video Business

A new way for foreign brands in Kenya

Monday, December 01, 2014 - 02:01

Kenya has seen an increasing number of foreign brands set up shop in the country. As Sonia legg reports investors seem alive to the opportunities offered by a fairly young population, a growing middle class and rising incomes.

▲ Hide Transcript

▶ View Transcript

There are some international brands you just can't avoid wherever you go. But Kenya could soon see a much bigger influx. It's not the companies themselves moving in - it's their franchises. Samuel Njiru runs Nairobi's Cold Stone Creamery (SOUNDBITE) (English) SAMUEL NJIRU, COLD STONE CREAMERY, OUTLET MANAGER, SAYING: "We went to Arizona, where Cold Stone was founded back in 1988- Arizona, Scottsdale that is for training on ice cream. We trained on how to produce ice cream." Kenya's an attractive country for investors - last year it saw growth of almost 6%. But it's not the easiest place to do business - in fact in a recent World Bank report, it came 136th out of 182 countries. Poor infrastructure, a complex legal system and regulation are the main problems. Letting locals run the business helps solve that. Dr Joyce Gikunda has the franchise for MAC cosmetics (SOUNDBITE) (English) DR. JOYCE GIKUNDA, MAC COSMETICS KENYA FRANCHISEE/OWNER, SAYING: "We sat at the table and we said - we know this market better than you do. You know the product, you know the brand better than we do but we know the clientele, we know the attitudes, we know the demographics of this country better than you." There are benefits too for Kenya. Consumers get more choice and standards often improve. Kiprono Kittony is from the Chamber of Commerce and Industry (SOUNDBITE) (English) KIPRONO KITTONY, KENYA NATIONAL CHAMBER OF COMMERCE & INDUSTRY (KNCCI) CHAIRMAN, SAYING: "Foreign brands, a lot of them ascribe to global best practice, these are brands, goods and services that have found their place in the international market. And I think the fact that they have chosen Kenya to position those brands is also a manifestation that we are both ready as a market and willing to really adapt best practice." That could lead to less corruption - which is often a problem in Africa. And in time perhaps less poverty. There may be a growing middle class among its 41 million population. But 40 percent still live on less than $1.25 a day with no chance of being able to buy an ice cream.