21st-Oct-2025 • Reddington Onyango • Economic Trends
Small and medium enterprises (SMEs) in Kenya play a significant role in the country's economy, contributing to more than 98% of businesses and creating over 70% of employment opportunities.
However, staying afloat and thriving amidst the rapidly changing economic landscape can be challenging for SME owners. To help navigate these trends, let's explore key factors impacting Kenyan SMEs and actionable strategies to boost your business in 2023.
The shift towards digital adoption has gained momentum, with 86% of small businesses in Kenya adopting at least one digital technology as of 2021, according to a report by the Communications Authority of Kenya (CAK).
For SMEs looking to leverage this trend, consider implementing digital solutions like Lipabiz Technologies Ltd's business management and payments platform. This will streamline operations, enhance customer experiences, and improve overall efficiency.
The rise of e-commerce in Kenya has accelerated since the onset of the pandemic, with a 50% increase in online sales observed in 2020 compared to the previous year.
To capitalize on this trend, SMEs should focus on developing an attractive and user-friendly e-commerce presence. This can be achieved by partnering with experienced digital service providers or investing in platforms designed for small businesses like Lipabiz's integrated marketplace solution.
The Kenyan government has pledged to support the growth of SMEs by increasing funding and investment opportunities through initiatives such as the Kenya National Chamber of Commerce and Industry's (KNCCI) SME Fund.
SME owners should take advantage of these resources, as well as private sector financing options tailored for small businesses. Doing so can help provide the much-needed capital to scale your operations and navigate economic challenges more effectively.
Environmental, social, and governance (ESG) considerations are increasingly important for businesses seeking to attract investors and customers alike. By integrating sustainability practices into your operations, you can demonstrate a commitment to responsible business practices that will resonate with consumers.
Consider partnering with organizations like the Green Entrepreneurship Network (GEN) Kenya to gain access to resources, training, and networking opportunities focused on sustainable business development.
Finally, SMEs must prioritize adaptability and resilience in the face of ever-changing economic trends. By staying agile, innovating continuously, and learning from failures, small business owners can ensure their businesses remain competitive and thrive despite any obstacles that may arise.
In today's dynamic economic landscape, Kenyan SMEs have the opportunity to flourish if they stay informed, adaptable, and proactive. By leveraging digital technologies, embracing e-commerce, tapping into available funding sources, focusing on sustainability, and cultivating resilience, small business owners can navigate economic trends with confidence.