Are you thinking of starting a Mitumba business in Kenya but have no idea where to start, or how much this business investment will cost you? Worry not, as this article will provide you with answers to all your inquiries, ensuring that you are set in the right path to success.
So, without further ado, let’s delve into the details.
Do proper market research
Before investing in your Mitumba business, you MUST do market research to know what your potential clients want and the money they are willing to part with when buying your products. For instance, if a Mitumba business owner located in Mombasa County decides to purchase a bale of jackets, that would be considered a hazardous environment as the temperatures of the coastline do not allow shirts, let alone jackets. However, a supplier located in Limuru, Kinangop or any other cold area is assured of a good market for the jackets.
Further, your market research should include places where Mitumba businesses thrive. Setting up a stall in the middle of an estate such as Muthaiga will work against you. People there are rich and will more likely prefer new clothes as compared to second-hand attire.
Finally, your research should help you estimate the total cost/capital required to set up a fully functioning Mitumba business.
What capital is required to start a Mitumba business in Kenya?
As simple as it looks, setting up a mitumba business can be quite a daunting task. If you think that buying a bale of clothes is the only cost you will face, then you are in for a rude shock. For a good Mitumba business, you will require an investment of Ksh.50,000. Let’s break it down;
1. Venue and vending space expenditure
Where your business is located is a key aspect of your business’s success. Having a location with many people of the middle class is crucial to your sales. Further, despite the high cost of renting a stall, you should choose one that is safe for your Mitumba storage and is attractive to your customers. Remember not to overspend here as you need to purchase inventory, which is what the entire business is based on.
Upon settling on a suitable rental stall, you should now focus on the design of your shop. You will need to purchase cloth hangers, clothing and garment racks. You may also need shoe racks if you plan on stocking up on Mitumba shoes.
After setting your rental and interior design costs, you will need to purchase a trade license from the government. This will cost you between Ksh.4,000 to Ksh.15,000 depending on the size and location of your business. You will also require a music license because you will need to play local music to entertain your customers.
Finally, you will need to register your business in the e-citizen portal. This will cost you around Ksh.1,000.
|Venue Cost||Cost (KES)|
2. Recurring Costs
You will have to cater for these costs every month or as soon as the need arises. We have listed them below. Any that has not been included counts as miscellaneous.
|Recurring Expenses||Cost (KES)|
3. Inventory expenditure
A typical bale of Mitumba clothing will cost you between Ksh.15,000 to Ksh.20,000. However, you should note that these bales are graded in terms of quality thus varying in price. Generally, Grade 1 bales are the most expensive, followed by Grade 2 onwards.
After purchasing your bale, you need to sort out the Mitumba into Camera, Second Camera and low quality. You will need labour because the clothes are usually too many to be sorted out by one person. If possible, feel free to employ your family members.
What is ‘Camera Clothing’?
Camera clothing referred to those pieces of clothes that are of good quality and adhere to current fashion trends. Furthermore, these clothes, according to your assessment, should have the highest pricing. With this, you will end up with low-value clothes that won’t be bought. This is what is called the ‘dead stock’.
|Dummies/Mannequins x 3||1,300 x 4 = 5,200|
|Sorting & Processing||500|
4. Grand Total
|Total Venue Cost||26,700|
|Total Recurring Cost||1,000|
|Total Inventory Expenditure||21,500|
|Grand Total||49,200 = 50,000|
What if you have a low capital investment?
If you don’t have Ksh.50,000 lying around waiting to be invested into a Mitumba business, don’t despair. You can start your business with as low as Ksh.500 bob. In this case, you will need to forego owning a stall or even purchasing an entire bale of clothes.
You will have to look for already established Mitumba owners and buy a small amount of clothing that you will then sell to your customers at a higher price.
These large mitumba businesses also sort and subdivide the clothes into half and quarter bales. Feel free to purchase according to your pocket depth.
Without a stall, you will need to sell your clothes on the market day and therefore, you will need to register for a government-sponsored stall. Visit your local huduma centre for more information.
Know your Mitumba Suppliers
Like any other place in the world, Kenya is prone to fraudsters posing as trustworthy suppliers. mitumba business novices have often fallen into the trap of buying a grade 1 bale and being supplied a grade 2 bale. This happens because of ignorance.
When choosing a supplier, make sure you have done prior research. Contact your close friends in the Mitumba business and as they connect you to their supplier. Doing these will save you lots of trouble.
Specialize in a Mitumba Niche
Just like any business, specializing in a clothing niche will help build your brand and clientele. Pregnant ladies will always remember that vendor whose stall satisfied all their needs and teens will always come back to purchase new fashionable shoes from you if you choose to specialize in a particular line of clothing.
This, however, does not limit you from stocking up on variety. In business, you should find what works for you and stick to it.
What makes many Mitumba businesses fail?
Assuming you have followed all instructions mentioned above, what makes many Mitumba businesses fail? Here are some possible reasons:
- Overpricing your products – Whether or not you bought your Mitumba clothes at a high cost, it is none of your customers’ business. Therefore, to avoid clients running away from your shop to cheaper stores, do proper research and sell your clothes at reasonable but affordable prices. Avoid underpricing as you will end up making huge losses.
- Competition – Many other entrepreneurs started before you and will give you a hard time through competition. You will need a solid marketing game plan and resilience. Utilize social media to reach a wider market. Build up your Facebook, Twitter and Instagram accounts. Further, post your best products on your WhatsApp Business account and watch as viewers and followers convert into leads.
- Poor inventory management – As an owner of an enterprise, you have to secure a steady flow of inventory. If in a certain month, a supplier bailed out on you, you should have options that will keep your business running smoothly
Best practices you should employ in your Mitumba business
- Quality Control – Make sure your stall is clean as possible, repair damages and keep the room devoid of pests and vermin. No one wants to buy clothes in places filled with roaches or rats.
- Manage your inventory efficiently – You should know when to buy new bales of clothing and when to remove dead stock from your stall.
- Strategic pricing – Choosing a pricing sweet spot is crucial to your business. You must ensure market equilibrium, where both the buyer and you, the vendor, agree on a specific price for a particular piece of cloth.
- Comply with laws and policies – Make sure to pay for any renewable licenses by the government, to stay on the right side of the law.
- Provide feedback channels and client support – Clients may sometimes purchase damaged clothes. In such situations, offer free repair services as the clothes were already damaged in your hands. You could also offer replacements in case the clients no longer want the repaired product.
If you’ve read to this point, you are ready to start your own Mitumba business. Quit stalling and start your own Mitumba business. Success!