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Category Archives: matatu investment

PARTICIPATE IN RESEARCH TO IMPROVE MATATU SAFETY, AND BE ELIGIBLE TO RECEIVE FREE NEW TECHNOLOGY

Poor collection of basic data by operators is probably the biggest challenge in effective management of Matatu business. Despite the numerous complaints from investors in the industry, Matatu Sacco’s often do not have sufficient information and a holistic understanding of their system in order to better advice investors on specific targeted improvements and growth of their resources.
Lack of professional and reliable management structures, tools, expertise and also failure by the institutions of the Government to provide guidelines on public transportation has hindered growth in this sector and has seen many investors lose millions of shillings through unprofessional business ethics.
Better information dissemination or sharing however, makes your business more efficient and easy to monitor. But most often, many a Matatu investor, ignore or don’t have ways or means to acquire the information they need or would wish to get in relation to their investments.
However, a group of researchers from the department of economics at the University of California, Berkeley {USA} is now testing a way to close this information void. The team is working together with Echo Mobile, a Kenyan technology company based in Nairobi to carry out a research in the Kenya public transport sector for academic purpose and with the possibility to make recommendations on optimal Matatu management.
The team has developed a phone app (SmartMatatu) that receives data from a a tracking gadget with the ability to monitor driving behaviors and vehicle’s location at all times. The device has been programmed to sends alerts to the vehicle owner/ managers of all unsafe driving behaviors like; over speeding, over braking, driving off-road and hard turning. The app has been designed to connect with the gadget and users can access it immediately to track their vehicle’s location, mileage and safe driving, among others.
Unsafe driving costs money either in court’s fines for violation of traffic laws or increased repair cost and also endangers the lives of passengers and other road users. By tracking your vehicle in real-time, you will be able to know for a fact how your employees behave on the road. You’ll know when drivers are unsafe and also track the productivity of your investment by getting firsthand information on the distance travelled compared to money earned}. You receive SMS alarms when the driver is unsafe and also {on request} get a summary at the end of the day on each driver’s safety record.
The program was started earlier last year in route 125 Ongata Rongai- Kiserian matatus. A total of 10 Matatu vehicles were fitted with the Tracking device and we have been monitoring, collecting and sharing the information with the owners and at the same time, making improvement to the device to accommodate the feedbacks we receive from participants on what is of importance and necessary information they would want to know about their vehicles. The program has been a success and now, we want to expand and offer more drivers the opportunity to be selected to receive the same services at no cost.
We are looking for volunteers to register for a lottery to be selected for participation in the second phase of this project which will run from January to April 2016 with approximately 40 matatus. We are also registering owners with interest in a lottery selection for participation in the full-scale trial, with up to 250 matatus through the end of the year. Of the owners who register, some will be randomly selected to receive a device and access to the SmartMatatu application for the remainder of the year. This will come at no cost, but in exchange for the submission of short daily reports on performance, earnings and expenses so that the research team can understand how tracking can be improved and made effective to optimize the Matatu business.
Other randomly selected owners will not receive the SmartMatatu app, but will receive a free mobile phone in exchange for having a device installed and for submitting the same daily survey submissions. All selected owners will also be paid a small amount for daily reports. Owners wishing to be considered for participation are requested to register for the lottery by sending an SMS with the title….OWNER to 20788… and respond to each question in the survey. Whichever group owners are selected for, any information shared or retrieved by system will be used for research purposes and shall not be shared or availed to a third party. Send an SMS now to register for consideration!

 
 

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Cost of owning a 33 seater minibus in Nairobi.

MATATU INVESTMENT.
Matatu is a name associated with Kenya public transport sector referring mostly to the low capacity public service vehicles. Over the years, this sector has remained chaotic and mismanaged and many investors have kept a distance. But since public transport is more of a basic requirement, and people need to move from one point to another, the demand for public means of transport has continuously increased and provision of the same has remained one of the most rewarding investments in terms of returns to those already in the business.
WHICH MODEL IS THE BEST?

SANYO DIGITAL CAMERA
The Government is in the process facing-out lower capacity public service vehicles {14 seater Vans} in all urban centers especially in the capital Nairobi- it has been a continuing program for the last Eight years- investors are now going for minibuses with a capacity of 25- 29-33 and 47 seaters respectively.
Different vehicle Manufactures have come up with several models to fill the gap, ISUZU — MITSUBISH -TOYOTA DYNA — HINO — TATA — HYUDAI – Nissan UD {Swara} — FOTON etc.

 

 

 

 

SANYO DIGITAL CAMERA ISUZU NQR remains the biggest contender in the minibus category especially the 25—29 and 33 seater capacity. General Motors the manufactures of Isuzu has been selling buses across the country for many years and their different modes have worked for Kenyan roads. The availability of genuine and affordable spare parts is also an added advantage to buyers.

 

 

 

 

Hino is making a grand comeback in the passengers transport services. SANYO DIGITAL CAMERAThe 33 seater Hino minibus is giving Isuzu quite a worthy challenge especially in the Manyanga {soaped up} category. With the fancy bodies, it is hard to tell the difference between an Isuzu and a Hino. Although there is still room for improvement, this model has most of the important features that are ideal for Matatu business.

 

 

 

 

CAPITAL,

To own either of the two popular minibuses, you need an estimated capital of 5 million Kenya shillings. You can pay cash or get finance through lenders either a bank or savings and credit cooperative societies.
For cash buyers- the requirements are as follows.
 Chassis/ cabin. =sh 3,502,000
 Manyanga body. = ksh.1.2 {depending in features}
 Registration number plate= ksh15, 000.
 Advance tax @ksh, 720 per seat= ksh 23,760.
 Comprehensive insurance cover = ksh 450,000.
 Music system advanced = ksh. 150,000.
 Sacco registration & tlb license.= ksh. 20,000.00
TOTA L. =Ksh. 5,360,760.

RETURNS
The fare from Rongai to Nairobi is 100 peaks and 50 off peaks- on average the minibus makes six return trips to and from Nairobi. The average income per trip is between 3300— 4000 shillings; for six return trips the crew will collect sh 19,800,00
 Fuel is equivalent to 1000 per return trip—in a day a total of Ksh 6,000 will go to fuel.
 Salaries for the driver and conductor rage between 3,000—- 4000 shillings depending on terms of employment.
 Other expenses are; parking
 car wash
 Sacco contribution-= 500— 1000. Depending on the sacco.
 On average a 33 seater manyanga makes a net income of between 9,000—10,000 per day i.e. after all expenses have been deducted from the gross income including fueling & salaries.
 Most drivers work six days a week and rest on Sunday on average the minibus works for 27 days in a month and makes 270,000.
Monthly expenses include INSURANCE, PARKING FEE and SERVICING.

DURABILITY.
A brand new minibus is more productive in the first three years- during that period it can maintain the target of 9000 Kenya shillings per day; but the income drops in the fourth year by slight margin- of between Ksh.7,000- 8,000. Despite the drop on returns this bus can and will give you service for a minimum 7 years.

MANAGEMENT.
A Matatu owner has the right to employ a trustee/ manager of his choice to run the daily affairs of the van; it is however recommended that investors seek the services of qualified managers/ management agencies. This helps in setting a target which is sustainable and eases the burden for the owner.
1. The agency maintains control and costs incurred by each of the managed vehicle and must record / report to the owner of any malfunction or mechanical problem noticed on any vehicle.
2. It is the duty of the fleet manager to see to it that a file is kept containing all documents related to each vehicle such as Accidents reports, insurance, repair charts, and road licenses.

SURVIVAL IN THIS BUSINESS
For those who want to go it alone, there is of-cause the protection fee. This last bit is necessitated by corruption in the traffic department. It would be unwise not to have a contact person at the police station especially those that man your route of operation. It is hard to survive in this business however you may hate corruption; even when your Matatu has complied with all government requirements. The traffic police department is the regulator and most of them see the industry as their cash cow; there are police officers who will look for reasons or even obscure offense and place it on your crew and this will cost you dearly. It is therefore important to bear in mind that they also have a share of your cake and this might have a very significant role in the success or failure of your investment.
For more information.. wambururu@gmail.com
To book an appointment call: +254 724 384 676

 
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Posted by on December 8, 2015 in Its life, matatu investment, Matatu matters

 

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