Eldoret International Airport, situated on a quiet highway in Kenya’s midwestern highlands, has a single runway and a modest cluster of terminal buildings. Built in the 1990s as a prestige project by then-president Daniel arap Moi, it was long thought of as a white elephant, an unnecessary piece of infrastructure for a small city in the Rift Valley.
But the airport, 310 kilometers from Nairobi, has undergone an unlikely reinvention as a point of entry for hard-to-find specialist goods, from car parts to studio equipment such as cameras, sound systems, and recording microphones, thanks to an innovative supply chain with roots in the global Somali diaspora.
Dan Aceda is a recording artist, songwriter, and podcast producer based in Nairobi. Over nearly two decades in the business, he’s seen how the explosion of digital platforms, such as YouTube and Netflix, have increased audiences’ expectations of quality. But achieving the higher resolutions and better audio that consumers want means getting hold of high-end equipment, which can be hard to source locally.
“Just a few months ago, I was looking for Shure SM7B microphones for the podcasting studio; I needed that crisp sound that this mic is able to achieve,” Aceda told Rest of World. “I called up the local distributor and they gave me a price of 80,000 Kenyan shillings [around $690] for each.”
Considering this too expensive, Aceda turned to a solution he’s come to rely on over the past few years. He ordered the mics on Amazon in the U.S., where they were listed considerably cheaper, and gave the delivery address as that of cargo firm Savo Store.
$1.5 billion The size of Kenya’s e-commerce market in 2021.Source: Seacom
Amazon does indirectly ship some products to Kenya via the Postal Corporation of Kenya (Posta), but few customers trust Posta to ship anything valuable. Instead, people turn to cargo firms such as Salihiya or its competitors, which include VituMob, Savo Store, and Kentex Cargo. Customers in East Africa buy from online retailers in the U.S., such as Amazon, Macy’s, eBay, or Walmart, and provide the cargo company’s warehouse address as the shipping destination. Shipping is charged by volumetric weight. The companies combine multiple orders and ship them to Eldoret, and onward by road to Nairobi, with some shipments going as far as Kampala, Uganda, and Juba, South Sudan. Customers can track their orders online, and typically receive a text or email when their orders are ready for collection or for home delivery.
By aggregating demand and shipping in bulk, the handling companies are able to keep costs down. Some have been able to squeeze further savings: VituMob’s warehouse is in Wilmington, Delaware, where there is no sales tax.
“On Amazon, I found the same mic at $440 and spent about $50 in shipping and handling with one of the aggregator firms,” Aceda said. “I had my mic delivered to my doorstep in a couple of weeks, and I saved $200.”
African Salihiya Cargo and Clearing is one of the largest players in this business. The company, founded in 1993 by Kenyans of Somali ethnicity, has been able to leverage a global network of Somali traders, who are able to aggregate demand globally to reduce costs, and ship through their affiliates and partners.
“The story begins with the collapse of the Somali state in 1991,” said Yusuf Hassan Abdi, a former businessman and diplomat who is now Member of Parliament for Kamukunji constituency in Nairobi, who represents the Eastleigh neighborhood of Nairobi, a bustling business hub in the city also known as “Little Mogadishu” due to its large ethnically Somali population. “This was the foundation of Somali diaspora networks that are found all over the world, from Nairobi to Toronto, Minnesota, Johannesburg, Dubai, Jakarta, and beyond.”
The diaspora networks organized themselves to set up routes for sending remittances back to Somalia, using the hawala system – a trust-based method of transferring money through agents that does not rely on formal banking systems, which had collapsed in Somalia. Soon, they realized that they could use their networks to move goods as well, and import-export businesses sprang up along the same routes.
In the late ’90s, some of those traders saw an opportunity in Eldoret. “They were looking for a less bureaucratic transit point [than Nairobi], and so approached Moi to use Eldoret as a regional cargo hub,” Hassan said. The president, keen to shake off the airport’s reputation as a waste of money, agreed, according to Hassan.
Today, African Salihiya brings in between 50 and 100 tonnes of cargo each week. The company consolidates its international orders in Dubai and leases planes from Ethiopian Airways to make two flights a week to Eldoret, Saeed Sidoman Sheikh, co-founder of African Salihiya, told Rest of World.
The company’s minimum order weight is 10 kilograms, meaning that most of its clients are small and medium-sized businesses bringing in stock to resell, but the company also takes smaller orders, acting as a “super consolidator” for smaller import-export firms. The prices offered by the Somali networks means that they are often accused of tax evasion by their local competitors, which Hassan and the traders say is untrue, but typical of a system that often discriminates against Somalis and Kenyans of Somali ethnicity.
Hassan said he can personally attest to the value offered by the Somali networks. “A few months ago, I needed spare parts for my Jeep — a set of four sensors,” he said. “I went to the local Jeep distributorship and they gave me a total price of 120,000 Kenyan shillings [$1,030]. I called up African Salihiya and their total price was $280. They sent it the next day by air, and I was sorted.”