Everything You Need To Start A Wine And Spirits Business In Kenya

Wine And Spirits Business In Kenya

The beverage and alcohol market in Kenya has witnessed a significant rise in recent years. This means that anyone starting a liquor business in the country can earn a significant amount of income regularly.

However, if you have ever given thought to the possibility of starting a liquor business in Kenya, then you might want to consider wine and spirits. Not only are wine and spirits cheaper than regular beer but they also come in both alcoholic and non-alcoholic forms which is something beers do not come with.

Also, there are various things to take into consideration when running a wine and spirits business. From the area the business would be located to the licensing for the business, the competition it might face, as well as other things.

To set you on the right path, we have provided in this article everything you need to know about the wine and spirits business in Kenya.

How Profitable Is Wine And Spirits Business In Kenya?

One of the most profitable businesses in Kenya is the wine and spirits business, this is because of the high demand for wines and spirits.

As we all know wines and spirits are always needed in events like weddings, birthday parties, hangouts, and occasions. Even individuals buy them to store in their various homes.

The demand for wines and spirits will remain constant and its volume will continue to increase, especially during the festive seasons.

For all these reasons, a well-established wine and spirits business will always make sales and profit especially when in a good location.

What Are The Challenges Facing Wine And Spirits Business In Kenya?

The biggest challenges facing the wine and spirit business in Kenya are:

1. The Challenge Of Low Purchasing Power: This challenge comes in as a result of expensive wine and spirits which limits the potential buying markets for the product.

2. High Taxes: High taxes can also be a challenge in the wine and spirits business as the government imposes high taxes on alcoholic beverages which makes them more expensive.

3. Counterfeit: Counterfeit products are now a major problem in this business. Many businesses are operating on counterfeit products and selling them cheaper to people. However, this has a way of affecting legitimate wine and spirits shops in Kenya.

4. Inferior Regulations: The regulations guiding the wine and spirits industry are inferior. In fact, they are not strong enough to combat illegal operators.

5. Poorly Produced Product: Most times, legitimate beverage companies don’t produce quality wines and spirits that meet the required standard and this imposes a bad reputation on the industry.

6. Insufficient Raw Materials: This has to do with some of the ingredients used in producing wine and spirits. Most times, the ingredients are not widely available which results in importing them at a higher cost. As a result, it leads to a high cost of the end-products.

How Much Does A Wine And Spirits License Cost In Kenya?

It costs Ksh 56,500 to get a wine and spirits license in Kenya. This is the breakdown; a liquor license costs Ksh 50,000, a license from the county council costs Ksh 3500, and while health certificate costs Ksh 3,000.

But know that the license may cost more through certain charges, changes, and location.

Meanwhile, below is how to get a liquor license in Kenya:

1. You have to obtain a payment bill for an application form
2. Then pay for the application fees
3. And apply for an alcoholic drinks license
4. The next option is “premise inspection”
5. At this stage, you obtain the notification of approval
6. And also obtain the payment bill for a liquor license
7. Finally, pay for the liquor license

What Is The Starting Capital For Wine And Spirits Business In Kenya?

If you are starting a small wine and spirits business in Kenya, you should budget at least Ksh 300,000 to Ksh 500,000. Starting on a small scale means that you are starting as a retailer.

However, if you want to start a wine and spirits business on a large scale (wholesale), you should have a starting capital of Ksh 2 million and above. With this capital, you can be able to find a shop, buy the needed equipment, and stop your shop.

How Do I Start A Wine And Spirits Business In Kenya?

Below are the step-by-step process of starting a wine and spirits business in Kenya:

1. Conduct A Market Research: If you want to operate the best wine and spirits business in Kenya, then you need to have an understanding of how the wine and spirits market operates.

You can achieve this by conducting an extensive market research. Of importance, you need to do your proper findings on the market trends, competition, wine, and spirits that sell fast, pricing strategy, marketing strategy, and how to attract customers.

2. Write A Business Plan: A clear business plan is vital for the success of your wine and spirits business. When it comes to starting a wine and spirits business in Kenya, without having a business plan you are likely to fail.

You don’t only need capital to start a wine and spirit business, you also need a business plan to run it successfully. This is why many businesses fail because they don’t see any need for a business plan.

Fortunately, you are lucky to have read now that a business plan is essential for succeeding in your business.

Meanwhile, you can hire the service of a professional business plan writer if you can’t develop it by yourself.

3. Get A Place For Your Business: You need to site your shop in a location where your target customers can easily locate you. Of course, that’s the most important factor to consider.

Before you find a place where your liquor shop will be located, you have to ensure that the target market is high and it should be populated mainly by middle-class people. So you need to take your time and ensure that you meet up with this location criteria.

4. Apply For All The Necessary Licenses And Permits: Licensing is very important when it comes to starting a wine and spirits business in Kenya. However, you should apply for all the necessary licenses and permits like liquor licenses, business licenses from the county council, health certificates, etc.

Failure to obtain this license often leads to hefty fines and a business shutdown.

5. Equip Your Shop: Now that you have found a good location and obtained all the necessary licenses and permits, the next option is to equip your shop and furnish it.

You first start by furnishing it with wine shelves and installing lights, fans, or air conditioners. At this stage also, you put a signpost showing your wine and spirits name to increase customer attraction.

6. Get A Reliable Supplier: You will need to find dependable and reliable suppliers that will supply you with original and quality wine and spirits at an affordable price.

Getting your shop stocked up with original and quality wine and spirits makes your business a trustworthy one as customers will be recommending your shop as the best wine and spirits shop that deals in quality products.

This is why you need to be careful about the supplier you have because they have a way of having an impact on your business either positively or negatively. However, avoid suppliers that deal with counterfeit.

7. Start Selling: After stocking your shop with different quality wines and spirits, the next step is to start promoting your business to make sales.

Note; you need to talk to people about your business. You can also reach out to wine bars, clubs, and hotels and inform them about your wine and spirits business and how you could supply them with quality wines and spirits whenever they need them.

Also, you can use social media through paid Ads to promote your business.

Conclusion

The wine and spirits business is one of the most lucrative businesses to operate here in Kenya though is capital-intensive.

Don’t forget that the most important thing that matters when it comes to running a wine and spirits business in Kenya is selling original wines and spirits, because if you do the contrary by selling fake products, and people later realize, it will lead to business failure.

So no matter what, make sure you deal in quality and original products.

Ambassador Victor Chidera
Ambassador Victor ChideraAmbassador Victor Chidera is a business consultant, writer and a blogger. He provides lots of professional and expert advice to small businesses, entrepreneurs and organizations. He has many years of experience in business, teaching field, and research work. And his aim is to provide business articles that matters to you both nationally and internationally.
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