We have high levels of unemployment in Zambia and more than 60% of the Zambian population lives on less than 2 dollars a day. The rates of inflation are high and the cost of procuring food and brand new stuff is high but people are able to save between $40 And above for emergencies..
The cost of borrowing from banks and other financial institutions is close to 50% rendering it a risk to borrow. And very few people have collateral..
I run a base in my neighborhood where I buy and sell used household goods and business is excellent and the profit margin is between 50% to 200%..
Used house hold goods tend to be cheaper and within the means of almost everyone when the economy is not doing fine. That's why I have a good customer base. I sell my stuff just outside my househouse on the roadside where a lot of cars and pedestrians pass..
about 3 weeks ago I invited friends who had monies in their homes and if they wanted to grow them by more than 50% on their equity..
I collected an average of 50$ from two guys and about $ 100 from a third guy. I went to the auction and bought stuff from the 3 amounts including my own working capital..
Within 10 days I was able to build an additional 50 to 60% on their equity that enabled the guys to buy more grocery and to pay rents etc..
The idea is to ensure that the idea does not turn into a pyramid or ponzy scheme by ensuring that invested equity is attached to actual purchased stock. Furthermore if the business grows a portion can be set aside with the insurance companies for any unforseeble losses or risk. But the risk should be as minimal as possible..
This idea if well harnessed and managed can lift a huge number of people in communities and countries that are still developing such as Zambia.
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