Entrepreneurship; How to pull youth into billion-shilling beauty industry

NAIROBI, KENYA:  The beauty and personal care industry is fast becoming Kenya’s new investment hub, attracting massive foreign investment by renowned global brands like Yves Saint Laurent, Black Opal and Oriflame among others. It is also one of the fastest growing industries in Kenya having grown by 400 percent in four years from Sh 26 billion in 2011 to over Sh 100 billion in 2015, according to KPMG estimates.

The growth in beauty products and services can be attributed to increased discretionary spending and urbanisation. Market growth is also fueled by a large demand of millennials who want to try new looks – for the perfect selfie shot. This is coming against the backdrop of a handful giant cosmetic manufacturers gradually coming back after keeping away from Kenya out of lack of skilled manpower, the belief that there was low demand for their products and assumption of the country being a low spending power region.

However, in spite of the huge strides, the beauty and personal care industry in Kenya is yet to fully maximise on its potential both from demand and supply side. Kenya’s population of about 45 million is an adequately ready market for cosmetics and beauty products but also a ready workforce for the industry. However, the contribution to the economy is still minimal.

Lack of skilled workforce remains the biggest obstacle to unlocking the beauty market potential. Other market attributes that hinder the growth of this industry are: financial illiteracy and high cost of salon equipment.

Through concerted efforts, the youth can be involved in the beauty industry by assisting them to gain skills. This can also be an incentive for international investors keen on setting up shop in Kenya.

To attain this, a critical mass of young people need to be trained, given the necessary infrastructure as well as financial access and business advisory support. Moreover, strategic partnerships can be created with established salons to absorb budding salon entrepreneurs who cannot open their own. This would enable them to gain wide experience and in-depth understanding of the industry.

Furthermore, the industry can be promoted through innovative mechanisms such as adoption of the ‘franchise container’ model where students trained in beauty can own franchises of popular local and international brands across the country. The successful Brazil beauty industry for instance has largely been supported by franchising, guided by stringent legislations that guard the interests of both parties.

The ‘Salon Suites’ concept also known as booth rentals, brings a different approach to the industry. It offers beauty professionals an opportunity to own their own business without the large upfront costs and risks associated with building or renting and running a salon, the potential is untold.  

KCB Foundation is piloting this revolutionary approach to business premises hosting for the beauty and personal care professionals through a franchise container model. Modified shipping containers are retrofitted to host the salon. The container acts as an incubation hub for students who have completed hair and beauty courses where they can perfect their professional skills even as they prepare to start their own businesses.

The joint venture model takes into account the graduates’ capital inadequacy to assist them meet the operational cost of running the salon. This business model has a co-working style and provides a platform to incubate hair and beauty beneficiaries until they are ready to take up their own containers. The beauty of the concept is that it takes into account issues of space as well as mobility as the container can be moved from place to place depending on business performance and owner preferences. Additionally, the fittings are never disentangled when forklifting the container, hence guaranteeing their safety. Owners of the containers can assist their tenants to place them at vantage points like public and private parking areas, church compounds or at market centres.

KCB Foundation is implementing this through 2Jiajiri, a transformative skill development and wealth creation programme, established in 2016, that seeks to develop a new cadre of youthful entrepreneurs within the informal sector to ease the country’s burgeoning unemployment crisis.

The Foundation has partnered with Ashleys Hair and Beauty Academy, Azizi Hair and Beauty College and Amadiva Beauty and Hair Salon among others.

Measures such as these will see Kenya boost its earnings from the beauty industry as it seeks to match the pace of other leading global players such as Brazil.

[Article first published in the Standard Digital on Tue, October 31st 2017]

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