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". Gourmet is an industry classification for highquality premium foods in the United States. Gourmet may describe a class of restaurant, cuisine, meal or ingredient of high quality, of special presentation, or high sophistication. Gourmet food is characterized by high quality, accurate preparation, and artistic presentation. This name “gourmet” was suggested by his daughter who is living in America. “Gourmet Bakers and Sweets” is the largest food retail chain of Lahore. It is based in Lahore, the second largest city of Pakistan known for its traditional foods and passion for eating. It was started with a single outlet in Ichra in 1987 by Mr. Muhammad Nawaz Chathha, in the begging they did not get good response which resulted in shut down. He again started in 1992 at different place at Muslim town, and Gourmet did not look back since then. Now with its 5 production units, 2 restaurants and 88 sales outlets, gourmet outreaches to a huge population for their food needs. Mr. Chathha the founder of Gourmet stared his business with 20 million rupees. He is holding the position of Managing Director of the company. He was serving in Shezan Bakers as a General Manager and later on he decided to make his own bakery. He started his business through getting employees from Shehzan bakers in the beginning. Gourmet produces a wide variety of bakery items, sweets and dairy products and offers high quality services in their restaurants. Gourmet has introduced many new items in bakery products categories which were previously not in the market of Lahore. Gourmet stresses hard on quality and taste of their products and making them affordable for their customers at the best prices in the market.
The company has shown an explosive annual growth of more than 25% till 2006 in its business since this unique business was started in 1992. Recently gourmet shows 65% of annual growth in its business from 2006 to 2009. With his commitment and strenuous effort to provide the consumers with best quality food products in a convenient and unmatched displaying manner, Gourmet has become a success story of business growth in Pakistan. At the moment Gourmet has more than 4500 employees working in the organization. Mission statement:“Our mission is to provide quality products at lowest prices” Vision:“Leader of quality juice providers in the region by offering products enjoyed in every home. This will be achieved from the dedication of each employee in conjunction with supportive participation from management at all levels.”
Gourmet Dairies is another step forward to provide its consumer with wholesome milk and milk products. This is also a sort of backward integration for the provision of dairy raw materials for bakery.
ORGANIZATIONAL/ HIERARCHY CHART OF GOURMET:
Director G.M Production G.M Market Assistant General Manager Area Managers Branch Supervisor Assistant Branch Supervisor Complaint Manager/ Auditor Purchase Manager
Assistant Branch Supervisor
Industry analysis: -
The food items industry has been rising constantly at a considerable rate and the eating habits of people are changing over time with the changing life styles. With the growing trend of having light snacks with tea in the afternoon and other readymade snacks for a meal instead of the traditional meals of curry n bread, the demand and consumption for the products of this industry is growing rapidly. Apart from that as more people and youngsters are working especially the women, their daily lives are becoming very fast and they don’t have time to cook at home. Due to this reason more people are now seeking convenience goods, which act as a alternative to the traditional meals. Although people are becoming more aware and more health conscious thus they demand high standards of quality and hygiene along with a balanced nutrition. Along with that the trend of celebrating events and having a get-together in the West is now sweeping our culture as well and more people are now celebrating many different events such as birthdays, ceremonies, anniversaries, New Year, Valentine’s Day, Mother’s Day etc as compared to the few events celebrated earlier such as Eid-ul-Adha, Ramadan, Eid-ul-Fitr, weddings, birthdays and get to gether. These events boost the sales of this industry as people opt to buy things from outside instead of cooking themselves. The trends of dining out have also grown rapidly over the past few years and that’s the reason why many new companies like Gourmet are entering the Restaurants market. The acceptance and need for such products are growing every passing day and it is expected to grow at a higher rate in the future as well which is a very healthy sign for companies like Gourmet to invest smartly and be in front.
Indonesia. Similarly the production distribution and use of Gourmet’s products are subject to some federal laws. Pakistan ranks 46 out of 139 countries in terms of business cluster development compared with India at 29 and China at 17. As shown in Table 1. Malaysia and China. Table 1: Business Sophistication9 Countries Cluster Developme Pakistan India Indonesia Thailand Malaysia China nt. They also have to comply with federal. Pakistan ranks lowest when compared to other Asian countries including India. According to the Global Competitiveness Report 2010-2011. Pakistan ranks poorly in terms of domestic commerce measures: business sophistication. goods market efficiency as well as property rights protection. Thailand. The political environment directly influences all the industries working in the country. The businesses are subject to the Government stability in the countries as the businesses are directly subjected to the taxation policy of the country they are operating.PEST analysis:1) Political change= from one party (change of government) to another Political analysis:Political scenario in Pakistan has seen many important changes in recent years. 46 29 24 34 15 17 Local Supplier Quantity 87 7 43 26 29 19 Local Supplier Quality 95 60 61 43 37 54 . such as the Food and Drug Act. state and local environmental laws and regulations.
shopping areas and offices in large complexes. Increase in exemptions for income tax will increase the buying potential of gourmet customer . Above situation analysis of taxation structure for 2010-11 shows some mixed trends for the future prospectus of gourmet baker of Pakistan. The reformed GST will not apply on health. food grains and cereals. and heavy metals. beverages. a small office space of 12 x 38 square feet is rented out for between PKR 29. All these improvements will help Gourmet baker to enter in new markets which are conscious about traditional food items and also with security measures such as Sharjah.200 (maximum) in Islamabad.640 (minimum) to PKR 91. The Pakistan Pure Food Laws (PFL) of 1963 is the basis of the existing traderelated food quality and safety legislative framework. food preservatives. 7. food and synthetic colors. These laws cover 104 food items falling under nine broad categories: milk and milk products. spices and condiments. sweetening agents. Trading policies are the long run hurdles that cannot be resolved in near future. but no space has been provided for large complexes to develop. The productivity of a city and employment generation needs more entertainment. The GST will not apply to turnover less than Rs. Dubai and other Middle East countries. fruits and vegetables and miscellaneous food products. • TAX MEASURES 2010-11 Existing system of General Sales Tax would be reformed to eliminate multiple tax rates and replace it with a single lower rate of 15%. hotels. education and food items consumed by the poor. antioxidants. edible oils and fat products. The regulations address purity issues in raw food and as well as additives.According to the prices above. starchy food.5 million per year whereas the current threshold is Rs 5 million per year and would be automated thus reducing possibilities of corruption and refund delay.
• Home market lobbying/pressure groups In Pakistan sugar industry is operated almost in all by some political families and in food industry sugar is a major raw material.and will stabilize the employee the gourmet baker by strengthen there economical conditions. Shopping trends are decreasing due to suicidal attacks and . In the mean while increase in GST and Surcharges on electricity consumption will lower down the sales volume of gourmet products due highly cost of production resulting in high product prices. For the sake of fetching good profits these groups put a strong pressure and prove themselves a strong lobbying group. Strong transport unions may also create some logistic problems for Gourmet baker distribution channel. Low labor costs in India has enable Indians to get more share in international markets. In the mean while Indian lobby is strong enough as compare to Pakistan to reach in foreign markets. Employee union is also an other lobbing group that pushes the gourmet baker for higher wages that will result in high cost of productions. Gourmet and many other entrepreneurial needs strong government assistance and coloration to enter in international markets • Wars. • International pressure groups India is a leading manufacturer of sweet and bakery items. conflict & Terrorism Recent wave of war against terrorism has created a sense of in security in general public in Pakistan.
there has been a crisis in the production of sugar in Pakistan. Economic analysis Despite inhospitable domestic and international environment resulting from the either the global recession or due to the terrorism acts. oranges. increase in per capita income and increase in IT development as well which are positive signs for the industry but there are some negativities as well. – Gourmet also relies heavily on trucks to move and distribute many of their products. Pakistan’s economy grew by 2 percent in the financial year 2008-09 according to Economic survey 200809. for example. vegetables etc. Moreover. The increasing number of women going out to work. grapefruit. Like all the other companies are subject to the harvest of the raw material that they use in their soft drink and juice. Another crisis that Pakistan is dealing is the shortage of electricity. Reports have shown increase in GDP. Rate of interest raises depressing business and causing redundancies and lower spending levels as well as energy crisis too. Such economic factors have resounding impact on such industries and increase the cost of goods. with prices sky rocketing. so they are subject to the fuel prices. like corn.people are not willing to come at bazaar as they were in past. This situation has adversely affected the sales of gourmet baker and sweets. Socio-culture analysis . 3) Socio-cultural change=Involves changing attitudes and lifestyles. 2) Economic change= For example a recession creating increased activity at the lower ends of product price ranges. led to the need for time-saving products for the home. fuel is a very important subject.
w). Gourmet has to pay a special attention on the lifestyle changes. major portion of its population consists of youth. birthdays. Shabraat. Eid-ul-Fiter. Technological analysis Pakistan is considered as developing country. e-commerce. valentine`s day and get together. This has affected the industry in the positive manner and many new companies are being entered in the food market. Engagement parties. as it is not heavily dependent on technological advancements like the . Further Income of people is increasing more trends towards FMCG. There is a large population of the age range known as the baby boomers. Technology plays a secondary role in this industry. Although it is a nuclear power yet it lacks behind in other technologies. Eid milad-un-Nabi (s. Further a major social trend in the rural areas of Pakistan has been a shift from presenting guests with drinks and bakery products such as lassi towards such beverages and bakery products.the internet. Weddings. People use bakery products on different events new born babies. Gourmet bakery products. Basant. Father`s day.a. mother`s day. The need for hygienic products and healthy products are in important in the average day-to-day life. All these situations are calling for new and new opportunities and investors. the usage of the food products in the households has increased a lot. 4) Technological change=creates opportunities for new products and product improvements and of course new marketing techniques. dairy products as well as beverages and moreover Juices and ice creams are subject to the lifestyle changes as the awareness of health consciousness is rising in the people now.The population of Pakistan is on the rise where as the health consciousness among the people is also a lot more than it has been in the past. The age distribution of Pakistan is also very balanced. Consumers from the ages 37 to 55 are also increasingly concerned with nutrition. Eid-uladha.
he could generate competitive advantage. technology in this industry is therefore limited to function as a catalyst to improve production capacities. Because bakery and beverages products are non-tech based in nature. Weaknesses. The SWOT analysis will give you a clear picture of the business environment Gourmet Baker Pakistan is operating in at the present time. the opportunities and threats. speed of product manufacturing cycles. Internal factors. SWOT Analysis: SWOT stands for Strengths. inventory management. It has to pay attention to the new distribution techniques as well. Due to affective transport facility the company has achieved great success in distributing its products to all over the country. Weaknesses. The new technology of internet and television which use special affects for advertising through media. SWOT Analysis of Gourmet Strengths: Research and Development Center: By having a strong R&D center Gourmet is offering a quality product to their customers. the strengths and weaknesses and external factors. Gourmet is offering a product to their customer in different packing and according to different occasions. Opportunities and Threats. or the software industry. Well Organized Structure: . The analysis shows Gourmet Baker Pakistan's Strengths.consumer electronics industry. They make products look attractive and this help in selling of the products. Even though one have to take into account that specialized factors involve a heavy and sustained investment. Opportunities and Threats. but also at the same time if one is able to achieve them.
Customer Retention: . All the departments perform their work according to the organizational structure.Gourmet has a well organized structure. Quality: By applying the various strengths Gourmet offers the product to the customer. Computerized database provides error free center. Computerized Database System: Gourmet has an organized database. It is updated on the regular basis. HR and Administration etc. Team Work: All the departments are working as a team such as Quality assurance. which can only be seen as strength in their overall performance. all the activities are recorded in the database. Gourmet never compromise on quality that is why they are able to capture a huge market share. Low cost: Keeping costs lower than their competitors and keeping the cost advantages helps Gourmet Baker Pakistan pass on some of the benefits to consumers. Sweet and other bakery products are prepared with immense care using traditional and authentic recipes to give unforgettable taste. Marketing. Working as a team increases the efficiency of the Gourmet. MIS. Supplier relationship: Supplier relationships are strong at Gourmet Baker Pakistan. 100% of production at Gourmet is carried out at automated plants.
As retaining the customer is better rather than switching towards the new customers. newspaper.As Gourmet is offering complete range of sweets. Latest Machinery required increasing the Production Rate: Latest machinery is the key strength of any organization. Gourmet Baker Pakistan is in good financial position. • • . which is an opportunity for them to explore in terms of investment in new projects. and bakery products to their customers with the best quality and taste. Opportunities: • Gourmet Baker Pakistan could benefit from expanding their online presence and making more money from online shoppers/internet users. but Gourmet lacks in this point. By using the appropriate resources they can advertise their product by different tools of advertisement. By using the latest machinery Gourmet can increase the production rate. The changes in the way consumers spend and what they buy provides a big opportunity for Gourmet Baker Pakistan to explore. dairy. magazines and many other materials supplied by the media and press. Weakness: Less Financial resources for advertisement: Gourmet is using less financial resources for advertisement. No broadcast media is used: The term broadcast media covers a wide spectrum of different communication methods such as TV. radio. so more focus should be on broadcast media. Gourmet is able to retain the customers because of its brand name and worth of the brand.
either geographically or through new products. Gourmet Baker Pakistan has a number of highly skilled staff. Brand Worth: Gourmet is the well recognized brand nationwide and it is also operating internationally which means the worth of the brand is good in the mind of the customers. • Many cities to capture: One of the most important opportunities is that Gourmet can increase their target market by capturing other cities which consist of the potential customers. Because of the brand worth Gourmet can come up with the different market of bakery products. Threats: • Consumer lifestyle changes could lead to less of a demand for Gourmet Baker Pakistan products/services. which is an opportunity for them to explore as expertise of their staff can help Gourmet Baker Pakistan to bring the business forward.• Grasping the opportunity to expand the customer base is something Gourmet Baker Pakistan can aim for. New market to explore nationwide and internationally: It is the great opportunity for Gourmet to expand their business and market by exploring the new markets nationwide and internationally. • Expanding the product/service lines by Gourmet Baker Pakistan could help them raise sales and increase their product portfolio. .
for instance. Gourmet Baker Pakistan could be threatened by the growing power customers have to set the price of their products/services. Extra competition and new competitors entering the market could unsteady Gourmet Baker Pakistan and be a threat.• Tax increases placing additional financial burdens on Gourmet Baker Pakistan could be a threat. Change in demographics could threaten Gourmet Baker Pakistan. The actions of a competitor could be a major threat against Gourmet Baker Pakistan. Increased competition from overseas is another threat to Gourmet Baker Pakistan as it could lead to lack of interest in their products/services. The rise and/or fall of the foreign exchange rate could threaten Gourmet Baker Pakistan with regard to importing and exporting. if they bring in new technology or increase their workforce to meet demand. A slow economy or financial slowdown could have a major impact on Gourmet Baker Pakistan business and profits. • • • • • Gourmet could be a big threat because it is also offering a sweet Nirala’s taste and quality could be the restrictive force for other to penetrate. Gourmet Baker Pakistan could be threatened by the growing power their suppliers have to set their prices. • • • • • • Price wars between competitors. The financial burden of increasing interest rates could be a threat to Gourmet Baker Pakistan. Rising costs could be a major downfall for Gourmet Baker Pakistan as it would eat into profit. Change in the consumer preference: . price cuts and so on could damage profits for Gourmet Baker Pakistan.
2. a company should have a portfolio of products that contains both high-growth products in need of cash inputs and lowgrowth products that generate a lot of cash. therefore the cash in each direction approximately nets out. it will become a cash cow when the market growth rate declines. It has two dimensions: Market share Market growth The basic idea behind it is that the bigger the market share a product has or the faster the product's market grows the better it is for the company. high market share) . high market share) Stars generate large amounts of cash because of their strong relative market share. As if we talk about Gourmet now people prefer international brand over local brand which have become a major threat. Placing products in the BCG matrix results in 6 categories in a portfolio of a company: 1. If a star can maintain its large market share. but also consume large amounts of cash because of their high growth rate. BCG Matrix The BCG matrix method is based on the product life cycle theory that can be used to determine what priorities should be given in the product portfolio of a business unit. Stars (=high growth.Changing of consumer preferences is a major threat of any organization. Cash Cows (=low growth. To ensure long-term value creation. The portfolio of a diversified company always should have stars that will become the next cash cows and ensure future cash generation.
4. Such businesses are candidates for divestiture. to fund research and development. Dogs (=low growth. and eventually a cash cow when the market growth slows. its value can be determined with reasonable accuracy by calculating the present value of its cash stream using a discounted cash flow analysis.As leaders in a mature market. A question mark (also known as a "problem child") has the potential to gain market share and become a star. cash cows exhibit a return on assets that is greater than the market growth rate. but because they have low market shares they do not generate much cash. to cover the administrative costs of the company. and to pay dividends to shareholders. Cash cows provide the cash required to turn question marks into market leaders. and thus generate more cash than they consume. Because the cash cow generates a relatively stable cash flow. then after perhaps years of cash consumption it will degenerate into a dog when the market growth declines. Question marks must be analyzed carefully in order to determine whether they are worth the investment required to grow market share. dogs are cash traps because of the money tied up in a business that has little potential. Question Marks (= high growth. . low market share) Question marks are growing rapidly and thus consume large amounts of cash. If the question mark does not succeed in becoming the market leader. However. 3. Such business units should be "milked". The result is large net cash consumption. to service the corporate debt. extracting the profits and investing as little cash as possible. low market share) Dogs have low market share and a low growth rate and thus neither generate nor consume a large amount of cash.
per day sale of Fazal sweets in 2010= Avg. per month sale of Fazal sweets= Estimated sale of 2008= NIRALA SWEETS: Avg. per day sale of Fazal sweets in 2009= Avg. perhaps by repositioning into another market.000 68.000 21600. per month sale of Nirala Sweets = Estimated sale of 2010= 60000 1800. or whether it can be revived. and are probably best discontinued. 6.000 2040. the problem for management is to decide whether the product is in an irreversible decline. DATA FAZAL SWEETS: Avg. per day sale of Fazal sweets in 2008= Avg.5.000 63. per month sale of Fazal sweets= Estimated sale of 2010= Avg. Dodos They have a low share of a negative growth market. per day sale of Nirala Sweets in 2010= Avg.000 24480. per month sale of Fazal sweets= Estimated sale of 2009= Avg.000 1890.000 . War Horses They have high market share.000 75000 2250.000 27000.000 22680. but the market has negative growth.
000 30600.000 7200.000 20.000 85. per day sale Nirala Sweets in 2008= Avg. per month sale of Nirala Sweets = Estimated sale of 2009= Avg.000 1500.000 1200.000 25200.000 600.000 18000. per month sale of Gourmet Sweets = Estimated sale of 2010= Avg. per day sale Gourmet Sweets in 2008= Avg.000 70.000 25550. per day sale of Gourmet Sweets in 2009= Avg.Avg. per month sale of Nirala Sweets = Estimated sale of 2008= GOURMET SWEETS: Avg. per day sale of Gourmet Sweets in 2010= Avg.000 2100.000 14400.000 SALES Companies Fazal sweets Nirala Gourmet 2008 2268 720 1800 2009 2448 1440 2520 2010 2700 2160 3060 Total 7416 4320 7380 . per day sale of Nirala Sweets in 2009= Avg.000 50. per month sale of Gourmet Sweets = Estimated sale of 2009= Avg. per month sale of Gourmet Sweets = Estimated sale of 2008= 40.
45% INTERPRETATION: In the BCG matrix.78 2009-10 0.26 0.GOURMET SWEETS STARS QUESTION MARK N1 N2 Gourmet (2008-2009) .8 and market growth is given at y-axis with a median point of 38.56/3=0.83% and with positive growth upward and negative growth downward.85 MARKET GROWTH Company Growth of 2008 to 2009 Each year Fazal sweets Nirala Sweets Gourmet Sweets (2448-2268)/2268*100=7. Positive growth upward and negative growth downward. BCG MATRIX.31 0.57 1.79 2.36/3=0.29% (2160-1440)/1440*100=50% (3060-2520)/2520*100=21. Relative market share is given at the x-axis with a median point of 0.97 0.Total 4788 6408 7920 RELATIVE MARKET SHARE-(RMS) Companies Fazal sweets Nirala Gourmet Total 2008-09 1.02 2.94% (1440-720)/720*100=100% (2520-1800)/1800*100=40% 2009 to 2010 (2700-2448)/2448*100=10.
The western people eat chocolate as sweets but in our region sweets are mithai.5 1. people of our region have different taste in sweets as compared to west. So in every town every city of Pakistan these sweets shops are seen. Lahore and the people of Lahore are known for their tastes and eating habits so there are many small scale sweet shops .4 .6 .2 .2 1.0 .0 DODOS Relative Market Share INDUSTRY AND MARKET DESCRIPTION Sweets are in our culture for centuries.83% CASH COWS Market Growth 0 1.1 .1 1.3 1.8 WAR HORSES Gourmet (2009-2010) F1 F2 DOGS .7 .4 1.5 .100% 38.3 . It is our cultural heritage.9 .
But this trend is not in sweets industry the habit of eating sweets is very much in like centuries before. Although the tastes of customers in many other dishes are changing people now a days are eating fast foods and liking Chinese and western dishes rather than our typical eastern or Pakistani dishes. 1. no ceremony or other occasion of celebration is complete without sweets. Brand Positioning: . CUSTOMER CHARACTERISTICS How selective is your customers in terms of buying your product How much customer switch from your product to another product POSITIONING AND BRANDING Gourmet carries its image in a positive manner. Although the industry of sweets is century old but it is not fading with the time it is getting rich day by day. Gourmet has also started as a small shop in Lahore but with changing market conditions with increase in purchasing power of customer and their every day changing taste buds gourmet has also improved. With the ever increasing purchasing power people are purchasing sweets in bulk form. Its packaging is perfectly according to the occasions. It is the most essential component of wedding no wedding. like we have seen many western dishes in our wedding occasions which shows the changing consumer needs. For the best quality and impressive representation of the events people prefer gourmet. In consumer’s perception Gourmet is producing hygienic products with high quality.in almost every area.
Product Attributes/Features: The products being sold at Gourmet carry the following attributes which are: • Quality: Gourmet has been very careful and has been following a very strong standard for maintaining its quality so that customer is not complaining about its products. .Gourmet Position their product in the mind of the consumers by offering: Superior in Price and Taste Quality Freshness Superior Quality Brand Name 2. Brand Image/Personality: Superior in Price and Taste Status Conscious (consumer’s perception) Strong Commitment No Compromise on Taste & Quality Positioning: Product Analysis: The main product because of which Gourmet was able to make a name for it and has been continuing to go on and on is mithai and they are famous for it but their bakery products and beverages also give value to their customers. The product includes: 1.
• Purity: It’s another attribute which has been taken care of. • Good Taste: Taste is because of which a customer would love to purchase a product again if he likes the taste of your product. In products such as mithai where people like that they get pure things specially in milk and better where there are chances that the customers don’t get pure products. Benefits: • Same taste: This is one of the biggest benefits of coming to Gourmet that the consumer will get the same taste whenever he purchases products from Gourmet it’s not that at one time the products will taste different and other time they would be different. • Freshness: Food products all over the world are loved for their freshness and if we talk about products which Gourmet is selling they should be fresh otherwise customer won’t purchase it. 2.Since they are dealing in food products where quality plays a very vital role so they believe in quality good and healthy product to the customer. For so many years. Gourmet has been way ahead in the market and leading it on the basis of its taste and it promises to give good taste to their customer so that they enjoy it. Gourmet has made sure that they use pure materials in making of the product so that when the customer gets it they don’t feel that it’s not pure. Gourmet promises to give fresh products to their customers by giving them those products which they feel are good and healthy to eat and if any product they feel is not fresh enough they won’t give it to the customer. .
• Cleanliness: At each and every outlet of Gourmet.• Uniqueness: One of the strong aspects of Gourmet is that its sweet (mithai) has a unique and at the same time very nice taste which no other player in the market is providing. • Brand Name and branding Gourmet is one of the strongest brand name and market leaders in its field which enables them to get more benefit out of it. Since they are one of the biggest as well as the oldest in this field they have established a name in the market and consumers are automatically attracted towards Gourmet. special emphasis is laid on cleanliness so that consumer feels that he is standing at a nice place and doesn’t get irritated. SEGMENTATION AND TARGETING . • Large Variety: The customers can benefit from a large range and variety which Gourmet is providing them not only in its major products which is sweet (mithai) but lot of other products such as dairy products etc. Owner Point of View: • Social Class: From Gourmet point of view they are benefiting from segment they are targeting which is the upper middle and upper class as they enjoy a large amount of profit by charging handsome amount and are enjoying huge amount of financial reward.
There prices of Gourmet products are higher as compared to their main competitors and secondly their shops and stores are mainly located costly areas of cities. They have been successfully able to shift their small scale business to a company level business. They changed their stores outlook made them more modern and updated and introduced more updated functions in stores operation. but they successfully expanded their business to other big cities of Pakistan. The other example of their continuous learning about the market is their successful launch of snacks product category and their dairy products. Their initial area of business was their hometown Lahore. Keeping these factors in view we can say that there target market is upper middle to upper class. They started their business from the inner city congested Locality as traditional sweet shop mostly found in cities doing small scale business and selling only mithai related products or dairy products. They launched Gourmet milk in the market a few years back although their milk was not the big success as it has to compete industry giants like nestle. Their major focus is on quality of their products so to maintain strict laws of quality they have separate quality control department. Continuous Learning about the Market: Gourmet is different from others because they have been continuously upgrading themselves over the years. Secondly they continuously keep working on their products and for over the years been able to launch different successful products in market. But Gourmet has learned a lot from the changing tastes of their customers and their preferences. haleeb etc. but their snacks category is successful and been able to capture a large portion of the .
e. including teenagers. old usually suffers from different sugar prohibit diseases.e. Target Market Analysis: Demographics: Mithai is a product well-known among all age group people. virtual placement in order to facilitate the customers worldwide. People of all: Age Gender Generation Family Size People belong from all ages generally love sweets and our core products so there is no exception likewise teenagers like it whereas old people don’t like it.market. New generation is more concern about new taste and looks. These snacks and beverages are not only available at gourmet stores but at some other stores also. So this sector is a low consumer of their traditional product. youngsters. Being a server of eastern society like Pakistan where family size is usually large which means strong concern about events and occasions. Gourmet as one of the . but in one sense gourmet is targeting more towards people belong from age group approx 10 to 50 years I. gourmet’s seems quite conscious about this factor. mature people however age group exceeding 50 years i.e. It is continuously modifying its products according to the changing needs of the new generation i.
Islamabad. Banners.e. Advertisement on public transport . Magazines. Sialkot. whether it’s a joyful moment like marriages or a moment of sorrow. Multan. Gujranwala Psychographic: Marriages. Rawalpindi. Faisalabad. Newspaper. Geographic: Gourmet is targeting mostly the urban areas all over Pakistan Lahore. Leaflets. Karachi. cultural occasions and personal events are the events from which no social class can be excluded.largest sweet dealers was always be there to facilitate them i. However being a sole marketer of high quality which ultimately leads to higher price. Media Graphics Hoardings. Kasur. Gourmet’s focus is more towards society’s middle and upper class.
Government Policy: In our country the government has no policies for this industry. Own Distribution System: .Porter 5 Forces Threats of New Entrants: Capital Requirements: High capital cost is required for acquiring good places for the outlets if anyone wants to jump in the market.
because gourmet already has introduced such type of taste & quality in this industry that it is very hard to compete. Convince Product Low Involvement of Buyers Buying Behavior – Price sensitivity Brand Loyalty Status is low . Brand Identity: To identify a brand in the market is more difficult for any new entrants. Gourmet has its own distribution systems. Bakery makes cakes. Threat of Substitute Products: The substitute products may be. chocolates. ice-cream etc Local area manufacturers Bargaining Power of Buyers: The bargaining powers of buyers are high because.It’s very difficult for newcomer to own a distribution channel because it needs huge investment.
Bargaining Power of Suppliers: The bargaining powers of suppliers are low because. Now Gourmet has become its own supplier. ORGANIZATION PROCESS AND CULTURE Culture and environment inside the Gourmet is very much attractive people serving customers are always available for service. It is an honor to become a supplier for Gourmet. Computerized database provides error free center. Computerized Database System: Gourmet has an organized database. More than 20% of Mithai production at Gourmet sweets is carried out at automated plants. all the activities are recorded in the database. . It is updated on the regular basis. Large number of suppliers in the market. Well Organized Structure: Gourmet has a well organized structure. All the departments perform their work according to the organizational structure. The person at desk always is in a happy mood to treat the customers.
-in new product development -in forecasting and managing cash flow. Marketing. withdrawal etc. Working as a team increases the efficiency of the Gourmet sweets. HR and Administration etc. Quality: By applying the various strengths gourmet offers the product to the customer.Team Work: All the departments are working as a team such as Quality assurance. Gourmet never compromise on quality that is why they are able to capture a huge market share. redesign. Sweet is prepared with immense care using traditional and authentic recipes to give unforgettable taste. The stages of the product life cycle: • • Development Introduction . • • • Each product – different Determines revenue earned Helps -identify when a product needs support. Product Life Cycle: The stages that product go through from development to withdrawal from the market. MIS.
Stars.Covert to star.products with low market share in industries with high growth potential.products with high market share in industries with high growth potential. BCG Strategies .make heavy investment because of sales/profit potential. or Exit market.• • • Growth Maturity Decline Gourmet sweet & bakers Gourmet bakers Gourmet deals in multi products and it possess: • • • • • • • A distinct mission Own managers Identifiable customer segments Specific competitors Ability to plan independently Question marks.
There are 4 major strategies that can be followed.products with high market share in industries with low market growth potential-maintain status as long as possible-products produce strong positive cash flows. Build Hold Harvest Divest Build The product or SBU’s market share needs to be increased to strengthen its position.This strategy are suited to Question Marks. Invest in one or more SBUs to build a share . the planner then has to decide on a strategy for that product.• Cash cows. HIGH HIGH LOW Stars Cash cows(hold) LOW Question? Dogs Dodos Model Use and Applicability • • War Horses The BCG identified four major strategic thrusts in terms of market share. Once the products have been plotted. • Dogs-products with low market share in industries with low market growth potential-minimize position-withdrawal. Cash cows support Gourmet because of good will and market share. .
sustaining or holding the Cash Cows. and for Dogs. price increase. This strategy is typically used for Question Marks that will not become Stars and for Dogs. Divest The objective of this strategy is to rid the organization of the products or SBUs that are drain on profits and to utilize these resources elsewhere in the business where they will be of greater benefit. Gourmet invests just enough to maintain a share in the market. Gourmet aim is to achieve a balanced portfolio. Hold Gourmet objective is to maintain the current share position and it lies in cash cows and this strategy is often used for Cash Cows so that they continue to generate large amounts of cash. Cash Positions of Gourmet VS Competitors .g. Gourmet lies in Cash cows and these are cash generators and require an invest or hold strategy while maximizing cash flow. It is a strategy suited to weak Cash Cows or Cash Cows that are in a market with a limited future. Harvesting is also used for Question Marks where there is no possibility of turning them into Stars. cutting costs). Harvest Here management tries to increase short-term cash flows as far as possible (e.
Business Type Cash Cows(Gourmet) Star Cash Source More More Cash Use Less More Net cash Balance Funds available Build Competitive position and grow Dog (Fazal Sweets) Question mark(Nirala Sweets) Less Less Divest and redeploy proceeds Less More Funds needed to invest Market Attractiveness/Business Strength Matrix Or GE Matrix It includes: Market Attractiveness Organizations strength Gourmet Attractiveness is determined by factors such as: Market Growth Rate Market Size Demand Variability Industry Profitability Industry Rivalry Global Opportunities Macro Environmental Factors (PEST) Gourmet Strength can be determined by following factors: .
Market Share Growth in market share Brand Equity Distribution Channel Access Production Capacity Profit margin relative to competitors Technological or other innovation Customer Loyalty GE Matrix (Gourmet sweets & bakers) .
A position in the red zone is not attractive.Gourmet sweets & bakers Gourmet lies in YELLOW ZONE. This indicates a "green light" to invest in this product/service. Best Strategy: INVEST FOR EARNINGS The GREEN ZONE consists of the three cells in the upper left corner. Management must therefore exercise caution when making additional investments in this product/service. High Attractiveness LEADER Strong Competitive Position Strategies: provide maximum investment diversify your position to focus High Attractiveness GROWTH Average Competitive Position Strategies: build selectively on strength define the implications of challenging for market High Attractiveness IMPROVE/QUIT Weak Competitive Position Strategies ride with the market growth seek niches or specialization seek an opportunity to increase . The suggested strategy is that management should begin to make plans to exit the industry. Best Strategy: INVEST FOR GROWTH The RED ZONE consists of the three cells in the lower right corner. The suggested strategy is to seek to maintain share rather than growing or reducing share. Best Strategy: HARVEST or DIVEST. If your enterprise falls in this zone you are in a favorable position with relatively attractive growth opportunities. a position in the yellow zone is viewed as having medium attractiveness.
your resources accept moderate nearterm profits to build share Medium Attractiveness TRY HARDER Strong Competitive Position Strategies: invest heavily in selected segments establish a ceiling for the market share you wish to achieve seek attractive new segments to apply strengths Low Attractiveness CASH GENERATION Strong Competitive Position Strategies: defend strengths shift resources to attractive segments examine ways to revitalize the industry time your exit by monitoring for harvest or divestment timing leadership strength through acquisition fill weaknesses to avoid vulnerability Medium Attractiveness Average Competitive Position Strategies: segment the market to find a more attractive position make contingency plans to protect your vulnerable position PROCEED WITH CARE Medium Attractiveness PH. WDL Average Competitive Position Strategies: make only essential commitments prepare to divest shift resources to a more attractive segment Low Attractiveness WITHDRAWAL Weak Competitive Position Strategies: exit the market prune the product line . WDL Weak Competitive Position Strategies: act to preserve or boost cash flow as you exit the business seek an opportunistic sale seek a way to increase your strength Low Attractiveness PH.
STRATEGIES BUSINESS STRENGTH (Gourmet) Strong PROTECT POSITION • • Invest to grow at maximum digestible rate. Concentrate effort on • • areas maintaining strength • Medium INVEST TO BUILD Challenge for leadership Build selectivity on Reinforce vulnerable • • strengths • Weak BUILD SELECTIVITY Specialize around ltd strengths Seek ways to overcome Withdraw if indications of sustainable growth are lacking weaknesses .
Scorpio technique is a continuous process of every company and each and every company have own time frame to review the technique may be in 0ne year or one month .BUILD SELECTIVITY • • • • Invest heavily in most attractive segments Build up ability to counter competition’ Emphasize profitability by raising productivity Hold SELECTIVITY/ MANAGE FOR EARNINGS • • Protect existing program Concentrate investments in segments where profitability is good and risks are relatively low.may be in one week or other . . LIMITED EXPANSION OR HARVEST • Look for ways to expand without high risks else minimize investment PROTECT AND REFOCUS • • • Manage for current earnings Concentrate on attractive Defend strengths segments MANAGE FOR EARNINGS • • • Protect position in most Upgrade product line Minimize investment profitable segments DIVEST • Sell at time that will maximize cash value • Cut fixed costs and avoid investments meanwhile SCORPIO TECHNIQUE This technique is used to justify the strategies that we have selected while doing the analyses of BCG Matrix.
2. Middle class. research & development. upper class. because large number of . beverages and dairy products. CUSTOMER:- 1. Cakes. Example:.Industry or Market Industry or technology thinking 1. e-commerce. pastries. upper middle class.online complaint centre.
customer relation. etc Reliability.branches are there for their easy access.g. 5. loyalty. 5. 4. upper class. built a positive relations to customer . Inflation rate. energy crisis. POSITIONING AND BRANDING . Upper middle class. 3. Differentiated. 7. Alternate Distribution Channel. as people are more concerning about health. Increase number of branches. No priority because same treatment to all the customer 6. 2. Branches. to increase loyalty and to do research and survey on customer preferences. By delivering new offerings e. To develop Durability. 4. To increase customers by targeting all the level of social classes now. SEGMENTATION AND TARGETING 1. catering in parties on different occasions. Now they are trying to target all the segments as their beverages are available on other local retail shops. online complaint desk. to targeting the customer according to the need and demand. website under construction (updating reason). customer retention. 7. Soft drinks charges are less then coca cola and Pepsi etc. 6. high prices of sugar. each and in every branch give response to the customer same and fair interaction. online complaint desk. 3.
6. more and more improvement in quality of the product and position to built relation to customer to improve brand loyalty 4. Differentiation marketing. high quality and good position 3. Retention Strategies . pamphlets. Customer trust increases 7.1. Increase promotional activities like advertising on different channels. Establishment a complete bakery of first choice to facilitate the customer. 5. concerts etc. 2. To innovate different product and services and built a positive image in the mind of the customer.
Strictly followed Yes BCG Matrix OFFERINGS . 4. Good To get satisfaction of the customers Offering new items. 3. Both internal & external include employees .1. 2.customers Providing better hygienic and healthy food. and giving more value to customer through more advertisement. ORGANIZATION: PROCESSES AND CULTURE 1. 5. Listen and Respond to complaint No. 3. 5. it can also increase the customers No. 6. 7. 4. Holding current customers to attract new customers. 2.
number of branches increase. Through Advertisement. 7. Providing more healthy products to satisfy each and every type of customers 5. 3. 6. cakes. provide value.1. 2. introduced new innovative products. Analysis and recommendations The whole report shows that the Gourmet bakers and sweets are striving to get a competitive advantage against its customers but there are some problems too on which the company should concentrate because they serve many other factors respectively 1. Provide banking facility that influence the customers. Different products. pastries. beverages. And secondly they should reduce the employee work hours so that they better deals the customers. improved brand image. . 2. Yes we are managing the life cycle. Gourmet should offers incentives and benefits to its old employees to reduce its turnover rate. 4. Sugar free ice creams. Superior values and services with attractive and hygienic and healthy products. print media.
The Gourmet should increase the quality of the new products as it has offered (milk and ice-cream) and it should also concentrate on the advertisement of the new product seriously. .3. The Gourmet hasn’t advertised themselves through media. 5. The Gourmet should plan for the loyalty of its customers. 4. The Parking area of the Gourmet bakers should be enhanced if their customers face problems in parking . The Gourmet should take feedback from the customers by personally survey and should concentrate on the requirement of the customers. they should have adopted some other source of advertisement to cater the market.then the customer would prefer to go on some other store to find convenience rather than buying for the Gourmet. Well they are well known in the market but they should use TV media for their advertisement. They should give discounts to its regular customers in this way the customer’s sincerity with the company will grow. 8. 7. they could also advertise themselves on the cable in the areas in which they are having their chains. 9. As the people is weight and diet conscious today so the Gourmet bakers should introduce sugar free sweets and cakes for those people too.
They have to acquire new technology for production if they don’t move towards acquiring new technology then they won’t be able to meet the needs of customers. 14. lucky draw schemes should be introduced to attract more customers and involve kids and children to increase sales. They should be concentrating on the quality of their products so that the customers wouldn’t be returning the goods back and thus the image of the Gourmet wouldn’t be lost in the eyes of the customers. 11. Not only more customers will come there will be increase in the number of loyal customers as well. Must capture some special events like local sports series. 13. Sales promotions like prizes. By adopting reduce price strategy they can make more and permanent customers.10. 12. convocations & charities shows by sponsoring these shows as would give a good image about the company to the consumer. .