ET 826 – is an alcohol production sector, working on traditional alcohol drink (tella) production business. She is 35 years old and a mother of two children.
Nine years ago, this respondent was thinking about the idea of opening a traditional alcohol drink (tella) production business. At that time, the respondent was working on making coffee on the street with a small monthly income (less than 100 birr), but she stopped doing it and she planned to open her own business. Then she opened ‘tella’ production.
Initially, she sold around 150 cups of ‘tella’ per week (one cup is 1birr). After that, she understood the benefit of the business and she planned to expand it. She bought some materials used for the ‘tella’ production and she rented a wide ‘tella’ selling house. Also, she hired employees, and then the income generated from the ‘tella’ sale highly maximized. The production and the selling of ‘tella’ is increasing from time to time and currently, on average, she is selling 600 cups of ‘tella’ per week.(one cup is 10 birr). Also, she has another income that is associated with the ‘tella’ production called ‘lottery games’ (a game played during selling ‘tella’ to attract customers).
On average, currently, her gross weekly income from this alcohol production and the lottery game is estimated to be around 7500 birr. She has hired six employees working in full time, and totally pays 8000 birr per month in addition to accommodation and food.
The respondent is very challenged by the cost increment of the house rent and raw materials. This makes her not to furtherly expand the businesses. For the future, she is planning to improve those challenges and to increase her income. Most of the time, she doesn’t keep daily financial records, but she is trying to remember it. She is one of my respondents who are still cooperative for data collection.
History of a respondent who owns a furniture and wood business solely, with ID No-ET654.
This respondent felt optimistic about the business as he got an assistance from a small scale enterprise, for instance by making him to save 300 birr in each biding by writing a support letter (bid document, guarantee and other assistance). He is waiting for the result of his great bid and is eager to know who will be the winner for the last three weeks. He is also regularly searching for bids through reading news papers.
This respondent identified his challenges as lack of market linkage, both forward (for his products) and backward (with raw material suppliers) due to not having shops at different places. This is evident that he were given a place for his sales which then got taken over and was given to the jobless individuals in the city. Persistent raw materials price increase and non-existence of some raw materials has made him to agree on customer orders after checking for the raw materials’ existence in the prevailing market in order to do a rearrangement on the price. This respondent seems far sighted as he has bought and stored some raw materials in his warehouse beforehand which enabled him to use them now and become competent.
Firm ID : ET415
Business sector : N – milling, husking, grinding and agro-processing
This business is a family owned business. Owned by the respondent’s three sisters and one respondent’s brother. This business was started in the 1960’s during Emperor Hailesilasse’s time. These family members got this business as a gift from their father. They have 10 milling machines. From these milling machines, except three, they are new model machines. Many customers are getting their services with low cost. The owners are also happy with this. During our discussion, my respondent told me that all milling service givers in Adama City have an association and he is a member of this association. The aim of this association is to act as a representative for the owners, fix problems when they are facing them, limits cost of service, gives license for those who need to be a member. Until April 2021, cost of milling for 1Kg of ‘teff’ was 1.50 birr, but now their association has renewed this cost of service to 3 birr. This means he is milling 100Kg of teff by 150 birr and others 100Kg in 300 birr. Most milling owners are now using the new service cost given by their association. But my respondent told me that he is using the old service cost till now and his association members are forcing him to use the new cost but he said no to them. He said to me that “I have reasons for not using the new cost.” his reasons are:
First reason is that he is getting many customers and he does not want to lose his old customers
second reason is that his profit is as usual, didn’t change till now while in an economical inflation
third reason is that he is controlling all his income and expenses properly without any one’s interference
Today’s story is about ET384 who is engaged in a Garment sector. ET384 is 29 years old and newly married. He has a fashion interest since he was young. After finishing preparatory, he joined ‘Bahirdar’ University and graduated in fashion technology/garment engineering. In his 5 years duration in the campus, he participated in different activities. He was the representative of the department and he was one of the candidates for being the president, and he said he had a good relationship with the teachers and also the students. After graduation, he became a lecturer and he got a scholarship in Addis Ababa University, MA in Industrial Engineering. He will graduate after a few month.
He has been a production manager for a multinational company, he participates in fashion shows and he participates in a COC center. He then left his University and and joined ‘Wolkite’ University to start his own business here in Addis Ababa.
When he started the business, his initial capital was little, he didn’t have much, there were only two employees and he started his business in his own place where he lives in since they have enough space to start the business. His parents were the one who gave him money which was 100,000 birr and he has saved a few money from his work. He then bought 4-5 machineries. When he started, he didn’t have a rent expense because it was at his own place. It’s been 2 year since they started this garment business. Their supply chain has increased through time and their customs are well satisfied because of the quality of the product.
Before the COVID crisis, the business was great, they produced different products, they didn’t produce specific products, they produced garment materials with different styles because they have the knowledge and experience, they also worked on fashion. When the crisis happened, the business started getting slow. So when it slowed down, they started making masks to go with the flow as much as possible around ‘Megenagna’. We can say that for some part of Addis Ababa, that they were the first garment firm who started making masks and distributing to the users. Doing that was serving the community and the income helped the owner to pay the employees since he didn’t want to fire them, because if he did he knew they will get hurt financially. He used the occurrence of the pandemic to a business which is really appreciable respectively. They have worked for 4 to 5 months on only producing masks. After that, they slowly proceeded on their normal garment production activity.
They were capable on captivating the pandemic but the political conflict arose, and because of that, the customer started decreasing so fast. They had an outlet for distributing their products to the different regions of Ethiopia but because of the conflict, it was hard on taking a risk through the transport process, hence they were forced to lower the amount of products they distributed. This crisis affected the company’s income. So they just used the ‘Merkato’ marketing places and ‘Kolfe’ area, but currently the business is gradually improving. They are adding up manpower and machinery and even their capital in increasing. They have asked for an expansion to add up a machine for the firm.
When they started, they had three employees, but now some of the employees were employed for a long time so they are just paid in piece rate since they are not just working on only one garment, they are experienced. So currently they have 10 employees, most of them work only when there is an order or when they are in need of additional manpower.
For the future, they want the manufacture to enter into a new market and international market as well. Sometimes the products they produce stays in the store for a long time. And now since the inventory cost has increased, they have planned to open their own shop place. They want to expand the production area and win over their competitors.
* ET423 – Her work place is still sealed, she has no idea why they did this. Because of that they couldn’t work at all. She is staying home, her employees are out of work as well. She had a work which she signed with Addis Ababa University, the due date is soon and they are thinking of canceling the contract because of this incident. She bought raw materials from her savings for this work so she is in a confusing situation.
Is one of my respondents who is engaged in the making of different styles of Leather Shoes both for men and women. He started his business 9 years ago by being so energetic, happy and by giving all the possible effort to his work. He used to work by renting a work place, however he found it so difficult to balance his income with that of all the things he’s supposed to pay especially for his rent and for employees’ salary. Even though he worked 8 hours per day and 6 days per week, he was not able to grow and enlarge his business. He found his working environment becoming so difficult and he was not able to sustain his business and save money out of it, so he used to work just for a day to survive.
A couple of years back, he found the current working place he’s at now from micro-enterprises. He can’t compare his rent with his previous one because it’s way lower.
A couple of months back when I was recording the report task, he was idle and mostly he didn’t open his firm and he reduced his employees because he suffered from lack of work as a result of the covid-19 and a very high, that is more than double, price of product increment of raw materials which had affected his business. He preferred that he buy the products from a retail market and not directly from the manufacturers, thus they doubled the price.
However, now a days, he’s so thankful that his business is changing to be better and he is even able to hire new employees and he’s getting a profit especially by participating in exhibitions for different occasions and he’s hoping he’ll gain his profit and attract customers for the coming new year’s exhibition.
Today’s story is about ET898. We have already introduced her to you previously. She is a very strong woman. As we wrote, she had many plans, one of which was to start selling coffee in the stationery. When we went to see her this week, she has started it and is doing well. We have also started recording her income. This coffee making business is not only a source of income but it is also a source of great joy for her customers. Because most of the time there are so many people coming together to write a contract. It takes a long time, but now she has provided a place for them to relax. Not only that, but she has a lot of plans for the future. She plans to start printing and advertising services. Based on her research, there is high demand on the printing services like t-shirt and banner printing.
Overall, her work is going well. When we found her, she had a lot of customers and was very busy. All this is good, but she told us that she is about to leave her working place. This is because her working place owner asked her to leave the house if she did not pay 17500 birr per month which is 27% increment from her current renting cost. She told us that currently her profit is decreasing due to our country’s economic inflation. So she is not ready to afford this working place’s rent expense and now her plan is to look for a better place if she can find one.
ET179 owns a carpentry. When he first started this business, it was with other members together. However, other members left this firm and currently our respondent owns the firm solely. Currently, He has three employees and he pays them by price rate. The sustainable price increment became a serious problem for his firm. Moreover, he sells wood furniture for retailers with low profit margin. The current weather condition is another challengs for this firm reducing its productivity.
Before a month, after he took partial payment from his customers, he was robbed by a thief and was forced to pay it, which is an additional challenge for his firm.
ET 562 – is a garment sector, working on tailoring male clothes business. She is 45 years old and a mother of three children.
Eight years ago, the respondent was thinking about the idea of opening a garment business. At that time, she was working in Dire Dawa cotton factory. After she retired, she planned to open her own business that matches with her previous profession, but the condition was not suitable for her. She has planned to open other businesses and work as food preparer. After she obtained some money from food preparation works, she opened her own garment place. Initially, she started her work with a capital of 8000 birr by receiving some garment products and selling it in retail. At that time, she was providing the service alone. After that, she understood the benefit of the business and she planned to expand it. She took some money from her friends in addition to the saving income that she had gained from the business. She bought some sewing machines and rented a wide house. Then after, she added some employees and expanded the business.
The gross monthly income from the business is around 80,000 birr. She hired three employees working full time and totally paying more than 25,000 birr per month. Also, she shared her experiences with her son that came from Dubai and her son opened his own garment place.
The respondent is critically facing a challenge with the late payments from her customers and the ever increasing price of raw materials and price of rent. The other challenge is the difficulty of getting a person proficient in this work. This makes them not to furtherly expand the businesses. For the future, she is planning to improve these challenges and to increase her income.
She is among the cooperative respondents of mine on data collection.