How businesses around universities are adjusting to students ‘economic situation'

BUSINESS | EDUCATION | STUDENTS

KAMPALA - On a hot Saturday afternoon in Kampala, I find Fred Obonyo, a student of Makerere University Business School (MUBS), buying a Rolex along the streets of Kataza, a suburb near the university.  

On probing him about his liking for the famous Ugandan delicacy (rolex), he burst out into laughter and made an honest remark. 

 “Actually, I would love to also eat pizza from Café Javas but I can’t afford it. I can afford this rolex worth sh2000 unlike the pizza which takes almost sh40,000 from me at a go,” he said. 

Obonyo says that he solely relies on the money he gets from his parents and spending with caution is something he has to put into practice. 

He asserts that most of his colleagues at university spend majorly on four items including food, entertainment, electronic devices and personal care products. 

“The ladies love to keep glowing skins and so the market for skin care products is there but for me, as long as I have eaten, the rest can wait,” he said. 

For Obonyo and many other university students across the country, their expenditure limits their ability to constantly access ‘high-end’ services such as fancy food from five-star hotels and restaurants. 

However, to fit into the financial constraints of students, many businesses that operate within the area scope of these institutions have adjusted their prices. 

Racheal Nantume, who owns a bakery shop around Uganda Christian University (UCU), says that the prices of her products are favourable for students. 

“I am using a value-based strategy where the students buy what they can afford because there is a variety for them. I have cakes ranging from Sh1000, Sh2000 and even Sh3000 with the difference being in the ingredients used,” she said. 

Nantume says that she also employs the economic strategy of buying in bulk and selling in large numbers. 

“Instead of buying one kilogram of baking flour which will mean that I sell each cake at Sh1,200, I buy two kilograms and sell in huge numbers at a lower price of Sh1000. That way, am able to earn a good profit,” she said. 

According to Nantume, creating a harmonious relationship with students ensures that the market is constant and large. 

“I even give them cakes and they pay later at times. This pulls them back and keeps my market intact. I also have a lot of one-on-one conversations with them.” she said. 

Annet Nagujja, a businessperson who sells clothes around MUBS says she chooses the clothes she sells according to the demands of the students. 

“Girls at Campus are interested in body-hugging dresses, skimpy skirts and light blouses. I cannot go and purchase traditional dressing (Gomesis). They just don’t have the market here,” she said. 

She highlights that she has to keep studying the trends of students by not only engaging with them but also checking out the latest stock on the internet. 

“I like to be a step ahead of the students. Before they even get to know of a particular new shoe, I am in the know of it and all its unique features,” she said. 

She acknowledges that on top of ensuring fair prices, it is also important for businesses to study the trends of students’ wants and needs because they keep changing over time and act accordingly when making business decisions. 

Thadeus Musoke Nagenda, the chairperson of the Kampala City Traders Association (KACITA) says that businesses within the scope of universities should ensure fair pricing for students. 

“They should reduce their operation expenses and minimize the profit gap to have a realistic price for their products. Otherwise, students will always choose cheaper alternatives and if they don’t adhere to that they end can incur losses,” he said.