START A SMALL YOGURT BUSINESS AND SCOOP 300% RETURNS FOR EACH SHILLING INVESTED

Before I introduce you to the idea of yogurt production and marketing, think of it this way: A litre of raw milk at the farm goes for Ksh.40. Each litre of milk can produce four tumblers of 250ml yogurt, which currently retail at Ksh.55 each.

In a nutshell, a litre of milk if converted to yogurt and marketed the right way can give as much as Ksh.220 which is equivalent to 500% value addition (or 300% when you deduct all expenses). 

Does that awaken your business curiosity? Well, if it doesn’t you probably aren’t an entrepreneur.

Yogurt is among the most preferred drinks due to its high nutrition value. As such, starting a yogurt business is a good venture that will earn you good profits. 

The demand for Yogurt across the country is increasing with each passing day. Yogurt production business offers many opportunities for entrepreneurs. 

This article will provide you with details on how to start a yogurt business in Kenya.

Learn How to Make Yogurt

If you want to maximize on profits, it is best to make your own yogurt. The first step is to learn how to make yogurt. You can learn from a friend who already knows how to, or enroll in yogurt making classes.

Alternatively, there are many websites online where you can get quality content on yogurt preparation. YouTube tutorials on making yogurt can also be very useful. There are many ways through which you can learn. All you need is self-drive and the determination to learn.

Identify your Target Market

Every business targets a specific audience. Although anybody can be a customer, you will need to have specific customers that you can count on. This will help you choose a strategic location for your business and also dictate how much yogurt you will be preparing.

Your target customers can be passers-by, retail shops, households, and learning institutions. If you plan to run the yogurt business on large scale, your target market can be hotels, supermarkets, and government institutions.

You can approach your nearest kindergarten and give them a discount so that they can be ordering from you frequently. You can even hire a few salespeople who can be hawking your products in commuter buses.

Choose your Yogurt Business Location

Upon identifying your target market, you will be in a better position to choose a business location. Your target market should have easy access to the business premise.

Yogurt businesses do well in urban areas. You can also decide to hire a salesperson who will hawk your products along busy roads or even in commuter buses.

Invest in Yogurt Making Equipment

You do not need a lot of capital to buy equipment to start your yogurt business. The equipment you buy will depend with how much capital you have. 

If you are running on a small budget, you can use a firewood kitchen, invest in high-quality saucepans or sufuria, a thermometer, flavors, sugars, a weighing scale, and a milk sieve.

You will also need plastic tumblers for packaging. If your budget allows, you can buy a pasteurizer to make milk boiling easier.

How Much Does it Cost to Make Yogurt?

Yogurt business startup capital depends on the size of the business you want to run. A small yogurt business will cost around Ksh.50,000, while a large one will cost you around Ksh.500,000.

The following is startup capital breakdown for a yoghurt business:

Store rent – Ksh.10,000

Business Permit – Ksh.5,000

KEBS certification – Ksh.30,000

Pasteurizer – Ksh.350,000

Food Hygiene Certificate – Ksh.300 per year

Food Handling Certificate – Ksh.600 valid for 6 months

Branded Tumblers – Ksh.20,000

Other items such as sufuria, thermometer, weighing scale, milk sieve – Ksh.30,000

Acquire the Necessary Certification and Licenses

It is best to acquire the necessary business licenses and certificates when starting a business in Kenya. This will prevent you from getting into trouble with the authorities.

Besides, you will avoid spending much in terms of fines.

KEBS Certification. Your yogurt business will require you to get a KEBS certification. This is to show that the products you are producing are of good quality with the recommended packaging. If your products are standard, then it will be easy to get a KEBS certification.

Business Permit. Every business in Kenya needs a business permit to operate.

Food Handling Certificate. This certificate shows that anyone handling the yogurt making process in your business is free from diseases.

Food Hygiene Certificate. A food hygiene certificate will show that the place you intend to work from is hygienic.

Market your Yogurt Business

If a business is to make profit, people must know that it exists. This means that you will need to invest in marketing and your strategies need to be smart to help you stay on top of the competition if any.

You can market your yogurt business by distributing flyers, putting up posters in public places such as parks, social media marketing, etc.

Depending on whom your target market is, you will need to find out which marketing strategy works best in terms of reaching many people at the same time.

Is Yogurt Business Profitable in Kenya?

Yes. The yogurt business is among the most lucrative businesses in Kenya. If you want to maximize on profits, it is best to source milk directly from the farm. You will buy a liter of raw milk for Ksh.40.

You can sell a liter of yogurt for Ksh.200 or Ksh.50 per Tumbler (250ml).

 If you can sell 1,500 liters in a month, you will make Ksh.300,000. If you deduct all expenses, you can make around Ksh.200,000 per month. This goes without saying that this business is highly profitable.

Final Word

The ball is in your court. Remember, even those big companies you see today were once small ideas that seemed too difficult to implement. So psyche yourself up and go for it.

Also don't forget to join our training on Business Plan Writing.

Most people who think about starting a business usually don`t consider writing a business plan.

I have read from different business experts about the fact that most start-up entrepreneurs do not write a business plan but what I have not read from anyone is why this is so.

Why is it that most people have fear (so to say) about writing a business plan?

I know the answer.

You see, there are many myths and lies you probably have heard about the subject of business plan. 

Some people present business plan as if it was a university thesis or an academic report to be defended before certain professors. 

Other people think that a business plan has to be 50 pages long and that it must be written in a certain “approved” format.

Well, I am here to tell you that all those opinions are not valid. 

Because there are some ugly lies around this important business step, most people are “afraid” of doing it.