Following a seven wicket loss to Cooma, BLU knew they had to improve against the might of Kyabram Fire Brigade.
But their best wasn't enough as they fell short by just 10 runs, although coach Greg Hector refused to dwell on the result.
"They're a very good side and we've done well to get so close," he said.
"The result will give us a lot of confidence going forward knowing we can compete with the better teams in the competition.
"Obviously it's not ideal to start the season with two losses but we're going to stay positive. It's about moving forward and learning from our mistakes.
"We've already done that compared to our performance in the opening game."
With star batsman Greg Pearse unavailable, Chris Smith stepped up to the plate with 69 runs to continue his impressive start to the season.
And it was his opening 78-run stand with Joseph Holloway which kept BLU in the contest.
"We've struggled with our opening partnerships in the past so it's nice to see a change of fortune," Hector said.
"Chris is a new player at the club and already in two games we've seen he is going to be a very valuable player for us.
"If we can have more guys making runs we will be much more difficult to beat."
Amila Gunathilaka and Joseph Nicholls did the damage with the ball, taking three wickets each after opening bowler Jeremy Felmingham lasted just three overs.
"There is no doubting Jeremy's quality so it was important for those guys to stand up," Hector said.
"To limit them to just 174 runs is a stunning effort."
In other games, Tongala easily accounted for Echuca South winning by seven wickets as Adam Nunn finished on 40 not out.
Josh Novoselek top-scored for South with 31 as three players failed to score.
Meanwhile Echuca endured a frustrating afternoon going down by eight wickets against Cooma, as Simon Maddox again led with the bat, picking up 41 runs.
Moama kept their perfect record intact following a three wicket victory over reigning premiers Rochester.
Jordan McGregor did the damage with the bat, scoring 46 runs, also taking two wickets and getting a run out.