums. The agreements with insurers are more for co-operation than confrontation. So, the thought that such agreements should end up in court is rather impalatable.

Arising problems can be resolved through follow-up and dialogue.
This is what is exactly happening. Both through the Association of Kenya Insurers and individual insurers directly engaging their check-off partners, discussions are in progress to resolve the matter.

In particular, concerning policyholders in civil service, the problem has been exacerbated by the on-going devolution where many payrolls are being decentralized.

It is such changes that have disrupted the system, not the employers deliberately failing to fulfill their obligations concerning remittance of premiums deducted to the respective insurers.

The prevailing situation also impacts life insurance operations adversely, of course.

The premium revenue stream has been disrupted for many life offices. In turn, this affects the investment activity.

Insurers do not cherish disputes with their policyholders in these circumstances and that’s why they are working towards resolving the problem.

But they have to alert affected policyholders so that the latter can, from their end, promote their employer to resolving the remittance issue expeditiously.

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Wednesday, October 29, 2014

What to ask before taking personal loan

In today’s hard financial times when money has become scarce and low in purchasing power, borrowing has certainly become inevitable. PHOTO | FILE

In today’s hard financial times when money has become scarce and low in purchasing power, borrowing has certainly become inevitable. PHOTO | FILE 

By EDWIN OKOTH
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In today’s hard financial times when money has become scarce and low in purchasing power, borrowing has certainly become inevitable.

A recent Ipsos poll showed that one in every four Kenyans has contemplated suicide due to the rising cost of living.

A previous report shocked many that 93 per cent of Kenyans earn less than Sh40,000 while almost half of them take home less than Sh10,000. 

These scenarios have not only pushed Kenyans down the pit of debt but also made them to diversify the reasons for borrowing from fulfilling long-term goals to fixing short-term emergencies or simply accessing credit for consumption or paying pressing debts.

“We live by debt, it is hard to balance income at the end of the month when you know very well that what you expect will all be swallowed in the debt,” says Caroline Achieng’ who works for a local supermarket in town. 

Borrowing from financial institutions is the fastest way to access a large amount of money that you cannot save over a period of time.

Many people also consider it more personal in a society where asking friends and relatives for money can turn out to be quite embarrassing.

The Kenyan financial market is also continuously opening borrowing channels with mobile money, credit cards and overdrafts becoming so easy to access that the temptation to borrow is just too high.

That be as it may, the pit of debt is definitely where you would not want to be found in.

It is worth considering certain realities before taking the jump to be a debtor. Here are some of them: 

What are the costs associated with the loan?

When applying for a loan, many people simply plan with the amount they are applying for in mind.

The urgency to get cash makes potential borrowers sign the loan forms without even knowing what the net take home will be.

Isabella Wambugu is a micro loan officer with a local bank in Nairobi, she says that borrowers simply say that they want a certain amount and ask for the monthly instalments.

“Customers will be seen in the banking hall after spending the loan to ask about the charges and the interest of the loan,” Ms Wambugu says. This group is just a few among the Kenyans who care to know after all. Others never even have an idea about what many call “the hidden charges.”

Every loan application has charges tagged on it.

Some banks may call it service charges or appraisal fees but the truth is that it ranges between three and nine per cent of the total amount of loan being applied for.

Some banks would deduct this amount in advance before disbursing the loan to you while others will load it over the principal borrowed and the interest in the repayment.

If you are applying for say Sh3 million loan, you may pay as much as Sh270,000 in processing fees alone.

Apart from the processing charges, banks normally insure the loans you take against death and or disability; again this one ranges from one financial institution to another.

“Banks have to keep safe and avoid the embarrassment of looking for relatives of the deceased to add salt to the wounds of people who have probably lost a bread winner,” notes Mr Richard Mwaniki, a private debt recovery consultant in Nairobi.

This fee is dependent on the period of the loan since it applies annually.

It is, however, charged at the processing stage, further reducing your take home or carefully loaded in the repayment structure but either way — you pay. That is the bottom line.

Loans are repaid with interest and since the figure is usually given in percentage per year, it rarely crosses the mind of the borrower how much he/she will return to the lender over and above the principal.

In 2011, when inflation went through the roof, many borrowers found their loans restructured because interest rates increased.

Many either did not understand it or just did not care to know why the repayment periods had become longer.

What is the timing of the loan? 

While planning to borrow, the purpose must guide your timing which will be crucial in determining how the money helps you anyway.

Loans in some circumstances may not be instant especially when collateral is used as security.

A title deed for example has many legal processes for its joint registration that may take between three weeks to one or even over a month to complete.

Banks will only lend you after the land is cleared as clean and safely registered under the borrower and the bank’s names.

If your purpose for the credit is time-fixed, you may end up getting the much needed cash when it is too late. As a consequence, you may end up misusing the money. 

The same applies when you rush to borrow before the time is ripe and as fate would have it, something unusual comes up to consume the money you intended to invest.

The next thing is that you may fall in repayment struggles and consequently lose an asset in the process.

A timing error will mean you never get value, for example, borrowing for a car or a machine whose value will depreciate by the time you complete repaying.

You will have simply gone through a borrowing and repayment process but the asset dies with the loan leaving you with no value in the end. 

Another aspect of time is tied on the repayment schedule. You must clearly know your income plans and relate it to the frequency of repayments, whether weekly, monthly or quarterly.

Agreeing to a deal that does not obey your income trend will land you in repayment hardship and make you look like a bad borrower who delays repayments.

Wait, one more thing... never rush to borrow when you are in a crisis. You will not only end up with the worst lender but also sign anything to get cash.

Net value versus alternative means

It is also worth asking yourself whether it is the best option available. Have you considered other ways of raising cash other than debt?

Is it a burden worth carrying? How much value will it add to you or your business?

These are crucial but mostly ignored issues that ought to cross your mind before you sign the dotted lines and commit to repay for a loan, sometimes for a period of even over 10 years.

 

Shopping for the best debt

  • Prepare yourself. Before lending you money, a bank or other group will want to see a business plan and current financial statements. They’ll also check your personal credit history, so be sure your credit score is excellent.

  • Shop for the best terms. If one bank wants to give you a loan, it’s likely another will, too and at a competitive rate. Just make sure to read contracts closely and ask the right questions to ensure you are being offered a better deal.

  • Borrow only what you can afford. Avoid the temptation to borrow more than the absolute minimum you need, no matter how much you are qualified for.

  • Debt isn’t evil, but it can be dangerous. Use it wisely, and it can give you a financial edge, providing the flexibility to seize opportunities you otherwise couldn’t afford and ones that could push your business to the next level.

  • Always remember: The best debt is one that has been repaid.

    — Entrepreneur.com

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Wednesday, October 29, 2014

Builder finds treasure trove in quarry

Ndegwa Muriithi displays tiles at his company, Stone Centre at Kiganjo, Nyeri County. PHOTO |JOSEPH KANYI

Ndegwa Muriithi displays tiles at his company, Stone Centre at Kiganjo, Nyeri County. PHOTO |JOSEPH KANYI 

By BONIFACE MWANGI
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Come next month, Ndegwa Muriithi will be adding three more machines to his workshop so that he can try to meet the rising demand for his products.

Mr Muriithi says he will be shipping in three Single Gang Stone Saw machines, the devices which he uses to cut different types of natural stones into various decor products for buildings.

Decor floor slabs, tiles for wall copings, decorated paving slabs, natural stone cobbles and inter-locking blocks are just some of the products which he makes at his Stone Cut Limited, located in Kiganjo, in Nyeri County.

With a single machine using wet-cut method, Mr Muriithi has been turning waste stones from the expansive quarries in Kiganjo into money.

According to the builder who is also a father-of-two, the idea came about five years ago when he was contracted to set up a four-storey block in Thika town.

RELIABLE MARKETS

“The owner wanted very smooth walls and we started looking for a machine that would cut the building stones to the desired texture,” he says.

This, he says, forced them to halt the construction until they got one that produced the desired finish.

From that day, the 50-year-old planned to buy one Single Gang Stone Saw from China at a cost of Sh1 million and put up a small plant that does not only recycle the quarry waste, but sees quarry workers earn more.

The steel blade of the machines is made of diamond. This means that Mr Muriithi has to cool the blade with water to reduce friction.

His products are made from  granite, slate, sandstone, marble, travernite and other stones. According to him, every product has its own price and this usually depends on the type of stone.

“I have been in production for the last three months and things are really looking good for me,” he says.

His products, he says, have zero carbon rating, are easy to clean and at the same time, they are beautiful.

The building blocks require little cement, he adds since they have been smoothed.

“One only requires painting his or her wall after completion of the building but even without that, the wall looks beautiful,” he notes.

“Professional designers prefer natural stone for both residential and commercial buildings. The beauty and elegant finish of natural stone are unequalled and it is a timeless sense of style and luxury and increases the overall worth of your home in the market,” says Stone Centre Limited manager, Ms Ann Wangui.

WATER - TIGHT

Currently, Mt Kenya Region and Nairobi provide him with a reliable market. However, he says, after buying three new machines, he will start exporting to China where he has been scouting new markets. If successful, he says, it will be a big win for both Nyeri County and himself.

As for wall and floor clubbing tiles, Ms Wangui says, they have long life and require minimal maintenance. The water-tight nature of precast eliminates moisture absorption.

“A sealed, exposed aggregate finish tends to be self-cleaning and has a very long service life,” she notes.

Until now, Mr Muriithi has pumped over Sh7 million in his business which only occupies three-and-a-quarter acres of land. He has employed five people already. However, with the additional machines, he intends to hire 48 people.

At the moment, his main competitors are products from China which he says they are made of ceramics.

According to him, it costs one $40 (Sh3,520) to ship in a square metre of natural stone and this he says has made many people to avoid using them since they are expensive.

And with his products now ready and locally available, he hopes many will use them as he says they make construction cheaper and easy to maintain.

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Wednesday, October 29, 2014

He is just 23 and skating his way to financial freedom

Mr Kelvin Mwangi in a skating lesson at Shah Lalji Nangpar Academy-Junior School in Nakuru on October 22, 2014. SULEIMAN MBATIAH

Mr Kelvin Mwangi in a skating lesson at Shah Lalji Nangpar Academy-Junior School in Nakuru on October 22, 2014. SULEIMAN MBATIAH 

By MAGDALENE WANJA
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He started skating by the roadside as a hobby immediately after high school. While at it, parents approached him to train their children.

The request saw Kelvin Mwangi buy three sets of skating kits from second hand shoe dealers to start coaching his skill in 2012.

Today, Mr Mwangi, 23, is an accomplished skating trainer in Nakuru and does not regret venturing into an area that is slowly becoming a popular sport among children, especially those from affluent families.

He usually charges Sh300 per session with each period lasting three hours in a day.

With the demand growing, Mr Mwangi incorporated his two friends into the booming business.

“My weekends are jammed and I have to attend church service early in the morning before venturing out to attend to many orders in various schools,” he said.

EVER BUSY

Schools keen on introducing skating as a sport have ensured that he is ever busy every evening and at weekends.

Earlier, Mr Mwangi, who is a trained chef, used to skate as a way of exercising but has slowly turned cooking into his hobby while skating is his full-time job which earns him Sh20,000 profit in a month.

“I charge Sh7,000 per student in the international schools and Sh4,500 per student in the local schools. The payments are paid per term,” he told Money.

So far, he has acquired 30 sets of skating kits which he uses to train both children and adults. Each set consists of a helmet, a pair of elbow-guards, palm-guards and knee-guards as well as a pair of skating shoes.

Flexible and swift

“I have mainly invested in children because I enjoy most when training them since they understand easily than adults. Their bodies are highly flexible and swift, too,” he added.

Apart from training children, skating has also seen him get marketing contracts with local companies to distribute flyers, booklets and posters.

“Skating helps in covering long distances while at the same time having fun. I have done it with NSSF, Orange Kenya and a number of mobile phone companies,” he said.

Like any other form of business, however, Mr Mwangi has faced challenges which include lack of training stadia.

“The county government should consider skating as an important sport that requires a specialised indoor facility for both adults and children. This will also help in creating more opportunities for the youth,” he added.

 

INCOME AVENUES

  • Parents part with Sh300 per three-hour session for their children.

  • International Schools keen on introducing skating as a sport pay Mr Mwangi Sh7,000 per pupil per term as local schools pay Sh4,500 for each learner.

  • Marketing contracts from local companies.

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Wednesday, October 29, 2014

Career auditor’s investment in data software pays off

Managing director Grande Afrique Consulting, Godfrey Mwika speaks to the Nation at his office in Nairobi on October 28, 2014. PHOTO | ANTHONY OMUYA

Managing director Grande Afrique Consulting, Godfrey Mwika speaks to the Nation at his office in Nairobi on October 28, 2014. PHOTO | ANTHONY OMUYA  

By RAMENYA GIBENDI
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Godffrey Mwika stepped out of a high flying corporate job after working for 10 years with various top brands to set up a consulting firm that leverages on technology to tackle challenges facing businesses in the modern world.

In 2012, the career accountant and auditor with certification in accountancy, auditing and information systems quit his job to set up Grand Afrique Consulting, an outfit whose core business is provision and use of cutting-edge technology to access, audit, investigate and manage data in organisations.

“Throughout my employment, I realised that one of the biggest challenges facing businesses today is data management, especially with the advent of technology and phenomenal growth in the size of transactions,” Mr Mwika told Money.

If a business cannot fully understand and control all its data, that is, how it is acquired, processed, stored, released and applied in making decisions, then it cannot adequately handle business risks such as fraud as well as wastage of resources, he added.

Data management, he said, is key to impartial audits, risk management, performance measures and fraud management by all institutions.

GOING IT ALONE

“There was a big gap in the market and I jumped onto it after realising the potential,” he narrates when asked why he opted for the business.

Since 2001, Mr Mwika has worked for several multi-national and blue chip firms including PricewaterCoopers as a senior associate auditor, a risk consulting manager at KPMG, head of audit and risk at Bata Shoe Company-Kenya, a senior manager in audit and risk at Mumias Sugar Company, an ICT divisional director at AH Consulting in Uganda as well as head of audit and risk at Sovereign group limited.

Throughout his career, Mr Mwika worked in risk management, ICT consulting, internal and external audit departments, business process reviews as well as fraud investigations all over Africa.

The experience he gathered over the period by handling different clients is what he says motivated him into going it alone.

“I realised there existed computer software to help institutions and businesses easily handle challenges related to these areas but no one seemed to exploit the area well,” he said.

Armed with about Sh1.5 million savings, Mr Mwika set up shop, carefully assessed the right software and approached several international program developers who later worked out dealerships and partnerships with his firm as the licensed regional business leader.

“Curently, we have established business partnerships with global leaders in specialised software including ACL Services Limited (Canada), CQS GRC Solutions (South Africa), Pentana Limited and Ideagen Plc in the United Kingdom, OMS Solutions in India and Imacert in Dubai,” he said.

His biggest clients, he says, are financial institutions, media houses, telecommunication companies and manufacturing firms seeking to manage losses through efficient data management systems.

Other clients are drawn from insurance, agriculture, real estate, hospitality and healthcare sectors in what Mr Mwika believes underlines how institutions have been battling challenges brought by inefficient data management.

“We have an aggressive marketing team but the bulk of the business we get is through client referral which means there was a huge need in the market,”  explains the employer of eight permanent staff.

Once purchased and installed, depending on the software, an institution is able to perform extensive data analysis in aspects such as sales, expenses, procurement and inventories among others.

SEALED LOOPHOLES

ACL software, for example, can access any type of data from any source or format and perform limitless analytics at very high speeds and with 100 per cent accuracy and completeness, he says.

A single user licence, one that can only be installed on one computer in an organisation, is sold at Sh170,000 which is renewed on annual basis at an agreed fee while the ACL audit exchange licence for continuous auditing costs Sh720,000.

“ACL Software Solutions alone has over 70 users in Kenya drawn from government institutions, private sector, NGOs across all industries. There are over 15,000 ACL users globally and 98 per cent of Fortune 500 companies globally use ACL. This is indeed a good company to be in,’’ Mr Mwika notes.

Through the analysis, the software easily records suspicious transactions and or entries thus providing room for faster intervention and easy detection of fraud.

“The clients we have offered these technological solutions have admitted to having sealed so many loopholes through which they were previously losing money from their system as well as piece together waterproof evidence for prosecution of criminals,” he notes.

The firm also does human resource consulting and offers specialised software to manage individual staff information about each employee in organisations.

The proprietor is currently working with various government agencies keen on leveraging on technology to seal loopholes exploited by rogue state officials to perpetrate graft as has been noted in public procurement fraud and ghost workers.

 At two years old now, the firm employs 8 permanent staff, all of whom were direcTly picked from university and taken through an induction procedure to align them with the unique needs of the company. It has also opened an office in Kampala, Uganda.

“Our next phase is targeting SMEs and medium enterprises with reasonably priced technological solutions in relation to the size of their business,” explains Mr. Mwika.

Grande Afrique Consulting has also see growth in its fraud investigations work, business restructuring, internal audit work, business process reviews, ICT consultancy and a number of other service lines in its management consulting arm.

‘He however is reserved on the firm’s monthly turnover but judging from the expensive address in Nairob’s Central Business District in which the firm’s offices are headquartered, Mr Mwika seems to have  got his business right.

ABOUTGRAND AFRIQUE CONSULTING

  • Owner: Godfrey Mwika

  • Year of established: 2012

  • Capital: Sh1.5m - personal savings.

  • Specialisation: Provision and use of cutting-edge  technology to access, audit, investigate and manage data flow in organisations.

  • Partnerships struck: ACL Services Limited (Canada), CQS GRC Solutions (South Africa), Pentana Limited and Ideagen Plc in the United Kingdom, OMS Solutions in India and Imacert in Dubai.

  • Clients: Financial institutions, media houses, telecommunication companies and manufacturing firms besides companies in insurance, agriculture, real estate, hospitality and healthcare industries.

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Wednesday, October 29, 2014

Student designers call for Kenyan fashion body

A model walks the runway at the Afrivazi fashion show at Egerton University, Njoro in Nakuru County, October 25, 2014. A one day university fashion gala attended by hundreds of students has supported pleas for the formation of a body bringing together all fashion colleges and linking them with the market. PHOTO | SULEIMAN MBATIAH

A model walks the runway at the Afrivazi fashion show at Egerton University, Njoro in Nakuru County, October 25, 2014. A one day university fashion gala attended by hundreds of students has supported pleas for the formation of a body bringing together all fashion colleges and linking them with the market. PHOTO | SULEIMAN MBATIAH 

By MAGDALENE WANJA
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A one day university fashion gala attended by hundreds of students has supported pleas for the formation of a body bringing together all fashion colleges and linking them with the market.

Speaking on the sidelines of the Egerton University fashion Gala, an organiser, Ms Vallary Achieng said that the response received from participating institutions and students showed Kenya was ripe for a body tasked with monitoring fashion trends.

The fourth year student pursuing Fashion and Design at Egerton University added that this will allow for interactions and exchanging ideas which will eventually lead to growth in the industry.

“The fashion industry has a high potential of not only creating employment among the youth but also contributing to the economy of the country,” she added.

Over 500 students participated in this year's Egerton University's fashion show where various designs were displayed by models.

INNOVATING IN FASHION

The show dubbed Afrivazi raises awareness on the role played by arts especially fashion design as an element of entrepreneurship so as to make more people embrace Kenyan and African made outfits.

The event also aimed at linking the arts and design students with the local and international fashion industry where 10 institutions of higher learning showcased various innovations on fashion.

This year’s show attracted hundreds of university students, lecturers, staff and the general public who attended the event.

The show also attracted the participation of 25 models all picked from different institutions of higher learning and upcoming models from Kisumu, Laikipia, Nairobi and Eldoret.

“It is our hope that the show will bring more people on board to help us achieve our objectives not only through the annual fashion and art showcase we hold but also the other events,” said Ms Achieng.

The various participants specialised in designing, jewellery, clothing and vintage from University of Nairobi, Kenyatta University, Ashleys and Vera Beauty College.

“Fashion is in the sky, in the street, fashion has to do with ideas, the way we live, what is happening” and it is up to us to use it to bring out the best in ourselves and in the human race,” she added.

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Tuesday, October 28, 2014

One in three Africans have entered middle class: study

More than one in three Africans have entered the middle class in the past decade, and their numbers are set to increase thanks to rapid economic growth, a study showed Monday. PHOTO | FILE

More than one in three Africans have entered the middle class in the past decade, and their numbers are set to increase thanks to rapid economic growth, a study showed Monday. PHOTO | FILE 

By AFP
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JOHANNESBURG,

More than one in three Africans have entered the middle class in the past decade, and their numbers are set to increase thanks to rapid economic growth, a study showed Monday.

At least 370 million Africans, or 34 percent of the continent's 1.1 billion people, are described as members of the middle class, according to a survey by the African Development Bank.

In turn, the bulging middle class will help drive further economic growth and development, the Tunis-based AfDB said.

By 2060 the group should represent 42 percent of the population, according to the study launched in Johannesburg nearly 20 years ago.

"There is a stable middle class and it is growing," said Mthuli Ncube, the AfDB's chief economist and a senior research fellow with Oxford University's Blavatnik School of Government.

DEFINITION OF CLASS

"It is a big driver for investment in Africa," he added at a news conference in Johannesburg.

The International Monetary Fund forecasts that Africa's economic growth, boosted by rising investment in natural resources and infrastructure, will reach 5.1 percent this year, up from 4.7 percent in 2013.

It should climb to 5.8 percent next year, the IMF predicts.

The study, which defined the middle class as having a purchasing power parity of between $2.20 and $20 (15 euros) a day, found that the middle class is strongest in countries with a robust and growing private sector.

North Africa leads the pack with at least 77 percent of its population counted among the middle class, surprisingly followed by the central African region at 36 percent of its people falling in that category — though many are considered to be vulnerable.

The southern African region, home to the continent's most developed economy, South Africa, is in third place, level with west Africa with around 34 percent of their people classified as middle class.

East African countries are at the bottom of the ranking, having just a quarter of their nationals in the middle class.

Consumption and ownership of items such as a television set, car and refrigerator, and the type of flooring in dwellings were among the yardsticks used to define the class.

Other measurements included access to electricity, sources of drinking water and types of toilets.

Based on a survey of 37 African countries, the study polled nearly 800,000 households and concluded that most of the countries saw a rise in the size of the middle class over the past decade.

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Tuesday, October 28, 2014

Regulator says only PhDs will lecture in varsity

Graduands at a past ceremony. Lecturers with master’s degrees have been reduced to tutorial or junior research fellows. PHOTO | FILE

Graduands at a past ceremony. Lecturers with master’s degrees have been reduced to tutorial or junior research fellows. PHOTO | FILE  

By GERALD ANDAE
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Only holders of PhDs will be allowed to lecture in universities following the introduction of fresh guidelines by the universities’ regulator.

The Commission for University Education (CUE) said the new guidelines would be adopted by all universities, including those owned by private investors, and implemented over five years.

Lecturers with master’s degrees have been reduced to tutorial or junior research fellows.

“It is now a basic requirement that for one to be a lecturer he/she has to be a holder of a doctoral degree,” said Prof David Some, secretary of the Commission for University Education (CUE).

This brings to an end the current criteria where each university had a different formula of promoting and appointing lecturers.

NEW GUIDELINES

For one to be promoted to professor, they would now have at least a minimum of 60 equivalent publication points from scholarly journals, up from the current 10 points.

The publication points are based on the number of books published and level targeted such as high school or university. For example, one university book is equivalent to four points while one tertiary level book has two points.

The new guidelines also require a professor to supervise five postgraduate students with two of them at doctoral level, unlike the current system where one can become a professor without having supervised PhD students.

The common regulation will curb the situation where lecturers have been moving to universities with lower grading points in order to earn higher titles.

“We have had cases where a lecturer would move to a university with lower grading requirements to earn titles. This has come to an end with the enforcing of the new standards,” he said.

On the other hand, associate professors will only earn the title after attaining a minimum of 48 publication points of scholarly journals and having supervised four students at postgraduate level.

Currently, one would get the title having accumulated eight publication points.

The new guidelines were approved on Monday at a stakeholders’ workshop in Nairobi. Education secretary Jacob Kaimenyi said the new criteria would create order and level the field for fair competition in local university system.

The article first appeared in The Business Daily.

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Tuesday, October 28, 2014

Zuqka speaks to Mandela Washington Fellows

From left, Suzanne Semenye, a director of The Grass Company for YALI Program and Mshila Sio, Director and founder of Agua Inc. PHOTO | CHARLES KAMAU

From left, Suzanne Semenye, a director of The Grass Company for YALI Program and Mshila Sio, Director and founder of Agua Inc. PHOTO | CHARLES KAMAU  

By NALIAKA WAFULA
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Suzanne Semenye, co-founder and director, at The Grass Company

 

Tell us a little about yourself

I am a wife and mother. I have been married for six years and  have a three-year-old son.

I studied at the University of Nairobi, with a focus on communication and sociology — something I never thought I would study.

That was mainly because I wanted to be a pilot, which never happened. But on the flip side, I ended up marrying one.

I was chuffed to find that I was nauseous flying in the cockpit so I guess it’s just as well that I didn’t end up flying.

How did you hear about the YALI fellowship?

I heard about the Mandela Washington Fellowship through a friend, who asked me to share the information with young people who work with our agency.

She encouraged me to apply as well, and I  actually qualified. The application was done online, and the shortlisting was done in Washington. 

What was your reaction on being selected?

When the embassy notified me that I was selected, I felt humbled, honoured, surprised and elated because there were more 50,000  applicants  and I was among those chosen.

The opportunity was in God’s timing as I was looking for the next frontier in my career and personal development.

You got to meet the US President among other important people…

Meeting President Obama, Secretary of State John Kerry and Michelle Obama were definitely the high points in the programme.

I sat at the very front row when Michelle Obama spoke to us about facilitating education for girls in Africa.

She is a warm person who clearly loves advocating for change. She was so genuine and relatable. To the chagrin of her security detail, she went around hugging the fellows; I received a motherly hug from her.

I was in awe that such a powerful woman could be so accessible. She is really unlike a lot of powerful figures you would meet.

What stood out most during your stay there?

Two things impressed me. First, the calibre of young leaders in Africa is astounding!

Young people are doing great things against all odds: rescuing girls from FGM, generating alternative sources of energy, changing the economy of a village.

The level of confidence and willingness to sacrifice to make a change was inspiring. The second thing that impressed me was the warm reception.

You are a co-partner at The Grass Company, tell us more about it?

A few months after getting married, a good friend approached me to partner with him in founding The Grass Company, a consumer collaboration agency based in Nairobi.

I was scared witless but with my husband’s blessing, I took the chance and jumped in. It was one of the best decisions I have ever made.

Being in business is not as glamorous as people imagine because the challenges are immense and often overwhelming.

The rewards are equally rewarding and now The Grass Company has been in this market for six years and we are only getting better!

What next?

In the next couple of months, I would like to engage with the young women (and men) in entrepreneurship to teach them what I  learnt during my fellowship and inspire them to achieve their goals.

I am creating an online mentorship platform to allow diverse linkages among women where they can share and learn from each other.

I will also leverage on my newly acquired African network of friends to expand my business within the continent.

One maxim I learnt is that your dreams should scare you – that way, even if you achieve 10 per cent, you have achieved a whole lot!

____________________ 

 

Mshila Sio, Director and founder of Agua Inc.

Zuqka: How did you hear about the Young African Leaders Initiative (now Mandela Washington) fellowship?

Mshila: A friend sent me an email. She thought I would be perfect for the programme, based on the work I do in the water sector. I simply sent in my application a few days before the deadline. I was determined to be involved and knew a few very qualified friends who were applying so I was very thorough.

Tell us what the fellowship is about?

It is the flagship programme of President Obama’s Young African Leaders Initiative, in which  a class of 500 was selected as a representation of the extraordinary promise of young people’s ideas and potential on the continent. They selected current and emerging young Africans in three areas, namely business and entrepreneurship, civil leadership and public management.

How did you feel when you were chosen as a fellow?

I was ecstatic, as you’ would expect since it provided an incredible opportunity for our organisation, Agua Inc., and for me as well although initially, I didn’t realise how incredibly competitive the selection was. I was very humbled when the state department told us that 50,000 Africans had applied for the programme.

What was your experience there?

The simplest way to put it is life transforming. I was with 25 other fellows representing 19 countries under the “business and entrepreneurship” track at Dartmouth College.  

Dartmouth is an Ivy League institute and they took the programme very seriously, meaning we spent all our time with the best of their faculty members going through an executive training schedule. It was an academic endurance race.

We had several opportunities to visit businesses in the region, learning and absorbing best practice and we got to participate in numerous community activities. It seemed like we never stopped. Even our leisure time was crazy, from hikes to camping to high-ropes courses.

How do you hope to apply what you learnt here?

I left thinking that every Kenyan should have an opportunity to go through what I had just experienced.

So, apart from applying those teachings in my business and daily life, I will also be working with the Global Peace Foundation in their Leap Hub programme to duplicate what we learnt and applying it in Kenyan high schools with the aim of mentoring the next generation of entrepreneurs.

I will be joining other Leap Hub champions such as Dr Manu Chandaria and Mr Heshan de Silva.  

You met the Obamas; tell us a bit about that experience?

It was out of this world. President Obama had a very candid discussion with us at the summit about Africa’s future and the roles Americans hope to play. We also had a say about how we want this relationship to move forward over the next few decades.

The summit in Washington DC was an exchange of ideas and goals from both sides.

It is time we started trading with them on an equal footing and we have to recognise our value for that to happen and approach the table in a different way; not through aid or as lesser nations.

I got to shake Obama’s hand, which was quite a privilege.

Two days later, we got to listen to Michelle Obama and she was beyond inspiring.

I was left standing in the hall for a few minutes just absorbing her energy after she left. She is the magic in that relationship.

Simply an outstanding and powerful woman and for me, she was the highlight of the summit.

What impressed you most about this particular experience?

The people. I can tell you about several people whom I would gladly follow into the jungle because they inspire the socks off me.

I was so impressed by what people are doing in the continent, and most with very little or no government support.

Our government has offered more  support to  young people  than other governments through youth funds and similar programmes, but it still has no idea what we are capable of and  can learn a few things from us.

Americans can learn a lot from Africans too, but the one thing I realised they do extremely well and gain from is the active support of young people’s ideas.

They provide a platform for young people to be heard and to be active in their development. In Africa, we play with 1/3 of the team on the field, with young people — who comprise the vast majority of the population — and women, sidelined to a large extent.

And that is letting us down. I will work with  other Kenyan fellows to change that.

Tell us a bit about your social and educational background?

I was born and raised in Nairobi. I grew up in Utalii, Ruaraka, where my dad was a lecturer. My mother taught Kiswahili at Msongari.

My parents later got into various businesses  and I would say it has been an interesting learning experience for all of us.

I studied at St Mary’s School, Nairobi, for most of my life. The school had a very active extra-curriculum programme and I got involved in everything, from rugby to musicals. 

What did you study in college and did you always know what you wanted to do?

I graduated with a Bachelor of Marketing degree from in Australia and later a Masters in professional accounting, but my career has taken a very different direction now. I didn’t always know what I wanted to do but I kept an open mind and was willing to take a risk when I came across something that roused a passion in me.

I left a comfortable set-up and country to start from zero and it has been my favourite adventure so far.

You co-founded  Agua Inc; tell us a bit about it?

Agua Inc. Kenya is a bio-technology company.

We offer innovative wastewater treatment and water purification technology and consulting.

Our technology offers world-leading results using no chemicals, little to no energy and at a significantly lower cost than conventional methods.

We use plant-based biotechnology to purify water from numerous sources, making our technology extremely viable for Kenya and Africa.

I founded the company with my partners who are based in Colorado, US, and Spain. We design, install and maintain advanced water purification and wastewater treatment systems.

You were also one of the lucky few to receive a $25,000 (Sh2.2 million) grant; tell us about that?

The grants  were only given to  36 people with the best ideas, so once again it was highly competitive.

They selected based on originality and potential impact on the continent and being in the water sector, we have can have incredible positive impact in the country.

On the day the winners were  announced,  emails were sent to everyone telling  them whether they had won or not.

But  hours after some had received the news, a few of us were still in the dark. We were in one of our leadership classes when someone suggested that we check our spam mail and there it was.

I was over the moon, to say the least. So along with nine other winners   from Dartmouth, we started  celebrating in class. Needless to say, that marked the end of the class.

What are your future plans?

Well, I have seen the light in terms of the potential for social change in our region and although I have several business ideas, my focus is primarily on Agua Inc. Water management is a huge challenge for us.  Not everyone has access to safe water and waste water is a burden for most people.

Current technologies are dependent on expensive chemicals  and/or high-energy consumption, but that is no longer  necessary.

We have a brilliant solution to these challenges that can be implemented now at low cost and very sustainably.

We are using the grant to implement a project with Kenyatta University that will begin later this year and will serve as a showcase for the whole of East Africa.

Once that is done, we will involve all stakeholders in the water sector because I believe we can revolutionise how water and waste water is managed in this country. We will keep learning, innovating and inspiring young people to develop their ideas because that is the key to economic prosperity, social change and growth for Kenya.

 

WHAT I LEARNT AT DARTMOUTH

I have always thought that young Africans have the most outstanding ideas and energy, and this programme was an affirmation of that. I was constantly inspired. I’ll break down our Dartmouth experience into three sections:

1. Design thinking: We spent two weeks at Thayer Engineering School, where we learnt a process that can be applied to almost any sector or industry to solve problems through designing  systems or products based on the problem. This was probably the most valuable section of the academic learning.

2. Ideas to success: We then spent four weeks at Tuck Business School learning how to transform an idea into a successful business and tool for social change.

3. Leadership: Throughout the six weeks we  trained in leadership, with visits by some of the best trainers the country had to offer.

Thursday, October 23, 2014

Subtle grudge as generation Y, X meet at work

“The so called generation gap is in large part the result of communication and misunderstanding, fuelled by common insecurities and the desire for clout.” PHOTO | FILE

“The so called generation gap is in large part the result of communication and misunderstanding, fuelled by common insecurities and the desire for clout.” PHOTO | FILE 

By Verah Okeyo
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Mark feels like he is under siege because of a reality in his life he cannot not alter: his age.

At 48 and a senior manager at an energy parastatal, Mark is finding it difficult to understand his younger colleagues. What he sometimes considers mundane and irrelevant mean the whole world to them. 

“I am often frowned upon for not showing up at the boardroom to smile at cameras as we sing happy birthday tunes to a 24-year-old in the department. It’s their birthday. Surely, why must I go there to sing with them...?”

Mark is experiencing a lot more. Every few minutes, there is an email popping up. Another twenty-something is urging everyone to check out the latest phone app. The correspondence therein is in a language Mark can hardly decipher.

“The app is dope. This time Apple killed it. We be ballin’.”

“It’s all confusing,” Mark says. He then recalls the day when, after interviewing a young job seeker, he gave the young man a chance to ask a question. Mark says he was dismayed when the candidate asked whether the company organised regular outings for the workers to “unwind and get to know each other”.

Well, as Mark endures his discomfort at some of the mannerisms of his much younger colleagues, they too feel the distance. In fact, they have given him names such as “uptight”, “the ancestor”, “fossil” and the like.

He learnt of this when a group email was mistakably sent to his inbox after he had made a decision that the twenty-somethings found unpopular.

On the flipside, Lucy Nyambura, 26, an IT executive at a Five Star hotel, swears she would never invite her boss for any activity in the office that is not work-related. “He is a snob. He always thinks that life is about work,” she says with a dismissive tone.

MILLENNIAL

Lucy is a typical millennial. Mark is the average Generation X. These two generations have met at the workplace. The resultant generational grudge is creating subtle challenges in the manner in which the differing attitudes interact.

Lucy’s boss, for instance, does not find her coming to work in rubber shoes the act of a disciplined employee. And during meetings, Lucy prefers to type her notes on her tablet. This bothers her boss, who imagines she is on to other things.

Eng Job Ndege, the managing director of Protocol Solutions, an ICT firm in East and Central Africa, says that there need not be hostilities between the three generations that occupy the workplace today.

The three generations he is talking about are the baby boomers, who were born after the Second World War to the mid-60s; generation X, born from mid-1960s to early 1980s; and the generation Y, born from early 80s to mid-90s.

While Ndege acknowledges that there exist certain stereotypes that define these generations, some of the bromides do not cast much of a shadow when held against the light of research.

“These generations just want the same things, such as recognition for their jobs, to feel part of a team, and respect. It’s the way of expression that is different,” he says.

His observation are conformed by a study that was conducted by senior research scientist at the Centre for Creative Leadership in San Diego, Jennifer Deal. The work revealed that the common generalisations about these generations are just a myth.

In her book, Retiring the Generation Gap, Ms Dealwrites: “The so called generation gap is in large part the result of communication and misunderstanding, fuelled by common insecurities and the desire for clout.”

Eng Ndege, who has worked in environments where these age differences are prominent, offers what he considers a simple solution to all the bickering: “Every worker must develop some basic supervisory skills to be able to recognise the patterns of behaviour and communication in their colleagues so as to get along. Human resource management should not be the job of a single department.”

The younger people, he argues, must understand that no technology can replace the real world experience and interpersonal skills that the older people have gained over the years.

The older people must also acknowledge that the world is changing and the use of smart phones by young people during a meeting may just mean multi-tasking and not disrespect.

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Thursday, October 23, 2014

Great managers stand by these 12 pillars

"In order for leaders to succeed, they needed to develop themselves to their fullest potential." PHOTO | FILE

"In order for leaders to succeed, they needed to develop themselves to their fullest potential." PHOTO | FILE 

By FLORENCE KITHINJI
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Maarifa’s presentation was over. It was now question time. One of the managers spoke: “I really like all the things you have told us, but in reality, it is really hard to do all these things. Where do we begin? What do we do to become effective managers?”

All the other managers in the room looked at Maarifa expectantly.

Maarifa said: “To answer your question, I would like all of you to read The Twelve Pillars of Success by Jim Rohn and Chris Widener. It is a story of a certain man who was going through life without much direction.

“One day, this man by the name Michael was driving on a country road. As luck would have it, his car stalled near a huge mansion that belonged to a wealthy man known as Davies. The mansion had 12 pillars. The gardener, whose name was Charles, explained to a curious Michael that his boss had built the 12 pillars to represent the 12 areas that one needed to conquer in order to succeed in life. Charles went on to teach Michael on the 12 pillars of success.”

Maarifa went on to explain that the first pillar, according to Charles, was personal development. He told the managers that in order to succeed, they needed to develop themselves to their fullest potential.

For any change to occur in their lives, they first had to work on themselves and change before anything in their lives changed.

The second pillar is total well-being, which means ensuring that the body, mind and soul are well taken care of. Each successful person experiences harmony in the three realms so that what is on the inside shines on the outside.

The third pillar is having a good relationship with everyone because relationships are the foundation of real success. Any relationship that is not flourishing means a setback on the road to success. Good relationships are what make the world go round.

Fourthly, Maarifa continued to narrate, Charles advised Michael to write down and achieve his goals – that commitment to the achievement of goals would bring him success. Writing the goals down would actualise them.

The fifth pillar, he explained, was on proper use of time to achieve one’s goals. Those who made good use of their time tended to succeed.

According to Charles, Maarifa further said, the sixth pillar was about surrounding oneself with people who would challenge them and bring out the best in them. Such people were themselves successful in life.

The seventh pillar, Charles went on, signified life-long learning about what went wrong and sharing what went right. Sharing of experiences with others was part of the learning process.

The eighth pillar is to become a person of influence through virtues and character. To succeed, managers must lead by example.

The ninth pillar is about becoming a million dollar person by personal development. People get money for what they are.

The 10th pillar is to have communication that fosters good relationships and makes people know that you care for them.

The eleventh pillar is that of becoming a person of influence and a great leader.

Finally, the 12th pillar is that everyone should leave a legacy that will become an example to others. Blaze a trail.

Maarifa concluded his presentation, saying: “You can see that success is a long process that takes time and total commitment. Everything that is worthwhile takes effort and time. You do not wake up one morning and find a beautiful garden outside. In order to have such beauty, you must put in effort and time. This is the same with success in your career. It is important to know just what you want in life and to develop a philosophy that will lead you to attain it.”

Dr Kithinji is a trainer and Management Consultant at the Kenya School of Government, Nairobi

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Thursday, October 23, 2014

Struggling with a decision? Try this one

Decisions must get their life from purpose. The WHY always sets the agenda for the WHAT. PHOTO | FILE

Decisions must get their life from purpose. The WHY always sets the agenda for the WHAT. PHOTO | FILE 

By WALE AKINYEMI
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For the past few weeks, I have been writing on different aspects of decision making. I am passionate about it because I see life passing many people simply because they refuse to make bold decisions.

A colleague of mine at work named Gladys recommended a very good book, which I got and read. It is such a good book that I too want to recommend it. The title is, Made to Stick: Why some ideas Survive and Others Die. It is written by Chip Heath and Dan Heath.

The book gives some very good insight into decision making and ideas, some of which I will skim over today.

When faced with very good options, how do you decide which one to take? Many people have no problem deciding between a positive and a negative choice, but what happens when the options are all potentially very good?

For example, if as a young man you have to make a choice on who to marry between two dazzlingly beauties, what should ultimately influence the decision is in this case not how they look, but which one best compliments you.

At this point, you should look at issues like values and vision.

Similarly, if as a young lady you are faced with many suitors, what should influence your decision must eventually move from the tangible to the intangible.

The story goes that the former CEO of Southwest Airlines in the United States once said he could teach anyone how to run the airline in 30 seconds.

That was a very loaded statement, considering that Southwest Airlines had been the darling of consultants as a case study for many years, and justifiably so. The company has maintained a status of profitability and respect for so long. It makes profits even when others are suffering losses. 

CEO and co-founder Herb Kelleher’s 30-second prescription for running the airline was tied to the fact that the company was THE low-fare carrier.

So, once you understood that fact, making any decision would be easy, argued Kelleher.

He cited an occasion when a lady from the marketing department approached him and said that based on surveys, passengers would enjoy some light refreshments on the Houston-Las Vegas flight. Southwest Airlines traditionally serve only peanuts on their flights. The marketing lady suggested chicken Caesar salad.

A decision had to be made between serving the salad or not. Herbs reaction was simple. It derived its power from the core of the airlines existence.

He said: “Will adding that chicken Caesar salad make us THE low-fare airline from Houston to Las Vegas? If it doesn’t help us become the unchallenged low fare airline, we are not serving any damn chicken salad.”

Decisions must get their life from purpose. The WHY always sets the agenda for the WHAT. If you do not know why you are doing what you do, then any decision becomes acceptable once it sounds good. What helps to sift between good and great decisions is the why – the reason for existence.

When purpose is unknown, choices abound. The revelation of purpose streamlines the decision making process. It reveals the original intent.

When faced with a tough decision, you must begin an elimination – weeding out ideas that just aren’t the most important.

Sometimes we may not know what we want, but we know with certainty what we don’t want. We must then execute the elimination. Ask yourself, ‘Will this decision take me in the direction I was made to go? Will it make us more of what we were established to do, or will it take us away from our original intent?’

Living without a revelation of purpose is like trying to navigate a ship in the ocean without a compass. There will be a lot of motion but no progress.

Progress is not determined by how much we move but by how closer we are to where we set out to go to.

Never lose sight of intent and destination. These two pillars help to simplify the process of making a decision between very good options.

Have a lovely weekend.

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Thursday, October 23, 2014

How Capital Gains Tax will affect your shares

As Kenyans celebrate the New Year on 1 January, 2015, the Nairobi Securities Exchange will be taking yet another step in its long journey to the peak of world capital markets. GRAPHIC | NATION

As Kenyans celebrate the New Year on 1 January, 2015, the Nairobi Securities Exchange will be taking yet another step in its long journey to the peak of world capital markets. GRAPHIC | NATION 

By KINUTHIA MBURU
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As Kenyans celebrate the New Year on 1 January, 2015, the Nairobi Securities Exchange will be taking yet another step in its long journey to the peak of world capital markets.

Starting midnight on that Thursday, the NSE is to implement the newly assented capital gains tax. Consequently, starting Friday, 2 January, investors at the bourse will begin to pay 5 per cent tax when they sell shares and make a profit.

This new tax will be in addition to the transaction fees usually charged by stockbrokers to buy and sell shares at the stock market. Why? you may ask. Well, the new levy, dubbed capital gains tax (CGT), was approved in the Finance Bill 2014 in late August this year and assented to by President Uhuru Kenyatta on 14 September. It is estimated that the tax will earn the Kenya Revenue Authority (KRA) Sh7.5 billion annually.

CAPITAL GAINS

It is not only investors at the NSE who will be affected. According to the Act, a firm acquiring more than 50 per cent stake in mineral blocks will pay a premium tax. 

Value of the transaction

“This tax is technically referred to as net gain tax and will be paid on the value of the transaction after deducting attendant charges,” explains Mr Ndindi Nyoro, the executive director of Investax Capital, a Standard Bank Group affiliate.

The law states further: “Subject to this schedule, income in respect of which tax is chargeable under section 3(2) (f) is the whole of a gain which accrues to a company or an individual on or after 1 January, 2015, on the transfer of property situated in Kenya, whether or not the property was acquired before January 1, 2015.”

The Capital Gains Tax is making a comeback after its suspension in 1985. According to Mr Eric Munywoki, a research analyst at Old Mutual Securities, the tax was suspended in an effort to spur growth in the real estate market and deepen local participation in the capital markets.

The effect the tax law could have on the Nairobi Securities Exchange was first felt last year when plans for its reintroduction were announced in the June 2013 budget. Investors’ wealth depreciated as share prices at the local bourse marched south due to fears that the tax would erode the NSE’s general profitability stature.

The Kenyan shilling also took a nosedive amid concerns that the effects on the NSE would trickle down to the general economy.

Although the goals that led to the suspension of the law in 1985 may appear to have been realised with the NSE now ranked among the top five bourses in Africa and the country climbing to middle income status, its reintroduction have begged the question whether it was necessary.

According to Aly Khan Satchu, the chief executive officer at Rich Management, “It was not necessary. As a country, I think we have gone a little stir crazy on the taxation side.”

According to an Old Mutual Securities paper titled Reintroduction of ‘Red hot’ Capital Gains Tax prepared by Mr Munywoki, the tax should have been much lower. 

MORE INCENTIVES

“Given the need to grow our economy in the long term, the long-term capital gains need to be taxed at a lower rate than short-term gains in order to provide more incentive to invest in firms that build the economy, rather than trying to make quick profits by speculating on stocks,” says the paper.

Evidently, although all investment analysts agree that the new tax will scare investors from the NSE, there have been differences on whether the tax is a mere scarecrow, or the effects will be majorly felt.

According to the Kenya Association of Stockbrokers and Investment Banks (KASIB), the tax will be discouraging to existing and potential investors. Prominent among KASIB’s worries is that the Nairobi Securities Exchange will lose its competitive edge.

“Nigeria has a 10 per cent Capital Gains Tax, but the capital markets are excluded,” said Mr Willie Njoroge, the chief executive officer at KASIB.

But, according to Dyer and Blair Investment Bank, the tax is going to be non-consequential.

“We maintain that, from a private investors point of view, the five per cent rate is fairly competitive and unlikely to ward off would-be investors from the Kenyan market,” the bank said in a report in September.

Further, according to Mr Nyoro, the tax will be way lower than what is charged in other markets in Africa. “Zambia has a high rate of 35 per cent, Uganda has a rate of 30 per cent, Tanzania has a rate of 20 per cent, while South Africa and Nigeria are at par with 10 per cent CGT,” he says.

“Given the need to grow our economy, the long-term capital gains need to be taxed at a lower rate than short-term gains in order to provide more incentive to invest in the companies that build the economy rather than trying to make quick profits by speculating on stocks,” says the paper.

Evidently, although all investment analysts agree that the new tax will scare away investors from the NSE, they are divided on whether the tax is a mere scarecrow or if its effects will be significant. According to the Kenya Association of Stockbrokers and Investment Banks (KASIB), the tax will be discouraging to existing and potential investors.

Prominent among KASIB’s worries is that the Nairobi Securities Exchange will lose its competitive edge. “Nigeria has a 10 per cent capital gains tax, but the capital markets are excluded,” said Mr Willie Njoroge, the chief executive officer at KASIB.

However, Dyer and Blair Investment Bank thinks the tax will be inconsequential. “We maintain that from a private investor point of view, the five per cent rate is fairly competitive and unlikely to ward off would-be investors from the Kenyan market,” said a report it released in September.

Further, according to Mr Nyoro, the tax is much lower than what is charged in other markets in Africa. “Currently, Zambia has a high rate of 35 per cent, Uganda 30 per cent, Tanzania 20 per cent, while South Africa and Nigeria are at par with 10 per cent CGT,” he says.

FOREIGN PORTFOLIOS

Mr Munywoki explains: For instance, if you buy 25,000 shares at Sh4 per share, you will need Sh100,000 for the shares and Sh1,800 transaction fees.

If the share price rises to Sh5 and you sell, your gross proceeds will be 125,000. After deducting your transaction fees, your net profit today will be Sh22,750. On 2 January, after paying the five per cent tax, your profit will reduce to Sh.21,612.50.”

He is quick to point out that with higher returns, the effect may not be so hard-hitting. “Looking at higher returns derived from frontier markets, we still expect increased foreign portfolio flows driven by the recent discoveries in oil and gas,” he says.

“This could lead to introduction of new products at the bourse such as day-trading margin calls, which may not be subject to CGT.”

Although investors who sell their stakes at a loss will not be affected by the CGT, Mr. Munywoki notes that the law is quiet on what will happen in case you make losses on investments outside shares and whether you can net off your losses from your gains in order to pay lower taxes.

Interestingly, Mr Munywoki points out that the CGT will be applicable where the gross gain exceeds 20 per cent.

“This means that small investors can cash in their 19 per cent gains without paying the tax,” he says. “However, this will not be a rational move to make. An investor who makes 30 per cent gross profit and pays the 5 per cent tax will still make more money than the investor who exited at 19 per cent without the tax.”

The Treasury and KRA are yet to come up with a schedule on how the re-introduced tax will be calculated.

Subsequently, before 1 January, 2015, KRA and the National Treasury are mandated with the task of formulating guidelines on how much is to be paid and under what circumstances.

According to Mr Satchu, the current proposed formula where stockbrokers are to levy the CGT is not tenable.  Mr Munywoki concurs, adding that in future, the taxman may want to integrate the charge with other market levies through the broker back office, making it the responsibility of the market players to remit the tax.

It remains to be seen whether the tax will affect foreign investors, who account for most of the trading at the NSE.

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Thursday, October 23, 2014

Besides meeting the monthly payroll, drive your SME to make profits

The constant thought of whether you will have ready money to pay salaries every month is one of the biggest preoccupations of many business owners. PHOTO | FILE

The constant thought of whether you will have ready money to pay salaries every month is one of the biggest preoccupations of many business owners. PHOTO | FILE 

By MUTHONI NGATIA
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Far too many SME owners are more worried about making the payroll and not their profits.

The constant thought of whether you will have ready money to pay salaries every month is one of the biggest preoccupations of many business owners.
The number one reason many business owners lag behind in profitability is that they do not have the answers at hand. They simply do not know their numbers.

Many business owners have no idea whether they made a profit last month or a loss. This means they are constantly chasing the payroll money.

It is worse for those business owners who do not pay themselves a salary and look forward to a cash drawing to meet personal or family expenses.

Assuming you have school fees, insurance, house rent or mortgage to pay, many business owners find themselves in a difficult situation.

I know of many business owners with a very decent monthly turnover who constantly do not have cash to expand their businesses.

MANAGEMENT TOOL

This is because they are either breaking even, or trading at a loss. They have debts or expenses to service, too, and this keeps eating into the business funds without the clear knowledge of the business owner.

Business owners who focus on their numbers tend to have some form of accounting background or experience.

Many SMEs depend on accountants to give them critical information but few are lucky to have proactive accountants who spend time doing analysis and helping the business owners understand what is going on.

Many accounting systems available at the disposal of SMEs do not provide quick snapshots.

As a business owner, you need to know the difference between profitable and “busy”.

If you wait until year-end to get your financial reports for audit or income tax purposes, you will continue losing money being “busy” yet not sure whether you are profitable.

I will recommend that every SME owner invests in a business management tool that allows them to see realtime their income, expenses and profitability for any given period.

We all know that income minus expenses gives you the gross profit. The trick to boosting profits is always increasing income and decreasing expenses. We are a cash society and many SMEs hardly track cash expenses effectively.

If you are making 80 per cent of all income for to your business, you should be directly benefiting from 80per cent of all expenses incurred by your business.

If your payroll is the highest cost-item per month, and your employees are contributing only 20per cent of the income, place some jobs on the line.

Consider outsourcing specialised tasks or hire part-timers for roles that are not busy. Saving a few thousands per month can make a big difference.

Look out for underutilised resources that have long-term contracts. Review your office space utilisation, telephone contracts, Internet bandwidth and other recurrent expenses.

COMPLEMENTARY SERVICES

If anything is underutilised, figure the best way to get value for your money. Overall, think through the different ways you can use to reduce the money that leaves your business.

To boost your income, consider introducing complementary products or services. Say you provide printing solutions for branded merchandise, offer a direct sales training programme on the best way to distribute promotional materials.

Also, consider giving monthly or yearly discount plans to guarantee revenue.

Lastly, extend your marketing to the online audience. Many people simply Google what they need.

Be sure to get recognised online, whether with a website or on social media.

Your premises may not be on a main street but social media is one big digital street.

Be creative with ways to increase your income and to reduce expenses. Most importantly, track and keep a good record of your expenses.

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Thursday, October 23, 2014

For Nakuru widows, life is a positive tapestry

Ms Mary Atieno explaining to her customer some of their artwork products. After losing their spouses and relatives to HIV and Aids, a  group of widows in Nakuru has defied the odds and launched a successful beadwork business in the town’s Kaptembwa estate. PHOTO | CAROLINE CHEBET

Ms Mary Atieno explaining to her customer some of their artwork products. After losing their spouses and relatives to HIV and Aids, a  group of widows in Nakuru has defied the odds and launched a successful beadwork business in the town’s Kaptembwa estate. PHOTO | CAROLINE CHEBET 

By CAROLINE CHEBET
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After losing their spouses and relatives to HIV and Aids, a  group of widows in Nakuru has defied the odds and launched a successful beadwork business in the town’s Kaptembwa estate.

Members of the group, which started as a “widows living with Aids chama”, are now able to pay school fees for their children, house rent and other daily needs by making necklaces, bracelets, table mats and earrings.

Baraka Upendo Women’s Group was started in 2006 and now has 20 widows living with HIV and Aids. “We came together as people suffering from the same disease. That way, we fought off social stigma and shared financial ideas on how to empower ourselves”, says Mary Atieno, the group’s chairperson.

The group also launched an education drive, visiting churches and local functions to raise awareness on HIV and Aids, as well as collecting trash in the estates.

“Many people still have a negative attitude towards people living with HIV and Aids. So we formed a group where we could encourage ourselves to rise above the social stigma and educate the youth,” says Atieno.

RECYCLED MATERIALS

Efforts to clean up the environment bore fruit, after they discovered they could recycle some materials and make necklaces, table mats, bags and knitted clothes.

“We get lots of recyclable materials like polythene bags, calendars and papers. We decided that re-using them was a cheaper way of starting a small business where we could generate some income”, Atieno told Money.

Through active table banking, the group kicked off their business, which helps them put food on the table for their families and cater for other basic needs.

“We started by contributing Sh20 each, but increased this with time so as to expand the businesses. We now contribute Sh250 every month”, she said.

In a good month, each member earns up to Sh6,000 from the final products, which they make three times a week.

To market their artefacts, the members usually attend agricultural shows and other public fairs in the county. This has boosted their sales from Sh2,000 a month per member three years ago.

The group sells their bracelets, beads and necklaces at Sh100 to Sh600, while beaded handbags go for Sh300 to Sh700.

Through their savings, the group members recently started making soap, which they supply to local customers, hotels and supermarkets.

Most of the time, they get orders for liquid soap from supermarkets and hotels. On a good day, they sell up to 20 litres. The soap goes for Sh60 a litre.

During the past eight years, the group’s main goal has been to live a happy, fulfilled life, says Anyango, “earning a living from our sweat. There’s nothing as bad as having to seek alms from wellwishers; we want to keep ourselves busy”, she adds.

EXTRA MATERIALS

The group has lost some members through the years to the disease, but a positive attitude to work has helped the members cope with the loss and even support families of departed colleagues.

“With the kind of disease we suffer from, death is a constant companion. This has strengthened our bond,” says Mary Anyango, a group member.

However, sourcing for extra materials to make beaded bags and liquid soap, as well as competition in the market, hamper the women’s progress.

With time, they hope to export their unique products.

“As much as we try to cut down costs by using recycled materials, we also have to clean and paint the materials. And this is expensive,” Atieno says.

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Thursday, October 23, 2014

Solar pack helps fish mongers of Kilifi see the light

KMFRI in Mombasa has come up with an eco-friendly, solar powered lamp for fish traders. PHOTO | NATION

KMFRI in Mombasa has come up with an eco-friendly, solar powered lamp for fish traders. PHOTO | NATION 

By REBECCA OKWANY
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We all know them; we visit their kiosks or business stands almost every evening or night to purchase groceries. We fondly call them Mama Mboga and Mama Samaki.

But even as we exchange pleasantries and purchase groceries, more often than not we feel irritated by the whiff of paraffin smoke emitted by their lamps (korobois) and hate the teary effect it has on our eyes.

Mama Mboga, on the other hand, seems oblivious to all this. Many of them don’t know that they are slowly damaging their lungs and eyesight with the smoke, besides driving away would-be customers.

It is against this backdrop that the Kenya Marine and Fisheries Research Institute (KMFRI) in Mombasa came up with an eco-friendly, solar powered lamp for fish traders.

SOLAR LANTERNS

They have also improved the current methods of preserving fish used by traders.

The lamp is a flexible, bulblike light that can be attached to wooden fish trays to provide adequate lighting.

On the wooden tray is an aluminum foil for ease in cleaning, unlike the old newspapers that Mama Samaki spreads on her trays to act as paper towels.

According to KMFRI business development manager Peter Oduor-Odote, they were driven to come up with the innovative lamp and tray by the challenges facing most small scale fish sellers at the Coast, most of whom lack cooling facilities for their fish stock. Also, the price of freezers is out of reach for many of them.

 “Mama Karanga normally displays fish on shelves or trays by the roadside, or in some designated place of the market with a koroboi for customers to see the fish,” says Oduor-Odote at his KMFRI offices.

“The fish industry is quite important in this region. It supports a wide population of women traders. About 60 per cent of the fish trade is handled by Mama Karangas,” he adds.

Oduor-Odote, who is also a research scientist at KMFRI, notes that since korobois use paraffin, they emit a lot of carbon dioxide, which is unhealthy when inhaled and sometimes spills onto the fish, contaminating it and spoiling the stock.

In the research, he thought of a way of assisting the women,  and that is when he came up with a way of improving the display shelf unit. He then went about redesigning the display shelf by introducing an eco-friendly lamp (solar lantern) to replace the paraffin-lit koroboi.

The lantern is charged by solar during daytime and can be placed at any strategic point.

“There is worldwide interest in reducing carbon emissions because they are known to be responsible for climate change. The women, numbering over 100, use about a quarter litre to half a litre of kerosene per day because they come to the market at about 6pm in the evening and some leave at about midnight, burning kerosene and emitting smoke,” he said.

ECO-FRIENDLY

He adds: “One litre of kerosene — from literature calculations — releases about 2.53kg equivalent of carbon dioxide when burnt. Therefore, a quarter litre of kerosene releases 0.6325kg of carbon dioxide.”

“The eco-friendly lamp in the new design brings this carbon dioxide emission to zero,” he points out. He adds that they will roll out the lamps, all free of charge, to fish fryers in Kilifi in a month before issuing them to the entire Coast region.

He says they are in the process of registering for exclusive rights of the eco-friendly lamp with the Kenya Industrial Property Institute (KIPI).

Kilifi Beach Management Unit chairperson Halima Mbaruk praised KMFRI for the innovation. She added that the solar lamps were also convenient during rainy and windy nights, unlike kerosene lamps. 

  • KMFRI has also come up with an innovation that assists women in drying fish in an affordable, efficient manner and in large quantities. It uses racks for smaller fish (sardines) and solar dryers for bigger fish.

  • There, too, is an improved smoking oven, commonly used to preserve fish in Tana Delta region. It reduces fuel consumption by up to 60 per cent.

  • The improved oven has up to five trays where fish are arranged for smoking. This saves on the amount of fuel used, while many fish can be smoked at a go.

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Wednesday, October 22, 2014

Jury still out on the proposed financial services authority

Treasury Cabinet Secretary Henry Rotich.Little has been heard of the progress towards making the FSA operational. The Ministry of Finance, which is the supervising authority, has as yet to invite stakeholders to discuss any Bill concerning the intended agency or pertaining to amendments of existing laws. FILE PHOTO

Treasury Cabinet Secretary Henry Rotich. A parliamentary committee has asked the House to approve the Treasury’s request to borrow up to Sh2.5 trillion from foreign sources. FILE PHOTO   NATION MEDIA GROUP.

The taskforce on parastatal reforms recommended that financial services regulators IRA, CMA, RBA and SASCCO be consolidated into one agency.

Little has been heard of the progress towards making the FSA operational by 1 January 2015, as indicated by the Treasury Cabinet Secretary in this year’s Budget speech.

What is happening and how is this move likely to affect the operations of IRA? 

- Insurance player, Nairobi

 

Truth be told, there is little happening on this score, as far as I am aware. One thing, however, is certain: the proposed Financial Services Authority (or whatever it will be called) is not going to be in place by 1 January, 2015.

For one, such an agency would have to be set up under a specific legislation providing, among other things, its mode of operations. Then, either the same legislation or more specific laws would have to amend the other enactments under which the existing Authorities have been set up.

As has become the practice in the current democratic dispensation, Bills intended for submission to Parliament are discussed among the stakeholders.

So far, the Ministry of Finance, the supervising authority, has as yet to invite stakeholders to discuss any Bill concerning the intended agency or pertaining to amendments of existing laws.

It is either a case of the Bill still being drafted, or none exists.

This state of impasse is likely, considering that the taskforce that came up with these recommendations reportedly failed to consult even the supervising ministries. If this be the case, the recommendations were merely lofty ideas made without considering their practical aspects. As one Oriental sage once said: “In theory, there is no difference between practice and theory; in practice, there is”.

Perhaps, the ministries concerned are still wrestling with the problem of how to bridge the gap between theory and practice in the real world of parastatal consolidation.

Regarding the intended Financial Services Authority, there is a school of thought that, as the relevant supervisory and regulatory bodies are mainly in the nascent stage of development, being consolidated into one bureaucratic behemoth would adversely affect the progress so far achieved.

Moreover, the benefits for such consolidation cannot be readily perceived.

SERIOUS DISLOCATION

It is pointed out, for example, that the financial services regulators are neither a financial burden to the Treasury nor to the regulated entities.

At our stage of development, such consolidation is premature as each of the regulatory bodies in the sector is still evolving a systems regime in line with its mandates.

A case is cited of the UK, which had one such authority. Lately, there has been a move to break FSA up into its constituent sub-sectors.

Let it be noted that all the financial services regulators, through a memorandum of understanding signed sometime ago, have been collaborating on many common areas.

As convergence of financial services takes root in our society and economy, this initiative has been necessary.

But it is probably not yet time for upgrading this co-operation into an amalgamation of the bodies concerned.

In respect of the Insurance Regulatory Authority, there is already a serious dislocation to the IRA operations.

Without a board since the latter’s term expired sometime in May, the Authority has been rendered almost dysfunctional.

It is anybody’s guess how, for example, licence renewals will be done in the absence of a Board which assumed most of the powers of the Minister under the Insurance Act.

The question still remains: Is the intended agency really necessary, at least, for now? The jury is still out on this one.

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Thursday, October 23, 2014

Class one drop-out who owns top hotel company in Kericho

Mr James Mwangi Kuria proprietor of Sunshine Hotels, Kericho County. Mr Mwangi, 59, was passionate about the hospitality industry from a tender age. PHOTO | TIMOTHY KEMEI

Mr James Mwangi Kuria proprietor of Sunshine Hotels, Kericho County. Mr Mwangi, 59, was passionate about the hospitality industry from a tender age. PHOTO | TIMOTHY KEMEI  

By ANITA CHEPKOECH  
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Mr James Mwangi, 59, was passionate about the hospitality industry from a tender age.

While running errands in Kericho 25 years ago, the illiterate youth got word that someone was renting out a prime kiosk near Tengecha lane and thought that his dream had come true.

He had insufficient capital, so he talked his two friends (Rop and Muiruri) into contributing Sh20,000 which they needed to rent the place as an eatery. But the two gave up at some point as the venture didn’t seem to earn them anything.

“They said that we should sell the business, but I refused. I asked them to be patient so I could pay them back their share of the contribution,” he says.

He bought sacks and lined them on the ceiling. He also painted the room and started stocking kitchen utensils. Then he got a permit to start a hotel after a tussle with health officials.

“I bought one kilogramme of flour and meat. Then my money got finished,” he says.

After cooking, he asked a mechanic to try out his food. But the mechanic retorted that even if the food were free, he would not dare eat in such a den.

CHAPATI DOUGH

Mwangi did not give up. He convinced some people to buy his food, and with the money earned, he bought extra recipe for the following day.

It surprised him that he was a good cook, just like his father, Mr Joseph Kuria. But there are dishes he had to learn to make.

He had trouble making chapati and mandazi dough, for instance. “I requested a man called Juma to show me how to prepare dough. He did it just once then I struggled on my own. I took hours to light a jiko,” he recalls.

He would soon make delicious githeri, ugali and tea. Many people began visiting his hotel. Soon, he could no longer act as the cook, waiter and cashier and had to find a helper.

In the second month, he found someone to assist him, but the person left shortly afterwards to start a hotel in Kisii.

Kuria was left more confused, doing everything all alone. At times, customers would eat and leave without paying. He was desperate for assistance.

It’s after  he employed Kennedy, a good cook, that the business boomed. Mwangi served food and collected money.

Everything went well until some customers from Nairobi visited the hotel. One ordered for an omelete but, due to ignorance, Mwangi scrambled the eggs. “The customer looked at me and said, ‘Stupid!’, and spoke more English that I did not understand. I was hurt and begun remembering the circumstances that denied me the opportunity to get an education,” he recalls. 

He had left school for good the very day his teacher sent him home to fetch Sh20 for fees, way back in the sixties. He was then in Class One in Nakuru’s Bahati.

Thereafter, he was employed to take care of goats in the neighbourhood for 50 cents a month.

Mwangi does not blame anyone as lack lurked in their family of eight children, who were left with their mother as their father cooked for European settlers in the highlands.

STEADY RISE

At some time he was told a group of missionaries was enrolling children for free education in Naivasha but his mother could not afford the fare.

However, it’s a great milestone that he is today the director of the busiest hotel in Kericho. The jovial Mwangi owns the famous Sunshine Hotel Ltd.

This is the place President Uhuru Kenyatta had a meal during a recent visit to Kericho. 

This year alone, the hotel has also hosted Deputy President William Ruto, Cord leader Raila Odinga and an international event for UN Habitat.

The hotel also hosts a range of parties, launches, weddings, and cultural events.

“We are fully booked throughout the year. Our rates are competitive and people prefer our food, customer care and priximity to the town centre,” he says.

However, it was not easy getting this far. A steady rise of Sunshine started in 1991 when Mwangi had earned enough to employ more people. He brought in a Charles Ochieng as the hotel manager. The two key departments (kitchen and finance) were managed diligently by the two.

Mwangi bought his first car from former town mayor John Kauria at a fair price. It was a pick-up. Before he knew it, an investor, Mr Benjamin Tirop, who admired his work, asked him to be a tenant in one of his buildings at Tengecha lane.

He declined the offer two times but later gave in after seeing how beautiful and strategic the nine-roomed building was.

Then they re-launched the hotel with likeable guest rooms. But they disappointed customers since alcohol and casual dates were prohibited there. Every couple had to produce a marriage certificate to book a room.

“Some managers even threatened to quit, saying the rules denied the hotel more clients, but I stood my ground. I said I would rather lose them than cave in to spoil family morals that my dad warned me against,” he says.”

Mwangi eyes Isiolo and Nanyuki as target towns to expand his business, before he ventures to  South Sudan and Rwanda.

Having missed formal education, he is unforgiving to anyone who despises school. “Our last born will soon join university, just like the rest of the siblings,” he says.

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Friday, October 17, 2014

Women milk fortune from dairy group

Members of Ilkipirash Women Group deliver milk at their cooperative society in Kajiado. BILLY MUIRURI | NATION 

By BILLY MUIRURI
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Every end month at the branches of Equity and Cooperative banks in Kajiado town, you will find in the halls long queues of women resplendent in multi-coloured shukas, bracelets and necklaces.

Two tellers in each of the banks are normally assigned to serve the women. At the Kenya Commercial Bank branch in Namanga, more than 80km away, things are not any different.

The women who throng the banks belong to the giant Maasai Kajiado Women Dairy Cooperative Ltd, an outfit that has changed the lives of dairy farmers in the county where cattle is the most precious property.

For most of the population, though, livestock here - cattle, goats and sheep - are kept in their hundreds for prestige.

But pride and honour are not enough for this women. They now throng the banks to receive their pay for monthly milk deliveries.

Milk in the Maasai community is purely a women’s affair, and so is this cooperative society’s management.

The institution’s turnover has shot from Sh59 million in 2012 to Sh87 million last year.  Started in 2011, their first turn-over was Sh10 million, according to documents seen by Seeds of Gold.

The 5,000-member cooperative brings together seven women groups that deal in milk business in Kajiado Central. Interesting to note is the manner the institution manages its affairs. The women groups deliver milk to eight collection centres spread across the vast constituency.

“We deliver the milk between 6am and 2pm. Our members chose one of them to be in charge of the collection centres but a clerk manages the records at the cooling plants,” says Phyllis Matapash, the secretary of Ilkipirash Women Group, which has 1,000 members.

Initially, they had leased two cooling plants from New KCC. The County Government of Kajiado, however, recently donated two more. The cooling plants located at Enkorika Nkoile, Il Bissil and Kajiado town, have bettered the handling of milk, which is finally taken to the New KCC factory at Dandora.

The four cooling plants have a capacity of 20,000 litres per day but the women are capable of producing 40,000 litres, according to the cooperative’s field officer Zacheus Lesinko.
At the moment, milk prices range from Sh25 to Sh35 a litre, according to Ruth Maya, a member of Ilkipirash group, who delivers 150 litres per day from her 25 Sahiwal breed cows. 

BANK ACCOUNT

“We deliver as a group about 7,000 litres of milk per day during the peak season,” says Mary Maren, another member of the group and an official of the cooperative.
The cooperative insists that each of the farmers opens a bank account.

“All the 5,000 members have bank accounts from where they can withdraw money or borrow short-term loans to finance education of their children, particularly girls. It is our ultimate goal to empower the girl child,” says Hellen Nkaissery, the patron and wife of the local MP Joseph Nkaissery.

In the region, the Sahiwal breed which is productively better than the local Zebu and Boran cows seem to be the dominant “animal of trade” even as the women set eyes on more improved breeds.
But how did these women brave the resistance from their husbands who naturally wanted to stick to the traditional zebus for prestige that comes with numbers?

“Women got the go-ahead, especially after our husbands saw the fruits of the change,” says Mary.

The cows, though, are yet to gain from seriously organised management programmes. “We herd them in the traditional style, but ensure we rotate in paddocks to have pasture throughout.”
Mary says they are now embarking on pasture growing to ensure their milk production is not affected.

Initially, the farmers used to milk their cows and hawk the produce from home to home at Sh20 a litre.

But now after milking, they deliver the produce in cans to collection points where it is checked for quality and the quantity is recorded.

“The cooperative has given the farmers a forum to discuss and exchange experiences and network. It has also given them bargaining power since they can even dictate the prices,” says Hellen.
“With the county government coming in and giving them cooling plants, they can sell their milk to KCC and other buyers.”

Hellen notes they have strived to upgrade the handling of milk to enhance hygiene. “We insist that our members use aluminium containers and not the plastic ones to increase the life of the milk,” she explains.

Poor road network, however, has become a hindrance for the women who are forced to use motorbikes to deliver milk from their homes.

Governor David Nkedianye says there is a plan to rehabilitate rural roads to ease the transport problem.

“Our support began with the donation of the two cooling plants. Then we will move to the roads. Already, we have donated a piece of land in Kajiado town to have the women construct their head office,” Dr Nkedianye says.

The cooperative is in the county government’s economic empowerment programme. The County Executive in-charge of Trade, Tourism, Cooperatives and Industrialisation Florence Mutua says the cooperative has a real potential to turn around the local economy.

“We have set aside about Sh50 million to support the women and others. Our key objective with this dairy project is to ensure they produce milk throughout the year and not just when it is raining,” says Florence.

The officer says plan is underway to have the women adopt new breeds and modern farming practices like zero-graxing. “We want to have more paddocks and plant exotic grass to boost milk production.”

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Friday, October 17, 2014

Charcoal and sawdust keep my crops healthy

Grace Githaiga harvests capsicum and spinach, which she grows in greenhouses in Nyeri. FAITH NYAMAI | NATION 

By FAITH NYAMAI
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The two greenhouses measuring 22 by 72 metres each on the outskirts of Nyeri Town are full of lush crops. On one side of the greenhouses are capsicum plants and on the other spinach.

Both crops are flourishing, making many visitors ask the owner of the farm, Grace Githaiga, about her secret.

The secret lies in strange quarters as we came to learn. Grace applies in her farms charcoal dust, sawdust, organic manure and fertiliser after every three planting seasons, an art of farming she says helps her to grow healthy vegetables and reduces costs by nearly half.

When Seeds of Gold met Grace recently, she had just arrived at her farm from a market in Nyeri where she had gone to supply vegetables to traders.

This was her third week of harvest. Grace walked to a tap outside one of the greenhouses, opened it and let water flow to the plants. She uses drip irrigation, which helps control the amount of water the crops get.

“I use sawdust to retain moisture in the soil and the charcoal dust to keep diseases and pests at bay. I mix the two with manure and apply on the farm a week before I plant,” says Grace, who learned the art from agricultural officers at Wambugu Agricultural Training Centre in Nyeri.

She then adds DAP fertiliser a week after planting. But the fertiliser is in much smaller quantities because of the manure use.

“This helps the crops, particularly, spinach to grow very first. I normally start harvesting in about a month.”

“Spinach grows fast because it absorbs plenty of water from the soil and there is enough circulation of air. Capsicum matures in about two to three months,” the farmer, who has erected her two greenhouses on part of her quarter acre, says.

Prof Mary Obukutsa, Head of Horticulture Department at the Jomo Kenyatta University of Agriculture and Technology, says charcoal has carbon that makes soil more fertile.

“There is scientific evidence that when charcoal is applied to soils, it significantly increases crop yields and improves soil fertility. Charcoal dust also helps in decreasing nutrient loss through leaching by percolating water,” she notes.

“The pores in charcoal provide a suitable habitat for many micro-organisms by protecting them from predation and drying.”

FINISHED COMPOST

The organisms are important in processing rich compost manure. According to the don, charcoal increases Cation Exchange Capacity, a factor that influences soil fertility by increasing the ability of the soil to retain nutrients so that they are not washed away by water.

Prof Obukutsa further observes that adding small amounts of sawdust to the soil increases organic matter and improves texture.

“Sawdust takes time to decompose, thus, it works well in moist, heavy soils like clay. Sawdust also acts as a bulking agent, allowing air into the soil. It takes approximately a year to transform raw sawdust into finished compost.”

She adds that sawdust, especially from hardwood trees like walnut, acts as a natural weed killer and keeps away pests because of its acidifying effect on the soil. It is also good choice for mulching. Mixing charcoal, sawdust and organic manure makes the three complement each other and optimise the benefits, according to the expert.

Charcoal will help to increase the pH, which is normally reduced by sawdust to levels that are optimal for nutrient availability.

“Mixing manure with sawdust reduces the effects of the latter on nitrogen depletion in the soil as it decomposes. To reduce these effects, it is recommended that you let the sawdust simmer in the compost pile for some time before using it in the garden,” she offers.

The three materials further improve soil structure and aeration leading to increased nutrient uptake and good root development.

Grace started her agribusiness in 2011 after investing Sh640,000, part of which was her savings while her husband provided the rest. She was working as a secretary at Pamki Coffee Farm (previously Kyanyange Coffee Farm) in Nyeri before she resigned go into farming.

The method of farming has helped her cut costs. 

“I do not spend a lot of water to irrigate my farm since the charcoal dust and sawdust help to retain moisture in the soil. Before I started this method of farming, I would spend up to Sh6,000 per month on water. I now spend Sh2,500 on water bills and Sh3,500 to buy fertiliser, manure, sawdust. I rarely spray the crops with pesticides because they are not attacked.”

She gets the charcoal dust from dealers in Nyeri Town, which she mixes with manure and saw dust in the ratio of 1:1:1. She measures the ingredients in a 20-litre bucket.

For her two greenhouses, the farmer uses about five 90kg bags of each of three materials.

“But I also apply inorganic fertiliser to enhance growth of the crops since it helps to increase nutrients in the soil that manure does not have.”

She harvests 70 to 80kg of capsicum and 60 to 75kg of spinach twice a week. She sells a kilo of capsicum for Sh40 at wholesale price, while a kilo of spinach at Sh50. This brings her earnings to about Sh50,000, much more than what she used to earn when she was employed.

Grace practises crop rotation, where she replaces capsicum or spinach with tomatoes. Last season, she planted tomatoes and was harvesting five to seven crates of tomatoes per week.

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Friday, October 17, 2014

Steps to take before restocking your chicken and growing fodder

 

NEW BEAN VARIETIES
My name is Patricia Mwangi. I have leased an acre where I am planning to plant the new bean varieties from Egerton University. How many kilos would I need for an acre and at how much? I would also like to know where I can get them. The land is not contaminated as it has never been cultivated before.

You will need to plant 24 to 25kg per acre and the seeds cost Sh250 a kilo. Please talk to Prof Paul Kimurto of Egerton University on [email protected] for more information.

Muriuki Ruth Wangari, Department of Crops, Horticulture and Soils,
Egerton University

MAKING ORGANIC FERTILISER
I wish to learn how to make organic fertiliser from poultry manure since I keep layers. Where can I get the knowledge?
James, Ruiru

Just like commercially prepared synthetic fertiliser, chicken manure is very high in essential nutrients and serves as a soil amendment by adding organic matter.  Organic matter in soil improves water and nutrient retention and, therefore, the use of manure is an integral part of sustainable agriculture. The institution that can offer training in the manufacture of organic fertiliser is Kenya Institute of Organic Farming.
Ronald K. Kimitei, Department of Animal Sciences, Egerton University

GROWING STEVIA
We are interested in growing stevia on 22 acres. We kindly need information, from getting seeds, transplanting to marketing.
Maulid J.T.

Stevia is propagated from seeds planted in trays in nurseries or greenhouses for seven to eight weeks, then it is transplanted to the main field. The plant grows well in altitudes of at least 1,200m above sea level and in soils rich in organic matter. It grows well on infertile, acidic, sandy and loamy soils, but it can also be cultivated on more neutral soils of pH 6.5 to 7.5. A density of 60 plants per acre planted with well-decomposed manure gives the best yields of up to 8 metric tonnes per hectare per annum. Optimum rainfall of between 1,500 to 2,000mm per annum, well-spread throughout the year and average temperatures of 10 to 30 degrees Celcius offer best results for stevia. Depending on different climatic conditions, stevia is cultivable throughout the year except when it is extremely hot or cold. Stevia is rarely affected by pests and diseases thus farmers don’t incur extra costs on agro-chemicals and crop protection. Stevia is an emerging crop in Kenya and is currently promoted by a company in Kericho called Pure Circle. You can reach them for more information on production and distribution on +254 0518002540, www.purecircle.com, Email: [email protected]
Lilian Jeptanui
Egerton University, Department of Crops, Horticulture and Soils

My name is Gichuki from Ruai, Nairobi, and I would like to know where I can get stevia seeds or plants. 
Farmer
You can contact your nearest agro-dealer or Horticulture Crops Development Authority (HCDA) for the information. Also talk to Pure Circle Kenya on +254 0518002540.
Muriuki Ruth Wangari, Department of Crops, Horticulture and Soils,
Egerton University

PhD in agribusiness
I would wish to pursue a PhD in agribusiness since I believe this will enable me to do what I love most — coming up with solutions to help small-scale farmers. I hold a Bachelor in Commerce degree, marketing option from Kenyatta University, and an MBA, entrepreneurship from Maseno University. Besides, I worked for over seven years with NGOs that promote food security among the rural poor before joining banking sector in 2009. My question is, with my qualifications and experience, do I qualify to do a PhD in agribusiness? I believe it is still a very lucrative field.
David Moi WasambaEco Bank Branch Manager
United Mall Branch, Kisumu

Please visit the Egerton University website for more information on qualifications for PhD programmes in agribusiness in the Department of Agricultural Economics and Agribusiness Management. Meanwhile, your request has been sent to the department for further consideration.
Seeds of Gold Team
Egerton University
CULTIVATING FODDER
Kindly advise me on the preparation of land and how to plant the Boma Rhode and other related grasses. When is the best time to prepare for the planting? I am based in Kitale.
Farmer

If you intend to cultivate the pasture on virgin land, you need to prepare the land by ploughing and harrowing twice. On previously cropped land, you will need to plough and harrow just once. Planting is then done at the beginning of the long rains season in April so that weeds do not interfere with the growing seeds or one can plant during the short rains season. This will take care of the weeds once the rains subside. Planting can be done using the seed drill, a machine that sows the seeds (0.5 to 1kg per hectare) and then covers them. The other option is broadcasting in which seeds are mixed with sawdust. It is recommended the seeds are covered with a maximum of 2cm of soil to ease germination. The farm can also be fertilised during planting using DAP fertiliser or manure. Returns depend on pasture management, the most important being weed control with either herbicides or hand weeding.

Dr Moses Olum, Veterinary Surgeon,
University of Nairobi,
[email protected]

EAST COAST FEVER VACCINE
I learned recently that there is a vaccine for the deadly East Coast Fever (ECF). I would like to know if the vaccine is currently in the market and if so, is it available in Kitale? How can farmers get it?
Paul Inyangala

There is a vaccine that has been available since the 1970s. It was produced by Kenya Agricultural and Livestock Research Organisation (formerly Kari) and was launched for use in 2012 by the Director of Veterinary Services. It is a preparation of the causative agent of ECF and must be administered concurrently with Oxytetracycline at the right dose. It was not widely adopted earlier since it has to be transported in liquid nitrogen, which is expensive compared to other vaccines. The vaccine offers protection for between three to four years when properly administered and is now widely used in East Africa. Animal health service providers have to undergo one week training on how to safely administer the vaccine.

Dr Moses Olum, Veterinary Surgeon,
University of Nairobi,
[email protected]
RESTOCKING CHICKEN
I want to restock my layers. What should I do before I bring in the new birds.
Ochieng

Before you restock, you must first disinfect the poultry houses thoroughly, and change the bedding materials. Thereafter, put in the chicken and monitor them to see if they have any sickness before you later mix them with others. Always remember that sharing food and water between healthy and sick birds leads to contamination. That should never be practised. Any bird showing signs of sickness must immediately be isolated from the rest. Transfer of drinkers and feeding troughs across poultry units can also lead to spread of diseases. These equipment should be cleaned and disinfected on a daily basis.
Seeds of Gold Team Egerton University

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Friday, October 17, 2014

Buzzing noise that signals rich harvest

David Kithusi, the chairman of Oldonyo-Sabuk Mango Growers Group in Ukambani, examines a beehive. PHOTO | SOPHIE MBUGUA   NATION MEDIA GROUP

By SOPHIE MBUGUA
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Kongo Gaceke, which loosely translates to “thin head” in Kimeru, is a sleepy village on the slopes of Mount Kenya.

Facing the snow-capped ridges of the mountain in this village is a farm owned by Agnes Kendi.

For many years, she saw bees as a nuisance and a threat to anything that lived in her homestead. The insects would invade her home and settle on trees and even houses, sending animals and children scampering for safety.

“I would use pesticides to kill them and when it didn’t work, I burned them at night using paraffin. But the bees kept coming back.”

Today, Agnes is teaching fellow small-scale farmers why they should keep bees. 

So what changed? The member of Kangaita-Mkando Vision Bee Keeping Group learned the importance of keeping bees.

RAISING THE QUALITY

She is among the 22 members of the group who have benefited from Kenya Pollinator Project (KPP), which is working with farmers to promote bee keeping.
The project aims at raising the quality and quantity of crop production by creating awareness on the importance of bee-keeping.

“We started the group with the help of KPP to understand the benefits of bees, particularly as pollinators,” Agnes says.

Dr Muo Kasina, a senior pollination and pest management researcher at the Kenya Agricultural and Livestock Research Organisation, says bees are active agents of pollination, hence farmers who keep them increase their yields.

“Out of every 10 90kg sacks of beans produced on a farm, four are due to bee pollination,” Kasina says.

“On average, farmers reap 40 per cent of their net benefits directly from bees since they contribute to 85 per cent of all agricultural production,” Kasina, who is behind the pollination project says.
He adds that beans (any type) produce more seeds and protein content when pollinated by bees.

“Pollinated beans have a six per cent higher protein content compared to the ones not pollinated. Even if farmers use certified seeds, they may not get much if their crops are not pollinated, particularly, by bees.”

Fruits such as watermelons, according to the expert, depend 100 per cent on bee pollination as they have male and female flowers separately.

“We did field trials for 45 months where we planted watermelons. We covered five with a net and left the rest open. During harvest, the five did not have a single fruit but we harvested fruits weighing between 5 to 7kg from the ones we left in the open and were pollinated by bees.”

Some members of Kangaita-Mkando Vision Bee Keeping Group, who had stopped growing watermelon, have now embraced the crop after starting to keep bees.

Their bean yields have also increased, with farmers harvesting about 14 bags from an acre, up from about half.

The farmers sell their honey at Sh600 per kilo.

But it is not only Kangaita-Mkando group which has embraced bee keeping.

David Kithusi, the chairman of Oldonyo-Sabuk Mango Growers Group from Nzambani, Machakos has been keeping bees for the last eight years for honey and to pollinate his crops.
THE SWEET SMELL

But over time, his bee population reduced, affecting honey production.

“The sweet smell from mango flowers has now brought them back. But black ants and spider webs can deter bees from getting into a hive.”

He says because of bees, his mangoes have become more uniform and bigger. “The yields have gone up. Initially, I would get about 30 fruits per tree in a harvest, but this has increased to more than 40.”

To get good honey and better crop yields, Kasina advises farmers to protect bees.

“Spray your crops mainly in the evening around 4 to 5pm when the insects are less active and have gone back to the hives.”

He adds that crop farmers should keep at least one or two bee hives in their farms.

“Have trees within your farm where the bees can get nectar. Indigenous trees and shrubs are good. They will ensure the bees will have enough food and thus better your crop yields.”

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Friday, October 17, 2014

My farm machinery spin more options for farmers

Alex Adundo processes sisal on his lathe machine in his workshop in Kisumu. jacob owiti | NATION 

By ALEX ADUNDO
More by this Author

Kibuye market in Kisumu is always as busy as a bee hive, both day and night.

Here, you can work for 24 hours, and the number of people who flock the market is huge, making traders sell their goods easily.

I found Kibuye the perfect place to put my workshop, where I mainly fabricate sisal processing machines for both local and export market under the business name Olex Technology.
I make several machines that includes a decorticator. The devices go for between Sh80,000 and Sh500,000.

The decorticator is used to strip the green cover from a sisal leaf and grinds the inner fibre into strands. The machine has a horsepower motor that uses diesel or petrol.

There is also the twinning machine which spins sisal fibres into thin yarns. It has a horsepower, electric motor, a fly arm, bobbin and a friction belt, among other parts.

The spooling machine, on the other hand, rolls different quantities of sisal for sale. It comprises of a two-horsepower motor.

I am a mechanical engineering graduate from Kisumu Polytechnic who loves making various machines for farm use. Since I graduated in 2004, I have always been thinking of how to use my education to make work easier in my society. 

My portable machines use either electricity, diesel or petrol. They consume an average of eight litres of petrol in eight hours.

But with diesel, the consumption is lower. A single head decorticator diesel machine consumes three to four litres for the eight hours. A double head decorticator consumes seven litres to 10 in the same hours.

The decorticator was the first machine I designed. I use locally available materials that include metal and motor to make the gadgets that I sell small ones for an average of Sh100, 000.
However, one can hire the machine for use at Sh300 a day

I make about five machines per month, mostly on orders.

To use the decorticator, you hold green sisal leaves and insert them halfway into the machine. It crushes the leaves turning them into fibre strands.

Besides the sisal machines, I also make bicycle water pumps and hydro floating pump for irrigating crops. A bicycle water pump retails at Sh15,000.

I have a website through which I market my products, but I get a good number of my clients through referrals. I also display the products in agricultural shows.

PATENTED

I get as many clients locally as from outside the country. My machines have been bought by clients from Nairobi, Migori, Mombasa and Baringo.

I have patented the sisal twine and a bicycle water pump because they are my own innovations. I have not patented the others because they are not new. I have just improved what is already in the market.

The main reason I came up with all these machines was to add value to the sisal plant and empower small-scale farmers, particularly in Western Kenya where sisal is grown.

Before I started making the machines, I was employed by an Indian family at a workshop in Kisumu as a technician earning Sh1,000 a day. It is here that I perfected my skills and learned most of the things I am doing.

We were mainly making machines for sugar companies. I worked for six months and in 2005, I went back to my village in Suba, Homa Bay County to plant sisal. I planted one acre but had problems selling it. It is then that I thought of making the machines, so I set up the workshop in Kisumu.

My initial capital was Sh400, 000, part of which was from my savings and the proceeds from my sisal, which I sold to a company in Homa Bay.

Some of the challenges I face include lack of finance to expand the business and failure to get qualified personnel. I normally get people from technical colleges but I have to take time to train them, which is expensive. Marketing is also still a challenge.

But I am grateful for the machines because in 2012, they gave me an opportunity to attend the Technology, Entertainment and Design (TED) talk show in the US. We were two Africans and I spoke about my machines. Currently, I am working on a weeding machine.

– As told to Everline Okewo

Are you engaging in any agribusiness. Tell us briefly via [email protected] Include your telephone number.

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Friday, October 17, 2014

The loan that made me a thriving farmer

Peter Kanyi in his greenhouse in Kikuyu, Kiambu, where he grows capsicum. ANN MACHARIA  NATION MEDIA GROUP

By GAKIHA WERU
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When Peter Kanyi took a loan in 2012 from the Youth Enterprise Development Fund (YEDF) to start a farming project, he wasn’t exactly sure how the venture would turn out.

Two years later, the success of the agribusiness project was recently on display at the Nairobi International Trade Fair.

Displaying the succulent capsicums was Rosemary Wangare, a marketer with Foliage Masters, the trade name for Kanyi’s agricultural products. She was showcasing one of the few successful farming projects funded by the YEDF.

The story behind the capsicums on display at the fair lay elsewhere in Nderi Village, Kiambu. On the leased three-and-a-half-acres, crops thrive, turning in an average profit of Sh20,000 a week.
It all started when Kanyi, a landscape architect, saw an advert in a newspaper inviting young people to apply for loans from the YEDF. He tried his luck.

“I was surprised when the officers from the fund came to assess my land, as well as my project proposal, and concluded that I qualified for Sh300,000 loan, which was to be paid directly to the company that was to put up two greenhouses, complete with an irrigation system,” says the Jomo Kenyatta University of Agriculture and Technology graduate.

In the two greenhouses, he planted capsicums, which produce an average of 100kg per week. He sells his crop to hotels, supermarkets and companies such as Fruit Juice.

But it was not easy when he started. Kanyi lost his crops to powdery mildew that swept through his greenhouse destroying the capsicums.

“I was lucky that I had diversified. The losses put me down, but I was able to pick up through sales from other crops.”

With the returns from the greenhouses, he is comfortably able to cover his overheads, service his loan at Sh10,000 a month and keep a tidy balance.

“The biggest challenge in farming is market and knowing what is selling at what price at any given time. I’m constantly doing research and avoiding traditional outlets like open-air markets where farmers are at the mercy of traders.”

He points out that farming is capital-intensive and for him to make profit, he only goes for crops that will fetch over Sh100 per kilo. This is not likely to happen if one is dependent on the traditional markets.

“In the open air market, you find traders buying a product at Sh20 per kilo and re-selling it elsewhere at Sh120. The trick is to navigate through this web of traders and middlemen to get the end of the market chain. This is why I have a full-time marketer.”

He acknowledges that there are always many variables that often come into play, and which can easily shatter a farmer’s dream. These include new diseases and market glut.

To cushion himself against this, Kanyi does not rely on one crop. He also grows carrots, cabbages, sukuma wiki (collard green) and strawberries.

BURN YOUR FINGERS

These are staggered all-the-year around. “I make sure every month I plant a little of everything. This ensures that every week throughout the year, I am selling something and I have cash coming in every week. It also makes the farm self-sustaining.”

Eventually, he plans to extend his farming to cover all the three-and-a-half-acres. One thing he has learned is that getting to the point of optimum returns is a long and painful process.

“Always start small and expand gradually. Don’t jump in expecting quick profits and remember at one time or another, you will burn your fingers. And when this happens, you must have the resolve to pick yourself up and forge ahead. In the long run, farming is rewarding.”

The 31-year-old consultant with Landscape Architects says farming comes naturally to him because his full-time job involves plants and moving the soil around.

Kanyi encourages the youth to embrace farming, pointing out that with a rapidly growing urban population, there will always be a market for food.

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Friday, October 17, 2014

One more reason to grow the versatile bamboo

Esther Wairimu uses the bamboo feeding trough in Thika. PHOTO | FELIX MUGENDI  NATION MEDIA GROUP

By FELIX MUGENDI
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Charles Thuo pushes the saw back and forth as it cuts through a bamboo stem resting on his lap.

He adds pressure on the saw completing the task in seconds. Thuo has done the job countless times, and that is why he has the confidence to put the bamboo stem on his lap and cut it.
The 38-year-old makes chicken and rabbit feeding and water troughs from giant bamboo trees in his Kahia-ini home in Kandara, Murang’a.

He begins by buying two-and-half-year bamboo stems from farmers at Sh200 each. “Stalks of this age are big enough for one to carve out the troughs. Their barks are hard, thus do not allow water to pass through, unlike the younger ones,” he says.

But Thuo doesn’t use just any bamboo; the green variety is best-suited for the work. It is hollow, unlike the yellow one.
Thuo cuts the mature bamboo stems into sizes of between 2 and 6 feet from which he makes the troughs. 

CHICK OR RABBITS
“Bamboo is also good because it has caps at the joints, thus, once I cut the stem, I remain with a complete feeding trough, with the sides well-covered.”
After he has divided the stem into pieces, he makes openings through which the chicken or rabbits would feed and drink.

“I use a hacksaw to do the work because an axe or panga may destroy the material or one ends up with rough edges.”
Thuo completes the work by smoothing the rough edges of feeding openings using sand paper.

The carpenter has been making the troughs since 2008. To begin the business, he invested Sh1,200 which he used to buy six bamboo stems.
Besides the troughs, he makes cigarette holders, piggy banks and hotel bill holders from bamboo stems.

He sells the products at between Sh50 and Sh500. “Piggy banks go for Sh50 each, cigarette holders and hotel bill containers Sh100 each while feeding troughs costs between Sh150 and Sh500, depending on the size,” says Thuo, who has been nicknamed Chicken Man because of his trade.

EARNS ME A LIVING

“I have been making the products for over five years now. This work is what earns me a living,” says the carpenter who dropped out of school at Class Six due to lack of fees.
Thuo, who also keeps chicken, recounts that he came up with the idea one day while carrying a mature bamboo stem.

“I remembered how we used to make toy vehicles from bamboo. It dawned on me that I could actually cut the stem and make troughs. I tried and saw it was a good idea and turned it into business.”

When he started, he was doing it on small-scale but production increased in 2012 when many people embraced quail farming, particularly in Murang’a, Nairobi and Kiambu.

“I raked in good profits when quails were the in thing, but business went down when farmers abandoned the birds,” Thuo says reminiscing that he would get farmers from as far as Nakuru ordering the feeding troughs.

“That time, brokers would come here, buy the troughs at wholesale price and sell to farmers in Ngong, Nakuru and Nairobi.”
Drop in business after people abandoned quails made him diversify to making cigarette holders and piggy banks.

“I sell the piggy banks and cigarette and bill holders to hotels and shops. Villagers buy the piggy banks.”

The carpenter, who now grows bamboo on his quarter acre, employs three casual workers to assist him ferry bamboo stalks from where he sources them.

He pays them Sh30 each. Each day, Thuo starts the work at 6am and makes 50 feeding troughs, 10 piggy banks and 10 cigarette and hotel bill holders by 11am.

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Friday, October 17, 2014

How I moved on after the quail ‘madness’

Patrick Mutua at his chicken farm in Pipeline, Nakuru. CHEBET CAROLINE   NATION MEDIA GROUP

By RACHEL KIBUI
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About this time last year, quail farming was one of the most-sought after agribusiness ventures.

Many farmers went into the trade expecting to harvest huge profits as prices of both the birds and their eggs were high.

An egg was going for over Sh100 and a bird for up Sh300. Quail rearing was the business to go into for any discerning farmer.

Soon, however, the market was saturated and the quail bubble burst. Seeds of Gold caught up with Patrick Mutua, a Nakuru-based farmer, who was in the business, to find out how he is faring on.

“Quails ushered me into poultry farming, but I will not keep them again,” he says.

As you enter the gate of his home in Pipeline estate, which borders Nakuru National Park, one can hear his 1,000 indigenous chicken in different cages clucking.

“I used to keep the quails in the cages, which is why they are smaller than the normal chicken pens. They were hundreds of them but I have now turned a new leaf.”
Mutua went into quail rearing in 2012, injecting Sh100,000 into the business. He was among the first people to venture into the farming.

Having an incubator enabled him to sell both eggs and chicks.

“In late 2012 and early 2013, there was so much demand that my eggs and quail chicks were always booked in advance,” recounts Mutua
But things took a nasty turn in October last year when demand declined.

“Egg prices started to plummet, from Sh100, to Sh80, Sh60, Sh30, Sh10 and finally Sh5.”
In the about one year he did the business, Mutua says he made profit of Sh200,000.

“Had I known that the business would be short-lived, I would have reared chicken instead of quails.”

MOVED TO CHICKEN

Having had enough, the farmer gave out most of his 600 birds to friends and ate others. He then moved to chicken.

“I already had an incubator, so I bought about 30 eggs from a supplier in Nakuru and started hatching chicks in February.”

Every month he sells about 150 chicks from Sh100 to Sh250 depending on the age. He also sells 20 to 30 trays of eggs a month for Sh450 each.
“With chicken, I am assured of a business that can sustain me for long. I learned my lessons with quails.”

Chicken farming, according to Mutua is not labour-intensive. One needs to feed them twice a day and clean the pens the same number of times.

“I give my chicken commercial feeds and supplement with sukuma wiki. I also follow strictly the vaccination schedule.”

Mutua says he learned three lessons from the quail business.

“The first one is, in farming, never follow the crowd. Second, do market research and talk to experts to see if your venture is sustainable and lastly, do not give up when your agribusiness fails.”
Dr Githui Kaba, a livestock expert in Nakuru, cautions farmers against rushing into agribusiness for quick profits.

“Quail business was good. The only problem is that many people went into it and flooded the market, which was small.”

He says that although indigenous chicken are disease-resistant, they must be vaccinated against Newcastle, fowl typhoid, gumboro and fowl pox, a disease that makes chicken go blind.

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Friday, October 17, 2014

Five reasons to be in farmers’ association are way to go

Vitengeni Women Group members in Kilifi last month when they received goats donated by an NGO. PHOTO FILE 

By MARY MUCHUNGU
More by this Author

Most livestock farmers shy away from being members of associations.

A smallholder livestock keeper would rather go and sell his milk at the roadside as opposed to collection points run mainly by associations for better prices.

The good thing with associations is that they offer farmers the economies of scale. Unfortunately, livestock farmers are yet to understand the power of collectiveness and unity as pertains bargaining for higher prices for their produce.

The farmers lack information on potential markets and are sometimes stuck with their produce for weeks.

Last week during the Nairobi International Trade Fair, I had the opportunity to have a discussion with a registered poultry group, and surprisingly, they had been requested to supply approximately 200 trays of eggs per week to a certain company but due to lack of resources, they missed the opportunity.

If that was a collection of groups, the farmers would have certainly clinched the deal. Isn’t it strange that cash crop farmers have formed associations that have been working well for years yet this is not to be the case with livestock farmers?

What are the benefits of joining associations?

Easy access to markets: Associations are key in the value chain. They assist farmers to access markets and fetch good prices for their produce.

Bulk sale of produce is a major catalyst for good prices. For example, smallholder dairy farmers would benefit greatly from village dairy co-operatives as opposed to hawking their produce individually.

CHANELLED THROUGH ASSOCIATIONS

Access to new technologies and information: Farmers’ organisations are crucial points of dissemination of information. It has been documented that most agricultural research and advisory services are channelled through the associations.

These services include financial support from the government or private institutions. In addition, members can be selected to participate in development programmes, benefiting the farmers through acquisition of new skills and other incentives.

Drivers of change: Through the associations, farmers can come together to form a strong force to lobby for relevant policies.

In 2007, poultry farmers’ associations in partnership with the Ministry of Livestock Development formulated a National Poultry Development Policy, and they have been at the forefront lobbying for the adoption of this policy.

Access to funding: Associations can recommend their members to various financial institutions for loans. This would be advantageous to many farmers as expansion of their enterprises may have stalled due to lack of adequate funds. The groups can also give information on how and where to secure credit services.

Value addition: Farmers’ organisations do not only assist in the identification of markets but help in value addition. This can be offered in form of training or a common processing plant where farmers add value to their produce.

For instance, bee keepers associations are involved in the processing and packaging of their members’ raw honey before sale thus fetching higher prices.

Smallholder farmers are encouraged to become members of these organisations to reap and enjoy the fruits of their hard work.

Dr Muchunguh is a livestock expert, drmary.muchunguh@gmail .com

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Friday, October 17, 2014

East Coast Fever: Here’s how to keep the disease at bay

Some of the cows grazing in Takaungu, Mombasa County, on May 7, 2014. East Coast Fever is one of the deadliest livestock diseases. PHOTO | LABAN WALLOGA  NATION MEDIA GROUP

By INYAGWA MULEKE
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East Coast Fever is one of the deadliest livestock diseases.

It is particularly virulent among exotic cattle breeds which suffer high rates of mortality. The disease has a devastating impact on the smallholder farmers because it can kill within three to four weeks of parasite infection.

The symptoms include swelling of the body lymph nodes.

In cattle, the disease is transmitted primarily by the brown ear tick (Rhipicephalus Appendiculatus), which attaches itself to the animal.
Signs to look out for

The first clinical sign of the fever in cattle appears seven to 15 days after attachment of infected ticks. This is seen as a swelling of the parotid (salivary gland), for the ear is the preferred feeding site of the vector.

This is followed by generalised swollen lymph nodes and fever, which continues throughout the course of infection with temperatures rising to 42 degrees Celcius. The rise in temperature is normally rapid.

The animal then lacks appetite, experiences difficulties in breathing, has soft cough due to accumulation of fluid in the lungs, blood stained diarrhoea, muscle wasting, nasal discharge and discolouration of the eyes and gums.

If not treated, the affected animals collapses and dies in three or four weeks. The farmer should also look out for sharp drop in milk in dairy cows to detect if the animal is sick.
How to prevent the disease

CONTROL

i) Regular dipping of cattle should be done. The cows can also be sprayed regularly with acaricides. This should be done on a weekly basis. But this rate has to be increased when tick infestation is high.

However, one should note that continued use of acaricides may lead to resistance of ticks and unacceptable residues in milk and meat. It is important to note the use of acaricides is expensive and poses a threat to the environment.

ii) Cattle immunisation: This offers life-long immunity to the animal. But it has not been adopted for widespread use because of logistical difficulties associated with production and distribution of a live vaccine and lack of commercial uptake.

iii) Integrated control: This is a more effective approach, particularly for dairy farmers.

The measures include effective fencing, pasture management, rotational grazing to reduce the level of tick challenge, selection of tick-resistant cattle, and new methods of immunisation.

With strategic acaricide application, this approach offers a more satisfactory method of East Coast Fever control. Several drugs are available in the market but their use is limited due to high cost.
It is also important to start treating animals during the early stages of the disease.

There are currently three drugs used for the treatment of East Coast Fever. These are Parvaquone (Clexon), buparvaquone (Butalex), and halofuginone lactate (Terit).

Prof Muleke is the Dean of Faculty of Veterinary Medicine, Egerton University

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Friday, October 3, 2014

Technology firm Empire Microsystems to raise cash at NSE

An investor at the NSE trading floor during the opening of the Exchange Building in Westlands.

An investor at the NSE trading floor during the opening of the Exchange Building in Westlands. Capital markets in Africa have too much protection, stifling growth. FILE PHOTO | DIANA NGILA |  NATION MEDIA GROUP

By NATION CORRESPONDENT
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A technology firm has announced plans to raise capital from the public by selling shares to fund its expansion strategy.

Empire Microsystems plans to list on the Nairobi bourse’s Growth Enterprise Market Segment (GEMS), which is reserved for small and medium enterprises.

“The listing is part of our expansion strategy aimed at aligning the company with the growth in IT industry, as well as the boom in property and infrastructure space where we play a key link role between the two sectors and the end user,” Empire Microsystems chairman Julius Kipng’etich said in a statement.

The firm works with other technology firms like Huawei, Jamii Telecoms, Safaricom and Wananchi Group to provide last-mile Internet connections to customers.

In the past six years, it has connected 5,000 buildings and 50,000 customers to various Internet service providers.

Empire Microsystems says it has hired Equity Investment Bank as the lead transaction advisor and ABC Capital and Equity Investment Bank as co-sponsoring stock-brokers for the planned listing that is awaiting NSE’s approval.

The firm joins a list of others, including consumer goods and tank manufacturer Flame Tree, Mayfox and East African Data Handlers in plans to list on GEMS this year.

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Monday, September 29, 2014

Banker bets on digital water meters to reduce leakages, beat vandals

Mr Stephen Muriuki, the managing director of Real Technologies, and a digital water meter. PHOTO | FAITH NYAMAI 

By FAITH NYAMAI
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Loss of water through leakages and defective meters has been a major challenge for both water suppliers and consumers in Kenya. How to control spillage and reduce cost has been a major debate, especially among urban households whose consumption of piped water is higher than their rural counterparts.

To curb this problem Mr Stephen Muriuki, the managing director of Real Technologies, has come up with digital prepaid water meters.

Though in its pilot stage, the programme which he is conducting across the country is introducing digital water meters which he says will solve the problem of water cartels and wastage. While the technology may not be new in Africa, it is new in Kenya and will help water companies and consumers too.

Water companies across the country lose millions of shillings monthly to cartels and vandals. A recent report by the government revealed that Nairobi Water and Sewarage Company alone has lost water valued at Sh2.1 billion. The report also unveiled rampant illegal water connections, especially in low income settlements.

Mr Muriuki, whose company is located in Nyeri town, said the idea of introducing modern water meters was born in July last year while he was still working as a cashier at a leading bank in the country.

“Doing my calculations and seeing how much money water companies were losing every month pained me a lot,” he said. “I also heard my friends complain of huge monthly water bills,” he added.

Mr Muriuki decided to leave his job and start Real Technologies, based in Nyeri town. He is the managing director of the firm. He started researching on how to bring a solution to many Kenyans suffering in the hands of water cartels and vandals.

“My research involved going across the country, more so to informal settlements in Nairobi, interviewing people and handing out questionnaires. ‘‘That’s when I realised that some people pay bills for water they have not used,’’ he said.

In some cases water companies do not visit homes to read water meters because of inaccessibility. In other areas meters supplied by companies are tampered with while others are stolen, making it difficult for firms to calculate water used.

Digital water meters will come in handy, he said. Customers buy tokens and load them into meters, cutting down the need to go to water suppliers’ offices. The meters allow water users to buy credit through bank cards, mobile money or pay directly to water companies.

They are set in search a way that when they are loaded with credit they open the valve and water flows. “In case of low credit or battery the meter will send signals to the consumer,’’ he said.

The meter also alerts the consumer and water company in case of leakages, helping them pinpoint where the problem lies. They also have proved to be tamper proof and all weather, Mr Muriuki said.

Several advantages

The meter has several advantages which include generating elaborate reports for management, giving maintenance schedules and preventing fraudsters from interfering with the water flow system,” said Mr Muriuki.

“Through this new technology companies will be able to get accurate bills, thus preventing the amount of water lost through leakages.”

Mr Muriuki said that he came up with the prepaid water metering system to balance the needs of urban dwellers against commercial goals of utility providers.

The prepaid meter has been successful in countries such as South Africa, Uganda and Namibia where companies are introducing it. If adopted, the gadgets will make water accessible to more customers at the utility provider’s rate.

He says that digital meters will be connected to water supplying companies and managed through a Meter Management System (MMS). The MMS is a centralised system which allows water firms to track records of all prepaid meters.

The meters will be mounted in people’s houses to prevent theft and damage. “Each also comes with a battery which lasts for six years,” said Mr Muriuki.

[email protected]

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Monday, September 29, 2014

Second Global Innovation Competition launched in Nairobi

People go about their work at the iHub offices in Nairobi. Making All Voices Count launched the innovation competition at the centre. PHOTO | FILE | NATION MEDIA GROUP 

By ANNIE NJANJA
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Making All Voices Count has launched the second annual Global Innovation Competition in search of creative concepts that encourage engagement between citizens and governments.

The 2015 Global Innovative Competition seeks to give local and international innovators and entrepreneurs a chance to design solutions that stimulate dialogue and improve the relationship between governments and citizens.

Run and implemented by Ushahidi and partners from the Netherlands and the USA, the competition’s call for applicants was published on September 15 and will run until October 15.

The competition, which directs global attention on creative and cutting-edge solutions for local problems, including those that use mobile and web technology, strives to ensure that voices of all citizens are heard, and that governments have the capacity as well as incentive to listen and respond.

This year’s competition will focus on four things: Legislative Openness, Inclusive and Participatory Lawmaking, Sub-national Governance, Gender Equality and Building Resilience and Response to Humanitarian Crisis.

Stakeholders briefing

Speaking during a stakeholders briefing at iHub in Nairobi, Innovation Director Daudi Were said: “We are looking for the outliers, disruptors and rebels among us who will create out-of-the-box ideas that boost citizen engagement and government responsiveness. Think big, think radical, look at old problems with new eyes and listen to the stories largely untold.”

It was also confirmed that the competition does not necessarily take innovation to mean the fastest and newest innovations.

“Previous finalists used basic tools such as SMS and print news bulletins in their solutions. This year’s competition seeks entrepreneurs and innovators with easily deployable technology that is relevant to the cultural, political, economic and geographical needs of the end user,” he said.

An open online platform where applicants can upload their campaigns will be used for review and voting by the public. Contestants will be shortlisted and evaluated by a panel of judges and finalists will be awarded £300,000 (Sh42 million).

The grant will go towards facilitating the finalists in improving their projects or campaigns and help them attend the Global Innovation Week in Jakarta, Indonesia, for networking and mentoring.

The inaugural competition, where a Pakistani government driven innovation won the top prize, attracted 250 submissions and 60,000 online votes.

This year’s competition will feature contestants from Ghana, South Africa, Indonesia, the Philippines, Liberia, Tanzania, Bangladesh, Pakistan, Mozambique, Uganda and Nigeria.

[email protected]

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Monday, September 29, 2014

Nail artist hits on lucrative home-grown idea after stint abroad

God’s Favour Beauty Parlour founder Martin Ng’ang’a (right) doing a client’s nails at the beauty shop in Nairobi. PHOTO | SALATON NJAU | NATION MEDIA GROUP 

By EVELYNE SITUMA
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When Martin Ng’ang’a got an opportunity to work abroad, he thought he had earned his ticket to success. But he would later find his fortune back home when he returned to operate a makeshift beauty parlour located at Bus Station in Nairobi.

Martin’s story is not unique but one narrated by thousands of Kenyans made to believe that prosperity lies abroad. Filled with the desire to better his life, he travelled to Dubai in 2011 to work as a security guard. At the time, he had more reason to believe that his life had reached a turning point. But he says this was not the case.

Although he earned a fat salary, life abroad was expensive, forcing him to live on a shoe-string budget.

“Most of the people who leave the country to work abroad can’t quiet admit it, but they are suffering. I used to rent a bed for Sh13,000 a month,” he says. Other than the high cost of living, he says he was frustrated with the fact that he could barely support his family.

“It pained me that the money I sent home wasn’t enough to transform my family’s life. My children were also growing up without me.” It was at this point that Mr Ng’ang’a made a decision to return home, amid opposition from his family and friends.

“I remember nobody came to receive me at the airport. They all thought I was insane. They couldn’t understand why I left a nice job to come home and wallow in poverty.”

Cash-strapped, depressed, jobless and hanging onto his meagre savings, Mr Ng’ang’a stumbled upon an idea that would later transform into a lucrative business.

“The idea (beauty parlour) came about in 2011 while I was taking a routine walk around Huruma in Nairobi. I saw young men doing manicure by the roadside,” he says.

It was then that he thought of venturing into the business. But instead of hawking around Huruma, he opted to find a shop in town. He linked up with one of the freelance nail artists operating from Huruma and rented a makeshift structure in the city centre at the bus station. This would mark his turning point.

Capital in hand, Mr Ng’ang’a rented the temporary stall for Sh10,000 but paid five-months rent upfront. He furnished the structure with Sh5,000 and invested Sh1,000 on nail polish.

“Nobody thought my idea was viable. Most people were surprised that a mature man like me would wash women’s feet and apply nail polish. But that didn’t bother me,” he recalls.

Today, his business called God Favour Beauty Parlour has grown beyond his imagination. From an initial eight clients, he now attends to 150 to 200 women daily.

Good client service, past experience from a second-hand clothes business he operated in Ngara before leaving for Dubai and innovation, he says, are the three key ingredients that have helped him thrive.

“We wanted to be different. So we started offering additional services like washing clients’ feet and offering massages for free before applying nail vanish.” This won him more clients, forcing him to increase the number of employees.

“In the beginning, I lost a lot of business because I had only one employee. I never wanted to hire more staff because I didn’t want to share the profits. But I realised I was wrong. Since I added more staff, we began to get more clients and the business grew exponentially.

“In this business time is of the essence. Clients don’t like to wait,” he says.

God Favour Beauty Parlour now has 10 employees. Mr Ng’ang’a operates three stalls in the city centre, although he still maintains his makeshift structure. Looking back at his journey and success, he advises youth opting for business to be patient and respectful to clients.

Cash flow

“Any business takes time before it grows. There is often a time where the business goes down and it’s at this point that it later springs up. But most people give up early. They should run the business for at least two years, observing and learning from mistakes, before they opt to quit.”

He also advises entrepreneurs to learn how to manage cash flow.

Mr Ng’ang’a pays his staff a 30 per cent commission per client. God Favour charges Sh100 for a re-varnish. From time to time, he can be found working.

He says that although he enrolled for a short training in beauty, he has learnt most of his skills hands-on.

Like any business, the father of four says, high employee turnover is his biggest challenge. But he has learnt to cope.

Since he opened his stall, he has seen more people open the same business next to his. But he says competition has only served to bring more clients to his doorstep.

[email protected]

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Monday, September 29, 2014

Former guard living his dream of making beautiful gardens

Michael Kabiah, founder Mika Landscapers. PHOTO | DIANA NGILA | NATION MEDIA GROUP 

By ANNIE NJANJA
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Michael Kabiah’s background is humble. He was orphaned at 16 and never made it to college like his peers. He, however, did not cast his fate to the wind and defied all odds to become an established entrepreneur.

After his secondary school education, his grandfather, who was left to care for him after his mother passed on, was adamant that he joins the National Youth Service (NYS) but Mr Kabiah was not for the idea.

Without much to do, he started planting flowers and trees on a two-acre piece of land allocated to him by his grandfather. His interest was not surprising to his extended family because since the age of six, he had been collecting and planting flowering plants at his late mother’s homestead.

He says he always wanted to make the environment beautiful through use of colourful flowers. He began selling flower cuttings but at the time, proceeds from his venture were not enough to put food on the table.

Mr Kabiah then went into construction and later got a job as a security guard.

“There was no satisfaction in those jobs and I was there for the money, which made me feel like my life was purposeless. It was not a good feeling,” said Mr Kabiah.

He decided to quit his security guard job. “Everyone thought I had gone crazy, but my heart was elsewhere. All I could dream of was flowers and making beautiful gardens.”

In 2011, he sought space on Outering Road in Nairobi where he began selling flowers.

“Aware that my survival relied on my marketing and sales skills, I would sell the flowers and ask the clients if they needed anyone to plant or care for them,” he said.

It was not long before he earned the trust of clients, and slowly his business began to stabilise after securing landscaping contracts. His first big job was at King’s Medical College in Nyeri.

“I used the photos of my first contract in landscaping to pitch to the clients buying flowers from my nursery. It was not easy because not many believed that I was capable of such flawless work. However, I managed to convince a number of them and slowly I built my portfolio, which did most of the marketing for me later,” he said.

This marked the genesis of Mika Landscapers. Four years later, Mr Kabiah is a happy man mostly for achieving his dream of owning a landscaping company.

“Most of the times, people resign themselves to fate which should not be the case. I am glad that I was bold enough to go after my passion yet everyone else made me feel like I was making a huge mistake,” he said.

Mr Kabiah has compensated for his lack of formal training in gardening and landscaping by reading widely. He regularly buys books from which he gets inspiration. He also gives attachment opportunities to trained landscapers, a platform he uses to learn more.

He says the number of contracts that his company has worked on since 2011 are more than 250. He acknowledges that the market is growing and that Kenyans are increasingly seeking landscaping experts.

His portfolio includes residential homes in posh areas of Nairobi, Ikon Gardens in Muthaiga and Nextgen Park on Mombasa Road, to name but a few.

He uses site plans to determine the layout of the gardens. Then a design sketch follows after which he consults a landscape architect for a 3D design.

Mr Kabiah says landscaping is an art of creativity because each project is unique.

“Landscaping is not an interior designing and decorating job where an empty room can turn beautiful in a matter of hours. As such, I make sure my clients are psychologically prepared for the wait it takes for a garden to take shape,” he said. “For instance, it takes three to six months for a new lawn to be lush with green foliage.”

He advises property developers to consult landscapers eight months to the completion date of a house. This ample time ensures the compound matches the standard of the house by the time owners are moving in. Besides, it increases property value.

A comprehensive project involves ground preparation, levelling, installation of garden lights and automatic irrigation system and planting of grass cuttings or seedlings. Once the grass is mature, various garden features like water fountains and man-made falls are installed.

For good practice, Mr Kabiah advocates for the use of processed organic fertiliser instead of animal manure to avoid transferring diseases to the garden. His monthly visits on projects he has worked on before ensures weed and pest control is carried out at all time.

“It is our policy to always keep in touch with our clients until we are sure that they are in a position to take care of the garden independently.”

For pieces of land with resident farmhands, MrKabiah trains them on how to best care for the gardens. A crusader of eco-friendly landscaping where clients are open to ideas, Mr Kabiah installs bio-digesters to recycle used water by channeling it towards irrigation and solar garden lights.

The cost for half an acre landscaping project lasting six months ranges from Sh500,000 to Sh3 million depending on design requested, desired flowers and number of garden features.

Although he has 10 permanent employees, when working on a number of projects concurrently he can have up to 100 people working on various grounds.

[email protected]

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