I’m Nicholas from Nairobi. I have drawn frame-based matatu designs since the late 90’s giving me vast experience on the trends and needs in the sector.
Budget Breakdown (approx)
We can connect you with the project owner if you would like to fund this project directly
Problem Statement
The National Transport & Safety Authority (NTSA), KS 372 vehicle bodybuilding standards, made it mandatory to build with anti-roll bars in the framework. In Kenya, passenger service share taxi vehicles are custom body build individually. This proposal seeks to improve upon the framework as per the NTSA standard but deliver aesthetic standards higher than what exists in the market currently. The aesthetics needs in matatus are driven by the youthful commuters who are the majority and are usually choosy and will only board a pimped vehicle. They are the high spenders in the matatu market and the vehicles they prefer are the latest design. This leads to higher daily takings for vehicles that are pimped. The ultimate direction for growth is to have the share taxi global trends influenced by trends in Kenya in terms of safety and aesthetics meaning our vehicle will be the point of reference. Accidents rates are much higher in the developing world. You can see the information on accidents rates on Wikipedia.
With a firm hand on the apex of the Kenyan industry, it will be possible to generate direct linkages with vehicle manufacturers to develop a share taxi vehicle with the following attributes:-
i) High Safety Frameworks – If the developing world should be involved in the production of their share taxi vehicles, they will most definitely have more toughened frameworks to deal with high occurrence of high carnage accidents.
ii) Efficient, Effective and Aesthetic designs – Currently in Kenya, we are using body on frame type of chassis. The only reason vehicles with Unibody type of chassis have not been adopted yet they would be cheaper to maintain as they are lighter and in case of accidents they could be safer, is they are aesthetically too far below the radar and are usually lower ground clearance. We would develop an appropriate share taxi vehicle that suits us in those regards. You can see details about differences in chassis frames on Autonews.
I started drawing frame-based matatu designs in the late 1990s. I have engaged with lots of industry players. This can be deduced from the pictures I have shared. I have visited over 15 bodybuilding workshops. CHODA who were until recently matatu design market leaders over the last 8 years or so are part of the workshops I have been to. CHODA FABRICATORS, however, overdid themselves and build their bodies too heavy which has forced high maintenance costs and poor reuse, resale values to vehicle owners, to deny them continuous stay at the apex. I have spoken to over 1000 vehicle owners and even Sacco managements (Sacco managements are the companies approved by the government to run routes in the country – vehicle owners must become members of a Sacco to operate their Matatu in various routes). I now have an agreement with Plateau Motors who are dealers for Mitsubishi Fuso and they have done some patent work with a tourism vehicle and are also sitting in the Kenya Vehicle Manufacturers Board (KVMB). They will provide technical and industry insider coverage for the project as well as quick patent processing. Their role is important at these initial stages. The Initiator/Designer will build other engagements for growth in the market once the start-up is done with.
Situations pointing to the possibility of high chances of success in the market include: –
- My design embeds the NTSA standards aesthetically in the matatu framework. Vehicle owners will now find that it will be weaved into the design of the vehicle.
- Having matatus owners’ networks, having industry insiders willing to work with me so that their product (Fuso) can find traction in the market.
- The most important intervention will be the provision for solutions to road safety, a recurring matter in Kenya.
- Finally, this is a highly niche and unique proposal building upon trends that have remained in place since matatus started being pimped.
Project Details
I target high-end matatus owners. These customers have bought from the fabrication market design leader over 2000 units (CHODA) (conservative estimates) in the last 8 or so years and now that the design is bust, there is a vacuum for a new design in the market which we shall fill. My design will offer a vehicle with higher safety standards due to reorganization in the framing in a way that ensures the matatu looks better, but with a more strengthened framework. Once the prototype is delivered upon, there will be news articles both in the electronic and printing press, launch and then we shall take this and by word of mouth whisper to owners, managers and Sacco managers.
The differentiation of my offer starts with the patent. With patent coverage, it is a clear differentiation that generates value for investment. It will start a new era in matatus as no one has ever filed for patent rights. This design will generate revenue by charging each person who wants to use parts or the entire package and will only be allowed to do so after making prescribed payments. For each unit produced an agreed percentage will be charged off the bodybuilding cost. Currently, the suggestion is 10% and averagely the body for a 37-seater at Plateau costs KES 1.5Million.
The cost structure which included variable and fixed costs is indicated in the budget. While the prototype is being discussed, a company will be developed based on shares, and agreements developed by the partnership including strategic partner(s) return on investment, and an exit plan will also be worked out before the company is registered.
Ready-made trucks could also be another opportunity to explore as vehicle owners suffer untold waiting and follow-up procedures while body-building. So far all-ready-made offers attempted have had below standard aesthetics and never picked any traction with the market. To add on to the marketing portfolio, the vehicle will be branded INEOS 1.59 – Eliud Kipchoge and we shall have changes in seats (which have largely remained similar) and roofing in the interior to drive the discussions.
Budget Needs
The project will require certain legal procedures including patent registration, registration of the company(s) involved, etc. These costs are included in the budget. Plateau Motors premises will be used as the host premises.
The machinery for this project is the prototype production, which will be provided by Plateau fabrication procedures. The design will require the purchase of the Chassis and Cabin (Mitsubishi Fuso FE85CH), bodybuilding, payments to components of the design (aluminum die-cuts for windows), development of new windows. We shall hire the graffiti artists who will be paid for their work and a separate budget line for the materials they will need to put together the final paint/graffiti finishing. The project will come alive upon delivery of the prototype. Once developed, the prototype can be sold ready-made to recover some of the costs used.
The project will require marketing to ensure that the target customers are fully aware of the new design, aesthetic, and associated advantages. There will be a launch for the new design where an appropriate venue will be secured, Stakeholders e.g., (NTSA, Sacco Management, Vehicle Owners, Commuter groups {In Facebook, for instance, I’m a member of several such as Matwana, etc.} and Media) will be invited. There will be media articles in local dailies and documentary will be developed.
Return On Investment
Actual figures
- Cost of Ordinary Vehicle (No Pimp up) – 5,386,000/-
- Cost of Vehicle (With Pimping) – 6,256,000/- (recovered by Sale price for Ready Made Prototype and the entire sales returns to the investor whole amount. If the investor chooses to run a matatu business, this cost will be removed from the cost of investment in the design proposal)
- Cost of New Prototype Pimped Vehicle 9,235,000/-
Real figure of investment
= Cost of New Prototype Over Pimped Vehicle – Cost of Vehicle (With Pimping)
= 9,235,000 – 6,256,000 = 2,979,000
- 1) My shares in this first company would be 40% with Plateau Motors having the rest for now; 50% will be dedicated to repayment of Investment and agreed on profit in investment.
- Costing of design product per bodybuilding 10% of Kshs. 1.5M which is Kshs. 150,000 of which 40% (Kshs. 60,000) is liable to the designer whereby 50% of this figure goes to the investor which is (Kshs. 30,000) per unit.
- Break-even level for investor – 100 units sold
- Profits to be made by the investor will generate Kshs. 900,000
3,879.170 – 2,979,170 = 900, 000 * 100 = 30% Return on investment. (300 more units).
2,979,170 - If launched well the 400 Units (Break-even 100 and 300 for the ROI to be achieved) needed can be achieved within a year or one and a half years.
SCALING
Scale Down
- The entire proposal can be delivered by using a used matatu. This could reduce the cost for chassis purchase though this would vary as such vehicle purchase will be dependent on many factors including the sale price and where possible the same owner gets a deal that will have their vehicle body replaced.
- This can also be achieved by lower capacity vehicles, though the design outlook might be affected by the ‘not so normal’ vehicle and it may affect the impact negatively.
Scale-Up
We can launch a number of ready-made vehicles (Maybe 2,3, 4 or 5) with one being the prototype and the rest creating variations of the final design as well as more buzz. These vehicles going to different routes may result in more buzz.
Comments
This is a wonderful concept. I know you have been into this for long, and you continue to grow in your thinking! I like the innovative way of looking at a common concept and for proposing security features blended with aesthetics! I approve this! Keep Shining!
One of those innovations that come along and you feel This MUST be supported…
With perennial high numbers of deaths, loss of limbs and livelihoods in accidents in Kenya, this will be a huge step towards reducing these losses in road safety…Great Innovation!
This idea is an out of the norm solution to explore since majority of kenyans are highly dependent on public transportation,it goes a long way in improving the safety and comfort of the passengers.Keep up Nick!
having been involved in the transport sector myself 12 year ago i believe this is a very good and innovative idea which will enhance safety and also improve the way way our PSV vehicles are operated.
Thanks, Roseline…I hope you have shared it…Thanks for the vote
Wonderful idea that can save lives
Very nice and timely proposal