Laxman Singh Bista’s Dairy Success Story
Laxman Singh Bista is from Bhaasi, Bhimdutta Municipality-1, Kanchanpur district. He is the owner of a small-scale dairy named Bista Dairy Udhyog and has been running a dairy business for the last five years. Having no additional source of income, the family of five is solely dependent on the revenue from the dairy to meet their daily needs.
Each day, Mr. Laxman starts his day by purchasing 205 liters of raw milk from farmers and milk collectors in his locality. He processes the milk to produce different milk products, such as yogurt, cheese, butter, khuwa — a semi-solid form of evaporated milk that is used in making sweets — etc. Khuwa is his specialty product, which is prepared in a unique metal bowl with a stirrer, run either by liquified petroleum gas (LPG) or by electricity. However, a few years back, the khuwa-making machine broke down, probably due to extensive use.
Since then, Laxman has been following the traditional method of making khuwa, which is by boiling and manually stirring the milk in a large pot. However, this process was time and energy intensive, and the chance of contamination is high as it is manually stirred. As a result, the cost of production was higher and the product was less competitive in the market due to compromised quality. With time, it became crucial for Laxman to purchase an automated khuwa-making machine to maximize his profits and stay in business. However, he did not have the finances to buy the machinery as the business, like many others, had been adversely impacted by the repercussions of the COVID-19 pandemic.
The Cereal Systems Initiative for South Asia (CSISA) has been supporting postharvest enterprises — to support them to access loans and to build their business management capacities. CSISA spotted Laxman in an interaction program for dairy entrepreneurs and now he is a direct beneficiary of the project. He expressed a dire need to get a loan for his dairy and requested CSISA’s help. The project facilitated him to acquire a loan of $2,311 (Nepali rupee (NPR) 300,000) from a cooperative at a subsidized interest rate of 8%. Laxman was happy and thankful to CSISA, as the banks were not disbursing loans due to the liquidity crisis. We have successfully managed the liquidity crisis risk by partnering with cooperatives. Laxman says, “If I had not received the loan on time, I would have suffered huge debt and my business would have been in a total loss.”
He purchased a multipurpose khuwa-making machine that could be used for both boiling milk and making butter — thus, he is able to increase production volume to meet the increasing demand for milk and milk products. Previously, Laxman had a limited number of customers, but today he also supplies to neighboring districts, such as Dhangadi, Dadeldhura, Doti and Baitadi. He serves around 200 customers per day in winter and 1,000 plus in the summer season. Before purchasing the machinery, his net profit was around $77-115 (NPR 10,000-15,000) per month, but today his profits amount to $308 (NPR 40,000).
In the coming days, Laxman is planning to invest in additional machinery, like chilling vats and refrigerators that would enable him to store more milk and milk products. He is also planning to get additional loans from the cooperative. CSISA provided him with capacity-building support on business management skills and technical training on quality product development.
This initiative is supported by the Feed the Future for Global Hunger and the Food Security Initiative under USAID/Nepal, implemented by the International Maize and Wheat Improvement Center (CIMMYT), in association with CSISA response and resilience partners iDE Nepal, International Water Management Institute (IWMI), Cornell University, and Texas A&M University (TAMU), and aligned with Transforming Agrifood Systems in South Asia (TAFSSA).