Mitumba Clothes Business Guide

This detailed guide will prepare you for the mitumba business. It includes:

  • Overview
  • The Mitumba Supply Chain
  • Major Players In The Mitumba Value Chain
  • The Process In Detail
  • What Happens When The Mitumba Arrives In Kenya
  • Wholesalers
  • Retailers
  • Steps To Starting A Mitumba Business
  • Suppliers
  • Licenses
  • Stock
  • Premises
  • Revenue and Margins
  • Revenue Trends
  • Revenue Scenario One
  • Revenue Scenario Two
  • Revenue Scenario Three
  • Sample Wholesale Prices
  • Competition
  • On What is Competition Based on
  • Opportunities and Survival
  • Manpower

 "....To get a better understanding of revenue let us explore another example ..

Now there is one wholesaler who sells a bale of trench coats at Kshs.28, 000. Such a bale contains 100 to 120 pieces. Assume this bale has 110 pieces. This means at wholesale each trench coat is being bought at an average price of Kshs.255.

Assuming you sell each trench coat at Kshs.500 that means that you need to sell at least 56 pieces for you to recover your purchase price without making profit. (56 x Kshs.500 = Kshs.28, 000)

If you sell all the 110 pieces at 500 you will net Kshs.55, 000. This will give you a gross profit of Kshs.27, 000. (Kshs.55, 000- Kshs.28, 000)

From this amount you will deduct Transport costs say Kshs. 1500, Manpower – Kshs.5000,
Rent Kshs.5000. Total – Kshs.11500

This will leave you with Kshs.15, 500 (Kshs. 27,000 – Kshs.11, 500), over 50% in margins.
And you being lucky hardworking and in a great location you are able to move 3 bales in a month. Not so bad, right?

This however is a very very ideal situation and not likely to happen.

First the trench coats in that bale will not all be of the same quality. Whereas some will command a price above Kshs.500 a piece say Kshs.700, Kshs.800, some could be unsellable while others can only be sold in the low realm prices of Kshs.50, 100 and Kshs.200.

Why will some be unsellable? Because of their poor quality, they could be torn, with stains, running colors, damaged through ironing or any other reason. And depending on whom your target market is and the ‘local’ brand you want to build for yourself you could be forced only to sell the mid and high quality coats and none of the lower quality ones so as not to dilute your brand.

Secondly is the length of time it takes to move the 110 pieces..... "

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