Hello Pastor Fred,

I just wanted to comment on this task, but it is somewhat related to other tasks. Self-sustainability always seems to be a big topic for most projects and it is one of the most important. Before gathering ideas from the world, maybe take a step back and look at what is being done locally already. Ask yourself, your organization and your community a number of questions such as:

What is already successfully being done in the community and in the markets in the area?

What services or products do people want and/or need locally?

What businesses are successfully being operated without outside assistance?

What skills are available in the community that could be looked at to generate income? Think not only of selling products, but also selling skills.

What needs or gaps are there in the current markets that people would be willing to pay for? Is there a service not being given? Is there a product that is hard to get locally and people would be willing to pay for?

What are people willing to pay for and how much would they be willing to pay?

If you are looking at specific ideas ask whether or not that idea would generate enough income to make it worth all the time and energy and cover all costs with a profit still being made. For example, if it takes a woman 8 hours to make a handcraft that she can only sell for a few UGX, then it would not be worth the time. Look at all the capital cost involved as well such as materials, equipment if needed etc, and ongoing or one-time operating costs. This could include space to rent, salaries, materials and/or tools, travel time, and so on.

There is much information available locally and that information should be gathered first. You and the community members have the knowledge and know want is wanted and needed and willing to be paid for far better than anyone else. Once that information is gathered, then input can be provided to asses whether the ideas are feasible and able to generate enough income to create an ongoing source of revenue for the project.

Barb

Thank you so much Barb,

Your message means a lot to me and the Zabef Village well you talked to many important point to consider
i am very happy dear, but according income sustainability we are looking at computer business (internate) in our areas it can work better , we can get skills for our people, children as well as income .

Please i am happy for your comment if possible keep on advising.
God bless
Pastor Fred.

Pastor Fred,
from your last comment here it sounds like your community would like to start up an interent cafe. Did I understand this correctly? Is that what your community has identified as the best source of income generation and providing new skills for the youth?
If this is the path you wish to go down then we need to start identifying all the requirements for setting up a business like this.
Let us know!
carolyn

Praise the Lord Carolyn DV,

You understood me well because in our town of Jinja many thousand people are using internet on high speed so it's very true it can work as Income and the same provide skills for the youth and this is what is on our finger tips right now if we can get advice and requirements to set up soon.
Thank you so much for your quick contribution towards our village development.
God bless
Pastor Fred.

Hi Pastor Fred and Carolyn,

If an internet cafe is the route the community wishes to take, the next step would be to sit down and write up a list of all that is needed - all the resources required to start this up.

List things such as equipment, space, staff hours, supplies, electricity, etc. List the items needed for start-up and one-time costs as well as on-going costs. For example, an ongoing cost would be electricity and technicians to keep the computers running properly.

Then list what is available locally and how much everything costs. The key is to find out what the expenses are and how much revenue you think can be generated. If enough revenue cannot be generated to make a profit, than an alternative idea may need to be considered. Also, take into consideration what would happen if there was no outside help. What if no organizations or individuals assisted? Could the project be sustained? This is a valuable question to ask of every project, because if funders or donors leave or do not come forward, the community still needs to generate income. And eventually, all NGOs leave. This should seriously be considered and accounted for.

Once the list is done and some projections made - consider where the funds will come from to get those items. Are you expecting funds or computers to come from outside of the community? Will community members contribute small amounts to get things started? Where will the initial capital come from? If that is clear than tasks can be determined on what to do at that point.

Try to also include replacement costs of computers in your estimates and budgets. Internet cafes have ongoing expenses and the cost of replacing a keyboard, a monitor, a hard drive and software must all be considered in the expenses as well.

The last question I have is related to a comment you made about internet cafes. You mention that thousands of people use internet cafes in Jinja. Can the community support one more? Can this internet cafe compete with them and generate a profit? If there is too much competition and the market is saturated, then it will be difficult to generate enough revenue to continue to operate and generate enough income to support other projects.

Lots of questions to ask, but the more you examine this, the better!

Warmest wishes,

Barb

Hey Barb,

This is was very great for me and my friend to think deeply how we can move on with this issue and i am trying to get the information which will help me to Answer the all questions in your remarks and i hope it may help as more.
Soon we are writing back to you or any one here can adivce.
God bless
Pastor Fred.

Hi Fred

The description for this task says "For the organization to become self-sustainable, alternative sources of income need to be brainstormed. These can include: commercializing handcrafted products, internet café, nursing, farming.", but your main focus appears to be just on setting up an internet cafe? Or do you hope to do other things too?

I would agree with the questions asked by Barb about assessing the most suitable ways to create income, they are very important. As well as looking at the big things, look at smaller things that can be set up with little or no outside money too. For you, computers may be your link with the outside world, but do others in your community share that interest or would they prefer to base the business ideas around things they are more familiar with?

From experience with Jinja Central and Anai Acoke (Lira), setting up an internet cafe and/or computer training centre is not easy, it can take a long time to get running, then more time before it starts to make any money.

I would suggest talking to others who have done what you want to do, learn from their experiences. This may give you a better idea of whether an internet cafe is really the best solution to your income needs or not.

Do you know Paul Bulenzi, LR of Jinja Central? They have set up a computer training centre, and hope one day to add internet access too. I am not fully up to date on their current situation, but last I heard they were not making much money from training - they train paying customers as well as members of their organisation. If you have not already, it would be a good idea to get in contact with him and learn from his experience especially as you are in the same town!

Sabbath Obua, LR of Acoke, may also be able to give some good advice. They run a computer training centre (free training to young people who cannot afford to pay, also paying customers) and internet cafe. Their long-term intention is that the internet cafe generates income that they can use for other projects, but they are still at early stages so that is not happening yet.

I am not trying to say "Don't do it!", just suggesting you look at other options as well.

Mary

Oh Mary and every one helping this project to move to other step your doing big change in children and widows lives big change, your most welcome and feel free to share any good advice as your doing, right now i have been in contact with Paul Bulenzi Center and advising them even even i have reached many time to the center my self i know what is going on and as you know always start up step business is not simple and profitable i believe this Center their about reach their target when they reach the step of having the internate in the place they will have done a big step now getting only income,they have finished wiring all the computer ready for the internate and they will do well that's what i know, Mary and others many things mentioned on this task but i request to be guided to be focused a bit on one thing if we are through then we can come for others, per now in Jinja internate Cafe business are few to the number of customer if you do good survey as i have done it,so it will work better for the income and skill for our orphans and widows so here comes my humble request to members to have the ways of getting the sources of computers, how to get internate in the place.

Thank you so much for the wonderful adivices and encouragements.
God bless
Pastor Fred.

Hey Barb i have attached for you the file about the internate .

Internate Cafe.doc

Hi Pastor Fred,

I will read over the document and make comments shortly.

Barb

Hi Pastor Fred,
I've had a look at the document you attached reagrding the start up of an internet cafe in Zabef. Many thanks for getting that information together- it will help us all make better suggestions.

Firstly, I think there are a couple of mistakes with your calculations Pastor Fred. They are: Switches cost UGX80,000 x 4 = 320,000. NOT 240,000; Public Phone: 4 x 180,000= 720,000 (not 2,400,000). So I now have a total of 14,440,000 (equivalent USD7578)

Could you please clarify a couple of things:
1- is the 600,000 telecom connection fee a one-off fee that you only pay once?
2- You refer to monthly subscriptions of 180,000. Please explain what this fee is about.
3- You mention that there is competition from other internet cafe's however your cafe could provide reduced per minute rates of 20-15/ I would be concerned that in the long trm you may lose profit. It's ok to offer a special reduced rate to attract new business tot eh cafe- but we need to figure out if it is sustainable for the cafe to continue to provide a discounted per minute rate. I am not an expert at these things but hopefully someone else here can help with figuring this out.

These are my questions for now!
Best regards Carolyn

Pastor Fred, one more thing...it may be written elsewhere on this Village, but is there an actual building or room where the internet cafe can be set up? I know the community has land however is there a structure on it that can be used as the cafe? Sorry if this seems obvious!! Thanks :)

Hi Pastor Fred,

First, thank you for putting this together and addressing some of the questions I have.

I have a few comments and further questions:

In the budget all the costs are listed together. Which are one-time costs and which are monthly costs? These would be two different budgets. There should be a budget for start-up, and then there should be a monthly operating budget. So to clarify I have separated them out here in the attached document. Since I don't have prices, I cannot add those amounts.

Also, there are some items in start-up and monthly costs that are not included. I have added some, but there are probably more to add.

The next part is the revenue. There has to be a projection of how much can be generated (even if just an estimate) on a monthly basis as well as a projection to show how long it would take to generate back the start-up costs. The start-up costs should be spread over a reasonable time frame and the cost divided by that time frame. For example if it is reasonable to think that 5 years is a good time frame, the total start-up cost should be divided by 60 and that amount would be how much you should add into your monthly costs to recover costs. You can't be considered to be making a profit until those capital costs are covered.

In looking at these numbers, it seems it would take a very long time before any income can be generated. You have to take capital costs into consideration, as you may not have outside support and there is always the need to replace items, especially when it comes to dealing with computers and technology. If the assumption is made that all start-up costs will come from an outside donor, than it may look like this project is feasible, because you have an advantage over other businesses. However, what happens when a computer needs to be replaced - who replaces it? What happens if your business is growing and you need to expand - who buys the new items? Who is going to pay the salaries of the staff until the cafe starts generating income? What if not enough income is generated one month - who will cover the costs? And the biggest question of all is where does this start-up capital come from.

You mentioned that the community is very poor and has no money. I understand this. However, the community should have a vested interest in the project - and by vested I mean they should be making a contribution to ensure that it is successful. If you are to take the route to find a donor for these items, most donors/funders will require that you shown some meaningful contribution by the community on a regular basis. It is a sign of commitment, investment and ownership. I know it is very hard to ask someone with very little to give money - but maybe you ask each community member to pay a small amount of shillings to get things started, as an investment in the business. So if there are 100 people in the community and each makes a 50 shilling contribution then there are 5000 shillings to start things up and show ownership. These people would be like investors in the business. They could be paid back after a fixed period of time, much like any other investor would. By become investors, they take ownership and responsibility for its success. If there is no meaningful contributions by those that will benefit from the project, then there is little chance of long-term sustainability. I know this may sound harsh, but so many projects that depend on outside funding for everything fail. And there are many examples of how even small contributions by community members can lead to success.

What about starting a few smaller projects to generate income for this larger one? Once you have a pool of some funds, you can either begin purchasing equipment or apply to organizations or programs to get a loan or funding for the rest of the equipment. It would greatly improve your chances of receiving funding if you have initial funds that have come directly from the community and you would have a proven track record that small business ventures are being efficiently managed. More and more organizations are looking for these.

In addition, you mention that it would take a very long time to raise funds directly in the community - however, the same can be said for start-up projects with the expectation of outside funding. There is much competition from funding dollars and as many other projects on Nabuur can attest to, it can take a very long time to get a funder to back your project, especially a start-up project.

I know this is a lot information here and many questions, but I think these are critical to moving forward and making a sound business plan that is sustainable and well thought out. Many of these are questions a funder would ask and you would have to address, so it is better to address them now.

Barb

Internate Cafe 2.doc

Hi Fred

Thanks for all the information. I can see you have been thinking about this.

I agree with the comments and questions from Barb and Carolyn.

A few more questions:

Whose idea was it to set up an internet cafe - was it a decision made by GIDDCO after consultation with your members, or is it mostly your idea? I suspect that many of them have never used a computer, so am interested to know what they think would be the likely benefits of the project.

How will having a computer centre in town improve the lives of those who live out of town?

I assume from another task that even when you are connected to the mains electricity supply, that is not reliable so you need a generator and/or solar power too. Or is that task referring to another building in a different place, that you are using for other activities?

What would be the main purpose of the computer centre? For example do you see it mostly as a source of income through providing internet access and training to paying customers, or as a place where your members can get computer training for free/low cost, as a mixture of the two?

If you will be training members, are these skills likely to lead on to employment for them? As you have been talking to Paul, it would be interesting to hear how many of his members have got jobs or started their own businesses because of the computer training they have received.

Do you have members with computer skills who could run the place, or are some of them going to be trained (add the cost of training courses etc to your startup budget, or will you employ trained staff from outside your organisation?

What ideas do you have for other smaller, simpler projects that could be set up with little or no outside funding?

Sorry, lots more questions!!!

===
Barb, I don't think all your figures add up! But that can be corrected later.

Mary

Hi Mary,

You're right about the numbers not adding up. I forgot to make the corrections Carolyn pointed out...

Thanks!

Barb