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Businesses you should think twice before venturing in

In Kenya, there are quite a number of businesses on can consider venturing in, some are on high demand with high returns and worth investing in.

However some businesses are a no go zone in Kenya and should you consider starting them, then you first need to think twice.

One would need to sit down and reconsider if it is the right decision to venture in some businesses depending on the risk factors.

Factors such as nature of business, competition and relevance due to the ever changing market should be key before you decide to put your money in the business.

Here is a list of business that might not be profitable to venture in in Kenya at the moment.

Businesses worth not investing in in Kenya
1. Car Hire Business

Some years back, car hire business was a lucrative venture that every person with financial muscles gave it a thought. While many who invested in car hire business made good profits out of the business, car hire business is no longer a venture you should run for.

Over time, car hire business has lost its grip and its profits are ever dwindling thanks to the influx of personal cars.

One would easily opt for getting a car from the neighbour or friends which is moderately cheap and free in most cases than spend thousands on car hire company for a limited period of time.

The introduction of affordable digital taxis has also pushed car hire business out of the Kenyan market as most people have found it more comfortable and cheap to go for this option.

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Most event organizers who minted a lot from this business are currently experiencing a decline in revenue and they are forced lower their prices to serve the few direct clients that they have.

2. Club/Bar business

Bar and club business is another business venture that has seen it viability and demand decline over time. While the number of club goers and drunkards have not reduced, the business environment has drastically seen some changes that are pushing bar and club owners out of business.

Ever since bars were restricted on operation hours, small businesses found a way to venture into the lucrative business by starting small shops that sell alcohol at anytime. The change saw the lovers of the bottle shift from taking their favorite drinks from bars to purchasing them from shops and supermarkets after which they take them at the comfort of their homes.

The outbreak of Covid-19 that saw bars and clubs ordered to close only made the problems of bar and club owners go from bad to worse.

High operation costs that bar owners incur, from paying for large rental space to employing several attendants and bouncers are no longer incurred by take away shops that only need small shops and one or two employees to run the business with no restrictions.

This has made drinks from shops more affordable than in clubs and bars and most people have found new love in them.

3. School Business

Are you thinking of starting a private school? While the idea of starting a school might be a good one, you may have to think twice.

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The presence of many private academies in every estate you go have pushed down fees collected by school owners to keep up with the competition. While most parents still pay out hefty amount in the name of school fees, operation costs of running a school and paying workers is way much more than you can imagine.

While previously schools used to employ untrained teachers who did not demand high pay, the ministry of education has made it mandatory for schools to employ qualified and TSC registered teachers before.

This teachers are paid way much more than their untrained counterparts that directors of private schools have to dig much deeper into their pockets to keep these teachers in their schools.

The introduction of the new Competency Based Curriculum CBC has further increased operation costs of schools making it much harder for anyone who wants to start a school business from the scratch.

These leaves only established schools with the muscles to sail through the water.

Nowadays, the hurdle of getting your new school registered is a hurdle that many have found a hard nut to crack. Those that fail eventually shut their venture prematurely leaving behind a trail of losses.

Should you have a soft spot on starting a school as a form of business, it would be wise to count the cost and get more advice from experts.

4. Taxi Business

If you have an idea of converting your old used car into a taxi, then you mist be living in the 20st century.

The tax business has been taken over by digital taxi service providers such as Uber, Bolt, Wasili and the list is endless.

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While these digital taxi hailing service providers partner with car owners, your old car cannot be enrolled into their fleets as they only work with clients own relatively new cars.

Going it alone will be much harder as currently most people have adapted these affordable, convenient and readily available mode of transport that is just a button away.

READ:

  1. How to easily start a business in town without the hustle of renting a shop and paying for licenses
  2. 8 Small Business Ideas with High Returns
5. Matatu Business

Matatu business is another form of businesses that is being threatened and will soon be wiped out.

With cities starting with Nairobi planning for introduction of rapid bus services and working on barring matatus out of town, the wave will soon spread to other towns.

Matatu owners have been complaining over the introduction of digital taxi services and long distance ride services such as SWVL which they claim are eating into business.

The introduction of the new commuter rail services have also dealt a blow to matatu business.

Matatus have also been facing a stiff competition from bodaboda riders who provide swift transport solutions beating challenges associated with traffic jam in most towns.

Within no time, matatu business will no longer be a lucrative venture to invest in.


Majira

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