On infrastructure challenges in Kenya

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“Infrastructure challenges” are often cited as a barrier to doing business in emerging economies. I thought it might be interesting for people to see very concretely how infrastructure challenges do and don’t affect our work at Kapu (1).

Roughly in order from least challenging to most challenging:

  • Water access issues don’t affect us. We have fine running water at our offices/warehouse. Water access is a bigger challenge in the countryside

  • Power outages: doesn’t affect our office or warehouse directly. But sometimes when power goes out for a night in a poorer neighbourhood, our agents can’t place orders the next day because their phones are all dead

    • power outages are a significant issue for businesses like manufacturing though

  • Cell network / internet issues: We have significant but not huge problems here

    • Cell and internet connection can be patchy. Lots of “can you hear me?” “sorry, there’s lots of lag”

    • Internet periodically just goes down - hurts our customer service response time most of all

    • Sometimes Safaricom - the biggest cell and payments network - goes down for a few hours, leading to failed payments, OTPs that don’t send properly, and lots of hassle

  • Low level corruption: Cops sometimes stop or impound our trucks and want bribes. They let us go after we show the proper paperwork for the 7th time, but it can make our deliveries late

  • No comprehensive street address system: You describe where something is by saying “it is next to House of God Church” or “it’s in the Mumbi area” (2). We rely on GPS pins (which are not always correct) rather than addresses to make deliveries. This slows down deliveries

  • The roads aren’t great: In Nairobi some roads are concrete, and some are dirt. When it rains hard, some of the dirt roads become impassable. This happens every couple weeks or so and then we are unable to make deliveries in a few neighbourhoods for that day

Collecting payment from customers and agents who - because of lack of trust and lack of liquidity - don’t want to pay in advance for a product that will arrive until tomorrow is also a huge challenge that you don’t face so much in the US. I wouldn’t consider this strictly an “infrastructure challenge” - but it is another type of challenge that also tends to go away as a country’s economy develops.

Overall these issues aren’t huge for us. I think these types of problems matter much more in industries like manufacturing, or in countries where infrastructure is worse.

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  1. ofc this is all my own views, not any kind of official view from Kapu

  2. My friend was once asked to draw a map of where he lived for an official document