Lockdown Economy Nepal in a Cold Pressed Juice company with Sonam Shrestha

The interview was transcribed and adapted into an article by Tapasya Das

Lockdown Economy: Interviews by think tank AlterContacts.org with real entrepreneurs sharing insights, challenges and successes during the COVID19 global pandemic to inspire, motivate and encourage other entrepreneurs around the world.

In this interview, we meet Sonam Shrestha, the Co-founder of NoChini, which is a cold-pressed juice company in Nepal. NoChini (which translates to No Sugar) stands for quality products. Health and sanitation is their first priority. Now, NoChini is moving into healthy snacks and other food needs. In this interview, we talked about what business was like for NoChini before the lockdown and how they adapted during the lockdown to move forward. Sonam tells us how pivoting the right way helped the company to get the revenue stream going for the business and what they are focusing on right now. With these strategies in place, he talks about what the outlook for NoChini is for the near future.

Watch the video version of the interview.

Please tell our viewers what “NoChini” is.

Sonam: So “NoChini” is an endeavour we started in Kathmandu, where wanted to bring a positive change in the health food sector. It started with just trying out different juices and putting them in the market. Now we have a company that does cold-pressed juice. We are moving into snacks and healthy options for basically all food needs.

So you are based in Kathmandu itself, right?

Sonam: Yes, we are.

So you know it’s a very good initiative because I think it’s a very healthy alternative in the beverage industry as well. Especially now, during the lockdown, when people are going through a lot of stress and they are required to stay at home. That takes a mental toll on people. So I think it is very important that people have this product, they detoxify themselves and lead a healthy life as well. So please tell me what was business like for you before the lockdown?

Sonam: The business was pretty good. It was our second year going into the market. We fixed a lot of the things that we had in our previous year. We polished our products quite a bit. In terms of retail locations, we were in 29 different locations in the city. We had some additional online platforms that we were selling through. We were seeing a double-digit compound growth annually. That is kind of the pre-COVID situation.

I think it is very good to hear that you were doing very well before the lockdown. I also understand that it is one of the fastest-growing beverage businesses in Nepal. So that is also very good to hear. But of course, after that, the pandemic hit the world and it was followed by the lockdown. That slowed down the business for a lot of us. So, how did you respond to the lockdown as an entrepreneur? Did you take some time off or did you put some strategies in place to stimulate the business and attract more customers?

Sonam: That is a great question. I’ll tell you a little bit about what we did. It was really a phase by phase process. In the first phase, we wanted to make sure that all of our employees were safe and that the whole team could communicate in a very efficient way. So for that, we started setting up virtual offices. So everyone was working from home. We had a lot of systems put in place so that there was easy communication on all ends. Then it was time for production. We made sure that we isolated the production from all the other departments. Lastly, we had basically, been turning that which used to be our brick and mortar sales and converting those to purely online ones. So like I said, we closed down all the point of sales that we had across the city. That increased profit margins for us. So even though we did take a significant hit when it comes to the revenue, we actually came out with larger profits in the lockdown period. There was also a healthier cash flow. So those were some of the good things that came out of the lockdown. But in and of itself, we took a large revenue hit and we tried to convert as many brick and mortar sales to online sales, as possible.

That was really good to hear that you were able to pivot even during such hard times and find revenue streams for the company itself. So did you see how the customers changed during the lockdown? Did you see a change in their behaviour? How did they try to reach to your company and how did they try to purchase your products?

Sonam: So one of the things that worked in our favour was that “NoChini” stood for quality products and quality ingredients from the get-go. Health and sanitation was our number one priority. So that ethos really helped us in moving into this lockdown economy. Because people are warier about what they put into their body or what they consume. That was a huge shift in customer dynamics. The second thing that we saw, very evidently was the fact that people were more mobile-friendly, more internet friendly. So like I said, we were converting a lot of our brick and mortar sales into online ones. Even more than that, we were converting those sales directly to our own channels. So on our website and on Instagram, we were seeing record sales. So that told me that the consumers were becoming more aware of where to get direct information about the product. Then, you could also see a huge trend in e-banking and mobile banking. So people would just pay using non-cash methods-which was really a great thing that I saw happening in front of my eyes in a span of two or three months. Lastly, I mean, the most evident thing is that the disposable income of a lot of our customers, basically from all around the world, has actually shrunk. So we could feel the implications of that, in our business too. So yeah, that is kind of it.

Did you see a similarity in the way your competitors responded to the lockdown?

Sonam: Let me take you a step back. When you look at something like cold-pressed juice, “NoChini” was the first mover in this space. We kind of created this category inside the country. When we started, there was no such thing as a cold-press. There was no infrastructure for cold press, whether cold chain for supply or distribution or hydraulic presses for making juices. Now, cold-press has become synonymous with good juice. Not only are big hotels and big restaurant chains moving into cold-press, but there are other cold-pressed companies that are coming into the market. “NoChini” still is by far the largest market shareholder in this sector. So even in the lockdown, we could see multiple companies enter into space which was very encouraging. This means that people really see the value of fresh and healthy products. Yes, it’s by far one of the fastest-growing sectors inside of the beverage space in Nepal.

So, I’m really happy to hear that you know the industry itself is growing with more companies coming into the market. That is very good for of course all the players in the market because you get to learn off each other as well. So tell me, now that the lockdown has eased in Nepal, how is your business performing right now?

Sonam: Well the lockdown is easing but our problem never was with the lockdown. Our problem never was with the lockdown. Our problem really was with the virus itself. So when we were dealing with the ideas of “How to control our production sites, how to screen our employees while producing?”. Those are things that we just did not have a great handle on. So we had to shut down production because we wanted to ensure that each one of our production staff was routinely getting tested, in order to make these juices. That’s a sacrifice we had to make. So currently, we are still temporarily closed. It has been since the second lockdown in Nepal. So even though the lockdown itself has eased, we are seeing a record number of cases in Nepal. So we are taking a very slow approach to start production. But since the lockdown has eased, a lot of other businesses have opened up. That opens up our horizons for doing collaborative business with other companies. So just to give you an example, now we can actually focus on product development. So we can get packaging ready, we can get product testing ready, we can talk to different ministries and governmental departments to get things underway. So a lot of the stuff that happens behind the curtains. A lot of the development work is actually happening faster than ever.

That actually is really good, You know sometimes it can be very healthy to take a step back, instead of just rushing and getting things done and going forward only. Right now you have a chance to step back and just see where your business is and what you want to incorporate further in your business. So yeah that’s really good to hear. So with these strategies in place, what is the outlook for “NoChini” for the next three to four months.

Sonam: So the first three quarters were definitely rough. But we really hope that the next three quarters won’t be as bad. We are seeing the festive season come. That is definitely going to shoot consumer-spending. We also hope that sooner or later we will see much higher numbers in sales of not just one product but of multiple products in our whole portfolio.

So this is my last question for you. If you could point out a few things or three things that you need help within your business right now.

Sonam: I don’t know if I can come up with three things exactly. So the first thing that Need and that which would the same for many other companies as well, would really be quick access to capital. Without collateral, it is definitely a very tricky one for the government or any sort of private institution to fill out. But I feel that startups like us that have very optimistic aims for the future, definitely need some sort of micro-financing or some sort of financing help. In that regard, again, there is an alternative to that, which is basically going lean by ourselves. The second thing that we are really hoping for is increased consumer spending on local products. Again there have been so many media campaigns, so much support for local businesses, it has been one of the big driving factors. It is also one of the most encouraging things that happened in the past couple of months. In fact that Nepali production, Nepali products are extremely competitive with imports from abroad. So you know we would like to see a little bit more consumer-spending in domestic products. Honestly, a combination of those two would be it. It is definitely going to help small businesses like us, especially the beverage industry, get much faster growth.

About the Guest

NoChini is a cold-pressed juice company and for the past two years has been one of the fastest-growing beverage startups in Nepal.

Sonam Shrestha is a researcher turned entrepreneur. Graduating from Kalamazoo College with a Bachelor’s in Chemistry and Mathematics, he worked briefly at Oak Ridge National Lab. Soon after, he returned to his home country of Nepal and started a beverage company with his business partner.

https://www.no-chini.com/

The UN-registered nonprofit social initiative that helps small businesses and self-employed professionals to overcome the challenges of the pandemic.