Saving via Mpesa gave me easy access but pushed up my spending
Maureen Abwao is an entrepreneur based in Kakamega County. She runs a motorcycle and power saws spares wholesale business, transportation business, and building materials supplies. Photo | Pool
What you need to know:
- Maureen Abwao is an entrepreneur based in Kakamega County
- She runs a motorcycle and power saws spare parts business, a transportation, and building materials supplies businesses
I started my entrepreneurship journey with a bank loan. I took Sh60,000 loan at Equity Bank and started buying and selling cereals. This venture never broke even. I had started it without doing my due diligence on the customer base. As a result, most of my products would go bad before I could find a customer. I was constantly ending up with losses. I decided to shut it down.
I switched to boda boda and power saw spares business. I started with around Sh50,000 in 2015. This was a smart move. The rise of the boda boda sector had spurred an intense need for spares. And since motor cycles are closely related to power saws, I decided to incorporate the power saw spares in my stock. Within one year, the business was self-sufficient. It had a stable operating capital and could afford to pay me a salary.
It is difficult to penetrate a market. The existing competition will always try to shut you down. This is the challenge I encountered when I started. Most of the competition would sell commodities at low prices to keep customers. I also realised that when getting started, it is very easy to order a whole batch of the wrong spares only to end up sending them back for replacement. The back and forth is a loss. In addition, I struggled with debt management. Some customers would take spares on credit, and because I wanted to have customer retention, I would agree only for the customer to end up defaulting on payment.
I have never been employed. I started my business shortly after completing college. I had always had a soft for business. In fact, in High School, business studies were my highest score. After High School, I went to college where I studied accounting and got a Certified Public Accountant certification.
Just when the business was doing well, I decided to take another loan. This proved to be a big mistake because the purpose of the loan was to purchase a motor vehicle. The repayments soon started straining the business. In comparison, the vehicle wasn’t bringing in funds. It was a bad loan on a depreciating asset.
It is not easy managing a new business. There is so much to learn, and without someone to hold your hand, you can easily get lost. If I could go back, I would leverage technology to make my business operations easier to manage and I would computerise my bookkeeping. Also, when I started, I used to save money through my M-Pesa wallet. It was an easy saving to access. All I needed was the four-digit pin. I realised that I was spending my savings and shifted to saving via the bank.
Being in the small and medium enterprises sector, I have learned that there really is no small or big money. Money is money. It all depends on how you spend it, where you invest it, how you save, and the type of hustles you get it from. If you want to start a business, set off with whatever amount you have and grow gradually. If the business doesn’t seem to be working, move on to the next idea. Spending too much time nursing a moribund idea will cost both time and money.
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