TOP 3 INVESTABLE IDEAS FOR 2016

Investing can be a daunting task for new entrepreneurs or even employed persons with some savings wanting to invest and make a return.

The greatest challenge of investing in a small business or a marketable security (Government Securities such at Treasury Bills and Bonds, shares) is always the risk factor. The difference in success or failure is a factor of risk-return trade off. Basically   the old adage of the bigger the risk the bigger the return goes.

Based on an extensive research by Viffa Consult on investment options in Africa, investment need not be a complex and capital intensive affair. There are many investment options individuals and small business can diversify to in order to make a tidy return. We always advice start small then work your way up.

Here are our top three areas that you can invest in that enables an investor to start small and scale up when need be:

Farming

Farming whether animal husbandry or cash crop will always be an investment that persists; as long as people keep on eating. With most African countries having a population growth rate of double digits the demand for food is constantly increasing.

The result of whether an investor makes a return or not on their investment largely depends on how they structure their business model

Tomatoes, Capsicum, Onions are some of the many crops that one can keep under controlled environment such as a green house.

Tomatoes, capsicums and French beans for example are ready for harvest after 3 months, meaning that an investor is looking at recouping their investment after 3 months.

The venture need to not to be expensive as one can lease land instead of buying meaning the cost of lease will be part of your expenses in your farming business. In Kenya for example, an investor would need Kes 600,000 (Usd 6,000) to lease, set up a green house structure plant tomatoes and harvest.

This would give a return of investment ranging between 50-80% depending on the market price of tomatoes. Compared to investing in undeveloped land as is the custom of many Kenyans , we reckon farming can be a better option

E-Commerce

Information technology has caused disruption of many sectors through  breaking of traditional barriers of trade among many other barriers.

An investor with minimal money can explore the potential of e-commerce to trade in whichever product they so wish such as purchase and delivery of groceries, shopping, clothes etc

Online retailers such as Jumuia, Kotec ,Pigiame, Amazon and the likes have made a lot of money on e-commerce.

An investor need not put up a lot of money on such business, all one needs to do is set up a good website, figure out a delivery framework and segment your target customer. There is no reason such a business cannot be set up in your own house.

E-commerce offers the option of high returns with minimum cost and capital requirements.

Government Securities

Government securities are considered risk free. In a sense government securities are less risky compared to other forms of investments.

The down side for such investment is that the return on investment is not as high as other forms of investments which have a much higher risk factor.

Government securities are a good investment option for investors will low risk appetite and need of predictable solid returns.The minimum required amount at least in Kenya is Kes 50,000 (Usd 500)

These are just but a few investment ideas that an investor can explore, for more information kindly consult professionals such as Viffa Consult who can give in-depth guidance on investments

Contact us on info@viffaconsult.co.ke or call + 254 723982528/ 775 578 148

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