Nurturing entrepreneurship
The government of Nepal launched the World Bank-financed Rural Enterprise and Economic Development (REED) Project in 2021 to support rural agri-based businesses and small and medium enterprises (SMEs) by enhancing their capacities, connecting them with markets for raw materials and sales, and supporting a well-functioning entrepreneurial ecosystem.
Through an intermediary service company, REED supported 102 SMEs and startups through business diagnostics and training, ultimately selecting 25 for a pilot business incubation program.
Poshilo and Harilo benefitted from intensive mentorship and technical support to enhance their business development and market expansion.
Each mentor worked with four to six SMEs and brought in subject-specific expertise as required through a structured process, including one-on-one meetings, follow-ups, and continuous progress evaluation.
For Poshilo Foods, REED support included the development of an incubation action plan based on a comprehensive diagnostic of its operations. This plan guided the delivery of tailored coaching and mentoring.
For Harilo, support included quality audits to improve adherence to established standards, staff training on quality management, and developing a raw materials quality control system. This ensured product quality and safety with additional on-the-spot technical guidance for proper meat handling and hygiene.
The mentors also conducted strength, weakness, opportunity and threat (SWOT) analysis of the various aspects of the companies to identify and address gaps in these enterprises.
Poshilo faced challenges in sourcing quality raw materials locally and relied on international markets increasing production costs. They also lacked knowledge of Nepal government’s standards on food handling and safety.
Harilo needed consistency in quality standards and reliable raw meat suppliers beyond Pokhara.
Based on these diagnoses, the REED Project provided training, assisted with standard operating procedures for maintaining food quality, proper preservatives and processing, facilitated partnerships with supplies, and provided business counselling to these enterprises.
Journey towards success
With this support, Poshilo now has a five-year business plan, a digital marketing strategy, and an action plan which Parajuli thinks are crucial to take his business to the next level.
“REED’s support in financial planning has really helped us plan our activities effectively for more profits.” he says.
“REED’s support in financial planning has really helped us plan our activities effectively for more profits.” Parajuli says.
They have also begun exports to India and the United States with plans to explore opportunities in other international markets.
This has helped the company increase its sales volume from 350 kilos per day to 600 kilos. With the planned completion of their grain processing infrastructure by Mid 2025, they’re set to scale up to meet the market demand of 4,000 kilograms per day. Poshilo has also created job opportunities, employing 25 people in production and marketing in March 2025.
Similarly, Harilo Agro Industries which started with an initial investment of Rs 50 million, generated Rs 20 million in revenue in 2024 alone. Impressively, by March 2025, their business brought in Rs 40 million and has created jobs for 23 people. Harilo Agro is now connected to suppliers in Nepalgunj in Lumbini Province for quality raw materials at a reasonable price.
“The technical support from the REED Project helped us in maintaining raw material quality and standards for handling meat and hygiene. This has helped minimizing loss and producing high-quality meat products that our customers are loving,” says Sharma.
"REED's technical support helped minimize loss and produce high-quality meat products that our customers are loving." Says Sharma.
– core elements of the REED project.
