She looks polished in a silver grey kaftan and black slacks. Her shoes are metallic brown and her nails are painted purple. But, as soon as she enters the shed, Catherine Nakitende puts down her Samsung phone and gleefully pushes her hands into a mound of wet crushed charcoal, scooping out handfuls, which she places into a machine. Then, she looks at her charcoal stained hands and laughs.
Someone once said there is good money to be made in dirty work. That is a saying Nakitende took to heart when the high paying job she was waiting on never materialised.
“In my last semester at Makerere University, in 2013, I applied for a position with Pay Global, a UK-based company, which was going to open an office in Kampala. I got the job – unfortunately, before I started working – the company folded.”
Today, the 27-year-old graduate of computer science looks at that misfortune as a marker, pointing her to success. With two factories and a third one going up by December 2017, Nakitende’s Kingfire Energy Solutions is an emerging brand in the briquette manufacturing business. Her largest factory is located in Rwamwanja Refugee Settlement in Kamwenge District.
When her dream job collapsed, Nakitende pondered her next move. As she sat outside the family house in Ntinda, a suburb of Kampala, she watched her grandmother place a crudely made briquette on the charcoal stove on which she was steaming matooke. It was a scene Nakitende had witnessed countless times, but at that moment, it was as if she was seeing it for the first time.
“Looking at that local model of a briquette, I wondered if I could improve it. I was completely broke. I only had Shs1, 000 which I used to buy cassava flour. The rest of the raw materials, such as matooke peels and maize cobs, I could get from home.”
For one week, modeling her grandmother, she taught herself to make briquettes. She endured the laughter of her siblings. “They thought I was crazy. To them, it was strange that a graduate should be crushing charcoal but at the end of that week I had 50 kilogrammes of briquettes. They were very poorly made and they had not dried well. However, I sold all of them at Shs2, 000 per kilogramme.”
By the time the first batch was sold out, Nakitende had learnt a valuable lesson. To succeed, one has to research the market to find out consumer preferences. Her research took her as far as Kabale District. As she interacted with consumers, she turned them into customers. Her second batch of 250 kilogrammes found a ready market. She sold each kilo at Shs1,000.
With her research, Nakitende discovered that cassava flour was a poor binder for the charcoal dust that makes the core base of briquettes. “Flour disintegrates quickly. I learnt that molasses were stronger. Nowadays, I use charcoal dust, molasses, corn cobs, banana peels, and saw dust.”
One and a half years after starting out, Nakitende moved her small enterprise into an incomplete house belonging to her family and hired 16 workers. “I named the business Kingfire Energy Solutions. We were still making the briquettes manually. I was reinvesting my profits into the business, and soon. I had enough to buy semi-automatic machines.”
Expanding the business
In 2015, Nakitende bought 20 acres of land in Kitale, Namilyango, on the outskirts of Kampala, where she set up structures for her business. However, in 2016, her plans changed. “The UN Refugee Agency (UNHCR) called for bids for briquette production in refugee settlements. We applied and were among the organisations selected. We were assigned to operate in Rwamwanja. The Office of the Prime Minister gave us four acres of land on which we built our factory. We moved most of our machines from Kitale to Rwamwanja.”
The factory in Rwamwanja only makes stick briquettes, which are sold at Shs700 per kilogramme to the refugees. To the other members of the public, the briquettes are sold at Shs1, 000 per kilogramme.
However, the factory in Kitale is still operational, although on a small scale. It only produces honey comb briquettes on order. These are sold to large households and businesses, such as restaurants and hotels. Each honey comb is sold at Shs1, 500.
The honey combs, which last seven hours once lit, can be used on an ordinary charcoal stove. However, the company makes customised eco energy saving stoves which only use honey comb briquettes.
“We only make the stoves on order. In the refugee settlement, we sell them at Shs27, 000 while we charge Shs2m and above for constructing a stove at a hotel or restaurant.
Challenges of expansion
With expansion, Nakitende increased the number of workers to 25. Although the preparationsfor opening up a new factory in Kyangwali Refugee Settlement are almost complete, she plans to start small and grow gradually.
“Expanding a business comes with financial challenges. I did not want to use loans but I had to apply for a Shs5m loan from the Youth Fund. I also got loans from friends but more importantly, I put back all my profits into the business. That is what helped me build a big factory.”
Unfortunately, the machines used are locally made; she must spend money replacing machine parts almost every month.
“Since we are producing in bulk, we are facing challenges with drying. Currently, we are using solar energy, and in extreme cases, we dry the briquettes directly in the sun. However, we are trying to invest in a thermal drier which costs Shs55m. So far, we have set up the structure but need Shs45m to complete the installation.”
The extent of the challenge was impressed upon Nakitende when she recently received an order for 150 tons of briquettes which she must complete within a month. Unfortunately, it is the rainy season.
Business lessons learned
A first time entrepreneur will face hurdles, especially from customers who take products on credit but do not want to pay. Besides this, Nakitende did not know how to read contracts.
“Once, I made a quotation for supplying stoves. I only considered the cost of production, which was Shs20, 000 per stove. I sent a quotation indicating that I would sell each stove at Shs23, 000. The company gave us a large order but asked us to reduce the price to Shs21, 000 since they were buying in bulk. Then, they took off the withholding tax before they paid us. I sold the stoves but I did not make a profit, yet I had got a loan to meet the order.”
Nowadays, the businesswoman consults widely before she sends out a quotation. “I use a financial spread sheet to compute everything. Our challenge, as business people, is that we only look at the cost of production and forget the overhead costs, such as, utilities, salaries, training given to employees, and the taxes, so we end up eating into our capital and profits.”
The best business advice she has received came from a peer who told her to record all her expenses and incomes to help her analyse whether she was on the right track or not. “He also told me to take time to understand the inner workings of my business very well.”
The worst mistake she has made so far was to buy land in Kitale with the help of the land owner’s lawyer. In the end, she was given land she had not intended to buy.
“I have travelled in and out of Uganda to demonstrate that it is possible for one to start small, using everyday material and make it big,” Nakitende says. From her profits, she has bought land and a car.
Currently, Nakitende trains women and youth groups to make briquettes and energy-saving stoves. Next month her team will be in West Nile.
“In the future, I hope to have model groups in different regions that can produce the briquettes for us. I also plan to diversify the business and venture into biogas production.”
Every individual has a weakness that is peculiar to them. Although Nakitende has grown her business in a space of only four years, she cannot drive.
“I am scared of even learning how to drive,” she says, continuing, “Recently, as my driver was driving to Kamwenge, we got an accident. I think that incident has turned me off driving for life.”
Born on July 7, 1990 in Kampala, Catherine Nakitende attended Buddo Junior School and Hillside International Cambridge School for her O and A-levels. Nakitende is the second child out of five children born to her mother Janat Nakayenga and father James Katamba; both businesspeople.
“I wanted to study accounting but my parents did not allow me to. Besides, since I had done Cambridge exams, it was difficult to get an admission into local universities. So, I pursuedan undergraduate degree in computer science online. At the same time, I studied for an online diploma in computer networking from Makerere University.”
Nakitende also has a diploma in sales and marketing, and a diploma in transaction processing systems. “I have never applied my computer knowledge; though there was a time when I thought I would use it, when I applied to join Pay Global.”
While she was a student – from Senior Six vacation to her last year at university – Nakitende worked part-time jobs, as a travel guide, decorator, restaurant manager, marketing and sales executive, insurance agent, and distributor, in six different companies.