WATOTO SCHOOLS STUDENT’S WORKBOOK

ENTREPRENEURSHIP EDUCATION
SENIOR 2
2020

Prepared by oleke moses

BUSINESS IN UGANDA
Introduction and meaning
 A business refers to any economic activity undertaken by an individual with a view
to make profits. it involves exchanging goods / services for money or for goods/
services.
Profits in business are realized after selling commodities at higher prices than the cost
of producing or providing them.

In Uganda, people do different types of businesses for them to earn a living. Some do hawking,
food processing, poultry keeping which can be categorized into different business types. Explain
the types of businesses in Uganda.

Businesses vary in size and they can be categorized according to how they measure against some
indicators, such indicators include; Amount of capital invested in the business, The number of paid
employees, The level of technology used and the Volume of sales realized over a given period. Like
Micro Businesses that are very small and it require very little capital to be started, very simple
technology used and it usually employ their owners and the family members. Explain other different
business sizes basing on the above factors.
Research work, What are the characteristics of;
i). Micro-business
ii) Small-business
iii) Medium-business
iv) Large sized business

There are a number of importance the society, government and the business owners enjoy as a
result of operating business. Among which are they act as a source of income to their owners and
they also provide goods and services needed by the people. As a student what are the
contributions of businesses in your community.

There are many business associations which voluntarily come together and agree to work
towards achieving a common objectives, like an objective of meeting their needs and
protecting their interests which cannot be achieved by one business unless they unite.
Uganda Manufacturers Association (U.M.A)
Northern Uganda Manufacturers Association (N.U.M.A)
Uganda National chamber of Commerce and Industry (U.N.C.C.I)
Uganda Women Entrepreneurs association (U.N.F.A)
Uganda National Farmers Association (U.N.F.A)
Uganda small scale Industries Association (U.S.S.I.A) e.t.c

Objectives of business association very from one business to another depending on how they
have agreed to operate, however there are common objectives that most associations use like
securing or accessing local and foreign markets for their members produce, Sourcing or
accessing raw materials for their businesses. In a group of three to four, discuss other
objectives of business association in Uganda.

Membership of business associations

Business Associations tend to attract membership from businesses which are in the
same line, for instance
a) U.N.F.A. draws membership from:
Farmers dealing in crop and livestock production
Agro-processing businesses like millers, food processors, e.t.c
Agricultural inputs and service providers like produce buyers, transporters, drugs suppliers

b) U.N.C.C.I. draws membership from:

Traders and industrialists
Importers , e.t.c

c) U.S.S.I.A draws membership from:

Carpenters
Metal fabricators
electricians ,e.t.c

d) U.M.A draws its membership from:

large industries like Mukwano Group of Companies, Wava Group of Companies , e.tc
Large coffee processors like Zigoti coffee , Kyagalanyi Coffee processors, e.t.c
Service providers to big companies like M.T.N , Warid telecom, Banks, clearing Agents ,
e.t.c
Services rendered by the business associations
Business associations render services which help their members to achieve their goals and also
achieve the objectives for which they were formed like providing information on market
opportunities and changes, negotiating and securing local foreign markets for the members
produce. In your group, identify other services rendered by business association.

Agribusiness in uganda
These are businesses whose operations involved production and selling of agricultural
products for profits. Use the pictures below to describe different types of agribusiness in uganda
Agriculture is the back born of Uganda and that means it play a very big role in the
economy of Uganda. Likewise, to agribusiness that is so vital to people. Form a group and
discuss the importance of agribusiness in Uganda

Just like we have weaknesses as human beings, agribusinesses also face a number of challenges
that needs to be addressed. What are the challenges faced by agribusiness and as well point out
some of the likely solutions to the challenges faced by agribusiness?

Manufacturing businesses

These are businesses that transform or process raw materials and make products that are
different from the inputs, by transforming these raw materials or adding value to them. For
instance a business that may use papyrus to produce mats, tomatoes fruit to tomatoes sauce
or soup, e.t.c. Therefore entrepreneurs in this business are termed as manufactures.

Use the pictures below and describe the types of manufacturing businesses in uganda

Just like agribusiness, manufacturing business also have a number of importance to the
community and they include, such businesses are a source of income to their families, if they
realize profits from their operations, they provide goods that are required by the people,
hence earning income which improves on their standards of living. Basing on the above
importance, in your group pout out other importance of manufacturing business

Looking at the pictures above, what are some of the likely challenges faced by manufacturing
business and the ways of over coming them.
Service business
Services are invisible and intangible products that satisfy customer’s needs or that provide
benefits enjoyed by customers.

Some entrepreneurs start such businesses basing on the technical skills they posses, like a
Doctor styaring a clinic, while others may not posses the skills but decide to set up such
business and employ personnel to work in them so as to achieve profits.

Services needed in the community and businesses that can provide them
There are a number of services that the community may require and various
businesses can be set up in order to provide such services, some of them may include;
1. Education service: Businesses that can provide such a service include;
- Nursery, Primary and secondary schools
- Polytechnical , vocational training institutions
- Commercial colleges like U.M.I
- Universities and other institutions of higher learning.
2. Medical / Health service: Businesses that can provide such a service include;
- Clinic
- Pharmacies
- Laboratories
- Hospitals and nursing homes, e.t.c
3. Transport service: Under this, businesses may include;
- Bodaboda
- Taxis, Bus service,
- Marine transporters, air transport, e.t.c
4. Entertainment: Here businesses may include;
- Disco theques, Theaters , Cinema Halls, sports, travel agencies, swimming e.t.c
5. Technical service: Here we find motor vehicle garages, electrical repairing e.t.c
6. Security: Here we find security services like security organs like Saracen,
Securiko companies e.t.c.
7. Food and drink; Here we find bars, restaurants, Kiosks, e..tc
8. Utilities : Here we find electricity , water and telecommunication forms like MTN,
Warid Telecom, Zain ,e t.c
9. Tourism : Here we find tours and travel agencies, hotels , lodges, campaign sites
e.t.c
10. Financial services: Here we find Banks, Micro financial institutions e.t.c
11. Beauty services: Here we may find Salon, barber shops, Bridal farms , e.t.c

9.35 Benefits from service business

Service businesses also play a great role to the owners, families and community, the
benefits are almost similar to those of agribusinesses and manufacturing businesses.
 However, form a group of three to four and discuss other unique benefits of service
business.

Challenges in service business and how to over come them

Some of the challenges to agribusinesses and manufacturing businesses do also affect service
businesses, however, the following are unique to them.
a. Since the quality of the service rendered depends on the skills of the entrepreneur and
workers, ensuring that workers are motivated and equipped with the necessary skills so as
to provide quality service is still a challenge , e.g how to ensure that a Teacher provides
what exactly he is supposed to provide.

b. Retaining the staff is a still a challenge as those who a re experienced normally are
taken by competing and emerging firms like Warid Telecom took abig number of experts
from MTN and UTL as MTN did so to Zain (former Celtel Uagnda) when it was starting.
c. There are associated with high costs of inputs, this is due to the stiff competition ,
entrepreneurs need to incur higher costs so as to provide quality services like high
salaries to employees, this leads to reduced profitability.
d. Most businesses face debts from their clients who fail to meet their obligations, this is a
big threat to the profitability of the business.

Ways of overcoming the above challenges

a. Provision of favourable working conditions in order to maintain the works in business
like good salaries and allowances.
b. Conducting a market survey so as to deal in a business where they have sufficient and
affordable technical expertise and ability to face competition.
c. Avoiding or minimizing credit facilities in order to reduce bad debts and setting up
stick rules for those who fail to pay, like signing contracts of sale of goods which are
enforceable by law.
d. Ensuring that staff is equipped with all the necessary facilities that would maintain the
quality of the services rendered, for instance providing constant training and workshops to
equip them with modern operational skills and techniques, e.t.c.
Trading business
These are businesses that buy goods at lower prices and sell them at relatively higher
price. These may include shops, butchers, Kiosks, supermarkets, e.t.c.

Types of trading businesses

We shall look at two types of trading businesses , i.e retail and whole sale trading
businesses.
Retail trading businesses
Theses businesses buy products fro either manufacturers or wholesalers in relatively large
affordable quantities and sell them in small manageable quantities to final users.

Such businesses may include those without fixed premises like hawking, roads side
vending , peddling ( those who use motorcycles), wheel barrow pushing e.t.c plus those with
premises like single shops market trading, tied shops, e.t.c.

Functions of a retailer in trade

A retailer is that person engaged in retail trade business, he/she carry a number of functions
like, he/she buys in relative large quantities from wholesalers or producers hence providing
them with working capital, a retailer breaks the bulk through selling to consumers in
smaller manageable quantities. Basing on the above functions, point out other functions of a
retailer.
Wholesale trading business
These are businesses that buy goods from manufacturers and sell them to retail businesses
or institutions in relatively large quantities.

Unlike retail trade businesses, which stock different goods, most wholesalers tend to specialize
in particular goods.
However, in Uganda it is common to find trading business doing both retail trade and
wholesale trade, this is done with a view to capture a wider market from both retailers and
consumers. Examples include those in different Arcades In Kampala like Mikwano
arcade,mutaasa Kafeero, Kikuubo, Kamukamu plaza, e.t.c.

There are different types of wholesalers in Uganda and among which are;
1. General wholesalers: There deal in a wide range of goods and henc e provide retailers
with a variety, for instance those businesses found in Kikuubo Lane e.t.c.
2. Specialized wholesalers: These ones concentrate on dealing in one field or particular
goods , for instance most traders along Nasser road and Nkurumah raod deal in
stationery, while those in Kisekka market deal in spare parts of different machinery,
e.t.c.
3. Nation wide wholesalers: These operate on a large scale and have different branches
through out the major parts of the country for instance Bata shoe shops are spread in
different parts of the country.
4. Regional wholesalers: These specialize or operate in specific regions or parts of the
country or district.
5. Cash and carry wholesalers: Such traders do not offer credit facilties nor delivery the
goods for retailers but sell to retailers at relatively lower prices than other wholesalers.
 6. Mobile wholesalers: These sell goods on moving vans, lorries and trucks, and normally
visit different regions in specific days like confictionery vans e.g Ntake bakery,
Kiddawalime vans e.t.c.
Functions of wholesaler in trade

a. He provide a link between the producer and retailers, hence facilitating communication
between the two.
b. He provides warehousing facilities for both producers and consumers and thus reducing
their costs of storage and therefore increased profits.

c. He breaks the bulk by buying in large quantities from the producers and sell to retailers
and consumers in desired quantities.
d. He maintains a constant demand and supply for goods, for instance by storing seasonal
goods during surplus periods and sell them during off seasons.
e. He acts as a financial to both manufactures and retailers through paying them promptly
and offering credit facilities or retailers.
f. He provides transport facilities for the goods from the producers’ premises to the
warehouse and sometimes from his ware house to the retailers shops mainly those buy in
large quantities.
g. He maintains stability of market prices through stocking goods during plenty seasons in
order to sell them during scarcity periods.
h. He sometimes reduce the costs of production for the producer, like advertising , transport ,
since advertise goods in stock for the producer.

Benefits of trading business

Trading businesses have similar benefits to those of agribusinesses, manufacturing and
service businesses, however, on top of that, the following benefits are unique.
All other categories of businesses benefit from the trading businesses as their products are
distributed and sold by the trading businesses.
They make goods available and affordable to customers through breaking the bulk and
bringing them close to them. ( Manageable quantities and prices.)
They also provide markets to the products of other businesses.

Challenges of trading businesses and how to overcome them

The challenges of trading businesses are similar to those of agribusinesses, manufacturing
and services businesses,, and hence ways to overcome them are similar.

May be , we can add on a challenge of goods getting expired or spoilt in shelves before
being sold.
This can be over come estimating correct quantities of goods that can be sold in a given
period and stocking only goods with longer self life.