WHY INDIAN BUSINESSES LAST LONGER THAN UGANDAN BUSINESSES

 Joseph (not real name) set up a retail shop and after a month he closed it because of lack of customers. The question is, what went wrong? The economic conditions under which businesses operate are tough with so many uncertainties. The cost of doing business is generally high. Uganda is credited as one of the most enterprising countries in the world. Unfortunately most of  these businesses do not last beyond the second birth day. 

In today's article I want to reflect on a question why do Indian businesses or companies last longer than Ugandan companies ?  How many Ugandan businesses go beyond the second generation? If they are few what leads to this state of affairs? Is it a cultural issue? Is it a lack of business management skills? We all know about Mukwano and Madhvani industries. These have become case studies for years in the Ugandan education system. The question is why is it hard for us to replicate the same practices among Ugandan businesses? Why is it that despite the fact that Ugandans are very enterprising that our businesses remain small and vulnerable to external shocks? 

Is there something special that we need to emulate from the Indians? Is the issue with the mode of delivery in the education system? I once observed an Indian bring along their child to the banking hall to teach them how to bank money. This is real mentorship. At the same time there was a report in the media of how a grand parent beat up their child for stealing two hundred Uganda shillings. So if this child was severely punished for stealing 200/=, what would happen when he grew up? Many of the African Children grow up while seeing money as an "enemy". So their dominant belief when they are adults is to wipe out any money that they possess. I have also interacted with university students who have a dislike for financial literacy training yet this is a key intervention in enabling them to become effective leaders of tomorrow.

The lukewarm perception of financial literacy messages in some sections of our society directly translates into the way businesses are handled. In many cases small businesses are disrespected and funds are misused by the microentrepreneurs. When business funds are misused it affects the cashflows and then within no time the businesses close. This affects both government and entrepreneurs because of loss of revenue and livelihood for the entrepreneur. We have seen cases of an original founder of an African  business empire dying and his assets are sold immediately. The question is, what causes this state of affairs? The question is why is it a normal occurrence that when the owner of the business dies his empire in most cases also vanishes? Could it be that as Africans we do not have a long regard for long term ventures? Is our discipline lacking in terms of corporate governance and stewardship? The late leader of Agakhan died but the empire is still alive and growing. Why is this so?

This article is not an attempt to underrate the efforts of the so many hardworking Africans who are toiling to keep their businesses afloat. Rather it is an attempt to analyze the prevailing notion of African businesses not lasting beyond 2 years compared to the Indian counterparts.

HOW TO CREATE SUSTAINABLE ENTERPRISES.

1.Think long terms

2.Children should be taught about entrepreneurship at a young age.

3.Financial literacy training should be emphasized at a young age.

4.Successful entrepreneurs should be recognized

5.Vocational education should be strengthened

6.Patient capital is key

7. Digital literacy is key

8.Provision of subsidized Business Development Services.

Ugandans are very enterprising individuals. The sad fact is that despite their entrepreneurial potential, most of their businesses their do not last more than 2 years . On the contrary there are some Indian families such as Madhvani whose businesses have lasted for decades. This is what the article has attempted to analyze.

For individual and corporate financial literacy training contact :

Coach Phillip Kiryowa 

Personal Finance Coach (CMA)

Master Trainer Bank of Uganda 

Founder, Advanced Empowerment Link

+256752615916

For Financial Freedom and Sustainable Enterprises

Comments

  1. Andrew SsaaziMay 14, 2025 at 12:36 AM

    This is deep,
    I think most of us learn entrepreneurship the hard way, for instance when all options to getting a job have failed, then we resort to starting a biz.
    So, such teachings should begin from childhood.
    But that Grannie who beat up the child for stealing 200= 🤔😎

    ReplyDelete
  2. PHILLIP KIRYOWAMay 14, 2025 at 7:21 PM

    Thanks a lot Andrew for your insights. I totally agree that entrepreneurship education should start at a young age.

    ReplyDelete

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