Guidelines on How to Start a Successful Milk ATM Business
Milk is an essential consumer commodity that is consumed every day in most households. This means that there is a ready market for anyone who wants to venture into this business. However this does not mean you are guaranteed to succeed in the business if you don’t plan and run the business well. In this post we will be sharing guidelines on how to start a successful milk ATM business.
Guidelines on how to start a successful milk ATM business- Preparations
Before venturing into any type of business, doing a market survey of its viability is very important. A good survey helps you determine if the business is worthy investing your time and resources in or not. Surely you don’t want to invest your money no matter how little in a business that is going to fail. No one gets into business to fail.
Another importance of doing a market survey is it helps you know if your target market is the right one or not. For example not all target groups are likely to buy milk from an ATM because some prefer to buy packet milk from top brands despite the price.
But as for you, you need to target those of the middle or low income levels who buy in small quantities. There are also those who will come with different amounts like ksh 15, 25, 30, 75 etc. with a milk ATM you are able to conveniently serve them.
Identifying a convenient business location
The other very important aspect to take care of before starting is identifying a convenient location for the business. It has to be easily accessible to your customers. Visibility in business is key therefore you need to find a place you are visible even to passers-by who are new to the area or not conversant with it.
Renovating the business premises
When it comes to renovating the business, this really depends with if it’s really necessary. There are some premises that might not need any renovation, others minor and yet others might require some serious renovation. When renovating have in mind that you need a client serving area, space for the equipment like milk ATM, freezer/chiller, shelves etc.
Guidelines on how to start a successful milk ATM business- requirements
Before starting the milk ATM business, let us look at some of the most important requirements to enable you start and operate the venture successfully.
KDB approved milk ATM
Kenya Dairy Board(KDB) is the industry regulator of milk and milk products production, processing and distribution. They have guidelines for standards of the equipment used for handling milk and its products along the entire value chain from milking to the final consumer.
As a result they have guidelines on what milk dispensers(ATMs) fabricators should meet. For example, the milk ATM must use a KDB approved food grade pump. You should therefore go for a milk ATM with a pump that is KDB approved.
In any business, suppliers are very important partners. They can make or destroy a business. You need reliable suppliers/source of your milk. The supplier(s) must be able to supply you with good quality milk handled in a high hygiene environment.
The supplier(s) must also be able to supply you consistently and on a timely manner. Failure to do so can have negative implications on your business because your customers might if you aren’t reliable. If also your milk goes bad easily and breaks when making tea or is adulterated with water so that it makes low quality tea you also risk losing customers. You must therefore ensure these aspects are put in check.
Milk is a product that must be handled in a very hygienic environment. This means maintaining cleanliness is paramount. It includes cleaning the equipment as well as the premises on a daily basis or even more than once per day if necessary. To be able to do this you need reliable source of clean water. You therefore need to ensure you have made arrangements for the same.
Food handling certificate
Another very important requirement for a milk ATM business is a food handling licence. The county health department is very keen on this so ensure you get one before starting to operate to avoid getting in trouble.
A business licence is a requirement for any legal business to operate in Kenya. This licence/certificate is normally issued by the county government. You should visit your country government offices the licencing department to get the certificate.
A milk ATM needs electric power to function. It needs the power for the cooling mechanism, running the pump and operating the PLC unit. You must therefore ensure that the premises you will be using has reliable power connection.
There are some optional equipment but very essential if you really want to succeed in this business.
Milk chiller or freezer
A milk chiller is good for storing your milk stock if you buy in large quantities. It helps you store more milk to avoid running out of stock at a time when your supplier can’t be able to deliver at that particular time. This is because suppliers most likely have a schedule on when they supply.
The alternative to a chiller is a chest freezer. The only challenge is that a freezer is you need the milk in an additional container and sometimes the freezer can make the make the milk to freeze to a solid form. But a chiller keeps it at a low temperature but in liquid form.
A milk pasteurizer is another optional requirement even though it is a KDB requirement that milk sold via a dispenser must be pasteurized. However if you are dealing with large quantities of milk sourced directly from the farmers, having a pasteurizer is very important.
While you can pasteurize your milk using traditional methods like direct boiling using a sufuria, it does not produce the best milk quality because there’s a likelihood of the milk burning. Not only that, it is expensive and time consuming.
The most recommended option is to pasteurize your milk is using a milk pasteurizer. Pasteurizers don’t do directly heating because water inside the chamber is what is directly heated and it produces steam which in turn heats the milk.
Another alternative if you don’t want to invest in a pasteurizer is to buy pasteurized milk from a supplier instead of buying from farmers. This is also a very convenient option even though the profit margins might be reduced. However it saves you time and the hustle of collecting milk from the farmer(s) and then pasteurizing it.
Scaling up the business
It’s never a bad idea to scale up your business and with milk ATM business you have a few options you can go for. Let’s discuss some below:
One of the best ways of scaling up this type of business is making yoghurt. If you know how to make it you can try different flavours and sell to your regular customers. This is called value addition and helps you sell even more milk at a higher price and therefore more returns.
In addition to yoghurt, you can also add fermented milk commonly known as maziwa mala or maziwa lala in Kenya. This also helps you sell more milk at a higher price.
Selling snacks & pastries
Most people take tea or milk with some accompaniment. That is why adding snacks and pastries like bread, cakes, cookies, scones etc to your list of products can be a good idea. You can make these on your own if you have baking skills and necessary equipment or you can buy from a baker who makes them.
It’s our hope that the above guidelines on how to start a successful milk ATM business will be of help to you. With careful planning, you can easily start this business and succeed.