Entrepreneurship

ASSIGNMENT 1

Entrepreneurship in Nepal

22nd July 2017

Submitted To:

Course Instructor: Mr. Sohan Babu Khatri

Submitted By:-

Mohit Maheshwari

EMBA Fall 2015- Semester III (First Half)

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ABSTRACT
Entrepreneurship has been recognized globally as one of the key factors aiding a nations
economic development and progress. It has many spin off effects like providing employment to
local people, sustaining even development and aiding in improving the standard and quality of
life of the people in the country. The importance of entrepreneurship in a country like Nepal
cannot be overemphasized. The economic development of a Nation depends on its industrial
development. The industrial development is based on entrepreneurial competencies of the
people. Hence the concept of building entrepreneurship development is the need of the hour.

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INTRODUCTION
Entrepreneurship has assumed super importance for accelerating economic growth both in
developed and developing countries. It promotes capital formation and creates wealth in the
country. It reduces unemployment and poverty and its a pathway to prosper. Entrepreneurship is
the process of searching out opportunities in the market place and arranging resources required to
exploit these opportunities for long term gains. It is the process of planning, organizing,
opportunities and assuming.

The concept of Entrepreneurship has a wide range of meaning. Entrepreneurship has traditionally
been defined as the process of designing, launching and running a new business, which typically
begins as a small business, such as a startup company, offering a product, process or service for
sale or hire. The people who create these businesses are called entrepreneurs. (Wikipedia)

An entrepreneur is an individual who, rather than working as an employee, runs a small business
and assumes all the risks and rewards of a given business venture, idea, or good or service
offered for sale. The entrepreneur is commonly seen as a business leader and innovator of new
ideas and business processes. (Investopedia)

Economists categorize the resources that go into production as either land (natural resources),
labor, capital or entrepreneurship. An entrepreneur combines the first three of these to create
goods or provide services. An entrepreneur typically creates a business plan, hires labor, acquires
resources and financing, and provides leadership and management for the business.
(Investopedia)

Entrepreneurs play a key role in any economy. These are the people who have the skills and
initiative necessary to take good new ideas to market and to make the right decisions that lead to
profitability. The reward for taking the risk is the potential economic profits the entrepreneur
could earn. (Investopedia)

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Nepal is a developing nation with an agricultural based economic system. Over the last two
decades the country is expanding more towards the manufacturing industries and other
technological sectors and these steps have achieved much success. Nepal is a country where
most of its youth go to work in various foreign locations and the economy of Nepal is heavily
dependent on remittances. As per a report of published by World Bank the Personal Remittance
received as percentage of GDP is as high to 31.576% (World Bank) in 2015. These figures show
that there are not many opportunities for the youth of Nepal to work in their own country, and
that is the biggest challenge for the entrepreneurs in the country.

The word entrepreneurship has become a buzzword in the Nepalese society. Entrepreneurship
Development seems to have caught the attention of the government and business sectors whether
profit or non-profit organizations. The Non-Government Organizations (NGOs) and International
Non-Government Organization (INGOs) are trying to incorporate the entrepreneurial culture in
their areas of work. The private sector or so called profit driven organizations have started new
initiatives like venture capitalism, investing in startups etc. and the government is also planning
to increase the money supply in the name of entrepreneurship, better late than never. Increased
entrepreneurship in the various sectors especially youth in the society is appreciable.

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CHALLENGES AS AN ENTREPRENEUR
Developing nations like Nepal who have recently started to change its major income source from
Agriculture to Industrial & Technological operations, entrepreneurship is an important
component in stimulating economic growth, innovation, competitiveness and even driving
poverty out of this country.

Unlike any other journey, the journey of Entrepreneurship is filled with bringing continuous
innovation, taking risks at each and every decision and to produce something of value to the
society which in turn generates revenue and uplifts the living standard of the people involved.
Even Peter F. Drucker in his article The Discipline of Innovation states that Innovation is real
work, and it can and should be managed like any other corporate function. But that doesnt mean
its the same as other business activities. Indeed, Innovation is the work if knowing rather than
doing.

To come up with continuous innovation and to correctly assess the risks in the market
entrepreneurs need to be equipped with technological advancement. Even though we say that
Nepals annual growth rate is as high as 7.5% (World Bank), we dont see much of it coming
from advancement due to technology. Nepals economy lacks the experts knowledge in the area
of technology. Entrepreneurs basic or fundamental need is to access to technology and
infrastructure.

Nepal is a rural based economy with around 81.39% ( (Nepal - Rural population) of its
population in 2015 residing in rural areas. Since most of the people reside in the rural areas
people remain unaware of the new product that is being developed in the economy and the actual
market demand and supply and this also slows down the emergence of new ventures because it
will take time to serve more and more number of people in the economy. And this is one of the
big challenges the entrepreneur face since it also halts the innovation in the entrepreneurial
process.

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In its article The Future of Entrepreneurship & Business Jason Nazar talks about Youth having
an advantage in the process of formulating a success business because of these four reasons:

I. More Energy
II. More Time
III. More Optimism
IV. Higher Risk Tolerance

In case of Nepal entrepreneurs have a challenge in finding youths to work with them, since many
of them go abroad to work, rather than capitalizing the opportunities in the country. It creates
difficulty for the entrepreneurs to find people skilled enough to work. They are also in a risk if
they plan to train the unskilled workers, because in Nepal people tend to jump job as soon as
they think they know something rather than to know everything.

The entrepreneurs in Nepal are not protected legally, due to the lack of strong intellectual
property right and patent rights they are not been able to compete with foreign producers. The
present patent law only gives a little protection to the entrepreneurs and which back the
entrepreneurs to initiate new steps.
Even though there are many problems and challenges an entrepreneur faces, it is an
entrepreneurial spirit that makes the entrepreneurs to create an opportunities surpassing all the
challenges.

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OPPORTUNITIES FOR AN ENTREPRENEUR
An Entrepreneur creates opportunities not just for himself but more importantly for others. In
Nepal, this is even more important as we have a high number of unemployed Nepalis and
opportunities are limited to a privileged few.

Nepal got too many crisis all around electricity, water, fuel, communication, inflation, whenever
we switch TV to watch News, or Log in to our social world we come across a lot of problems
and see people suffering due to not having a solution for these problems. Many people just let it
go and use the famous Nepali line Yahan ta yestai huncha, but there are some individuals who
have a different angle for seeing these problems, they see these problems as business
opportunities and how can they capitalize on such opportunities not to earn money but actually to
solve the problem. We call these people as Entrepreneurs.

In the process of solving problems, they create jobs and positivism and efficiency in the
economy. Today, many have become dependent on foreign aid and the government to solve our
problems. Entrepreneurs dont wait and will not wait for others to solve problems. They grab the
opportunity, try to solve it and find a sustainable way to do this (business). Imagine a future in
which each Nepali is hungry for problems and jumps to solve every problem in our society and
makes a business out of it. We could become a very different society.

If we talk about the traditional social culture of Nepalese society we wont find much difference
when we compare it with the Japanese, where the Nepalese people quest for a job preferably a
government one to remain secured for life time. And this is the must as the job holder is the only
person earning in the whole family. But, does this theory of tradition holds good in the present
and upcoming days? The answer is a No. Youths have understood the real meaning of
entrepreneurship and have starting to be one. We can name many entrepreneurs in Nepal like
Binod Chaudhary, Shesh Ghale, Poonam Gupta, Atulya Pandey and many more. The
entrepreneurial culture is catching fire in Nepal.

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Nepal is a country with huge political instability, people either look for a permanent job or even
leave the country rather than to start a business and become an entrepreneur. Despite of these
problems the Nepalese business industry is growing as compared to the previous year. Various
business sectors of Nepal like Banking & Financial Institutions, Telecommunications, FMCGs,
and Hotels & Resorts have grown as the market has supported the growth. With the rise in
urbanization and seek for international exposure (for goods, services, work, fashion, and studies),
the taste and preference, lifestyle, choices of people and needs change faster than it did before.
This creates an opportunity for entrepreneurs to capture the gap, serve the purpose and remain
profitable by on-time cashing of the opportunity. This is one of the reasons, we see lot of
entrepreneurs growing and entrepreneurship developing in the country.

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OPPORTUNITIES FROM THE PERSPECTIVE OF
DIFFERENT ENTREPRENEURS IN NEPAL
Min Bahadur Gurung waited almost for a decade before he expanded his one room cold
storage shop to a small department store, which then went on to be todays Bhat Bhateni
Supermarkets at more than one location.

Karna Sakya has devised a test that helps you find out how you work, how you value
time, and what your values are. His point is that unless you really know what you are
good at, and how you function, you are not likely to be a success.

You cant do everything by yourself. Icchya Raj Tamang says that working well in a
team is a function knowing and using the strengths of other team-mates toward your
goals.

Jonas Lindholm says that bad communication lies at the heart of many business failures
and misunderstandings. In Nepal, often, people say yes too eagerly, without being
aware of what they can do and what they cannot do. This can be a problem when things
do not go right. Say what you mean, and mean what you say.

Mahendra Man Shakya of Momo King says that most mistakes are made in Nepali
businesses when people get into business partnerships without doing the necessary
background research and without asking themselves some tough questions which need to
be answered and understood upfront. There is no fun in quarreling with your business
partners when things go wrong, which is likely to happen at some point in the business.

Min Bahadur Gurung says that long-term business success is anchored on honesty, and
on mutually trustworthy relationships with your financial institutions, creditors, debtors,
co-workers, employees and customers.

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 Gyanendra Pradhan of Hydro Solutions says that a good habit an entrepreneur needs to
develop is an ability to reflect upon ones mistakes, and learn from them without getting
stuck in the past. This habit can be cultivated through conscious practice and reflective
experiences.

Ambika Shrestha of Dwarikas Hotel attributes her success to her ability to work very
hard when she was young. No work was beneath her, and she made many, many sales
calls and visits to sell her hotel and travel agencys offerings.

Ajay Ghimire, CEO of Vibor Bank, says that he looks for a sense of persistence when
dealing with entrepreneurs. Those who are persistent are likely to not get disappointed
with failures and setbacks, and have the energy and willpower to push ahead to success.

Ajay Ghimire believes that whatever an entrepreneur does, success comes from an ability
to sell ideas, concepts, goods and services to others. This is why, an ability to sell what
one knows and makes is a critical skill to have.

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CONCLUSION
Being an entrepreneur is not an easy task, you need to be visionary and should know the market
and the people. Entrepreneur do not start their business to earn money or to say it in other way
money is not what drives an entrepreneur, but it is the passion to find opportunity from a
problem when no one can. Economic development cannot be initiated without the pioneering
efforts of entrepreneurs. Entrepreneurs have key role to play in the process of industrial
development in particular and economic development in general. The countrys economic policy
environment must be favorable for organizations to achieve efficiencies in todays global market.
It should enable the entrepreneurs to provide a magical touch to an organization, whether in
public or private or joint sector, in achieving speed, flexibility, innovativeness, and a strong
sense of self-determination. They bring a new vision to the forefront of economic growth of a
country.

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WORKS CITED
10 Famous and Successful Entrepreneurs of Nepal. (n.d.). Retrieved from
http://www.imnepal.com/famous-entrepreneurs-nepal/

10 Tips on Starting Your Own Venture in Nepal. (n.d.). Retrieved from http://e4nepal.com/wp-
content/uploads/e4nepal-top10tips.pdf

Challenges and Opportunities for Entrepreneurship Development in Nepalese Society. (n.d.). Retrieved
from https://www.linkedin.com/pulse/challenges-opportunities-entrepreneurship-
development-roshan-poudel

Challenges and prospects of youth entrepreneurship in Kathmandu. (n.d.). Retrieved from

https://brage.bibsys.no/xmlui/bitstream/handle/11250/2385486/Sitoula.pdf?sequence=1

Entrepreneurs in Nepal. (n.d.). Retrieved from

https://www.slideshare.net/Rhododendron/entreprenures-in-nepal

Entrepreneurship Challenges and Opportunities in the Context of Nepal. (n.d.). Retrieved from
https://np.usembassy.gov/entrepreneurship-challenges-and-opportunities-in-the-context-of-
nepal/

Growth Rebounded Strongly in F.Y. 2017, but Risks Are Mounting. (n.d.). Retrieved from
http://www.worldbank.org/en/news/press-release/2017/05/09/growth-rebounded-strongly-in-
fy2017-but-risks-mounting

How will Entrepreneurs transform Nepal? (n.d.). Retrieved from

https://blog.cloudfactory.com/2013/04/how-will-entrepreneurs-transform-nepal.html

Improving the Environment for Entrepreneurship in Nepal. (n.d.). Retrieved from

http://www.cipe.org/publications/detail/improving-environment-entrepreneurship-nepal

Incredible! Nepal total literate next year. (n.d.). Retrieved from

http://kathmandupost.ekantipur.com/printedition/news/2014-08-31/incredible-nepal-total-
literate-next-year.html

Investopedia. (n.d.). Retrieved July 19, 2017, from

http://www.investopedia.com/terms/e/entrepreneur.asp

Investopedia. (n.d.). Retrieved from http://www.investopedia.com/terms/i/intrapreneurship.asp

Nepal - Rural population. (n.d.). Retrieved from https://tradingeconomics.com/nepal/rural-population-

percent-of-total-population-wb-data.html

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Nepalese Society, Its Context & Entrepreneurship Development. (n.d.). Retrieved from
http://www.tec.tecno.id/news/Nepalese-Society,-its-Context-and-Entrepreneurship-
Development

Personal remittances, received (% of GDP). (n.d.). Retrieved from

http://data.worldbank.org/indicator/BX.TRF.PWKR.DT.GD.ZS?end=2015&locations=NP&start=1
993&view=chart

Promoting Entrepreneurship in Nepal. (n.d.). Retrieved from

http://www.surathgiri.com/2014/09/promoting-entrepreneurship-in-nepal.html

What Nepali Entrepreneurs Can Teach Us about Perseverance. (n.d.). Retrieved from
https://www.forbes.com/sites/celinnedacosta/2016/09/26/what-nepali-entrepreneurs-can-
teach-us-about-perseverance/#79c759ac188e

Wikipedia. (n.d.). Retrieved July 19, 2017, from https://en.wikipedia.org/wiki/Entrepreneurship

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