Sunday, February 25, 2007

Insights in Rural Internet

Followed up from Cyber Cafe with an EDGE

I've heard it said that when you plan to start a business, once you have written the business plan, half the work is done. A solid business plan is important for any start-up but... at the risk of sounding anti-establishment I've always found writing a business plan before starting the business so stifling. My preferred approach is to have a general idea of what the business is to achieve and write the plan as I go along, reacting to customers, suppliers and processes. I nevertheless ensure that I stay true to my business partner Stephen Alala's mantra that any business should be "anxious for profits, but patient for growth."

When launching the cyber cafe, I took it as my task to ensure that I was setting up a viable business and not a white elephant. The main fixed recurrent costs for a cyber were going to be rent and wages, while variable recurrent costs would be internet, electricity, and stationery. It was imperative that the cyber comfortably break even from the first month.

After doing the arithmetics with the proprietor we decided to initially price browsing at K.Shs. 3 per minute although our calculations showed we could do K.Shs. 1.50 if we had enough clients. Once we decided on the price, it was easy to calculate how many minutes of browsing we would need to sell in the first month to break even. With the calculations I was able to draw up the first objective of the business, to sell "X" number of minutes of browsing per month.

With the objective drawn out clearly, the business gained perspective. The interesting part was how to sell the required number of minutes. One advantage of an entrepreneur is the ability to adapt quickly, and in order to fully maximize this advantage the entrepreneur must always listen to what her client's are saying. When we opened the cyber cafe, it took the standard setup of other cyber cafes, but then we started listening:

  • I need a police abstract
  • Can you help me send an email to my daughter in the US
  • I have a computer college nearby but no internet
  • Can you help me send an email
  • How do I check my KCPE results
  • Can I get a job online
  • How do I download photos from my phone
  • I want to play games
As the customers spoke we gleaned their needs and turned them into opportunities for selling more minutes. Since the objective was delineated in minutes it was necessary to ensure that all the services were sold in terms of minutes. I'd usually just list all the different services that we came up with but I'll let you do it this time. Can you spot the opportunities?

Over and above the commercial opportunities that we were able to identify and exploit there were several economic social and cultural benefits that I realized internet in the village could bring. I have teamed up with some like minded individuals to explore these possibilities and I hope to be blogging soon about our progress.

4 comments:

N'Dama said...

Congratulations on your efforts; its like a living miracle . . . Your efforts will aid in minimizing the gap between the people of the West and developing nations.

Jean-Antoine said...

Hi Harry,
Your blog is pretty interesting.
I liked your note on "the victorious minute" and I like this too.
I am myself a recent entrepreneur and since 6 month, I had the same discipline to get up in the morning. I have the same problem to go to bed.
How ever, I am promoting in Kenya this website: www.pajamanation.com which might be interesting for some of your cyber users seeking jobs online. Tell me what you thing about it.
I hope to see you one of these days.
Jean

Jean-Antoine said...

Hi Harry,
Your blog is pretty interesting. I liked your note on the victorious minute and I like this too.
I am also a recent entrepreneur in Nairobi, so I have to deal with this issues.
I promote this website: www.pajamanation.com, it may interest your cyber users seeking jobs online.
Pajamanation provide jobs from all around the world, tell me what you think of it.
I hope to see you one of these days.
Jean

karanjakinyanjui said...

Karanja Wa Kinyanjui
Its true about the prior questions and observation of new customers. With derermination one can have a wonderful cyber cafe in rulal area.
Keep it up