In the recent emails that we recently sent, a lot of our users asked about how to start a reselling business in Kenya.

Well, with the recent and sudden rise in the cost of living in Kenya, the need for an extra income source echoes louder than ever.  There are multiple channels to create passive income but reselling is one of the least costly businesses to start online.

In this tutorial, we explore the art of reselling, a pathway to financial empowerment in the face of the rising tides of living expenses for you. You will learn how to start a reselling business in Kenya through our comprehensive guide.

Let’s first look at the data

The GSMA E-commerce Survey 2023 report sheds light on a significant challenge aspiring entrepreneurs face in Kenya. Capital constraints, identified by 23% of surveyed micro, small, and medium-sized enterprises (MSMEs), emerge as a formidable barrier to business growth. This hurdle, coupled with the complexities of taxation, accounting, and product sourcing, may appear daunting for those considering embarking on the entrepreneurial journey.

However, it’s crucial to understand that these obstacles, though substantial, should encourage your entrepreneurial spirit. In a world where digital commerce is thriving and Kenya’s e-commerce revenue volume surpasses $2 billion, there’s a remarkable opportunity waiting to be harnessed. 

This guide will empower you with a step-by-step roadmap to launch your reselling business in Kenya, offering actionable insights and strategies to overcome the initial hurdles and embark on a journey towards e-commerce success. 

So, if you’ve ever dreamt of starting a business online, keep reading, because this guide is your gateway to realizing your entrepreneurial ambitions.

What is a reselling business?

A reselling business is a unique e-commerce model where entrepreneurs purchase products from suppliers, wholesalers, or even retail stores and subsequently sell them to consumers, often at a higher price. 

For instance, you could start a kitchenware and appliances reselling business in Kenya, by purchasing these products from Kamukunji Market, in Nairobi. Nestled in the heart of Nairobi, Kamukunji boasts a vibrant array of kitchenware and appliances, including cookware and state-of-the-art appliances. What makes this venture truly captivating is the opportunity to acquire these products at competitive prices. With a discerning eye and strategic negotiation, you can curate a collection of kitchen essentials that will soon find their way into the kitchens of eager customers. Offering these wares at attractive prices in online marketplaces or local fairs, you can create a thriving reselling business.

Kamukunji’s kitchenware market is just one illustration of how you can embark on a reselling journey that transforms everyday purchases into profitable opportunities.

However, starting a reselling business can be more challenging than it may sound. There is a lot more to do, like ensuring high-profit margins and sourcing high-quality products. It takes more than going to the market, sourcing a product, and reselling it. 

Before we go on, let’s look at the pros and cons of starting a reselling business.

Pros and Cons of starting a reselling business in Kenya

Reselling products online is a great way to start a business. However, the reselling business model has its share of pros and cons. Let’s get started: 

Pros of a reselling business

Low Initial Investment

Starting a reselling business typically requires minimal capital, making it accessible to aspiring entrepreneurs with limited funds. Reselling allows you to dip your toes into the entrepreneurial waters without risking a financial tidal wave. 

In return, you can test the waters, adapt your strategies, and refine your business model without the looming shadow of hefty upfront fees.

Flexibility

A reselling business exudes flexibility from every angle of its operation. This flexibility is anchored in the ability to tailor your entrepreneurial journey to your specific needs and desires. 

You’re not constrained by a rigid 9-to-5 schedule or a fixed location. Instead, you become the master of your own time and workspace. 

Whether you’re a night owl or an early bird, the choice is yours. Operating from the comfort of your home, a cozy café, or even a beachside paradise becomes a reality. What’s more, the reselling model adapts to your lifestyle.

 If you’re a student or have a full-time job, you can seamlessly integrate your reselling activities around your other commitments. 

This adaptability empowers you to take charge of your work-life balance, making it an ideal choice for those seeking the ultimate flexibility in their entrepreneurial endeavors.

Scalability

As your business grows, you can effortlessly expand your operations to reach a broader audience and increase your revenue. However, the key to this scalability lies in your ability to diversify your product offerings, tap into new markets, and optimize your supply chain. 

The reselling business model accommodates various ways of stability. For instance, you can choose to add more products to your inventory, explore different niches, or leverage various online platforms. 

Unlike a brick-and-mortar store, you can reach customers far and wide through online marketplaces like Slyzed, social media, or local markets. A reselling business exposes you to an entrepreneurial journey that is not bound by limits but fueled by ambition and strategy. 

Cons of a reselling business

Competition 

The reselling market in Kenya is undoubtedly a bustling arena, with vibrant online resellers craving the consumer’s attention. Resellers find themselves in friendly rivalry with both fellow resellers and, interestingly, established retailers. 

In most cases, the competition arises from the attractiveness of the reselling model, where anyone with an entrepreneurial spirit can enter the game. This surge in resellers, whether on online marketplaces or in local markets, results in a significant supply of similar products.

So, what fuels this spirited competition? The ease of entry encourages a growing number of individuals to become resellers. Additionally, customers in Kenya are increasingly tech-savvy, with a penchant for shopping online, adding to the demand for resold products. 

The low overhead costs associated with reselling are also a driving factor, making it an accessible venture.

But how can you navigate this competitive landscape successfully? The answer lies in carving out a unique selling proposition (USP). This could involve curating a specialized product range, offering exceptional customer service, or employing creative marketing strategies that set your business apart. 

Moreover, staying updated on market trends and customer preferences will enable you to adapt swiftly and stay ahead in this dynamic reselling race. 

So, while competition in Kenya’s reselling market is formidable, it is also an arena ripe with opportunities for those who are willing to innovate and differentiate themselves.

Inventory Management

The logistical puzzle of storing and tracking vast quantities of products can be a formidable task. It demands meticulous attention to detail, efficient organization, and a commitment to avoiding common pitfalls like overstocking or understocking. 

For resellers, maintaining optimal inventory levels is a constant juggling act, as excessive inventory ties up capital and storage space. On the other hand, insufficient inventory can result in missed sales opportunities. 

The physical storage of products requires warehouse space and security measures. In addition, you will need well-thought-out logistics to ensure that products are readily available for shipping when orders roll in. 

To address these challenges, you can opt for business models like dropshipping, which eliminates the need to manage and store inventory. 

It’s a strategic choice that allows resellers to focus on marketing, customer service, and growing their businesses without the inventory management hustle that traditional reselling may entail.

Customer Service

Managing customer support is an essential aspect of growing your reselling business and maintaining a positive reputation. However, it can be time-consuming, especially when combined with the demands of marketing and product sourcing. 

Juggling between taking orders, addressing customer inquiries, and forwarding them to your supplier can stretch your resources and time to the limit. This multifaceted role can lead to burnout if not managed efficiently, as it requires consistent communication and rapid response to maintain customer trust. 

It’s vital to strike a balance and explore strategies like automated order processing or outsourcing customer support tasks to alleviate this challenge. This allows you to focus on growing your reselling business and ensuring its long-term success.

How to start a reselling business in Kenya 

Let’s embark on the heart of this journey, where we’ll unveil the five pivotal steps that will guide you to e-commerce triumph in Kenya. Whether you’re just starting or an experienced entrepreneur, these steps are your compass to navigate the exciting world of reselling, ensuring your path to success is well-charted and filled with opportunities. 

So, fasten your entrepreneurial seatbelt, and let’s explore the road to reselling mastery!

Step 1: Research products to resell

Before you can start creating an online reseller business, you need to research the market. This allows you to select products that you love and understand. On that note, I must remind you to select a niche when starting your reselling business. 

Focusing on a specific niche allows you to carve out a distinct identity and target a more defined audience. Consider your interests, expertise, and market demand when choosing a niche. 

Assess the competition and pinpoint areas where you can offer unique value. A well-chosen niche not only streamlines your product selection but also enhances your marketing efforts, positioning your reselling business as an expert in a particular domain.

 So, dive into a niche that resonates with both your passion and market potential, paving the way for a more strategic and successful reselling venture.

What can I resell in Kenya?

When starting a reselling business, it is critical to have an initial audience. These could be people who follow you on social media, your family, and your friends. It will help you build your customer base and understand the market needs.

Now, you cannot start a successful reselling business just because you like a product. Or just because the profit margins are high. 

Instead, you need solid criteria to determine the products to resell. You need to conduct market research to set yourself up for success in the reselling business. 

In the most recent GSMA E-commerce Survey 2023, beauty and personal care products dominate e-commerce across Africa, followed by apparel. 

However, this is not the only factor to consider when choosing a product to resell. You will need to consider other factors such as: 

Profit margins

You’ve got to ensure the numbers make sense. A product might be hot, but if the profit isn’t there, it’s like having a Ferrari with an empty gas tank—looks good, but won’t get you far.

Here’s a quick guide to understanding your profit margin to avoid unprecedented losses. 

Cost of Goods Sold (COGS)

This includes the cost of acquiring the product, shipping fees, and any additional expenses directly tied to getting that item in your hands.

Selling Price

The magic number you’re putting out there. This is what your customers will pay for the product.

Gross Profit

Subtract your COGS from the Selling Price. This is your raw profit before factoring in other expenses.

COGS – Selling Price = Gross Profit 

Gross Margin Percentage

To get this, divide the Gross Profit by the Selling Price and multiply by 100. It gives you the percentage of profit relative to the selling price.

Gross Profit * Selling Price/100 = % Profit Margin

Here’s a quick example: If you sell a product for Sh.1,000, and your COGS is Sh. 600, your Gross Profit is Sh. 400. Divide that by Sh. 1,000, multiply by 100, and you’ve got a 40% Gross Margin.

Remember, this is just the tip of the iceberg. Factor in overhead costs, marketing expenses, and any hidden fees. The more transparent you are with your numbers, the clearer your path to profit becomes.

Market demand

Effective demand market research acts as a risk mitigation strategy. When you understand the demand for your selected products, you reduce the risk of investing time and resources into items that might not resonate with your target audience. It’s a preemptive measure to avoid potential losses.

Competitive analysis 

Reselling products online is a competitive business. Therefore, it is critical to conduct a thorough competitive analysis to create an efficient sales strategy.  

In the next section, you will discover a simple strategy to conduct your competitor analysis. 

How to do competitive analysis when starting an online reselling business

Below are 8 simple steps to guide you to your first competitor analysis before starting your reselling business: 

1. Identify Your Competitors

  Start by listing out who your main competitors are in your specific niche. These could be direct competitors selling similar products or indirect competitors catering to the same target audience.

2. Examine Their Product Range

Look into the products they offer and understand their product mix. Are there gaps in their inventory that you could fill? Look for unique selling points or features that set their products apart.

3. Pricing Strategies

Analyze how your competitors price their products. Are they aiming for affordability, or do they position themselves as premium? Understand the pricing landscape to strategically set your prices.

4. Customer Reviews and Feedback

Explore reviews on various platforms to grasp what customers love or dislike about your competitors. It’s like eavesdropping on a conversation to understand what people want.

5. Social Media and Marketing Tactics

How do your competitors engage with their audience? Analyze their social media presence, marketing campaigns, and content strategies. It’s not about copying but understanding the tone that resonates with your shared audience.

6. Shipping and Customer Service

The post-purchase experience matters. Investigate how competitors handle shipping, returns, and customer service. This intel helps you identify areas for improvement or differentiation.

7. Strengths and Weaknesses

Conduct a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) for each competitor. This structured approach unveils insights into their overall business strategy.

8. Stay Updated

Regularly revisit your competitive analysis. New players might enter the scene, or existing ones might change strategies. Stay nimble and adapt your sales strategy accordingly.

In essence, competitive analysis is about understanding the market before making your strategic moves. 

Availability of the product

the availability of a product is like the heartbeat of your online reselling business—it needs to be steady for the business to thrive. It ensures you meet customer expectations and build trust. 

If a product is consistently in stock, you maintain a steady flow of sales. This allows you to create a reliable stream of income instead of a sporadic trickle.

Additionally, scarcity can create a buzz, but perpetual unavailability breeds frustration. Constant availability minimizes the Fear of Missing Out (FOMO) and encourages customers to make purchasing decisions without the pressure of scarcity.

Step 2: Decide on your fulfillment method

After choosing what to sell, you will need to determine your preferred fulfillment method. Your fulfillment method influences the customer experience, from order placement to delivery. 

Choosing the right fulfillment method ensures timely, reliable deliveries, contributing significantly to customer satisfaction and repeat business. 

 In this article, we are going to review 3 types of fulfillment methods: 

1. In-house order fulfillment 
2. Dropshipping 
3. Third-party Logistics 

Dropshipping

Dropshipping is a model where you don’t stock or own the products you sell. Instead, when you sell a product, you will purchase the item from a third party (usually a wholesaler) and ship it directly to the customer. 

Dropshipping is appealing due to its low upfront costs, as you only procure items when there’s a sale. In addition, you don’t need inventory storage, and you can resell a broader range of products without the burden of managing stock. 

However, delays in shipping times and potential product quality issues, as you rely on suppliers, can impact customer satisfaction. 

It is an efficient fulfillment method when starting a reseller business in Kenya. You do not need any capital to start a reselling business with Slyzed. Instead, the platform allows you to set up your online shop and cover fulfillment through dropshipping. 

In-house fulfillment 

Alternatively, you can opt for in-house fulfillment as a reseller. It would allow you to manage your entire logistics process. This involves not only managing your inventory but also handling packaging, labeling, and shipping directly from your facility.

With in-house fulfillment, you have complete control over the entire process. On the bright side, in-house fulfillment ensures faster shipping times and the ability to maintain product quality standards. Additionally, it allows you to personalize customer experience. 

However, the downside lies in the substantial upfront costs. You will need funds and an effective strategy for warehousing, staff, and logistics can be a hefty investment. 

In-house fulfillment demands meticulous organization and operational efficiency to mitigate these challenges effectively. 

Yet, for resellers aiming for a hands-on approach and a distinctive brand presence, in-house fulfillment can be a rewarding path to tread.

In this case, Slyzed can help you sell more products through our marketplace. You can easily upload your products for a broader audience reach as a seller. Additionally, Slyzed allows you to share your products with other resellers who can increase your sales volume. Click here to sign up.

Third-party Logistics 

In third-party fulfillment, you enlist the services of an external fulfillment center to handle the inventory management, packaging, and shipping on your behalf. 

The process is seamless: you send your products to the third-party fulfillment center, and they take care of the rest, ensuring timely deliveries to your customers.

3PL fulfillment allows you to focus on growing your business by handing over logistics. This automatically increases your flexibility to scale without worrying about warehouse space or staffing is a significant advantage. 

A good example is using courier service for parcel delivery. In Kenya, there are different courier and parcel delivery that can help you deliver products to various parts of the country including G4S Courier Services, Wells Fargo, etc. 

However, relying on external services means you do not have full control over your logistics. The potential for miscommunication and longer shipping distances could affect your customer experience. 

Yet, with the right third-party fulfillment partner, you can strike a harmonious balance, unlocking efficiency, and scalability for your reselling venture.

Slyzed allows you to select your fulfillment method based on what works best for you and your customers. In most cases, you will not have not handle inventory or shipping when starting a reseller business. 

Once you choose your fulfillment method, you are now ready to source your products. In the next section, we are going to talk about the best way to find suppliers to start a reselling business in Kenya. 

Step 3: Find Suppliers for your reselling business

Now that you’ve set the stage with your chosen products and a solid fulfillment strategy, it’s time to dive into the critical step of finding reliable suppliers for your reselling business in Kenya. 

In this pivotal phase, we’ll explore how to establish fruitful partnerships that ensure product quality, timely deliveries, and ultimately, customer satisfaction. Let’s navigate the terrain of supplier discovery to elevate your reselling journey to new heights.

Where do you find product suppliers for your reselling business?

To thrive in reselling, you must get products at a low cost and sell them for a profit. This relies on finding suppliers with fair prices. They’re not just providing products; they’re offering chances for solid profits. Discovering these suppliers is key to your reselling success. 

Let’s explore where you can find them, making sure your pricing strategy matches your profit goals perfectly.

1. Local Suppliers 
2. Online Marketplaces 

How to find local suppliers for your reselling business

Finding potential suppliers for your reselling business begins with a strategic local search. You can use Google to search for suppliers for your specific products. This gives you access to the local directories and business listings. 

For instance, below is a screenshot of the results of the search for cosmetic suppliers in Kenya: 

The next step would be to obtain the contact details of your potential suppliers. It would be best to create a database with these details for when you start sourcing products. 

Simultaneously, you can also join the relevant Facebook Groups, e.g. where wholesalers often congregate. Engaging with these groups opens doors to direct connections and firsthand insights into local suppliers. 

Furthermore, don’t underestimate the strength of your network; seek referrals from acquaintances, friends, and business associates. Personal recommendations are invaluable, fostering trust and streamlining the process of finding suppliers who align with your business goals. 

If you wish to start a dropshipping reselling business, you can source your products from either local or international suppliers. It is an ideal option when you do not want to spend too much money or time managing your online store. 

You can look up online marketplaces like Alibaba.com, Amazon, or eBay for product suppliers. Luckily, you can get all the information you need from the comfort of your home. In addition, online marketplaces allow you to reach out easily and even request samples. This is especially critical for resellers who want to hold inventory – drop shippers. 

Alternatively, you can also use a reselling platform to start your business. This will not cost you any upfront costs for inventory management and storage. Instead, a reselling platform allows you to start selling immediately. 

Join Slyzed and Start Selling

For instance, Slyzed is the first reseller platform where you can start reselling immediately after signing up. There is no hustle to get and manage your suppliers unless you want to start holding inventory. As the first of its kind, the Slyzed platform allows you access to multiple suppliers, share the products to resell on your shop, and start selling. What’s even more exciting is that the sales process is automated. Once a buyer checks out a product from your store, the order is forwarded to the supplier/manufacturer who will then ship the products directly to them. You do not have to worry about inventory, shipping, or even accounting as we have an automated payment system. 

Step 4: Create your Business Plan

At this point, you understand the products you want to sell, and where to find them. However, you are still in the initial stages of this journey. There is just one more thing, you do not have a documented plan. 

A business plan is your strategic roadmap, guiding you through your entrepreneurial journey. It’s the compass that ensures your reselling business soars to new heights.

Here is a business plan template for a reselling business.

You will use your business plan as a strategy and adapt as you go

Step 5: Build your Online Store

Staring at a scalable online business requires an online store, which can be expensive for beginners. Building an online store can cost from Sh. 50,000 -Sh. 100,000 in Kenya, which can be a challenge. 

Resellers in Kenya often resort to social commerce, using social media to promote their products. However, relying solely on social media platforms may limit the growth potential of your reselling business. 

This section elaborates on why an online store is essential and introduces Slyzed as a powerful third-party platform to streamline the process. 

Do I need an online store to start an online reselling business in Kenya?

An online store can significantly enhance your reselling business, especially in terms of professionalism, credibility, and scalability. However, it’s not an absolute requirement to start a reselling business. 

Many resellers initially begin by leveraging existing online platforms and marketplaces without the need for a standalone store. 

Here are a few considerations when looking into building an online store:

Pros of an online store for your reselling business in Kenya

 

1. Professionalism and Credibility

An online store provides a professional and credible space for customers to explore your product offerings. It establishes your brand as a legitimate and trustworthy entity in the competitive e-commerce landscape.

2. Enhanced Brand Visibility

While social media is an effective marketing tool, an online store extends your brand’s visibility beyond the limitations of individual platforms. It ensures that potential customers can find your products through various online channels.

3. Expanded Product Catalog

An online store allows you to showcase a comprehensive range of products, providing customers with a wider selection. This expanded catalog enhances customer satisfaction and increases the likelihood of repeat business.

4. Control Over Customer Experience

With your online store, you have greater control over the customer experience. You can design a user-friendly interface, implement personalized branding, and optimize the purchasing journey to maximize customer satisfaction.

However, as mentioned, building your e-commerce store can be expensive. Besides, you will need time to create a product catalog and manage inventory. Resellers can opt for third-party platforms like Slyzed to start their reselling business.  

Overcoming the Expense challenge with Slyzed 

Building a standalone e-commerce website can be time-consuming and costly. Slyzed, as a third-party platform, eliminates these hurdles by offering a ready-made solution. This allows you to swiftly launch your online store without significant upfront investment.

Automated Sales Processes

Slyzed’s features are specifically designed to automate various aspects of the sales process. From inventory management to order fulfillment, the platform streamlines operations, saving you time and effort.

Profit Optimization

Slyzed empowers resellers to maximize profits through its efficient commission structure and automated tracking of sales and commissions. This allows you to focus on growing your business while Slyzed handles the intricacies of revenue generation.

Scalability and Flexibility

As your reselling business expands, Slyzed provides scalability and flexibility. The platform accommodates the growth of your product catalog and customer base, ensuring that your online store evolves with the demands of your business.

Seamless Integration

Slyzed seamlessly integrates with various payment gateways, ensuring secure and hassle-free transactions for both resellers and customers. This integration enhances the overall shopping experience.

We aim to provide you with a quick solution to make a passive income, or even get started in the e-commerce industry. 

While social commerce lays the foundation for customer engagement, establishing an online store through platforms like Slyzed is a strategic move toward creating a scalable and efficient reselling business in Kenya. The combination of professional branding, automated processes, and Slyzed’s user-friendly features positions your business for success in the competitive online market. 

In addition to building your online store, take advantage of and leverage the power of social media. However, it is also important that you select the social media channels to use for your reselling business. 

Pro Tip: According to Statista, 34% of Kenyans prefer WhatsApp as their favorite messaging app while 17.5% prefer Facebook and Instagram. In addition, TikTok can also bring traffic to your product page. Select the social media channels based on where your target customer spends time or get their information from. 

Step 6: Start reselling products online 

In the last step of this tutorial, you will learn about the strategies to increase sales for your online business. We’re talking about turning casual browsers into enthusiastic buyers. Now you have set up your reselling business in Kenya, how do you start making more?

3 Tips to increase sales for your reselling business in Kenya

Now that you have everything laid out, how do you bring people to your online shop and convince them to purchase? Below is a list of 3 top strategies that have worked for our resellers: 

• Offer value to your customers 
• Research suppliers for lower prices
• Social media marketing 

Offering Value to your Customers

The best way to offer value to your customers is to understand the specific problems that your products can solve. Now, as a reseller, you must commit to continuously learning new marketing strategies. 

Research your customer’s pain points. In this case, what are the problems that your customers experience before purchasing your products? 

Understanding this will allow you to position your product as the solution your customer seeks. For instance, you can showcase a product review and how-to-use guides as content for your audience on social media and email list. The idea is to focus your marketing message on the benefits of using the product rather than insisting on the “buy now” sales message.

We often provide Demo videos on how to use Slyzed on YouTube to allow seamless signup processes for our use.

When running a reselling online store, we advise you to focus on improving your customer experience. This also includes offering premium customer service to improve customer retention. 

Source from Suppliers with lower prices 

Sourcing products at pocket-friendly prices is your ticket to a competitive edge for your reselling business in Kenya. However, managing this full-time can be a bit of a juggle but fret not! Online marketplaces like Slyzed provide you access to a multitude of suppliers. 

You get to choose the products you want to sell from single or multiple suppliers, share them in your shop, and start reselling right away. Well, unless you are running an independent online store. 

Slyzed is a reselling-focused platform that allows you to simply share products to your account and start promoting right away. 

Our extensive network of suppliers ensures a diverse range of high-quality products. Additionally, the platform’s robust features, including automated sales processes and commission tracking, empower resellers to maximize profits effortlessly. 

Joining Slyzed means efficiency, profitability, and user satisfaction. 

Leverage social media marketing

The power of social media allows resellers to catapult their sales to new heights. You should commit to strategically showcasing products on platforms like Instagram, Facebook, and Twitter to resellers expand your audiences. 

In addition, social media allows you to build brand visibility and trust. Create engaging content, and captivating visuals, and incorporate authentic storytelling to foster connections with potential customers. 

While at it, you might also consider using targeted ads and leveraging popular hashtags to amplify reach. It is also critical to foster community engagement through comments and direct messages to seal the deal. 

Conclusion

A heartfelt thank you for embarking on this reselling journey with us! You’ve reached the final chapter of your tutorial, and we’re genuinely thrilled to have been your guide. Your dedication to learning the ropes of starting a reselling business in Kenya is truly commendable.

As you venture into the exciting realm of reselling, armed with newfound knowledge and insights, we wish you boundless success and prosperity. May your reselling business flourish, and may each sale bring you closer to your entrepreneurial dreams.

Remember, the path to success is uniquely yours, and we’re cheering you on every step of the way. Here’s to a future filled with thriving sales, satisfied customers, and a reselling venture that exceeds your wildest expectations.

Wishing you the best in your reselling adventure!