Construction boom makes hardware shops most popular business in Kenya

The booming real estate sector in Kenya has made hardware shops the most popular businesses across the country.

The number of hardware shops is increasing every day, particularly in Nairobi suburbs, where building of houses seems to be the only meaningful business going on.

A survey in various suburbs, especially on the outskirts of the capital, showed that the hardware outlets currently outnumber grocery stores, meat shops and bars, which at one time were the most popular businesses.

In Kayole, on the east of Nairobi, lining up the main road and others that crisscross the estate are dozens of hardware shops.

One cannot walk for 30 metres without missing a hardware selling various construction materials that include cement, water pipes and related gadgets, doors, iron sheets and nails, among others.

Similar scenario is replicated in Kitengela, Athi River and Ruaka, fast-growing suburbs on the outskirts of Nairobi.

In Kitengela, there are tens of hardware shops that line up the main road which heads to Namanga and crosses into Tanzania.

The road is significant to the two countries because it leads to Arusha, a town dubbed East Africa's capital as it holds various diplomatic installments, including the regional parliament.

Kitengela has experienced an unmatched development in the real estate sector, and that has given a major boost to the hardware shops.

"We do not know about the future but for now, if you are not in the hardware business, then perhaps you are not making any good money," Fredrick Muthee, a hardware shop operator in the suburb said on Thursday.

Muthee stocks a myriad of construction materials and gadgets; a thing that he says gives him an edge over his competitors.

"The best way to run a hardware store is to be a one-stop shop for the different construction materials. If somebody wants cement, sand, water pipes, doors, door frames and tools, they should find them at one place," he offered.

For sand and cement, one gets them in whatever quantity they want.

"I sell cement starting from half a kilo. While this ensures that my customers get what they want, I get more money by selling in the smaller portions," he revealed. He sells half-a-kilo of cement at 0.20 U.S. dollars while a kilo goes for 0.25 dollars.

"The half-a-kilo is not very popular although some people ask for it but most buy from a kilo upwards," said Muthee as he declined to disclose how much he makes in a day for security reasons.

For sand, as many other traders in the town, he measures in wheelbarrows, with each going for 5 dollars.

"Our shops have brought construction materials closer to the people. They do not need to go to the factories because our prices are also fair. For instance, I sell a bag of cement at 7 dollars. I have only added a smaller margin on the factory price," said George Mungai, who runs a hardware shop in Kayole.

Latest data from Kenya National Bureau of Statistics indicate that the East African nation produces an average of 500,000 metric tonnes (MT) of cement in a month and consumes about 450,000MT.

Production and consumption have been going up steadily over the years as the country experiences construction boom. In 2013, production stood at an average of 400,000MT a month while consumption 350,000MT.

The Nairobi County government, on the other hand, approves construction of residential and commercial buildings valued at 161 million dollars every month.

"The boom in hardware shops will not slow down soon because the construction sector is still very vibrant and is likely to remain so for several years to come," said Antony Kuyo of Avent Properties, a real estate consultant firm.

Kuyo, however, noted that competition in the business is very tough.

"If you have up to 50 shops in a radius of about a kilometre, then business may not boom for all, the reason why some people are quitting. He added that increased competition has also led to sale of substandard materials," he said.