Why construction industry needs to embrace human resource management

Human resource has been described as the most essential resource in an organization since it is the human aspect that makes sure that all other resources work optimally (or not).

In the construction industry, the concept of human resource management is not as well defined and improved as in other mainstream and formal industries.

For every industry to grow there has to be continuous improvement of efficiency in resources usage. There has to be capacity building to empower all the stakeholders to be better and to do better.

Every construction site has labour, whether mechanized systems are employed or not and also regardless of the magnitude of mechanization. This therefore makes it necessary to direct enough attention and resources towards human resource management and development in construction.

How many times have you commissioned a site and you only know the contractor out of an average of 20 craftsmen in your premise? How many times have you thought of the fundi who helps the mason build your wall as a resource that could be improved through training and empowerment using fringe benefits such as insurance facilitation?

As a contractor, how many times do you think of your fundi as a resource that could benefit from  remunerations other than their daily wages?

Human resource management is a critical part of project management. A client who is building should be keen to know how well the resources are being utilized through-out the project. A contractor on site must be very hands on when considering the usage of resources in any individual project because this has a direct effect to the quality of his deliverables, his profit margins and eventually his reputation as contractor.

Imagine a contractor solution that comes in to help you conveniently manage your human resources on the job site; having the  proper knowledge of the people working on your projects, including their skills and skill level will increase a their capacity to function as a developer. Even as an independent Home Owner managing their own project, this knowledge brings then confidence in getting the right talent for every job. We live in the age where information is more powerful than anything!

There is no more need to imagine that solution. The iBUILD app  is here to revolutionize the human resource management aspect in the construction industry. It is a one stop shop where you have an elaborate and detailed list of all the fundis on your site, their skills, their reviews and recommendations from other contractors as proof of their capabilities. The iBUILD mobile app also allows you to digitize your day to day operations by running and managing timesheets. For every worker you hire through the iBUILD app, a timesheet is generated that helps you manage their working hours as it keeps records of the amounts due to each of them according to the hours worked. At the end of the day, it gives you a summary of who was on site and how long they worked and how much is due to them! iBUILD then provides the best tool of all- the ability to upload time sheets directly to the payment gateway and pay all of your workers through the iBUILD wallet. Straight from the contractor wallet into the worker wallets. And there is more! Workers can cash out of their wallets directly into their Mpesa accounts. Contractors will have a permanent record of who gets paid what amount, and who worked on which projects for how long. Workers are rated every time they are paid and contractors will never have to remember which workers performed well and which did not- it all becomes part of the permanent transaction history. Organized details, and historical knowledge all at your fingertips so that you minimize mistakes and continue to hire and manage the best talent for your projects.

What the App is able to achieve

You can even save your favorites for easy access to contact and hire them for new projects- all directly through the app.

As a Home Owner or developer, you are able to see the work profiles of all the people involved in your site. This puts the control back into your hands!

Marlowa Okwogo of Marvin Interiors Inc. is a company that specializes in interior installations and external façade finishes in Nairobi and Kisumu Counties. Marlowa has been using the new technology from iBUILD  to manage his fundis on site. He sent out a posting for some positions he needed urgently filled and within 6 hours he had a number of qualified applications. He was able to review and hire, all through the app. One worker in particular was named Charles. He has been managing these workers along with Charles through the timesheet on the app, as well as paying them and it has increased efficiency and accuracy and using the e-wallet in the app, the contractor no longer has to deal with all of that cash.

Mr. Marlowa was especially impressed by the convenience and the ability to keep better records. He can revisit these records in his project detail on the app at any point for referencing purposes. Charles, on the other hand appreciated the convenience of being able to get work to do right from the comfort of his home- without standing for hours on street corners. He is no longer just at home or roaming around. He has found consistent work and has started building his portfolio in the construction industry. He is now able to show tangible evidence through his profile on the app of the history of all his jobs and total hours he has worked and he has aa separate record of the payment dates and amounts he received.  This gives Charles the ability to qualify one day for a loan of his own and to help him to grow and scale his career in to the future!

The Kenyan development agenda requires that, as a country, we must be ready to improve our efficiency in all sectors. We must begin to add value to what we produce and what we build. The  iBUILD app is at the fore front to champion the ability of the construction industry to maximize efficiency and quality.  This improves production and scalability in the delivery of their products and services and it also improves the construction sector as a whole.  As acceptance for finance technology grows in the construction industry, so will the value that is ultimately delivered to customers in the form of increased production, greater choice, and lower prices due to increased efficiencies and better project management.

Read Also: Kenya mulls over new road construction method

Skills report says IT Skills gap between Kenya and Uganda to widen

By 2022, the value of Kenya’s and Uganda’s ICT sector is projected to be US$1.7 billion and US$1.33 billion, respectively.

The 4th edition of Nairobi Tech Week (NTW2019), has launched the IT Skills Gap Report. The report entitled The Development of IT Skills and Jobs in Kenya and Uganda, provides insights and recommendations on what Kenya and Uganda need to do in order fully benefit from digitalisation.

The Report which is a collaboration between Mercy Corps and Moringa School, explores the sources, nature and size of the existing IT skills gap in Kenya and Uganda. The importance of the Report is compounded by the well-documented growth of and joblessness within Africa’s youth population.

Stacey Ondimu, Country Director Moringa School noted, “Providing our youth with the right skills, will help us address one of the key barriers to the growth of Africa’s tech sector. The Report should help IT professionals understand trends in skills demand, and employers understand and appreciate tech’s role in their businesses.”

The Report examines existing IT skills amongst IT professionals and compares them to the skills demanded by local and international employers, now and in the future. It is based on interviews with employers, educators, IT professionals, and entrepreneurs, and incorporates market forecasting and supporting desk top research.

By 2022, the value of Kenya’s and Uganda’s ICT sector is projected to be US$1.7 billion and US$1.33 billion, respectively.  Though digital jobs have the potential to create significant opportunities in Kenya and Uganda, there is a shortage of IT professionals, which is expected to grow.

By 2022, the value of Kenya’s and Uganda’s ICT sector is projected to be US$1.7 billion and US$1.33 billion, respectively- The Exchange
Jussi Hinkkanen, CEO, Fuzu with Victoria Mukami, Senior Lecturer, Africa Nazarene University and Doris Chelangat Muigei, Head of Business and Partnerships, Shortlist at the launch of the IT Skills Gap Report

In Kenya, analysis of advertised jobs reveals developers to be in highest demand. More than 50% of postings seek mid-level applicants with 2 – 5 years’ experience; only 2% seek entry level candidates. In Uganda, almost half of IT-related job postings were for administrative IT roles. Just 13% were for developers.  Kenya’s IT sector is more advanced and the current Ugandan policy and regulatory environment deters investment.

All stakeholders who participated in the report agreed that the current formal educational system is a major contributing factor. In Kenya, 40% of survey respondents resort to teaching themselves, while many Ugandans take online IT courses offered by international training and certification providers to increase their chances of employment.

All Ugandan employers who were interviewed mentioned Ugandan graduates not only lack hard skills, but also the soft skills needed for effective service delivery.

Interviews also suggest that many employers still do not fully understand what IT entails, and by extension, businesses often do not know who to hire, the skills needed, and how to deploy them effectively. In Kenya, the number of IT professionals in employment will grow to 95,000 in 2022 from 57,000 in 2017. In Uganda, over the same period, these figures will grow from 28,500 to 43,400.

In 2022, it is expected 17,671 higher education students will graduate with IT qualifications in Kenya and 3,222 students in Uganda. These numbers will not address our IT skills gap.

Gituku Ngene of Mercy Corps says, “We think the Report helps both universities and specialist IT schools in Kenya and Uganda understand what they need to do, to address the needs of the private sector. If they adapt curricula to reflect industry needs, add the practical application of theoretical concepts and mix in soft skills, they are well on their way to equipping our youth to fully participate in the fourth industrial revolution.”

Read also: Challenge: Kenya’s smartest ICT students heading to South Africa

What Africa stand to gain from ACFTA

The African Continental Free Trade Area isn’t simply a ‘Free Trade Agreement’ it’s about establishing a unified continental market with 1.2 billion potential customers and where the private sector is a major engine to make it happen.

This, according to the East African Business Council (EABC) was the tone from the discussions of the meeting held on Thursday in Arusha about how the East African Private sector including Small and Medium Enterprises (SMEs) could benefit from the AfCFTA.

The one-day meeting, organized jointly between the EABC and the UN Economic Commission for Africa (ECA), convened close to 40 key players from the region’s private sector.

The office for Eastern Africa of ECA estimates large potential gains from the AfCFTA, including an increase in intra-African exports of Eastern Africa by nearly US$ 1 billion and job creation of 0.5 to 1.9 million.

“Together African economies have a collective GDP of 2.5 trillion USD, making it the 8th largest economy in the world. That makes the continent much more attractive to investment, both from within and from outside the continent”, said Andrew Mold, Acting Director of ECA in Eastern Africa. “This should encourage business people to take advantage of AfCFTA and make the investments necessary to sustain economic growth and create employment”.

Single continental market

According to data from the African Union, the objectives of the CFTA is to create a single continental market for goods and services, with free movement of business persons and investments, and thus pave the way for accelerating the establishment of the Continental Customs Union and the African customs union.

The agreement is also expected to expand intra African trade through better harmonization and coordination of trade liberalization and facilitation regimes and instruments across RECs and across Africa in general as well as resolve the challenges of multiple and overlapping memberships and expedite the regional and continental integration processes.

It is also expected to enhance competitiveness at the industry and enterprise level through exploiting opportunities for scale production, continental market access and better reallocation of resources.

The 18th Ordinary Session of the Assembly of Heads of State and Government of the African Union, held in Addis Ababa, Ethiopia in January 2012, adopted a decision to establish a Continental Free Trade Area (CFTA) by an indicative date of 2017.

The Seven Clusters 

The Summit also endorsed the Action Plan on Boosting Intra-Africa Trade (BIAT) which identifies seven clusters: trade policy, trade facilitation, productive capacity, trade related infrastructure, trade finance, trade information, and factor market integration.

The CFTA will bring together fifty-four African countries with a combined population of more than one billion people and a combined gross domestic product of more than US $3.4 trillion.

According to Nick Nesbitt, EABC’s Chairman it is important that the continent having a clear vision to put an end to the fragmentation of the internal market.

“I really applaud everybody who has involved in creating the AfCFTA because their vision is the one of pan-Africanism. It is something our founding founders aspired to. Our thanks to ECA for being at forefront of this conversation and pushing the agenda forward so that the continent becomes a single economic trading bloc”, he said.

Kenneth Bagamuhunda, Director General of Customs and Trade at the East African Community Secretariat, cited the experience of Regional Economic Communities as the building blocks for the AfCFTA. “The AfCFTA should build on what has already been achieved in regional negotiations like the Tripartite Free Trade Area, as well as within our respective regional blocks” he said.

Bagamuhunda highlighted governments need to set a conducive environment for the successful implementation of AfCFTA.

The AfCFTA was signed in March 2018, at a historic meeting of the African Union in Kigali. 52 of 55 African Union member states have so far signed the AfCFTA, 22 countries that have ratified the agreement, which was the minimum number required for it to enter into force.

According to a study by united nations conference on trade and development (UNCTAD), the CFTA must be ambitious in dismantling barriers and reducing costs to intra-African trade and in improving productivity and competitiveness.  Intraregional trade liberalization needs to be contextualized in a broader developmental framework that will provide benefits in terms of realizing Agenda 2063 of the African Union and the 2030 Agenda for Sustainable Development of the United Nations.

“Development-oriented regionalism can contribute to spearheading Africa’s achievement of development goals, the building of resilience to external financial and economic crises and the fostering of inclusive growth. It can have spillover benefits in terms of helping foster peace, security and political stability on the continent. UNCTAD, working in partnership with the African Union Commission, African States and other development partners, is committed to supporting the attainment of these objectives, embodied under the CFTA.” The study reads in part.

UNCTAD also notes that the CFTA may also mitigate costs associated with inaction in building an integrated market. The international trading environment within which Africa participates is changing rapidly with the proliferation of regional trade agreements and, in particular, mega-regional trade agreements, such as the recently concluded Trans-Pacific Partnership, the Transatlantic Trade and Investment Partnership and the Regional Comprehensive Economic Partnership. These arrangements may create spheres of trade centred on partner economies, and African countries face the risk that preferences and trade shares in these markets may erode.

According to an EABC brief on AfCFTA, one of the key steps beyond the ratification of the AfCFTA is to prepare and submit tariff offers, under modalities on goods that will determine tariff liberalization on goods to be undertaken between the AU Member States. Under AfCFTA, African Union Member States have agreed to remove at least 90 percent of tariff on goods imported from other State parties. This implies that under AfCFTA the coverage of products with zero-rated is not intended to be 100 per cent but rather 90 per cent with the remaining 10 per cent tariff classified as sensitive and exemption goods.

Currently is not very clear that 90 percent of tariffs refers to 90 percent of total tariff lines only or a combination of a minimum of 90 percent of total tariff lines and not less than 90 percent of the total value of imports.

In addition, there are uncertainties over the remaining 10 percent tariffs and how these are to be approached in relation to exempted and sensitive products, and how those tariffs are to be liberalized, whether partially or in full, and over what timeframes. Some quarters are proposing that of the remaining 10 percent: 7 percent are classified as sensitive goods with a lengthy phasing-in period, and 3 percent of goods to be exempted altogether. However, it is not known which products will be classified as sensitive and exempt. The most negotiating challenge is to determine which tariff lines will be classified as exempt and sensitive

Also Read: EABC means business when it comes to regional trade

 

Aviation growth in Africa boosts Kenya’s tourism sector

International tourist arrivals into Kenya for the year 2018 have exceeded the 2 million mark for the first time.

This is according to the recently released Economic Survey 2019 by the Kenya National Bureau of Statistics (KBNS) says that the improved performance was a result of conducive environment for tourism, withdrawal of travel advisories and high-profile international conferences and meetings held in 2018.

“The tourism sector registered an improved performance in 2018 compared to 2017. The number of international visitor arrivals increased by 14.0 per cent from 1.778 million in 2017 to 2.027 million in 2018.” The report stated in part.

The number of hotel bed-nights increased by 20.1 per cent from 7.174 million in 2017 to 8.617 million in 2018. The number of international conferences held expanded by 6.8 per cent to 204 in 2018 compared to 191 in 2017. This was boosted by high profile international conferences held in the country and visits by foreign dignitaries during the review period. Visitors to national parks and game reserves rose by 20.3 per cent to 2.868 million in 2018. Overall, the sector recorded an increase in tourism earnings from Sh119.9 billion ($1.181 billion) in 2017 to Sh157.4 billion ($1.550 billion) in 2018.

Some of the high-profile conferences held last year included the First ordinary session of the African Union Ministerial Sub-Committee on Tourism; the 79th International Skal World Congress; Sustainable Blue Economy Conference and; The African Hotel Investment Forum.

“Turning to 2019 economic outlook, we expect activities in the tourism sector to remain vibrant supported by strong expansion in tourists’ arrivals.” Said the Cabinet Secretary the National Treasury And Planning, Mr Henry Rotich.

However, the report notes, activities of the tourism sector are likely to remain vibrant supported by strong expansion in tourists’ arrivals. The construction industry is expected to follow the current trend given the ongoing infrastructural development by the government as well as the prevailing private sector confidence.

The improvement in tourism indicators was also attributable to concerted marketing efforts such as branding of tourism products, digital marketing and global campaigns during the review period.

The tourism sector registered improved performance in 2018 also attributed to growth in aviation sector. The performance was also boosted by visits by foreign dignitaries and revitalized marketing efforts.

International Conferences

The number of international conferences expanded by 6.8 per cent to 204 in 2018 while that of local conferences increased by 7.9 per cent to 4,147 in 2018.

The number of visitors to national parks and game reserves rose by 20.3 per cent to 2,868.9 thousand while that of visitors to museums, snake parks and historical sites grew by 32.3 per cent to 1,034.3 thousand in 2018.

The robust performance of tourism in 2018 indicate the sector is poised to achieve the set targets by 2020 as contained in the Third Medium Term Plan (MTP III) 2018-2022.

The targets include: The number of international arrivals rising to 2.1 million; tourism earnings at Sh 145.0 billion ($1.428 billion) and; hotel bed-night occupancy by Kenyans at 5.5 million.

Residents of Kenya occupied more than half of the total bed-nights in 2018, showing the significance of domestic tourism. The number of hotel bed Hotel Occupancy by Country of Residence Economic Survey 2019 190 nights capacity grew by 19.5 per cent from 22.987 million in 2017 to 26.500 million in 2018.

This may be attributed to new hotels and decentralization of some of the existing ones.

Overall, bed occupancy rate rose to 31.4 per cent in 2018 from 31.2 per cent in 2017 to 1.128 million in 2018. Notable decreases in hotel bed nights occupancy were recorded in the Coastal Hinterland and the Nyanza Basin in 2018.

Overall, according to the study, Kenya’s economy continues to be supported by a strong macroeconomic environment.

The Kenyan Shilling exchange rate against major trading currencies is expected to remain stable supported by diaspora remittances and a significant level of reserves. Further, Inflation is also expected to be stable during the year.

On the demand side, growth is likely to be driven by both the public consumption as well as private sector investment. Public consumption is projected to be underpinned by the ongoing development in infrastructure, while business confidence should remain strong enough to back up expansion in investment. The increased expenditure by the government mainly in support of the Big 4 agenda, is also expected to boost the performance of the economy.

Though the onset of the long rains have delayed, it is still early to predict on its impact on agricultural production. The Kenyan economy remains resilient and is expected to perform better in 2019.

Also Read: UNDP targets USD 4 million at conservation in Kenya

 

One Urban Garden; the road to Africa’s food security

The venture is keen to achieve food security, income generation, healthy living and environmental awareness

It is early morning in the outskirts of Kenya’s capital, Nairobi. A group of three young people are working in a field, using hoes to remove plastic bags and other solid waste from the soil in preparation for crop planting.

Together with other youth, they are raising seedbeds of vegetables such as kale, cabbage, spinach, carrots, onions, green peppers, tomatoes, and other commonly consumed vegetables in Kenya.

The seedlings will later be transferred to gardens and irrigated for several weeks before the vegetables are supplied to clients in households and restaurants within Nairobi.

The trio are Mastercard Foundation Scholars, selected for their academic talent, social consciousness, and leadership qualities.

Mutoni Shadadi  from Rwanda, and her colleagues Laetitia Mukungu and JacquilineMaina, from Kenya, are pursuing their studies in agricultural sciences at EARTH University in Costa Rica.

Mastercard Foundation Scholars have formed One Urban Garden, a social venture that gives people an opportunity to engage in the food production process, enhance the farm-to-table value chain,and demonstrate self-sustenance on a small piece of land. The group targets to help Kenya and the East Africa region achieve food security.
From Left: Mutoni Shadadi, Jacqueline Maina and Laetitia Mukungu during the Resolution Social Venture Awards in 2018.

Together, they formed One Urban Garden, a social venture that gives people an opportunity to engage in the food production process, enhance the farm-to-table value chain,and demonstrate self-sustenance on a small piece of land available.

One Urban Garden will provide fresh vegetables to the clients, acting as a training centre and an incubator for job opportunities involving youth.

One Urban Garden aims to provide youth with training in agriculture and agribusiness.The social venture envisions achieving food security, income generation, a healthy lifestyle and environmental awareness-raising among urban dwellers in Nairobi.

“We envision One Urban Garden as a hive of production and service provision. We are planning to start with vegetable production, which will include kale, peppers, and spinach and be readily available for household consumption. The second phase of production will be the introduction of rabbit farming and greenhouse production mainly targeting restaurants. Once the centre is established, six youth will undergo a 21-week training program and they will be in direct contact with our clients as consultants” said Shadadi.

Expected to be fully operational by end of this month (April 2019), One Urban Garden will first identify the farmers and provide training to those that need it.

The Scholars are currently looking for partners and available land in Nairobi and investing much time in studying other similar models, especially from other developing countries.

To serve a larger clientele in Nairobi, One Urban Garden will create several farms in different locations.

“We plan to move in phases and our target for the first phase is to have 25 farmers as our base, as well as a couple of restaurants. As variety is one of our selling points, the prices will vary depending on demand and we plan to make the prices more affordable as we grow.We estimate that farmers will pay 50 dollars for the training each year, and we hope that one day we might take on a big project from a hotel or institution. We are also considering the option of installment payments,” said Laetitia.

One Urban Garden won the Resolution Social Venture Challenge in 2018, a competition that rewards compelling leadership and promising social ventures led by youth.

These young leaders earned a fellowship that includes seed funding, mentorship, and access to a network of young global change-makers to pursue impactful projects in their communities.

Mastercard Foundation Scholars have formed One Urban Garden, a social venture that gives people an opportunity to engage in the food production process, enhance the farm-to-table value chain,and demonstrate self-sustenance on a small piece of land. The group targets to help Kenya and the East Africa region achieve food security.
The Trio

A collaboration between the Mastercard Foundation and The Resolution Project, the Resolution Social Venture Challenge provides a pathway to action for socially responsible young leaders who want to create change that matters in their communities.

Shadadi, Laetitia, and Jacquiline want to use urban farming to motivate African youth who think farming is a dirty job and only meant for people living in rural areas.

“It feels great being a Resolution Social Venture Challenge winner because it proves to me that we have the potential to contribute to change in the world. Being a Mastercard Foundation Scholar makes me feel like a winner because I get a chance to accomplish my dreams and also share them with my community as I give back,” said Shadadi.

Jacquiline said she is overjoyed and is very proud of her team.

“We have started working on the business strategy and sometimes that gets a bit overwhelming, but the teamwork is great and I learn more each passing day. I am also very grateful for this opportunity.”

Laetitia said that being a Resolution Social Venture Challenge winner is both a blessing and a challenge to keep pushing until One Urban Garden starts making a difference in the lives of Nairobians.

“I am thankful to the Mastercard Foundation because it not only gave me the opportunity to pursue my career but also to fulfill my interests and goals, and expand my network.”

The ambitious group’s initiative is just but one example that can go a long way in helping President Uhuru Kenyatta achieve his food security plan under the Big Four Agenda.

READ:EAC to launch platform to promote food security and nutrition

READ ALSO:Kenyan President Uhuru Kenyatta Tackling Food Insecurity as part of his Big Four Plan

 

HotelOnline conquers Africa from Kenya

How two Norwegians turned Kenyan built a global traveltech success from five apartments in Syokimau

When Håvar Bauck landed in Kenya in 2002, the country was in chaos. The government of outgoing president Daniel Moi was preparing to exit the scene after 24 years in power. It was not clear who would become the next leader and despite great optimism of the future of the country, fear of instability was still evident.

“Kenya was experiencing a great moment of change. When Mwai Kibaki won the election, the country exploded in optimism. I was excited to see Kenya starting to realize its potential. The spirit of ‘yote yawezekana’ was contagious,” notes Bauck who was on a student exchange program through the Norwegian Peace Corps.

For Bauck, there began his great love for Kenya and an exciting journey for sixteen years that has pushed him to developing one of the biggest start-ups ever developed in Kenya that is making great ripples across Africa.

HotelOnline is a technology backed online hospitality marketing platform that allows low to mid-sized hotels in Africa boost their online presence through several packages that expose these hotels to world class reach competing with established facilities.

How two Norwegians turned Kenyan built a global traveltech success from five apartments in Syokimau - The Exchange

The platform which was born out of Nairobi’s lack of an affordable accommodation next to Jomo Kenyatta International Airport has grown to be a force to reckon with in the hospitality industry. Since the first business in September 2014, to selling hotel rooms worth USD 80,000 by end of 2015 with 130 partner hotels to selling rooms worth USD 1.7 million in 2016.

But it was not all that rosy as Bauck tells The Exchange in an exclusive interview.  HotelOnline was not a big entity it is today. However, to understand the journey, Bauck took us through a story of his life.

Kenyan based entrepreneurs launch talk forums

Born in Norway and growing among diplomatic communities that took him to Brussels in the height of Fall of the Berlin wall, and the birth of the European Single Market. This gave him the concept of travel which he greatly enjoys to date. But it was the students exchange program that brought him to Nairobi that changed everything.

Bauck finished his internship and and did not want to move back to Norway.  He aggressively used his contacts for what they were worth to get consulting projects. That kept him going for the first two years. He later worked with different tech startups and scale-ups, all focused on Africa.

For almost a decade, he kept moving between Kenya, Nigeria and Norway. In 2015, he was just about to move to Kinshasa when he left employment once and for all, and went full time on HotelOnline.

His friend Endre, whom he has now known for almost two decades, had moved to Nairobi in 2010, and already then, the ball started rolling.

“Endre was running several quite exciting business projects at the time. I had a full-time job as the regional one-man army for a Greek company contracting with most of the mobile operators in the region. I was basically living on planes and in airports. Hence, Endre and I had a lot to do with the travel and hospitality industry on the continent, but from totally different angles. We were always discussing business ideas, and this is where the idea of a serviced apartments hotel came up.”

Endre was the first to go in terms of business. While looking for a place to live, he came across a ‘very run down’ house in Lavington area of Nairobi. He barely could use the entire house so he thought of an idea of converting part of it into a guest house. Endre knew it was going to be an epic effort to refurbish the place, but he went at it, and turned the place into a quite pleasant guesthouse.  When Bauck’s parents were visiting Nairobi in early 2012, he booked them there, and thus, they became the first guests,” Bauck notes.

The two friends kept their business discussions going, and their attention turned to the fact that Nairobi at the time lacked a reliable budget hotel near the airport.

Evaluating the role of Private Equity in Africa’s tech front-runners, the KINGS

“We moved in, and looked to exploit the obvious gap. We didn’t have the money to buy a plot and build, so we went for the serviced apartments idea instead at Syokimau.”

“Endre was the one who realised that the domain Nairobiairporthotel.com was available. You can say is aggressive marketing to brand some budget serviced apartments in Syokimau as an airport hotel, but it worked! “

The apartments were fully booked from the first day. The business was booming and they

“We realised our core skills was online marketing and not daily running a serviced apartments. We started offering simple online marketing services to hotels: Building their profiles on Expedia and Booking.com, and taking a commission on the additional revenue we brought in.”

The business has since expanded in many African countries. Bauck as still working full time in the job that kept him traveling. This gave him the opportunity to get in touch with hoteliers in some of the countries he frequented, such as Uganda and DRC.

It was however the birth of his first born daughter that made him cut his African trotting and decide to settle in Nairobi. He reasigned and committed fully to working on his outfit. Two events in the life of HotelOnline have remained etched in the company’s history.

First, Savanna Sunrise, still smarting from its newly found fame engaged itself into merger talks with Nigerian outfit HotelOga. This did not work well but as they were doing due diligence search, they met the owners of a technology company based in Poland. After the collapse of these merger talks, they opted to work with the Polish outfit and merged to form HotelOnline leaving behind Savanna Sunrise.

Then, in 2018 HotelOnline worked on its board buy incorporating Teranga Solutions where perennial investor Eric Osiakwan was a key shareholder.

“Last year one of my investments became profitable, – HotelOnline. I became a shareholder of Hotel Online through a merger that we did which basically resulted in the new business becoming profitable within the year because we combined our strengths which mitigated our weaknesses – the business is now poised for exponential growth and there is also a leading PE fund that is looking to come in this year,” notes Osiakwan.

HotelOnline is growing by the day. They work with online travel agents to boost the income of the hotels in their network.

Eric Osiakwan is the Managing Partner of Chanzo Capital, a growth capital firm investing both capital and mentoring in high-tech startups and scale-ups in Kenya, Ivory Coast, Nigeria, Ghana and South Africa- The Exchange
Eric Osiakwan during a past event

“Jumia travel, Expedia, booking.com, etc are all online travel agents (OTAs). They are only some of the channels through which we distribute the hotels. We handle the entire online marketing and distribution of our partners, from their official web site, to their profile in the channels you mention, and more,” notes Bauck.

The company is still going strong with new investments in the pipeline. Asked if there are options of closing any deal he said, “If by “closing a deal” you mean selling the company, then the answer is definitely: Not yet. In terms of raising money, several of the current shareholders wish to increase their investments before a potential strategic investor later this year. That’s an ongoing process. If other, new investors approach us, then we can obviously talk to them as well

“In terms of expansion, our current markets already have a combined population of 700 million people! We want to make sure we are the leaders in those markets before we venture into new ones.”

Famous traveltech investor Shravan Shroff has also agreed to join our board. Shravan has made more than 50 investments, and is a co-founder of the Indian angel-backed startup accelerator Venture Nursery. He was the first investor in the now-famous Indian traveltech unicorn OYO Rooms.

Shravan has a track record as a successful cinema entrepreneur in India, and sits on the Board of Dubai Entertainments PJSC, a multi-billion dollar group of companies, managing four theme parks in Dubai.

Read also:  Travel Agents are Key to the Success of KQ Flights to the US

Tell-Em PR appoints Joel Chacha as new General Manager

Joel will manage Tell-Em PR’s operations and client portfolio

Tell-Em Public Relations, one of Kenya’s leading Public Relations firms, has appointment veteran PR practitioner Joel Chacha as the agency’s new General Manager effective April 1, 2019.

Joel brings over 10 years of experience in developing and implementing successful communications and digital strategies.

“We are very pleased to announce the appointment of Joel Chacha as Tell-Em PR’s General Manager. Joel’s broad mix of strategy, crisis communication and media relations experience will be a fantastic addition to our agency’s Top Executive Team,” said Tell-Em PR’s Managing Director Elizabeth Cook.

Mutahi Kagwe, Tell-Em PR’s chairman, added:“On behalf of our Board of Directors, I welcome Joel Chacha to his new position. He brings a wealth of knowledge in strategic planning and business development.”

Joel has spent the last few months at the agency overseeing an aggressive client acquisition through strategic pitches and leveraging on his social capital, to date the company manages leading brands such Procter and Gamble, British Airways, Sanofi, Bolt – the riding hailing app,Coca-Cola Beverages Africa and Glovo.

READ:Investing in Kenya’s logistics space

“It is a tremendous opportunity to join the Tell-Em PR Management team. I am fully committed and eager to help the agency continue to execute on its public relations services and operational goals within this region,’’ Chacha commented.

He has a track record of success in leveraging the best-in-class communications to help companies differentiate and distinguish themselves and enhance their credibility.

His industry work and experience includes Coca-Cola Beverages Africa, Coca-Cola, Procter and Gamble, Safaricom, Visa, Kenya Airways, Taxify, Direct Pay Online, Weetabix, SC Johnson, Glovo, Bio-Oil, Kim-Fay, Alexander Forbes, Prudential Life Assurance Kenya, Heritage, and Liberty and The Institute of Chartered Accountants in England and Wales (ICAEW) just to name a few.

He holds a Bachelor of Arts in journalism from the United States International University – Africa and is currently pursuing a Master of Arts in Communication concentrating on strategic corporate communication from the same institution.

Tell-Em Public Relations was established in 1999 and has grown to become one of the leading PR agencies in East Africa. With offices in Kenya and affiliates in Tanzania, Uganda and Rwanda, the agency offers communications support across the region.

Tell-Em Public Relations is an award-winning agency and has won nine awards from PRSK – the Public Relations Society of Kenya, over the years, including Best Agency and Best Media Campaign. The most recent award was for the agency’s work on the mVisa launch where it won Best Media Campaign and Best Overall Campaign in the 2016 PRSK awards.

The agency includes a strong team of communications professionals, most of whom have worked in the media, have an in-depth understanding of how the media works and are able to package content and leverage their connections to give clients the best possible media positioning.

 

 

Investing in Kenya’s logistics space

Delivery has become the in-thing in the market. Customers nowadays don’t have to go to the shops but can just order, make a payment (either before or on delivery) and receive their orders at home, in the office or have them delivered wherever they want. The Exchange spoke to Glovo, a startup founded in 2015 in Barcelona, and launched in Kenya in February this year. The service is present in over 20 countries and more than 100 cities. With over 10 years in business development, seven of which have been in the tech world, Glovo Market Lead (Sub-Saharan Africa) Priscila Muhiu divulges into the logistics business in Kenya and the region.

 

What makes the logistics space in Kenya an attractive prospect and why is Glovo in this business?

Logistics is the key driver to any economy. Without logistics, businesses will not be able to get their goods to their consumers. Logistics powers economic growth and can unlock the potential of businesses. At Glovo, we believe that users should have access to their own city immediately and with ease by bridging the gap between consumers and the local economy. Consumers can use Glovo to get anything delivered to them in minutes while at the same time, businesses have access to thousands of customers who use the Glovo app. A report by the World Bank indicated that logistics costs account for over 30% of the total cost of goods. To lower these costs, increasing efficiency is paramount. Leveraging on technology can help organizations to increase efficiency and lower the costs of goods

With the recent negative coverage around the local bodaboda industry, along the lines of national security, what do you do to ensure that you enlist riders with clean criminal records?

Our riders go through a vetting process to ensure that they have no criminal record. We then get them trained on customer service and etiquette to ensure good customer experience. We also have a rating system that enables users to give us feedback on the riders ́ behaviour.

Being a multi-category delivery app has required you to get into partnerships with relatively unknown local brands. What does this model mean for both parties involved?

The partnership creates a win-win situation. The Brands get access to thousands of users that come to the app hence increasing their sales and lowering their marketing costs. In return, Glovo earns a commission by connecting it´s users to the local brands hence increasing the company revenue

Based on your experience in the market so far, what would you say are the challenges of doing business in the region?

The logistics infrastructure in Kenya is still not up to the global standard, though it is improving. The increasing cost of fuel poses a challenge and by extension increases the cost of transporting goods. Also the lack of proper address systems also creates friction in the delivery of goods. The delivery service providers are forced to make a couple of calls before getting to the destination. However, this has greatly improved over time

What makes you so sure that you will succeed within this market?

Our unique value proposition is that we are a multi category platform hence use cases are many. Users can get anything from food, groceries to drinks delivered to them in minutes. Users dont need to have separate apps for food, groceries or courier. They just need to download one app, Glovo, and they will experience convenience at its best.

What is your view on the current operating environment in the industry in Kenya?

The current operating environment is conducive for business growth. However, the cost of branding a bike is very high and doesn’t ́t make economic sense to the delivery companies. The key players in the industry are currently trying to lobby with the county government to lower the costs.

How do you plan to deal with competition from other logistics service providers within the local space?

Our focus is on our consumers and we seek to constantly meet the consumer needs. We believe that with our unique value proposition and exception customer experience, we can stand out from the competition.

Going forward what role are you going to play in the local logistics industry?

Glovo seeks to make everything available by connecting Kenyans with their local economy. To enable this, Glovo relies on two main pillars;

  1. a) Partnering with a wide variety of establishments including; top fast food restaurants, local food restaurants, Groceries, bakeries and gift shops
  2. b) bike riders, who are trained to provide efficient delivery service in minutes.

The economic impact expected from this is that riders will increase their earnings and get to service more orders. At the same time, businesses will have access to more customers and hence increase their sales. The overall impact will be local economy growth and access to opportunities.

 

Towards achieving a financially equitable society

Tanzania endeavors to become a middle-income economy by 2025 with a desired per capita income of USD 3000; this will be a monumental step towards economic development and growth for the country.

These aspirations can only be achieved by investing in human capital, in particular creating equal opportunities for women and men. Human capital is the driver of economic transformation and according to the National Bureau of Statistics (NBS) the population currently stands at 54 million and is projected to reach 67 million by 2025. Currently, women comprise 51.3 percent of the population, and while they play a key role in household resilience and sustaining livelihoods within Tanzania’s current economy, they face considerable challenges in other areas. For Tanzania to realize its development ambitions to attain middle-income status, these obstacles need to be addressed in order to create a level playing field that empowers women to be involved in the economy at the same rate as men.

Poverty rates are higher for female-headed households, especially in the rural areas -according to the Ministry of Health, 60 percent of Tanzanian women live in absolute poverty. Women struggle to access vital resources, such as educational opportunities, credit and financial services on a daily basis, hindering their chances for income stability and economic opportunities. While these challenges are not unique to women they are a particularly disadvantaged group.

Additionally, when it comes to accessing financial services, women are underserved. A 2018 report by FinScope notes that only 60% of women in Tanzania have access to financial services compared to 70% of men – while 30 percent are completely excluded from financial services due to qualifying criteria. Sadly, women are trailing behind men in the efforts to advance financial inclusion in Tanzania.

Mama Ntilie’s are a common feature of the urban landscape and when it comes to the business arena, women surpass men as founders of micro, small and medium enterprises (MSMEs) accounting for 54 percent of all MSMEs in Tanzania. As such, women should warrant more attention; they can catalyze the economy into Tanzania’s desired middle-income status by 2025.

Stanbic Bank Tanzania has joined forces with the United Nations (UN) Women HeForShe movement, which invites men and women to stand in solidarity for gender equality. We encourage all genders to partake as agents of change and act against negative stereotypes and behaviors.

It is imperative that financial services provide not only credit options but also equip women with information and direction to succeed in the market. Products and services need to be tailored to support their business and personal financial activities, provide convenience to carry out daily transactions such as transferring funds, paying bills and monitoring the activities on their accounts while allowing them to focus on running and scaling up their businesses. Stanbic Bank’s UHURU Banking is one such solution. It is a simple, easy, transparent and accessible way of banking that can contribute to balancing the scale between the genders by also providing women the right advice and support for their financial growth.

In Tanzania’s social framework, the function of women in bolstering a household cannot be overstated; they carry a large financial load when it comes to sustaining their households. Women are the doorway towards improving standards of living within homes in a qualitative and quantitative manner. In order to empower women and carve out a level playing field, they must have the tools to participate in economic and social activities as equal citizens, which requires access to opportunities, information and capabilities. Once this becomes a reality their input will lead to a significant improvement in the livelihoods of the population, creation of jobs and household resilience. The spirit of Tanzanian women will have transformative powers on the nation.

By Ruth Mwaiselage. Title: Head, Personal Banking

Also Read: Is Tanzania’s banking sector caving in?