How to Increase Your Income: What would you have to do to start making Sh. 100,000 per month from a capital investment of Sh. 1 million? This is the question that David ‘Kyrgitt’ Kiprono tackled in this post that was originally posted on his Flipside forum. Do you agree with his opinion? David explained as follows:
Well, 1M is not alot of money in regards to making it churn such an income but in life we can only be either smart or shrewd.
Okay here goes….
Travel the country.
Find someone building neat self-contained bedsitters near a busy road or town. Ensure its in a convenient place
He will most likely rent out a bed sitter for less than 6k a month. But let’s say it’s 6k. Approach the owner and take all of them.
In most plots, you’d probably have about 10 bedsitters.
Pay him 60k. Add another 60k and another, and another. In other words rent out his entire plot for 3 months. Pay him a deposit equivalent. So your total expenditure is 180k rent plus 180k deposit.
You’re left with 640k.
Convert one bedsitter into an office.
Register a company. Spend 15k on ecitizen to do it. (Hustlers selling company registration for 50k and MoH cartels are in the same wozap)
But an etr machine. 25k
Get a good sign writer. Probably 3k.
But 9 good 5×6 beds from the local carpenter at 8k each. That’s 72k.
Buy good beddings . Nice pillows and duvets. 2 sets per room. About 6k per room. That’s 54k.
Get accessories such as floor mats and cheap but beautiful paintings from Maasai Market. A total of 18k.
Buy a POS system. You can run an online one like POSNET.
Buy a set of 4 CCTV equipment. 35k.
Hire the services of a security firm for 2 guards. At 15k per guard. Pay for 3 months. That’s 90k.
Hire a 2 front desk personnel at a salary of 15k per month. Put aside their money for 3 months, that’s 90k.
So far you’ve spent a total of 762k. You have roughly 238k left.
Hire a 2 ladies to wash linen. Hire a 3rd one to clean the rooms. Their salaries could be in the ranges of 10k each. In 3 months that’s another 90k.
Print nice posters, use local classifieds and notice boards and work with nearby bars and restaurants.
Congratulations, you have a guest house. Call it Flipsidehustle Motel.
Sell each room for 2k a night. All you need is consistently sell 5 rooms every night and you have 300k per month. If you sold all 9 rooms especially during peak months you have the potential of making 540k per month.
If there’s space in the compound you can make a kitchen and dining area and add breakfast and charge an extra 200bob. It costs nothing actually to give tea, and eggs to someone paying 2k for a good night rest.
Now. If you have means such as your own land or bank facilities, you can build your own for less than 5M for the whole project and you have those figures per month.
Again, this forms part of the #retireyourego challenge where it works best outside the big cities.
Again I say, I love sharing these ideas because I’m a trove of thoughts. Please share the posts but if you must lift it, do credit the source because so far, I’m just a benevolent ideologist.
Nevertheless, I was given only 1m to work with to turn into a high revenue and we have pushed it.
I said you do everything in 3 months because you need to secure your rent as you scale your business. Also you don’t want staff to be disgruntled before you break even. And not unless you’re cursed, or not following my prescription properly, there’s no way you won’t break bread by the 2nd month.
The landlord just wanted to get tenants paying him 60k a month. Well, when your business does well, pay him for 2 years and he will stay off your back as you make good money and raise your own capital. Its a win for your landlord, a win for you and a win for your Bank.
Open your minds. The possibilities are endless. I know someone who has done this and replicated its 3 times. You could charge the rooms 800bob or 1200bob. Just work your math and make it work.