12 Worst Businesses To Start in Kenya

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In this blog post,  we’ll discuss the three worst businesses to start in Kenya – why they’re bad, and how you can avoid making this mistake.

It presents three reasons why these businesses are bad, first with a general overview of the business category and then an explanation for how they’re not profitable or sustainable in this modern economy:

1). Real estate investing 

This is one of the worst businesses to start in Kenya, especially buying unmaintained properties that most people can’t afford to fix up, fixing them, waiting for appreciation before selling so you don’t have to do anything else except watch TV while your money piles up.

Renting out homes as investments which means more time managing tenants than building wealth through real estate ownership. 

More often than not the property will be vacant because there’s just no way it makes sense for someone without any cash on hand to buy something when other options exist like living in their own home, renting an apartment from someone else who’s looking for a steady income stream or buying a house and keeping it as their home.

Why is this is the worst business to start in Kenya?

Renters want free things which makes it impossible to make money off of them because you’re constantly going to be spending more than what your property earns. 

This means that the best option is for people without any cash on hand to buy something when other options exist like living in their own home, renting an apartment from someone else who’s looking for a steady income stream, or buying a house and keeping it as their home.

2). Food truck business

This is another one of the worst businesses to start in Kenya.

The novelty of eating lunch at your desk is gone now that everyone has access to food in the office cafeteria.

So it doesn’t make sense to plan on having people come out of work every day just to order something they can get for free.

Start-up costs are high because you have to buy a vehicle, rent space near places with lots of foot traffic which means higher prices (if not pricey locations) plus permits and licenses. 

Why is this a bad business idea?

Novelty has worn off on food trucks because everyone eats lunch at the office cafeteria now.

There’s nothing special about buying lunch from your truck versus eating inside where you have access to water coolers and microwaves.

Plus signing up for a food truck business is expensive because you have to buy the vehicle, rent space near where people live or work and that usually means high prices (if not pricey locations) plus permits and licenses.

3). House cleaner service

House cleaner service is another one of the worst businesses to start in Kenya.

No one wants more chores than necessary when they’re already working 60 hours per week trying to catch up after being understaffed for months.

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And the thought of paying someone to clean for them is horrifying. 

Plus, people are lazy and there’s no way they’ll go out of their way to find a good house cleaning service.

Why is this the worst idea?

It’s hard to find house cleaners who are good with their jobs and charge reasonable rates; with 60+ hour weeks on top of being understaffed for months at a time, few can afford to pay someone else just so they don’t have more chores! 

Plus there’s no way anyone will go out of their way looking for the best cleaner when life has them working all day long already. 

4). High-end restaurant

The worst business to start in Kenya is a high-end restaurant. 

The two most expensive restaurant chains in the world are McDonald’s and Starbucks, which have famously low food costs of around 17%

On the other hand, restaurants like Chipotle spend about 30% on their ingredients but charge higher prices for them so that their margins are about the same.

Start-ups like Chipotle can survive because they have a significant number of existing locations that make up for their high food costs.

And also because it’s not as hard to convince someone to visit somewhere new if you already know where it is. 

But just opening one restaurant means starting from scratch every time with no history or reputation—a much riskier proposition than most other businesses in which people might be more likely to take a chance on.

5). Appliance/Electronic Repair

The appliance repair business is a difficult one to make money in because of the cost. 

It all depends on how much you want to buy into it and what appliances/electronics you choose, but for most people who don’t have an established customer base, this is not the best way to go about making money at home.

If your interest lies primarily in electronics, there are other ways to make money at home.

Nowadays, most appliances have a lifespan of less than 10 years and are prohibitively expensive to repair. 

If a broken appliance or television is not under warranty, it is often more financially sound to purchase a brand new model rather than risking spending thousands of shillings to repair a five-year-old device.

6). Limousine Services

This is another one of the worst businesses to start in Kenya.

Truth is, this is a service that can be quite lucrative. 

In theory, you would need to buy or lease an expensive vehicle and hire drivers, which could lead to substantial profits if the company was successful. 

However, taxi and limousine industries are being crushed by ride-sharing companies such as Uber and Lyft.

If you do this, make sure the market is still there for your service. The last thing you want to own is a limousine company with no drivers or customers.

7).  Nightclubs 

Nightclubs are not something that has ever really taken off in Kenya, so it is easy to see why this would be a bad business to start in Kenya.

Why is it a bad idea?

  • The market is tough to break into
  • You will constantly be struggling for business as you try and compete with the established nightclubs in your area. 
  • It may lead to a lot of debt problems which can cause more issues later on down the line.

Who should not start it?

Anyone who does not have experience owning or working at a club before. 

This could end up being very costly if you do not know what you are doing, so make sure that this would be something that would interest you first.

What could go wrong?

As mentioned above, there is always going to be competition when opening a new establishment like a nightclub because no one wants an empty building next door taking away their customers from them.

If the building is empty, then it will be very hard to turn a profit because you now have two businesses that could potentially fail instead of just one if you had not opened up another nightclub in the first place. 

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8). Non-proprietary SaaS 

This is a term that describes when you are using software from an already established company like Microsoft or Google.

Why is it a bad idea?

It will be much harder to compete with the big dogs without any kind of advantage over them in terms of how your product works and what they can do for their customers.

Who should not start it?

Anyone who does not have experience working at one of these companies before, because if you cannot land yourself a job there then starting up this business would probably end poorly very quickly. 

What could go wrong? 

If people were able to get past all the competition between SaaS providers and see some sort of benefit to yours instead, then they might just stick around long enough for things to start picking up for you.

You will be starting at a very big disadvantage because your customers are already used to using the software that they know and love, so it would take quite some time before people were willing to give yours a chance instead of sticking with what they like. 

9). Parking apps 

There are a lot of people who have tried to get into the parking app business, but most of them have failed in recent years. 

Why is it a bad idea?

Most places require you to pay for meters which means that you will need an army of people ready and willing to man these machines so they can do all the work while you collect money from their success. 

Who should not start it? 

If this sounds like something that would be too time-consuming or labor-intensive then there are plenty of other ways that you could make your mark on this area instead. 

What could go wrong? 

One big mistake when trying to launch anything similar has been charging too little for certain areas just because they were experimental at first, rather than covering all of your bases. 

If you are not able to cover the entire area that you want, then this is going to cost you quite a bit in terms of lost revenue because people will just move on over to the free parking spots instead if they know there are some nearby.

Parking or Taxi apps is among the top worst businesses to start in Kenya.

10). Web Designer 

A web designer is a very common business to start and it has been around for some time now.

Why is it a bad idea? 

The competition in this area can be pretty cutthroat, so you will need to do something that differentiates your service from everyone else’s if you want any hope of making money with this type of company. 

And that is why it is one of the worst businesses to start in Kenya.

Who should not start it? 

Anyone who does not have any experience designing websites because there are plenty of online resources where people could learn the skills they would need before deciding on whether or not starting up their own website design agency was worth all the risk involved. 

What could go wrong? 

Web designers often make use of freelancers when working on certain projects which means that anyone going into this business would need to secure a steady flow of these workers before they will be able to get off the ground. 

If you cannot find enough people who are willing and/or able to work on your projects then that is going to make it very difficult for you to turn any sort of profit from this business.

You also need some way of attracting customers as soon as possible, otherwise, there might not be anyone left by the time somebody else decides where they want their website designed at either. 

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11). Travel Agency 

A travel agency is another one of the worst businesses to start in Kenya.

See, Travel agencies are one of the oldest businesses out there and it is not easy to get into this business these days.

Why is it a bad idea? 

The internet has put most travel agents in an incredibly difficult position because they cannot compete with all of the information that people have access to online, so they will need some sort of advantage over their competition if they want any chance at surviving for another decade or more. 

Who should not start it? 

Anyone who does not have experience working in customer service before would probably struggle when trying to convince customers about what makes them different from everyone else’s services either. 

What could go wrong? 

If you do not offer anything unique enough then your only hope might be finding somebody willing to buy out your company eventually, otherwise, you will just need to close up and hope that someone else is willing to take a chance on this type of business.

If there are no other travel agencies nearby then the odds of finding such an interested buyer would probably be very low, so it might be best for you if your location was somewhere where these types of businesses were already thriving instead. 

12). Pet Supply Store 

If you love animals then starting up your own pet supply store might be an option that sounds very tempting, but unless this is something that you are passionate about exclusively there will probably not be much demand for it.

Why is it a bad idea? 

The market can quickly become crowded with any type of business where the competition has similar prices and more experience than you do too! 

Who should not start it? 

Anyone who does not enjoy working with pets on a day-to-day basis because otherwise, they would struggle to keep themselves motivated if things ever slow down in this area. 

What could go wrong? 

It always helps to have some sort of backup plan available just in case anything goes wrong at all either, so make sure that you know what you would do if you were to lose your only source of income one day.

You will also need enough money in order to buy all of the supplies that might be necessary for this business too, so make sure that you have everything saved up before investing any more than absolutely necessary into it instead. 

There you have it, the worst businesses to start in Kenya.

As you can see starting a new business in Kenya is not always easy even though there are plenty of opportunities out there for people who want them! 

Make sure that you know what risks lie ahead when trying something like this and then go from there accordingly because every opportunity offers its own unique set of challenges along with rewards as well! 

It just depends on how much effort each individual person wishes to put towards their success afterward!

Wrapping up

The biggest reason why these businesses are bad in Kenya is that people want more (namely free) stuff than you can ever offer! 

They’re too busy with work and life, in general, to even think about what might be necessary so it doesn’t make sense for them, or most anyone else, to hire someone to do something when they can just as easily get away without doing anything at all. 

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2 thoughts on “12 Worst Businesses To Start in Kenya”

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