SMEs digest: Young man reaps big from water dispensing business

Dar es Salaam. A young man is changing the narrative of access to drinking water in Mtwara and Lindi regions.

Mr Mwang’ine Madenge is capitalising on the saltiness of water in the regions by bringing to the residents water that they require to quench their thirsts.

Using the money that he got after engaging in mining for three years, Mr Madenge decided to invest in the distribution of natural water from the Ndanda Spring by using local technology.

He currently owns 23 water tanks, each with the capacity for 5,000 litres of water, and which he has erected in various parts of Mtwara and Lindi towns – a project which has opened up opportunities for the youth and women who engage in small businesses.

According to the entrepreneur, much of the water supplies in the southern administrative regions are salty – thus making it difficult for most local people to readily access clean and safe drinking water. Those who can afford the luxury of bottled water have no such problem, as bottled water is aplenty in shops.

Despite the availability of natural water at the Ndanda Spring, the Spring is located afar, and cannot be readily accessed by most folk.

This is where and how Mwang’ine Madenge – the holder of a Bachelor’s degree in Mining Engineering from the University of Dar es Salaam (Udsm) – smartly stepped in the breach to provide affordable clean, safe water that is not salty to all and sundry in the two regions.

When he finished formal schooling, the young Madenge went straight into the business of buying gold from small-scale miners in the Nanganga area, believing that it was in the mining sector that he would become a billionaire. After all – he reasoned – “gold was everything in our world!”

But, as soon as he took up the minerals business, the price of gold at the world market began to decline, from 2012 to 2014 – and he ‘changed gears aloft,’ so to speak, turning to the water supply business in all seriousness.

This was especially after he had seen how much people were suffering from lack of ready access to drinking water: a challenge that induced him to conduct a survey on the problem.

What with one thing leading to another, Mr Madenge took up the challenge, deciding to start the water dispensing business soonest. That was how and why he left the gold trading business and took up supplying clean, safe, salt-free water – some of it bottled and trading in the name and style of ‘Ndanda Spring Water.’

How he started

Mr Madenge told the SMEs Digest that he graduated at the College of Engineering and Technology (Coet) in 2011 – and, just as soon started a minerals business using the Sh5 million his parents gave him in cash.

So, he went directly to the Nanganga area in Mtwara Region where he worked in mining for three years.

“When I was there, the idea of supplying water from the Ndanda Spring developed, so I used the money which I had raised from selling gold – more than Sh5 million – to buy two water tanks that I used in a pilot project,” he says.

In 2014, Mr Madenge officially started doing the business of supplying water. In due course, he started a ‘family’ factory, Ndanda Splash Limited, to produce bottled drinking water, which the family leased to someone else who just as soon failed to continue with the business.

Due to some challenges – including shortage of people to trust the business to – he had to use his parent’s water brand which was already in the market. This was a positive move.

After the business became relatively big, Mr Madenge rented his father’s factory and started producing bottled water under the same brand.

The company filters the spring water at the factory, and adds a little pH (indicating hydrogen ion concentration in water) so that it can be safe for human health. “We sell 20 litres of the treated water at Sh1,200, so it is affordable for most ordinary Tanzanians.

“Consumers in other parts of the country – like Dar es Salaam –don’t understand why our water is so cheap, for a litre of bottled water in the city and much of elsewhere in the country sells at Sh500,” he says.

The water business started to grow rather rapidly, and the Madenge company was receiving lots of orders for water from people. He, therefore, needed tanks for storing water for his prospective customers.

To that end, he borrowed Sh15 million from a bank, using his brother’s house deed as collateral. Mr Madenge was a good bank borrower, repaying his loans in time and in full as agreed.

Thus, he was able to continue borrowing from the commercial banks and Village Cooperative Banks (Vicobas) – a situation which enabled his company to expand the water supply business.

After borrowing more than Sh100 million from creditors, the company today has put in place 23 water tanks – and boasts three water delivery lorries.

Successes and future plans

To start with, Mr Madenge’s water business was very much localised to a certain extent, as it was still difficult to expand far and wide, for financial and logistics challenges.

But, in due course of time and events, things changed for the better.

“I will not forget the Digital Opportunity Trust-Tanzania (DOT-T), an institution which guided and mentored me via training on how I can expand the market. If you can remember, I only graduated in Mining Engineering, and I didn’t know anything about business: how to brand one’s products so that the business can gain trust,” Mr Madenge says.

He attended a training programme known as ‘Daring to Shift’ which – among other things – taught him how he could use digital platforms to promote his business and impact communities.

“That training helped me a lot,” he now says. “I can’t say that the ‘Daring to Shift’ mentors were the only ones who made me reach where I am today. But they were very helpful to me especially in imbuing me with modern and practical techniques of doing business,” he says – revealing that his company currently has 46 workers, 25 of them directly employed.

Noting that a large number of women in the southern regions of Tanzania undertake small businesses in bona fide efforts to support themselves, their families and their close relatives/dependents, Mr Madenge said many of them are now in the business of selling water as water kiosk attendants. For some, this is part-time business, for which they are paid commissions.

“We normally install our water tanks in areas where women are doing small businesses and, in addition to those other businesses, they can also sell for us water – thus supplementing their meagre incomes from their petty trading.

In addition to selling raw, unprocessed water, Mr Madenge also produces bottled water which is traded as ‘Ndanda Spring Water.’

The Madenge business sells about a million litres of raw/unprocessed water a month, and between 30,000 and 80,000 cartons of processed bottled water – all depending on the season and other factors.

The company also supplies water to various government and private institutions, including the parastatal electricity company Tanesco in Mtwara Region.

Mr Madenge revealed to the SMEs Digest that the company’s capital has grown to a relatively respectable Sh150 million. But it nonetheless does have formidable challenges to surmount, including adverse climate change, which can play havoc with spring water supplies.

In that regard, the company has embarked upon a project to drill deep water wells, as well as take up rainwater harvesting as appropriate.

“The water supply business is good, and the locals appreciate what we are doing. So, plans are under way to introduce high quantity water packaged in five-to-ten-litre containers for high profile customers,” Mr Madenge says – adding that “the goal is to make sure that our products reach customers wherever they may be, and regardless of their income levels.”