How to Start a Business in Nepal: The Practical Guide

What most guides skip: testing your idea, real costs, suppliers, pricing, and your first 90 days of trading.

Most guides on starting a business in Nepal stop where the hard part begins.

They walk you through the ward office, the Company Registrar, the PAN certificate. Then they stop, as if the certificate were the finish line. It is not. The certificate is the easy part. It costs a few thousand rupees and takes a week.

What comes after decides whether you make money. Kavi Raj Joshi of Startups Nepal estimates that 90% fail. Almost none fail because they filled in a form wrongly. They fail because the owner never knew, month to month, if the business was making money.

1. First, check if people will pay

The most expensive mistake is building first and asking later. Most owners know the product they want to sell, and they assume a customer exists.

Before you spend a rupee on rent or stock, spend two weeks on three questions.

Who is the customer, and where?

Not "people in Kathmandu." A specific person, in a specific area, with a specific problem. Opening a kirana pasal? Your customers are the households within a five-minute walk. Go and count them.

What do they pay for this today, and to whom?

There is almost always an existing solution, even a bad one. Go and buy from your future competitor. Note their prices, their busy hours, and what they run out of. One afternoon in a competitor’s shop teaches you more than a month of planning.

Will they actually pay you?

This is the only question that matters, and it has one honest answer: a sale. Sell ten units before you sign a lease. From home, on Facebook Marketplace, out of a bag. Sell to strangers, not relatives. Family buying from you is politeness, not demand.

Track from that first test sale. Not in your head. Written down. Karobar lets you record sales and expenses before you register anything, so those ten sales become real data: what sold, at what price, and what it cost you.

2. Count the costs people forget

Most first-time owners in Nepal underestimate their startup cost by a third or more. The visible costs are easy. The hidden ones sink people.

Here is a checklist. The figures are examples. Replace every one with a real quote you have obtained yourself.

Working capital is not opening stock

If you spend all your capital on stock, you have nothing left to restock with when half of it sells. Shops die with full shelves and no cash. Keep at least one month’s purchasing budget aside, untouched.

Your living costs are a business cost

If the shop cannot pay you a salary, the shop is not profitable. Your savings are paying for it, and you should know exactly how long they will last.

Do not plan to borrow your way out. Access to finance is a major problem for 40.5% of small firms in Nepal (ADB research). SME interest runs around 12.51% plus charges, and banks often want more than four rupees of security for every rupee lent. Plan to survive on what you have.

3. Registration, in brief

This section is short on purpose. The official sources are better than any blog, and the rules change. Use this to orient yourself, then check.

Sole proprietorship (private firm)

This is what most small shops choose. You will need a ward recommendation letter, your citizenship certificate, proof of business address (with the landlord’s no-objection letter if you rent), photographs, and a PAN certificate. Expect around NPR 1,000 as an application fee, a registration fee of NPR 1,000 to 5,000 depending on capital, and about NPR 200 for PAN. It takes three to seven working days.

Private limited company

You register online through the CAMIS portal. Reserve a name (approval lasts 35 days), upload your Memorandum and Articles of Association with shareholder documents, and pay a fee based on capital: about NPR 1,000 up to 1 lakh, NPR 4,500 for 1 to 5 lakh, NPR 9,500 for 5 to 25 lakh, and NPR 16,000 for 25 lakh to 1 crore. One shareholder is enough. A clean file takes 7 to 14 days.

Which one?

Most single-owner shops in Nepal start as sole proprietorships and convert later if they grow. If you are unsure, register simple and revisit it when your turnover forces the question.

4. Finding suppliers and getting terms

New buyers get worse prices than established ones. That is normal and temporary, but only if you handle the first six months well.

Get three quotes

Depending on your sector, that means the wholesale markets: Ason and New Road in Kathmandu for general goods, Kalimati for fruit and vegetables, Birgunj for imported goods. Or distributors who come to you. The gap between the first and third quote is often 10 to 15%, which on a retail margin decides your year.

Ask about more than price

The rate matters less than: minimum order size, how often they deliver and who pays, whether you can return unsold or damaged goods, and how fast they restock a fast seller. A supplier who is 2% dearer but delivers twice a week is usually cheaper, because you hold less stock.

Credit terms are the real negotiation

Most suppliers start you on cash and move you to 15 or 30 days once you have proved reliable. Getting 30-day terms is worth more than a 3% discount, because your stock is then partly financed by the supplier. How to earn it is simple: pay early, every time, for the first few months, and make sure they notice.

Record every supplier and purchase in Karobar. You will see what you owe and when, so you never miss the payment that earns you better terms. And after a few months you can negotiate with numbers instead of hope.

5. Pricing: the mistake that kills your margin

Here is the most common pricing error in Nepali retail.

You buy an item for NPR 80. You sell it for NPR 100. You think you are making 20%.

You are not. Here is a shop selling NPR 500,000 a month at that markup:

That 20% margin is really about 8% before your own time, and closer to 2% after it. This is why shops feel busy and stay poor. Three things eat the difference:

• Dead stock. Goods sitting unsold are cash you already spent. A shop with NPR 100,000 of slow stock has NPR 100,000 less to trade with.

• Unpaid udhaaro. Credit never recovered is not a bad debt at year end. It was a discount you gave at the moment of sale without deciding to.

• Your unpaid time. Working 70 hours a week for less than you would earn employed means the business is not yet a business.

Price by category, not by habit

Fast-moving staples carry thin margins, and they should, because customers know those prices. Slower goods carry the real margin. Using one markup across everything leaves money on the table at one end and prices you out at the other.

Karobar lets you set purchase price, selling price, MRP and wholesale rate per item, so margin is calculated, not guessed. The product report shows which items actually make your profit. The item you sell most of is often not the one paying your rent.

6. What to record from day one

Nepal has gone digital on money. In one recent month the country processed 59.26 million QR transactions worth NPR 162.58 billion (Kathmandu Post). QR volumes are up more than sixtyfold since 2020-21.

Yet most shops taking QR payments still write the sale in a paper copy at closing, if at all. Money arrives digitally, the record is handwritten. That gap is where confusion lives.

You do not need full accounting on day one. You need four things, about ten minutes a day.

What can wait: formal accounting, balance sheets, payroll systems. Those matter later, and mostly to your accountant.

Karobar covers all four. It works offline, so an entry made during a connection drop still saves. It runs in Nepali and switches between Bikram Sambat and AD dates. You can import an existing Excel sheet. And it backs up to the cloud, which matters because phones get lost and a lost copy takes the whole business memory with it.

Build the habit in week one, while volume is low. Starting in month eight, with a year of gaps behind you, is much harder.

7. Your first 90 days

Watch the calendar

If you open in the second half of the year, festival timing matters more than almost anything. Dashain begins on 11 October 2026 and peaks on 21 October. Tihar runs to Bhai Tika on 11 November. Together they are the biggest retail event of the year, worth roughly NPR 200 billion (source). Stock ordering has to happen weeks ahead.

Laxmi Puja, on 8 November 2026, is when Nepali businesses traditionally open new account books. That makes it the natural moment to start keeping records properly.

The daily rhythm is simple: enter sales and expenses each evening, check your cash against the drawer, and once a week look at three reports. What sold, what is owed to you, and what stock is low. Fifteen minutes a week puts you ahead of most shops on your street.

8. When to hire

The trigger is not "I am busy." It is one of two things. You are turning away customers or closing early because you cannot cover the hours. Or you are spending so long on tasks worth NPR 100 an hour that you have no time for the ones worth NPR 1,000.

A staff member on NPR 20,000 a month costs more than NPR 20,000. Plan for the extras:

Once someone else sells while you are away, you need to know what was sold without watching it happen. This is where paper stops working. Not usually theft, but drift and gaps nobody can reconstruct later.

Karobar handles this with staff roles. Your employee records sales and checks stock without seeing your margins, cash position or supplier prices. Every entry is attributed. You can check the day’s takings from your phone and reconcile the drawer in under a minute. If you open a second outlet, multi-business support keeps the books separate under one account.

The businesses that survive their first year in Nepal are rarely the ones with the best idea. They are the ones whose owners knew their numbers early enough to act on them.

Frequently asked questions