Yogurt is one of the most popular beverages due to its high nutritional value. So, starting a yogurt company is a great business idea that will pay off handsomely. Yogurt is becoming increasingly popular throughout the country. Unfortunately, the market remains underserved. This article will explain how to start a yogurt business in Kenya.
The most common question is, “How much money do I need to start a yogurt shop in Kenya?” On average, a start-up capital of 50,000 Kenya Shillings is required. This, however, is entirely dependent on the size of the shop you desire. Larger shops require more initial capital than smaller shops.
How to Start a Successful Yogurt Business
The following are five crucial steps that one needs to follow to create a successful yogurt business, including the required start-up capital you may need:
1. Determine Your Target Market
Each business has a target market in mind. Even though anyone can be a consumer, you’ll need a few reliable clients. This will determine how much yogurt you will be selling and help you choose an innovative location for your business.
Passers-by, homes, and educational institutions can all be potential clients for your business. If you intend to operate a large-scale yogurt business, hotels, supermarkets, and governmental organizations can be your target market.
2. Decide on the Start-up Capital for your Business
The amount of initial cash needed for a yogurt business varies on its size. A little yogurt shop will set you back about Ksh 50,000, while a big one will set you back about Ksh 500,000.
The breakdown of beginning costs for a yogurt business is as follows:
- Pasteurizer: Ksh 35,000–350,000
- Store rent: Ksh 15,000
- Business Permit: Ksh 7,000
- Kenya Bureau of Standards certification: Ksh 32,000
3. Purchase Equipment
With a limited budget, you must plan carefully to maximize the return on each investment. A few excellent sauce pots, a thermometer, a milk strainer, a weighing scale, and a firewood kitchen are required.
You will need to consider packaging as your business grows. You will approach a company that produces plastic tumblers; a well-known local example is TechPack Industries Limited, based in Nairobi’s industrial region. You can purchase enough branded bottles to package your yogurt for supply for as cheap as Ksh 20,000.
4. Obtain the Required Licensing and Certification
Obtaining the required licenses and certificates is advisable when opening a business in Kenya. By doing this, you can avoid getting into legal difficulties. Additionally, you won’t have to pay a lot in fines.
The following are the necessary certifications needed while setting up a yogurt business.
1. KEBS Accreditation
You must obtain a KEBS accreditation for your yogurt business. This demonstrates that the goods you manufacture are high-quality and come in the suggested package. Getting a KEBS certification will be simple if your items are standardized.
2. Business license.
In Kenya, a business permit is required for every enterprise. To acquire one, you may visit the nearest county offices within the jurisdiction of your business operation.
5. Promote Your Yogurt Business
People must be aware of your business’s existence to be profitable. To keep ahead of the competition, assuming there is any, you will need to spend on marketing and develop effective plans.
You can advertise your yogurt company by handing out brochures, hanging posters in social places and other public spaces, using social media, etc. You must also be simultaneously reaching a large number of people based on who your target market is.
How You Can Make Your Yogurt
Making yogurt is a superb option if you want to optimize your income. You may also have a yogurt-making business plan that will guide you accordingly. Small-scale commercial yogurt production can be achieved straightforwardly by heating milk and adding a starter culture, which is often a teaspoon of yogurt that has already been made.
However, for much better and more satisfying results, you may need to purchase the right equipment for the production process. A small-scale yogurt-making machine may do the trick and give you terrific results.
Among the best small-scale yogurt making machines in Kenya are the Electric Yogurt Maker, full automatic yogurt Maker, Mini Yogurt Makers, etc., which range between 5,000 and 16,000 Kenya shillings.
Is Yogurt Business Profitable in Kenya?
Yes, the yogurt business is profitable in Kenya. Yogurt demand has continuously increased over the years, yet the market is still considerably undersupplied. This indicates that the chances for yogurt businesses to succeed are substantial, mainly if they provide specialized services, strong branding, and varied recipes.
Reasons Why Yogurt is Profitable in Kenya
The following are four reasons why the yogurt business is profitable in Kenya.
1. It Generates Income at a High Rate
Assuming a farmer sells you milk for Ksh. 40 per litre, you may sell your finished product for Ksh. 200 per litre or Ksh. 50 for every 250ml bottle. Assuming you sell 1000 litres each month, your sales revenue will be Ksh. 200,000. That can result in a monthly net profit of Ksh. 100,000 (after deducting all expenses).
2. There Is a Vast Demand for Yogurt
Due to its excellent nutritional content, which is healthy, and its simplicity, it has become a traveler’s favorite fast food, as evidenced by the huge demand, which in Kenya has climbed to 2.5 million litres a month. You will reap a large load of cash if you venture into this business.
3. It’s Simple and Cheap to Run a Yogurt Shop.
You can run a yogurt shop profitably with a minimal crew of low-cost workers. Unlike many other small enterprises, a yogurt shop operates as a cash-only operation. This implies that you are free from concern over accounts receivable, payment terms, or collections. As a result, managing your own business becomes more accessible and successful.
4. The Cost of Yogurt Production is Cheap
On average, the cost of production for a litre of completely processed yogurt is estimated to be Ksh. 20. If you buy a plastic container, it should be around Ksh. 60; therefore, if you sell the item for Ksh. 250 shillings, you will have made more than 200% profit.
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