Hardware Business In Kenya

Hardware businesses in Kenya have increased over the past years, with many people aspiring to generate profits. Most of us tend to wonder how to start a profitable hardware business with low capital and still be able to generate maximum profits.

This is possible if you have the correct information and can dry different approaches to differentiate you from your competitors.

Steps Of Starting A Hardware Business In Kenya

Step 1: Conduct thorough research

The first step to starting a hardware business in Kenya is finding out all the fundamentals of the business from successful hardware business owners. This is done in the following ways:

  • Going online and reading reviews on already-established hardware companies. This way, you will find out which hardware products are in demand. You will also learn something about how customers want to be served.
  • Going to hardware stores around the location you want to set up your hardware business. This is for observing how the hardware customers like to be served and the hardware products in high demand. While observing, you will discover how different-size hardware is managed to help you decide how big your hardware business will be.
  • Talking to a legal counselor. This is to clearly understand the legal regulations set by the government to avoid getting into problems with the law when you open your hardware business.
  • Talking to hardware business owners to find out where to get wholesale hardware supplies. As a new hardware business owner, you will also be told about the pricing of supplies to prevent being shortchanged.

Step 2: Construct a hardware business plan

The next step is to establish a business plan that will work for your hardware business with the help of the information collected when researching. You should make sure you include the following in your hardware business plan:

  • The budget you have set aside for starting the hardware business.
  • The size of hardware that you can handle. Ensure you can afford the rent of the size of the hardware store you settle on, depending on your budget range.
  • The hardware products you will sell.
  • The wholesale suppliers of the hardware products you will decide to sell and how they charge.
  • The legal requirements to starting a hardware business in Kenya.
  • The number of employees you will hire for the hardware business to run effectively and how much salary you will pay them.
  • The target market of your choice of hardware products.
  • The location you will set up your hardware business considering the target market.
  • The name of your hardware store considering your choice of hardware products.

Step 3: Rent space for your hardware

After making a hardware business plan, you will clearly understand the products you want to sell in your hardware store. You will also know the target market for your hardware products. This information makes looking for a shop to set up your hardware business easy. You should, however, not be carried away in the process and forget to rent a room that will not be within your budget.

Step 4: Gather your products of choice

You have already gotten a room and have paid for the rent. Shipping your hardware products of choice will be the next step because you have space to store them. Negotiate with your supplier and have the hardware products brought in. When the hardware products arrive, take some time to review each. This way, you can find out which ones are defective and place a complaint to the supplier. A complaint can only be valid when tabled before it’s too late to establish who is at fault.

Step 5: Clear all the hardware business legal requirements in Kenya

The government requires a hardware business owner to have a legal permit to start operations. A hardware business permit costs Ksh15,000-Ksh.25,000, depending on the hardware’s size and location. It is impossible to sell hardware products fast when you do not have a legal permit, even if the government fails to notice. Wholesale suppliers of hardware products will not conduct business with you because that would also get them in trouble with the law.

Step 6: Open the hardware store

When you have been legally cleared to operate a hardware business in Kenya, paid the rent to the store, and availed of all the hardware products, you are free to open the hardware store. When researching, you discovered the day’s hardware businesses get the most customers. Open your shop on one of these days.

How Much Does It Cost To Start A Hardware Business In Kenya?

Starting a hardware business in Kenya costs 100,000 shillings for a small one to 1 million shillings or more for a big one, depending on the location. Before you set up your hardware business, you should be able to correctly calculate the starting capital of the business to avoid unnecessary costs. Down below is a table showing the starting capital of a specific hardware business.

Hardware businessStarting capital (ksh)
Rod and Steel bars100,000
Cement stock- 200 bags 100,000
Roofing sheets150,000
Other expenses50,000
Business Permit20,000
How to start a profitable hardware business with low capital

Factors to consider when starting a hardware business in Kenya

1. Location of the hardware business

You will need to choose a suitable area to run your hardware business. This location should be around construction activities and infested with customers with high purchasing power to avoid making losses.

2. Carry your market research

You should be in an excellent position to conduct market research, which will help you know the proper starting capital and help you overcome challenges in the market. You will also learn to satisfy your customers and be aware of fast-moving products.

3. Obtain a business permit

To start a hardware business in Kenya, you will require a business permit from the Government to avoid unnecessary costs and harassment from the authorities.

A business permit in Kenya costs around ksh.10,000 from the county offices annually. You should also ensure you pay taxes regularly.

4. Identify efficient suppliers

You should know the best and cheap suppliers of your hardware products that can provide transportation services and efficient, fast-moving products.

5. Be aware of your hardware products

Ensure your hardware products are fast-moving goods that are high in demand to maximize your profits. Some of the fast-moving products you could include in your hardware include;

  • Nails
  • Tiles
  • Gutters
  • Roofing sheets
  • Rods and steel bars
  • Cement
  • Plumbing pipes

Is the Hardware business in Kenya profitable?

Provided you have fast-moving goods and high-end customers, there is no doubt you will make large profits. The profit margin is usually around ten percent of the total sales made; therefore, if your sales amount to ksh60,000, you will receive a profit of ksh6,000.