Byambagereliin BAYARJAVKHLAN

In this edition of its “Business & Development” section, the newspaper “Zuunii Medee” interviewed D. Enkhbold, founder and investor of the “Bagro” factory—one of Mongolia’s pioneering companies that processes vegetables and fruits grown in domestic soil and delivers them to consumers.

- What is your professional background? How did you first become involved in the agricultural sector?
- I am a lawyer by profession. I am also an investor and shareholder of Bagro LLC. During the early years of Mongolia’s democratic transition and privatization in the 1990s, small-scale trading became very active. At that time, my brother and I imported products from Poland and Russia and supplied them to the local market. While importing goods, we set a goal to process raw materials grown in our own country and turn them into finished products. With this vision, we established our company in 2008. In 2009, we launched our factory and began processing locally grown vegetables, fruits, and berries into final products that replace imports, delivering them to consumers under the “Bagro” brand.

- What does the name “Bagro” mean?
- It means “Joyful Agro.”

- What did you do before establishing the factory?
- People of our generation were quite fortunate. Any product brought from abroad was something completely new to the local market. Successes and failures happened quickly. At that time, I was one of the traders involved in cross-border small trade. Together with my brother, we imported goods and containers from Russia, Poland, and China and sold them locally.

- How many employees did you start with, and how many do you have now?
- A production factory requires manufacturing lines, staff, and operational guidelines. The number of workers depends on the type of product being produced. When the factory was first established, we started with 50 employees. At that time, we handled everything ourselves—from production to sales and distribution until the product reached consumers. Today, to adapt to modern market conditions, the operations have been divided into manufacturing and distribution. Bagro LLC, as the manufacturing company, is responsible for production and farming. Meanwhile, WE International LLC acts as the distribution company, handling sales, distribution, warehousing, and brand management. As part of this transition, the sales and distribution staff and related positions were transferred to the distributor company, and structural changes were made. This has allowed us to focus more on production and on manufacturing healthy, high-quality products, while also increasing production volume, product variety, and supporting production lines. Currently, with the new structure, we have more than 50 employees.

- How many types of products do you produce now?
- Over the past 15 years, we have tested and produced around 60 types of products and introduced them to the market. Currently, we produce more than 30 types of products.

- What challenges did you face when you first started, and what challenges do you face now? How do you address them?
- We encountered all the challenges that come with starting a new business. When we first established the company, tax-related difficulties were relatively smaller compared to today’s tax policies. Now, economic crises, rising inflation, and both external and internal factors affect businesses. Additionally, tax and subsidy policies create pressure on both employers and employees. For example, we have gradually increased our employees’ salaries over the past three years, but these increases still cannot keep up with the rising inflation rate. As consumers’ purchasing power continues to decline, maintaining normal production operations also becomes challenging. If the taxes we pay are properly used for national development, social and economic policies, and productive investments, it will eventually improve our livelihoods, purchasing power, production, and the overall socio-economic situation. Therefore, we hope that tax revenues will be used for the right purposes.

- How do you handle packaging and containers?
- In terms of packaging, Mongolia is not a manufacturing country and depends 100% on foreign markets. This directly increases the cost of our products by approximately 50%. In addition, during special circumstances when borders or customs operations are disrupted, there is a risk of supply interruptions.

- It is said that your factory was the first built according to European standards?
- The Bagro food factory has comprehensively addressed the needs for a comfortable working environment for employees, including electricity, heating, hot and cold water, wastewater treatment, and food production safety systems. It was established as the first modern factory in Mongolia—and in our industry—built according to European standards.

Source: “Zuunii Medee” newspaper