Dickson Nganga of Kilimall introduces commodities through livestreaming at an office in Mlolongo, Kenya, Nov. 10, 2023. (Xinhua/Li Yahui)
The Internet has become the saving grace for an increasing number of owners of small businesses seeking to survive tough economic times in Kenya.
NAIROBI, Dec. 1 (Xinhua) -- The Internet has become the saving grace for an increasing number of owners of small businesses seeking to survive tough economic times in Kenya.
The traders are closing their physical shops and stalls and moving online to escape high operation costs occasioned by rising inflation.
While embracing online operations, the businesses are seeking to eliminate operation costs associated with rent, electricity as well as licenses.
"It is the only way to survive the tough times," said Gilbert Wandera, who used to run a computer and mobile phone shop at Jamia Mall in the central business district of Nairobi, the capital.
Wandera, who also offers computer maintenance services, said he closed the shop two months ago as he shifted online.
"I keep the stock at home and promote the wares online, especially on social media, where I use influencers. Potential customers contact me for deals," Wandera told Xinhua in a recent interview.
Wandera said he used to pay 55,000 Kenyan shillings (about 360 U.S. dollars) in monthly rent for the shop, 26 dollars for electricity, and 163 dollars for yearly licenses.
"I could not sustain those costs since sales declined due to the tough times. I also had to release my two workers as I shifted online," he said.
Kenya's inflation stood at 6.9 percent in October, according to the Kenya National Bureau of Statistics, up from 6.8 percent in September.
While the rise was marginal, the costs of goods and services are on the rise, occasioned by high cost of fuel.
The situation has been exacerbated by the depreciation of the shilling, which fell by more than 22 percent against the dollar and other major world currencies in one year, leading to expensive imports, as the east African nation is a net importer.
The exchange rate of the shilling quoted by the Kenyan central bank on Friday was 153.2 to the dollar.
Staff members of Kilimall pack commodities at a warehouse in Mlolongo, Kenya, Nov. 10, 2023. (Xinhua/Li Yahui)
Among traders who are shifting their operations online to beat the tough economic times in Kenya are vendors of clothes and shoes, food, interior decor, perfumes, beauty products and various machines.
"I do graphics design making a range of items. From receipt books, business cards, flyers, funeral programs, wedding cards, banners, stickers, anything to do with printing and top branding solutions at very affordable rates," wrote Sam Musyimi in search of customers on social media.
Betty Wafula, who sells second-hand clothes as a side hustle, said she cannot let her business die in the tough times.
"I did not start from scratch this time round, because during the COVID-19 period, I embraced online business but relapsed when normalcy returned; but then I did not close my stall in Nairobi. This time round I have closed it and completely shifted online," the insurance agent said, noting she was paying 131 dollars for rent.
A Chinese staff member and his Kenyan colleague work at a Kilimall office in Mlolongo, Kenya, Nov. 10, 2023. (Photo by Li Yahui/Xinhua)
Her new operations involve getting her wares, posting them online and delivering orders to offices and homes in Nairobi, where customers usually pay upon receipt of the goods. Some customers pay in advance and receive the goods through courier services.
The surge in online businesses in Kenya has been catalyzed by widespread use of mobile money, social media and the Internet in general.
The Communication Authority of Kenya put the number of Internet users and mobile money users in the country at 49 million and 63 million respectively at the end of June.
Bernard Mwaso of Edell IT Solution, a software development firm in Nairobi, said the ability to reach more potential customers, locally and globally, and the ease in serving them makes online trading friendly to not only small businesses but also big ones.
"The cost of operation for online trade is also low since one does not incur overhead costs like rent and electricity. However, trust is key in the success of such businesses, and lack of it is what most traders struggle with," he said.
The Kenyan government is pushing for the increased adoption of e-commerce, especially among small businesses, through setting up free Wi-Fi spots in market centers and other public spaces.
"We are providing Wi-Fi for free in markets and in bus termini to support our mothers and our youth so that they can get involved in e-commerce and other gainful economic employment activities," Information, Communications and the Digital Economy Cabinet Secretary Eliud Owalo said recently.
Kenya's economy is expected to grow 5.5 percent in 2023, up from 4.9 percent in 2022, according to the National Treasury.
The country's economy has been battered by global shocks including the Russia-Ukraine conflict and interest rate hikes in developed economies, as well as extreme weather conditions like floods and drought. ■
