PRESENTED TO

MRS. SAADIYEH SAID

FACULTY OF MARKETING

INSTITUTE OF BUSINESS MANAGEMENT

PRESENTED BY

ANUM IMTIAZ KAZI ID# 9260 anumkazii@gmail.com

AYESHA FARHAT ID#

HARIS AHMED ID#

MUHAMMAD MATEEN ANSARI ID# 9144

m.a.mateen.ansari@gmail.com

TAHA BIN ADIL ID#

2
CONTENTS

ACKNOWLEDGEMENT................................................................................................. 4
EXECUTIVE SUMMARY................................................................................................. 5
ENGRO COMPANY PROFILE......................................................................................... 6
ENGRO FOODS LIMITED.............................................................................................. 6
INTRODUCTION........................................................................................................... 7
OMORE....................................................................................................................... 7
KEY FIGURES OF OMORE......................................................................................... 7
MANAGEMENT PROBLEM STATEMENT.........................................................................8
APPROACH TO THE PROBLEM..................................................................................... 8
Literature Review:................................................................................................... 8
RESEARCH PROBLEM:................................................................................................. 8
RESEARCH OBJECTIVES.............................................................................................. 8
HYPOTHESIS............................................................................................................. 10
TARGET MARKET....................................................................................................... 11
SAMPLE SIZE............................................................................................................ 11
WALLS ICE CREAM.............................................................................................. 12
IGLOO ICE CREAM.................................................................12YUMMY ICE CREAM
........................................................................................................................... 12
RESEARCH DESIGN................................................................................................... 13
CONCLUSION............................................................................................................ 23
APPENDIX................................................................................................................. 24
ARTICLE# 1........................................................................................................... 24
ICE CREAM INDUSTRY COMPETITION..................................................................24
BIBLIOGRAPHY.......................................................................................................... 26

3
ACKNOWLEDGEMENT

This report is on Market Potential For Omore Ice Cream Parlor in Karachi. It
has been prepared as a part of our course requirement, Methods In Business
Research.

In this report, we elucidate the methods and objectives in conducting a

Business Research.

Firstly we would thank Allah for giving us the opportunity and the resources to
be able to do something productive with our lives. Without His blessings we
would not have been able to come as far as we have.

Then, we would like to express our gratitude to our teacher of Methods In

Business Research, Mrs. Saadiyeh Said for providing us with the opportunity
to work on this report as a team and to let us practically perform all that we
have studied during the semester. It has definitely been a learning
experience for all of us.

We are very thankful to our teacher for her guidance and help which he has
extended throughout the course of this report, moreover this course Methods
Of Business Research was very informative and instructive for us.

Mrs. Saadiyeh Said demonstrated the real managing existence, providing us

with practical cases from daily routine life, as well as from the marketing
world, and also incorporated a joke or two into her lectures, keeping the
atmosphere light and friendly for the students.

We would also like to pay our gratuitous regards to Mr. Farukh Saad,
Manager at Gelato Affair who spare sometime for us so that we could
conduct the interviews with him. It is true that his responses in the interview
have been very helpful.

4
EXECUTIVE SUMMARY

5
ENGRO COMPANY PROFILE
Engro Corporation Limited is one of Pakistans largest conglomerates with
businesses ranging from fertilizers to power generation.

In the interest of better managing and overseeing businesses of subsidiaries

and affiliates that are currently part of Engros capital investments, Engro
Chemical Pakistan Limited converted into a holding company structure. As
part of this process, two major changes occurred with effect from January 1,
2010; Engro Chemical was renamed as Engro Corporation Limited and it
demerged and transferred its fertilizer business into a separate wholly owned
subsidiary, Engro Fertilizers Limited.

Currently Engro Corporations portfolio consists of seven businesses which

include chemical fertilizers, PVC resin, a bulk liquid chemical terminal,
industrial automation, foods, power generation and commodity trade.

Besides providing the long term vision for the company and overseeing
performance of the subsidiaries and affiliates, Engro Corporation Limited is
also responsible for allocation of capital, management of talent, leadership
development, HR guiding policies, leadership role in public relations and CSR
activities, control structures, legal and IT support.

From its inception as Esso Pakistan Fertilizer Limited in 1965 to Engro

Corporation Limited in 2010, Engro has come a long way and will continue
working towards its vision of becoming a premier Pakistani company with a
global reach.

ENGRO FOODS LIMITED

Engro Foods Limited was officially launched as a fully owned subsidiary of
Engro in 2004. Using dairy as a stepping stone to enter into the food
business, the Company has established state-of-the-art processing units in
Sukkur and Sahiwal, along with an ice cream production facility in Sahiwal.

Top quality brands like Olpers, Olwell, Tarang, Omore and Owsum have been
successfully launched under the helm of Companys dairy products. To
support these brands and their highest standards of quality, Engro Foods has
invested heavily in milk processing and milk collection infrastructure.

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After the success of our dairy products, to which our customers testify, Engro
Foods now plans to venture beyond the dairy sector. In this pursuit, grain and
fruit markets have been analysed in great detail.

Engro Foods vision is Elevating Consumer Delight Worldwide and the

Company aims to generate a significant portion of its revenue from foreign
operations.

INTRODUCTION
Engro Foods Limited was launched in May 2004. It has two manufacturing
sites, one in Sukkur and the other in Sahiwal. Ice cream factory is located at
Sahiwal and the ice cream factorys average operating capacity is 50,000
liters per day.

Yummy 36 was the first brand to set the trend of ice cream parlor in Pakistan
in the late 80s. There was wide gap before others jumped in this retail
business. However, in February 2001 Hot Spot opened its first official branch
in D.H.A which was an innovative idea and turned out to be a success.
Being an organization that is constantly looking for and capitalizing on
opportunities, Engro requires us to determine the scope for a potential
opportunity for Omore in Karachi - the launch of Omore ice-cream parlor.

Being an organization that is constantly looking for and capitalizing on

opportunities, Engro requires us to determine the scope for a potential
opportunity for Omore in Karachi - the launch of Omore ice-cream parlor.

OMORE
Omor was launched in March and formally launched on April 6, 2009.
The ice cream was launched in eight cities and towns. The brand
started with 24 different formats and flavors, 3 of which never
introduced before. Lack of cold storage facilities and proximity of
factory were reason for slow start.

KEY FIGURES OF OMORE

Engro has had its gross profit increase from 6917 million rupees in
2008 to 6931 million rupees in 2009

In just a few weeks, Omor made sales of Rs 10 million on volumes of

76,000 liters.

7
 Ice Cream now has 39 SKUs launched and boasts sales of over 6 million
liters.

Ice cream turnover in 2009 was Rs.751 million.

Market share is 11%

8
MANAGEMENT PROBLEM STATEMENT

Does an opportunity for Omore ice-cream parlor exist

in Karachi?

APPROACH TO THE PROBLEM

Literature Review:

According to Sarah Barrette (2004), the preferences of consumers vary

according to age and gender. Consumer research has shown that preferences
of consumers for Ice cream vary according to age and gender (Sarah
Barrette 2004). It is cited that Children eat more types of ice cream products
and also consume more during a 30-day period. Their consumption varies as
they enter their teenage years.

The most important research in this arena comes from Report Linker which
has covered all the key data on the Ice cream in Pakistan. It provides with a
value volume segmentation and market share data and highlights such
points as the reasons to purchase Ice cream, quantitative trends affecting
the Ice cream markets, consumers consumption and expenditure patterns
and five year forecasting for the market.

Another research can be cited from Data monitor which provides data and
research about a number of topics including take home Ice cream. It also
shows quantitative data on the consumption patterns of take home Ice
cream.

RESEARCH PROBLEM:
To find out if an opportunity exists for Omore ice-cream
parlor in Karachi or not

9
RESEARCH OBJECTIVES
To determine the scope of ice-cream parlors in Karachi and to find out
if an opportunity for Omore ice-cream parlor exists, based on its brand
awareness and perception.
To determine the target market for Omore ice-cream parlor, and to
obtain data regarding their preferred product range, price, location,
and name of the parlor.

10
HYPOTHESIS
H0: : People with high income group would not prefer going to Omore
ice cream parlor.

H1: People with high income group would prefer going to Omore ice
cream parlor

TEST STATISTICS

Chi-Square Tests
Asymp. Sig. (2-
Value Df sided)

Pearson Chi-Square 31.203a 18 .027

Likelihood Ratio 38.230 18 .004

Linear-by-Linear Association 1.591 1 .207

N of Valid Cases 135

Decision
Since the P-value associated with Chi-square (31.203) is very large i.e. >0.005
therefore we do not reject H0 and we can conclude that people with high income group
would not significantly prefer going to Omore ice cream parlor.

H1: Consumers will be willing to try the parlor due to the success of
previous products of Engro and high perceived quality

H0: Consumers will not be willing to try the parlor due to the success of
previous products of Engro and high perceived quality

Test statistics

Decision

Since the P-value associated with Chi-square (37.404) is very small i.e.
0.003 therefore we reject H0 and we can conclude that Consumers will be

11
willing to try the parlor due to the success of previous products of Engro and
high

H1: Consumers who often visit ice cream parlor would prefer the idea
of launching Omore ice cream parlor in Karachi .

H0: Consumers who often visit ice cream parlor would not prefer the
idea of launching Omore ice cream parlor in Karachi .

Test statistics

Decision

Since the P-value associated with Chi-square (52.401) is very small i.e.
less then 0.005 therefore we do reject H0 and we can conclude that
Consumers who often visit ice cream parlor would prefer the idea of
launching Omore ice cream parlor in Karachi .

TARGET MARKET
The target market consists of individuals, both male and female,
belonging to 20-35 years age group.

SAMPLE SIZE
1) Experience surveys - 3 surveys will be conducted with
experienced and knowledgeable individuals in the field.

2) Focus groups- 2 focus group sessions will be held. Each group

will consist of 8 individuals.

3) Survey- A sample of 135 respondents will be selected from the

target population.

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13
ICE CREAM INDUSTRY IN PAKISTAN

WALLS ICE CREAM

In 1995 Unilever started manufacturing of ice cream in Pakistan with brand Name
Walls. Unilever became the largest ice-cream manufacturers in Pakistan through
an amalgamation with Polka in May 1999.It has HACCP and Total Quality
Management certification. It is situated in Bhai Pheru .Its production capacity is 30
million liters per annum.

IGLOO ICE CREAM

Pakistan Dairy Products, Igloo Ice Cream, is the pioneer ice cream
manufacturer in Pakistan & operating since 1974. As a nation wide premium
ice cream manufacturer. The Company operates from Karachi; however its
distribution network covers a vast area of Sindh and Balochistan. Out of a
largely consumed range of scrumptious products, the Supreme Ice Cream
range is a market winner with its multitude of exceptional and unmatched
flavors such as Strawberry Cheesecake, Cookies N Cream, and lots more
mouth watering flavors. Igloo is providing ice cream to its valuable
consumers through three different channels, which are tricycles, retail outlets
& igloo parlors. These channels ensure efficient delivery & maximum fun &
satisfaction to consumers.
YUMMY ICE CREAM
It prepares pure dairy ice cream from milk fat. Its production capacity is 10 million
litres per annum. t is situated in Koat Lkhpat, Lahore.

The growing ice cream industry

A population of 161mn with 44% aged below 14 years is the key to the growth of
the food industry in Pakistan. The country has a market size of ~70mn liters or
PRs8bn of branded ice cream while combined with the unbranded sector the size
should be double that amount. Unilever, the only nation-wide seller, dominates
the branded ice cream segment with ~60% market share. It has recently
doubled its capacity to 77mn liters, out of which 39mn liters were produced in
2008. Unilever ice creams have witnessed 15% volumetric growth and 23%
CAGR in revenues over the past five years (2003-08). Pakistan has a per capita
ice cream consumption of 0.4 liters pa compared with 22liters in EU countries.
This coupled with the possibility of consumers of unbranded ice creams shifting
to branded ones implies upside potential for demand growth. The success of ice
cream business depends on (1) a strong cold storage network and (2) aggressive
consumer marketing.

14
15
RESEARCH DESIGN

Primary data was gathered using the 3 instruments mentioned below:

i) Experience surveys:

Experienced individuals in the field were surveyed. Comprised of

managers, in selected ice-cream parlors in Karachi, who provided us
with valuable data that aided in decision making. Interviews were more
like a conversation; we asked the managers a few important questions
in person, and jot down the responses on paper. Some sample questions
that were asked are:

How much potential exists in the market?

What are the average sales per month?
What is the profile of consumers who visit the most?
What is the product that is most frequently bought?

Managers of Gelato Affair at Clifton, Walls Ice cream parlor at Hotel

Metropole, Abdullah Haroon Rd. and Yum Yum Ice cream parlor in North
Nazimabad were interviewed.

Judgment Sampling method was used, concluding to:

High potential for ice cream parlors
Average sales per month counts to Rs. 400,000

ii) Focus groups:

Two Focus group sessions were held,

1. Between 20-26 yrs of age, students of Institute of Business

Management and University of Karachi

2. Between 27-35 yrs of age, random working people.

Moderator was one person chosen from our group. Participants

were given a chance to engage in a free discussion about the
research topic. Sample questions include:

Where do you prefer going for a dessert? Ice-cream? Why?

How often do you go?
Are you aware of Omore? Would you like to try it? Why?

16
 What comes to your mind when you think of the word Omore?
Would you be willing to try Omore ice-cream parlor? Why?

We conclude that:

Gelato Affair was more preferred

Enthusiastic and, in the offing to try Omore

Highly supported the idea for introducing Omore Ice Cream Parlor

iii) Surveys: Conducted by distributing 200 questionnaires to the

respondents. Closed ended questions were asked- ensuring quick
response from the participants.

Divided Karachi into the following areas:

Gulshan-e-Iqbal
Defence and Clifton
North Nazimabad
Saddar
Including vicinities of PECHS and Bahadurabad
40 questionnaires were assigned to each area.
Sample questions include:

Q1 What is your monthly household income?

Cumulative
Frequency Percent Valid Percent Percent

Valid Rs.10000-Rs.25000 14 10.4 10.4 10.4

Rs.26000-Rs.40000 25 18.5 18.5 28.9

Rs.41000-Rs.70000 40 29.6 29.6 58.5

Rs.71000 and above 56 41.5 41.5 100.0

Total 135 100.0 100.0

After analyzing the results of the monthly household income we came to know that out of 135
representatives 14 belonged to the monthly income range from Rs 10,000 to Rs 25000, while
25 belonged to the income group of Rs. 26000 to Rs.40000
40 belonged to the income group of Rs. 41000 to Rs.70000

17
And, 56 respondents had monthly income Rs. 71000 and above.

Out of the 80 male respondents most of them (41) have ice cream often while 18 of them have it
very often and 21 do not eat ice cream that very often.
Out of the 55 female respondents 25 do not eat it that often while 22 have it often and 8 of them
eat ice cream very often.
From this we analyzed that the male respondents have greater trend of eating ice cream as
compared to females perhaps due to the availability issues faced by women in Pakistan.

What is your monthly household income?

How often do you have icecream?
Crosstabulation
Q2 How often do you have ice cream?
Count
Gender Cross tabulation
How often do you have icecream?
Count
Very often Often Not very often Total
Gender
What is your monthly Rs.10000-Rs.25000 2 2 10 14
Male Female Total
household income?
Rs.26000-Rs.40000 2 13 10 25
How often do you have Very often 18 8 26
Rs.41000-Rs.70000 5 28 7 40
icecream?
Often 41 22 63
Rs.71000 and above 17 20 19 56
Not very often 21 25 46
Total 26 63 46 135
Total 80 55 135

The above results reflect that the people having income bracket eat ice cream more often than
people having low income group perhaps due to the budget feasibility, number of family
members depending on the income etc.

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Q3 Which ice cream do u prefer?
Cumulative
Frequency Percent Valid Percent Percent

Valid Packaged 29 21.5 21.5 21.5

Fresh 54 40.0 40.0 61.5

Both 52 38.5 38.5 100.0

Total 135 100.0 100.0

The above results analyzed reflect the fact that people (40%) usually prefer eating fresh ice
cream i.e, from parlors. Very few people (21.5%) go for the packaged ice creams maybe due to
the price feasibility or availability of ice cream parlors at their residence.

Q4 How often do you visit ice cream parlors?

Cumulative
Frequency Percent Valid Percent Percent

Valid More than once a week 19 14.1 14.5 14.5

Once a week 53 39.3 40.5 55.0

Once a month 59 43.7 45.0 100.0

Total 131 97.0 100.0

Missing Did not respond 4 3.0

Total 135 100.0

Most of the respondents (43.7%) visit ice cream parlors once a month while 39.3% of the people
visit ice cream parlors once a week and very few (only 14.1%) visit parlors more than once a
week perhaps due to the availability of ice cream parlors at their residence or having strong
financial background. Out of the total of 135 surveys conducted 3% people did not respond to
our question perhaps due to informal attitude or some personal confidentiality issues.

19
Q5 Which ice cream parlors do u prefer?

Cumulative
Frequency Percent Valid Percent Percent

Valid Gelato Affair 21 15.6 15.7 15.7

Move n Pick 46 34.1 34.3 50.0

Mini Melts 20 14.8 14.9 64.9

Dip shop 23 17.0 17.2 82.1

Others 24 17.8 17.9 100.0

Total 134 99.3 100.0

Missing Did not respond 1 .7

Total 135 100.0

When our respondents were asked which parlors they visit most then Move n Pick came out to
be on the top of our list covering 34.1% (frequency=46/135) followed with Dip shop covering
17%, Gelato Affair 15.6%. These results are influenced due to the availability of the parlors at
the respondents respective areas. 17.8% of the respondents prefer going to other ice cream
parlors in the city while 0.7% of the respondents did not respond perhaps being unaware about
the ice cream parlors.

20
Q6

55% said yes

28% said no
23% said Dont know

21
Q7 What are your perceptions about Engro?

1-Excellent

2-Very good

3-Good

4-Average

5-Not too bad

6-Poor

7-Very poor

22
Most of our respondents feel good about Engros already available products in the
market and are satisfied with the quality and features of the products they offer to
their customers. More than half of the respondents felt that Engros product fell in
the average priced category. There were very few people who told us that they
arent satisfied because the product doesnt fulfill their desired features or feel that
products are overly priced.

Q8

70% said yes

30% said No

23
70% of our target population is aware of the Omore ice cream brand offered by
Engro and only 30% werent aware of the ice cream product. The reason they told
us for not being aware was the unavailability of the ice cream in metropolitan.

Q9 what do you think of the idea of launching Omore parlor in Karachi?

1-Excellent

2-Very good

24
3-Good

4-Nice

5-Dont care

6-Poor

7-Very poor

Our respondents gave very positive reaction for launching the Omore ice cream
parlors at Karachi because they are satisfied with the other family products in the
market and want to try this ice cream too. There were very few people who did not
agreed to the idea of launchin this product at Karachi.

Q10

Male are 60%

Female are 40%

25
Q11 Which age groups do you belong to?
Cumulative
Frequency Percent Valid Percent Percent

Valid 20-23 48 35.6 35.6 35.6

24-27 53 39.3 39.3 74.8

28-31 22 16.3 16.3 91.1

32-35 12 8.9 8.9 100.0

Total 135 100.0 100.0

Most of our respondents belonged to the age group of 24 years to 27 years while
the rest stood between the ages ranging from 20 years to 23 years and 32 years to
35 years.

CONCLUSION

26
APPENDIX

ARTICLE# 1
ICE CREAM INDUSTRY COMPETITION
Ice cream manufacturers face competition from a host of sweet contenders. The
bulk of revenue generated in the ice cream industry comes from impulse sales to
consumers looking for an instant fix of sweetness. Makers of cones, sticks and cups
of ice cream have to battle with other similarly priced food and beverage items that
also offer an immediate sugar rush. In such, they are competing for a share in the
amount of money people are willing to spend for fun fun money.

It is estimated that this year Pakistanis will spend more than Rs200 billion as fun
money. The market for impulse food and drink items such as carbonated beverages,
confectionery items, packed snacks and chocolates is expected to grow by 10 per
cent annually.

Producers of ice cream, however, have anticipated a much higher growth and assert
that by next year the market for their products could grow by a whopping 25 per
cent.

This does not mean that there are no hurdles to the predicted expansion of the ice
cream industry. Ice cream sales have not been able to match the sales of traditional
items on days when people typically consume high amounts of sugar.

For example, kulfi and mithai almost always trump ice cream sales on special
occasions like Eid. Meanwhile, at the other end of the competition spectrum Pepsi
and Coke spend many times more on advertising than even the largest ice cream
brand in the country, Walls.

What then does Unilever, manufacturer of Walls ice cream, think about the launch of
Engro Foods brand of ice cream, Omore? It is the biggest blessing for existing ice
cream manufacturers! claimed Khayyam Rajpoot, the Brand Director for Walls.

Comfortable at the top

Customers willing to part with fun money have a wide array of options to choose
from. They constantly need to be convinced and reminded to buy ice cream. So far
Walls has been the only brand that spends a significant amount on advertisements
on TV, in magazines and other mass media, explained Khayyam. When they
(Omore) launch nationally, there will be more ads for ice creams and that would
translate into more overall demand, he concludes.

27
Khayyams optimism is not completely unfounded. Total sales of branded ice cream
stand between 70 and 80 million litres and even according to competitor estimates
more than 60 per cent of that volume is bagged by Walls. Walls is synonymous
with ice cream, Khayyam said, citing that when an ice cream cart or trike pulled
into a neighbourhood and played the brands familiar jingle, everyone knew the ice
cream man had arrived.

Clowning around

Preparing for the entry of a potentially threatening competitor is exactly what other
companies in the market are busy doing. Fareed Tharani, Brand Manager for Igloo,
said he was doing homework on the potential impact on sales from Omores
national launch. He predicted that there could be more competition on dealer side,
if they come on trade, they may come with trikes initially.

So far Igloo has not faced competition from the new brand as the company only
operated in Sindh and Balochistan, while Omore had been launched only in Punjab.
But the cost of inputs is increasing and more competition means that Igloo would
be unable to increase prices to accommodate cost pressures, admitted Tharani.

Besides a rush for market intelligence, Igloo management has also introduced
unique products hoping to boost sales. Recently, they launched Gumbo an ice
cream stick shaped like a clowns face with a bubble gum for a nose.

Street talk

Omore will need a lot more than trikes and tricks to win over buyers in a market
where competitors like Walls and Igloo are well entrenched. Walls has managed to
develop a strong working relationship with retailers since it started operations in
1997.

Moin Khan, owner of a small shop in Gulshan a middle-income neighbourhood of

Karachi, clarified: I only have enough space in my store for one freezer, so I got it
from Walls. They sell way more than other brands.

Still, Omore had already made big waves among potential consumers with their
marketing campaign. Wali Khan, a superstore owner from Defence, shared that
people were eagerly waiting for the launch of Omore in Karachi. Their ads have
great recall. People keep asking if the ice cream was available.

https://officialpakinfo.wordpress.com/2010/07/07/competition-in-ice-cream-world-of-
pakistan-walls-igloo-or-omore/

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BIBLIOGRAPHY

WEBSITES

www.engro.com

www.oppappers.com

ARTICLES

http://findarticles.com/p/articles/mi_hb092/is_n1_v27/ai_n28667076/

https://officialpakinfo.wordpress.com/2010/07/07/competition-in-ice-cream-world-of-
pakistan-walls-igloo-or-omore/

http://www.highbeam.com/doc/1G1-20457473.html

BOOKS

METHODS IN BUSINESS RESEARCH BY UMA SEKARAN

RESEARCH METHODS OF BUSINESS BY ZIKMUND

29