Stress-test the business
Growth that hasn't been stress-tested is just optimism with extra steps. Before you take on a bigger lease, a new branch, or a fresh loan, model how the business behaves when one of the big assumptions breaks.
What this step covers
- Downside scenarios: a 20% revenue drop, a 3-month receivables stretch, a key-customer loss.
- Upside scenarios: 2x volume — can ops, cash, and people actually absorb it?
- A short risk register with mitigations the team can act on this quarter.
The detail
The three scenarios every owner should model
| Scenario | Trigger | Question to answer |
|---|---|---|
| Revenue shock | -20% revenue for 90 days | How many months can the business survive? |
| Receivables stretch | Top customer pays 60 days late | Do I have the working capital, or do I need a facility? |
| Key customer loss | Top customer leaves | What's the redundancy plan, and how long to replace? |
Risks Kenyan businesses underestimate
- Currency exposure — KES/USD swings when you import or pay licence fees in dollars.
- Fuel & power volatility — diesel, KPLC tariff reviews, and tokens that vanish faster than expected.
- Political / electoral cycles — Q4 of election years sees customer spending drop 15–30% in many sectors.
- Tax law changes — Finance Act amendments hit every June. Read them within a week of publication.
Build a one-tab cash forecast in Google Sheets with weekly columns for 13 weeks. It's the single most useful document for surviving a shock — and lenders love seeing it.
Frequently asked
How often should I refresh the stress test?+
Quarterly at minimum. Monthly if you're planning a big decision (lease, hire, loan, expansion).
What's a healthy cash runway for an SME?+
Three months of fixed costs in the bank is the minimum. Six months is comfortable. Less than one month is a crisis, even if you don't feel it yet.
The information in this guide is provided for general guidance only and is subject to change. Fees, timelines, and regulatory requirements in Kenya are updated regularly. Before acting, please confirm details with the relevant authority (KRA, eCitizen, BRS, county government, or other regulator) or speak with a qualified MyBiashara advisor. MyBiashara is not liable for decisions made solely on the basis of this content.
