By Eddie Mugulusi
There’s a powerful business concept that doesn’t get talked about nearly enough.
But if you understand it, it could change the way you build and grow your business.
It’s called consumption expenditure.
What Is Consumption Expenditure?
In simple terms, it’s the amount of money a typical person spends in a day on all aspects of living.
From the time they wake up to the moment they go to bed—
On food, transport, airtime, utilities, grooming, snacks, entertainment, and everything in between.
When averaged out across a year, it gives you a realistic idea of their daily spending power.
And here’s why that matters:
A customer can only give you what they have.
Not what they want to give you.
Not what your business hopes to earn.
Only what’s in their pocket.
Why Most Businesses Get This Wrong
Far too many entrepreneurs jump into business ideas based on excitement, not economics.
They don’t take a moment to ask:
Who exactly is my customer?
And more importantly—
How much can they actually afford to spend on a daily basis?
If you don’t understand this, you may end up selling a good product…
To the wrong people.
Let’s Talk About Uganda’s Middle Class
We hear the term “middle class” all the time, but it’s not one group.
It’s made up of tiers—and each one behaves differently.
Understanding these segments can help you:
- Price your product correctly
- Market it effectively
- Serve your customers profitably
So here’s a breakdown of Uganda’s middle class—based on daily consumption expenditure.
1. The Floating Middle Class
Daily Spend: UGX 7,000 – 14,000
This group lives on the edge.
They’re not poor enough to be considered in poverty—
But they’re one bad day away from it.
Their spending decisions are heavily price-driven.
Every shilling counts.
So if this is your target audience:
You must sell low-priced goods or services—
And you must do so in high volume.
The challenge?
Low price = low margins.
If you don’t have scale, you’ll struggle.
This is why businesses targeting this segment need serious distribution power or lean operating models.
It’s a tough game for small businesses.
2. The Lower Middle Class
Daily Spend: UGX 14,000 – 37,000
This group is a step up.
They have a little more financial breathing room.
They’re not just surviving—they’re making calculated lifestyle choices.
This customer will:
- Spend a bit more
- Buy slightly better quality
- And more importantly—buy more frequently
This is the kind of person who can get a manicure every week, not every two months.
But here’s the catch—
They demand value for money.
So don’t try to cheat them with substandard products at high prices.
Give them quality at a fair price, and they’ll return again and again.
This segment is where many small service businesses—like salons, gyms, cafés, and urban retail shops—can thrive.
3. The Upper Middle Class
Daily Spend: UGX 37,000 – 74,000
These are the taste-driven, brand-conscious customers.
They don’t just buy for need—they buy for status, experience, and exclusivity.
They’ll pay more—if the product is right.
Here’s what makes this group unique:
- They value quality over quantity
- They’re drawn to strong, well-positioned brands
- They care about design, packaging, service, reputation
If you’re targeting this group, forget about bulk discounts.
Forget about “cheap.”
Focus on brand-building.
Sell them uniqueness, prestige, and premium experiences.
And the best part?
You don’t need a crowd.
Just a handful of these customers can drive strong margins and sustainable growth.
So, Who Are You Selling To?
You can’t serve everyone.
If your product is made for someone who spends UGX 50,000 a day,
but you’re marketing to people who only have UGX 10,000…
You won’t sell.
Not because your product isn’t good—
But because your target market can’t afford it.
As I conclude
Before you stock shelves, rent space, or build a marketing campaign—
Ask this simple but powerful question:
How much can my customer actually spend per day?
Because consumption expenditure isn’t just an economic term—
It’s a business strategy.
Get it right, and you’ll stop struggling with mismatched customers.
You’ll build with clarity.
And you’ll grow with confidence.
Unlock your true potential 