Don't start retail in Kenya until you understand this! (Week 2 reflection)
An update from us, one week after we started our tuck shop to learn everything about retail in Kenya
Hey everyone! Last week, we opened the doors to our very own tuck shop and started this wild retail adventure. In that short time, we’ve discovered exciting opportunities, made a few mistakes, and learned some huge lessons about what it really takes to run a shop here in Kenya.
But we didn’t just open this tuck shop for business—we opened it to learn everything there is to know about retail. And today? We’re reflecting on that journey with you.
The topics we explore in this weeks video are:
How to go from zero to one in retail
Don't start retail until you understand this!
The most important success metric in retail
Operational challenges for small retailers
Questions to explore in the next few weeks
Final thoughts for the week
So grab a snack, settle in, and let’s break down what went right, what went wrong, and what’s next. Oh, and don’t forget—if you’re loving this journey as much as we are, hit that like button, share this with your crew, and subscribe so you don’t miss a single step.
Alright, here’s the lowdown!
What was the first big milestone after opening the shop?
Our first major milestone was breaking even. This means the shop made enough money to cover all its costs. It’s not just about subtracting the cost of goods from revenue; you also have to include expenses like rent, utilities, and wages. Breaking even shows that the shop can financially sustain itself. This gave us confidence and a solid foundation to grow from.
How did you get the shop running so quickly?
The key was fast implementation. My approach is to act quickly rather than overthink. The sooner you launch, the sooner you learn from real customer feedback. In retail, speed can mean the difference between meeting a demand or missing the chance entirely. We launched with the idea that we could make improvements as we went. This principle of urgency applies not just in retail but in many areas of life—acting quickly keeps you moving forward.
What were the biggest lessons you learned?
Retail is a game of small but important decisions, and every choice adds up. Here are three key lessons from week one:
Balancing Margins and Revenue:
Some products with high profits sell slower, while others with smaller profits sell faster. Success comes from blending these types of products to maximize overall returns. Stocking only high-margin items could leave shelves full, but focusing on low-margin products might hurt profitability. The right balance is critical.Foot Traffic is Everything:
The more people visit your shop, the more chances you have to sell. This isn’t just about selling one item—it’s about giving customers a reason to return, whether through variety, promotions, or great service. Listening to your customers is vital, as every visit is a chance to showcase your products and build loyalty.Merchandising Matters Most:
Retail success depends on two things: smooth operations and great merchandising. Operations include managing rent, wages, and inventory systems, but merchandising—choosing and promoting the right products—is the heart of retail. If you select the wrong products, even the best promotions won’t help. Picking the right items ensures sales and better profits.
What was the biggest mistake in week one?
We made a mistake with our initial budget. We spent 80% on staple products, assuming they’d sell best, and only 20% on experimental items. Surprisingly, one experimental product became our top seller, while some “safe bets” didn’t move at all.
This taught me not to invest heavily in products without solid data. A better approach would have been to test a small variety of items in limited quantities and analyze which sold fastest. This ties into the power law, where a small percentage of products often drive most of the profits. Listening to customers helps, but sales data is the most reliable guide.
What’s the most important metric for retailers to track?
It’s called “turn,” which measures how quickly products sell compared to how much stock you have. High turn means products are moving fast and generating money. Low turn ties up cash in unsold inventory, which hurts profits. Promoting slow-moving items creatively can free up money to reinvest in faster sellers. Monitoring turn is essential for keeping cash flow and profits steady.
What was your biggest operational challenge?
The hardest part was collecting accurate data quickly. In retail, every decision relies on good data because profit margins are small. We’re good at building systems to analyze data, but the challenge was gathering it fast while managing daily operations. Closing this gap will help us make better decisions, especially about which products to stock, and improve metrics like turn.
What questions would you like to explore in the future?
There’s so much more to learn in retail. Some questions I’d like to dig into include:
The Safaricom Model: How does Safaricom’s system of agents work, and what lessons can retail take from it?
Financing Small Businesses: What are the pros and cons of different funding options for small businesses?
Retail Categories and Models: How do general retailers like Naivas compare to specialty stores like House of Leather? What can we learn from global giants like Costco, Home Depot, or Walmart?
Exploring these topics will deepen my understanding of retail and help refine our shop’s approach.
So, that’s it! That was week one of running our tuck shop—filled with big wins, tough lessons, and a few surprises along the way.
Thank you so much for sticking around until the end. It means the world to us that you’re joining us on this journey to learn everything about retail in Kenya.
If you enjoyed this video, don’t forget to like, share, and subscribe—it really helps us grow and keep bringing you along for the ride.
Until next time, keep hustling, keep learning, and we’ll see you again soon!