However, during his second year of college, he realized that he was not made to take up jobs or work under anyone owing to his own temperament. He started to export handicrafts from Nepal to America during his college days in India. He sent a few consignments but was unable to make any profit. Around 1994, after completing his engineering, he chose to start his own business with the determination that, even if he only started a shop, he would be his own boss. And that meant a lot to him.
Even though he had no money in his pocket, many business ideas ran through his mind, like running a consultancy, an advertising agency or a motor garage. After numerous failures, including a failed attempt at his father’s ball-point manufacturing company, Mr Bagaria says, “One thing that I always had in me is that every time I fail, I jump back with more vigor, enthusiasm and determination”.
Lesson 1: Never give up.
While juggling a few things here and there, he met a gentleman who was an agent within India and Nepal for the largest enzyme producing company in the world. He discussed an enzyme which sold about five tons a month in the poultry sector in Nepal. Even though Mr Bagaria knew nothing about poultry or enzymes, he believed the agent and got into the business right away. That was a big mistake but a blessing in disguise, says Mr Bagaria. Two or three months later, he sadly realized that the market for enzymes was small.
During this time, he met a lot of poultry farmers, especially in Chitwan and felt that he had finally found his niche. He learned that it was not an ordinary business, but was science in itself. There was more research to be done on poultry nutrition in comparison to human nutrition. Another interesting finding was that it had very high turnovers of around 15 to 20 billion rupees annually. The livestock value is close to 50 billion rupees, which is a significant amount in Nepal’s context.
What got him further interested was that there were no big players in the sector. He recognized the opportunity but knew nothing about the technical aspects of the industry.
“Being an engineer, biology was something I needed to master over a short period of time, so that I could learn everything about running this business”.
In this environment, he met one of the fastest growing Indian companies and established an arrangement where his company would produce poultry feeding supplements. In the process, he understood the market better. The feeds they were producing were unique with lots of potential. But to increase production, it required new technology and a lot of capital investment. He recalls facing difficulties while taking decisions.
Managing resources and analyzing the risks were some of the issues he faced. But after lots of study, discussion and persuasion by international experts, he decided to invest. He can now proudly say that the entire dynamics of the business has changed due to the technology being used.
Lesson 2: Study new technology and embrace it if it meets your need.
During the initial phase, the farmers would not accept his products. So he came up with an idea: if the farmers lost money by using his product, he would compensate. But if they made profit, they had to inform others about the product. That worked very well. In 2004, when he first started, 100 tons of feed was sold in the first month. In the second month he sold around 200 tons. Today, his company sells 6,500 tons of feed every month with a target of reaching 10,000 tons per month.
Lesson 3: Best way to sell your product is to offer a win-win situation with your customer.
The company is working to improve its distribution model. The company developed about 14 depots across the country to deal with countless “bandhs” and other instabilities in Nepal. That turned out to be a good idea as it made it easier to distribute his product to the farmers. So he opened depots close to customer to deal with frequent “bandhs” in the country.
The company’s turnover in 2009 was two billion rupees and in 2010 they are heading for Rs 3.5 billion.
Nimbus buys a lot of maize, soya, wheat and different kinds of products to make the feeds. In the last ten years, it has been able to establish itself as a reliable and a high quality brand. It has a large network of farmers and about 500 dealers across the country, mostly in rural areas.
His next plan is to leverage their rural network and attempt to provide rural population with micro financing along with micro banking which would essentially help the agriculture sector, and at the same time establish the company as a catalyst in bringing about a major change in the agricultural sector of Nepal.
(This is an extract from “A Nepali Entrepreneur’s Handbook” published by Entrepreneurs for Nepal. For details, visit e4Nepal.com.)
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