The beauty of living in Uganda is its warm climate throughout the year. It will rain cats and dogs the entire morning, then the sun will shine rhinos and zebras all afternoon. So in regards to setting up an ice cream business, Uganda is extremely favourable, plus, everyone loves ice cream.
If you are looking for a side hustle to bring in extra cash, or if you are looking to engage that vacist in work that will earn them some ka money, starting up an ice cream business is something to consider. With only 8 million Ugandan shillings you can have a fully-fledged ice cream business running within a month or two. Though, as much as having enough capital to start a business is key, there is still so much that goes into ensuring you have a healthy and profitable business up and running.
(1). Market Research
Market research entails getting to understand better the ‘who’ your product is for. In the case of ice cream, is your target market school-going children, campus students or office workers? You could also look to fill in existing market gaps, for instance, we don’t have mobile-quality ice cream services in Uganda. What we have is water, food colour and sugar mobile ice cream services. So having an ice cream truck travel to different areas selling quality ice cream, would set you apart.
Note that finding the right target market is closely related to finding the right location (which I will speak more into later).
Within your market, there is also a competition to consider. Analyse existing ice cream business owners, how they are faring, what sets them apart, what you can learn from them and how to do better; in terms of pricing, variety in flavours and customer care.
Once you have narrowed down your target clients, carry out surveys that help you understand better what they prefer and what would draw them to you.
(2). Business Plan
Just like any other business, an ice cream business needs a business plan (however small). Jason Lexwell, the founder of Ice Cream Profits, an online resource for Ice cream entrepreneurs, mentions that a business plan helps tackle challenges before they set you back. Before you make any rushed grand decisions, make that business plan. See the business on paper before you materialise it. This will help you navigate any possible threats or setbacks to the business while ensuring the uniqueness of your ice cream business is maintained.
A business plan includes key elements like financial projections, marketing, sales, management, and organisation among other components. Having a business plan also allows for the right decisions to be made regarding the success of the business.
(3). Equipment
This is where a clear head is required. If you have decided to purchase a new machine, be ready to pay UGX 10 million plus. If you have settled on a second-hand Ice cream machine, then you must be ready to handle the frequent maintenance costs. However, you can buy a second-hand machine that is still in pristine condition. These machines, both new and second-hand can be found on Jumia or Jiji, with prices ranging from UGX 4 – 8 million. The type of machine you purchase is dependent on your preference. Consider the capacity of the machine in terms of litres, the bigger the capacity, the more costly. How many knobs, wands or spigots (the lever that makes the ice cream come out) does it have? Does this machine stand on its own or it requires a counter to sit on? How large is it? Is it self-cleaning?
All these must be put into consideration when purchasing your ice cream machine.
In this article we are tackling the ice cream business at a small scale, implying that not so much equipment is needed. Abanista gives us some of the necessary appliances to purchase while starting up such a business, but we shall focus on four.
Soft serve ice cream machine:Â This machine produces ice cream quickly, making it ideal for high demand. Its user-friendly controls allow for dual flavours, so you can combine vanilla with mango, for instance. This machine also produces a great smooth and creamy consistency. It is possible to get a second-hand soft serve machine at 5 million, with a capacity of 25 litres.
Ice cream mix pasteuriser: This machine is important as it helps eliminate bacteria, enhances the flavour and texture of ice cream, and allows precise temperature control.
Wafer maker: This allows you to manage your cone stock, offering freshly made cones and customization. It also prevents you from running out of cones. While plastic tins can be an alternative, their environmental impact is worth reconsidering. These machines range from UGX 600,000 to as low as UGX 100,000.
Refrigerator: Totally necessary to keep your ingredients such as the milk and the ice cream itself fresh at all times.
(4). Location
Consider that an ice cream shop needs to be in a busy area—not just highway traffic like Jinja Road, but a high-foot-traffic spot like Owino. A location bustling with pedestrians increases sales potential. Also, factor in the costs associated with the location.
The cost of renting a shop depends on location—whether it’s in the city or on the outskirts. City rents are usually higher. Are you considering a temporary shack in front of a school or a cargo container shop inside a university? A shack is cheaper but less durable and more vulnerable to theft.
Investing in a cargo container (around UGX 8 million or more) could be a better option for security and durability. However, any space you use will still require rent. Set aside at least UGX 1 million for the first three months. Since this is a small-scale business, avoid expensive locations that don’t fit your budget.
Your location also determines your utility bill, for example, you may get a place that has free access to water, reducing expenses. However, in the event that it isn’t free, you will need to budget for it. Electricity is another essential cost to consider, along with security if necessary.
(5). Extra cash
So, approximately our balance of 8 million is about 1 million Ugandan shillings. If we are buying a second-hand machine at 5 million, then paying our rent and utilities, we then have some extra cash to buy the first batch of ingredients.
- Milk (heavy cream)
- Sugar
- Flavours (vanilla, lemon, strawberry…)
- Cones (each cone goes for 100 shillings on Kikuubo Online)
Don’t forget that you’ll need measuring tins, general kitchen utensils, and some branding for your business.
With an ice cream business, depending on where you are stationed you can earn UGX 30,000 per day up to UGX 300,000+, per day.
Typical pricing has the small cone at UGX 1,000, plastic tins at UGX 2,000, and the larger cones at UGX 3,000. I know someone who spent UGX 30,000 in one sitting, buying the UGX 3,000 cones one after the other. Some groups of clients can easily spend UGX 50,000 in one visit. With how much people love ice cream in this hot country, there’s little room for failure.
Ice cream is a lucrative business option because it reliably brings in daily income. There are challenges to it, particularly with accountability and theft. But a rigid system and good management will lead to maximum growth and good profits.
