Read the case and answer the question below from the case.

Company Gourmet Foods name should be used in the answer.

Case Study for "Creativity and Innovation"

TOPIC: Exploring and Exploiting Opportunities for Creativity and Innovation

The Rise of Gourmet Foods Lahore - A Tale of Exploiting Opportunities

This case has been developed by Dr. Muhammad Nouman with excerpts from the discussion of Dr. Rafi Amit from Wharton Business School, the interview of Chaudhary Muhammad Nawaz Chatta (Chairman GOURMET) and the materials available at the company's website www.gourmetpakistan.com

Back in 1987, in the area of Ich'chra, Lahore, GOURMET took start as a bakery and confectioner shop. The concept of fresh, healthy and hygienic food at affordable prices achieved quick popularity among bakery customers in Lahore. The bakery products for breakfast were provided in limited areas, but because of the over whelming response from customers, GOURMET decided to expand. Chaudhary Muhammad Nawaz Chattha, the Founder and Chairman of GOURMET, started his journey with the unique concept of hygienic and healthy food. As per the company's own claim, Mr. Chatta started his journey from the day he planted the idea of bakery products at Shezan Industry, where he had served for eleven years in the same field and got his expertise. It was from there that he developed the idea of initiating his own enterprise or business. Today the company has more than 120 retail outlets mainly in Punjab (including Lahore, Faisalabad, Sargodha, Islamabad, Rawalpindi, Multan, Gujranwala, Gujrat, Jalalpur Jattan and Sheikhupura. It also has international outlets in London and New York City as well. The company has seven processing units or factories and more than 1500 employees work for it. The portfolio of GOURMET products includes;

Bakery Produce

Sweets

Dairy Products (Pasteurized Milk and Powdered Milk)

Cold Drinks (Gourmet Cola & Bon Vivant) and Juices

Mineral Water

Ice Creams

Candies and Toffees

Jams, Ketchup etc.

Snacks (Nimko etc.)

Restaurants

Catering

Publishing (Magazine)

According to the company's website, GOURMET also has investments in the furniture, petroleum, pharmacy and personal care businesses along with shares in the banking sector.

The phenomenal growth of GOURMET over the last 30 years is an ideal example of exploring and exploiting opportunities successfully. For Mr. Chatta and his team the story of their success relates to a complex mix of decisions that were taken over this time. There are many sources through which entrepreneurs identify opportunities for their business. When you see inefficiency in the market and you have an idea of how to correct that inefficiency, and you have the resources and capability--or at least the ability to bring together the resources and capability needed to correct that inefficiency--that could be a very interesting business opportunity. In addition, if you see a product or service that is being consumed in one market, that product is not available in your market, you could perhaps import that product or service, and start that business in your market. Many sources of ideas come from existing businesses, such as franchises or outlets. Perhaps the most promising source of ideas for new business comes from customers--listening to customers. That is something every enterprise ought to do continuously, in order to understand what customers want, where they want it, how they want a product or service supplied, when they want it supplied, and at what price. Obviously, if you work in a large company, employees might come up with ideas. Indeed, you might want to listen to what they have to say. You could pursue these ideas by asking yourself some key questions such as, "Is the market real? Is the product or service real? Can I win? What are the risks? And is it worth it?"

The first step that everyone should go through is to ask the question, is the market real? In order to do so, the first thing you want to do is conduct what we call a customer analysis. You can do that perhaps in a very technical way, by conducting surveys. Or perhaps, in a less technical way, you can attempt to answer the question, "Who is my customer?" What does the customer want to buy? When does the customer want to buy? What price is the customer willing to pay? So, asking the "W questions"--who, where, what, when--is the first step. At the end of the day, the one thing every entrepreneur is looking for is revenue, and the revenue will come from customers. That is why you need to ask yourself, is there a market here?

The second thing you want to ask yourself is, who else is supplying that particular market? That is what we call competitor analysis. Ask yourself who else is in this market, and what are they doing for the customers. Are they supplying a similar substitute product or service as you have in mind? That is the second thing you have to establish, and by doing that, you can understand better what need is not met at the moment. That will also give you the opportunity to zero in on the price points and feature points of where you can differentiate yourself from existing players in the market.

You also need to conduct a broader industry analysis to understand the attractiveness of the industry you're going to enter. Is the industry growing or shrinking? What power do the suppliers have in this industry? How many buyers are there? Are there substitute products? Are there any barriers to entry? If so, what are they? That is very important for you to understand, because it will help you realize whether the industry you're thinking of entering is attractive. In addition, you may want to look at regulations that affect that industry. Are there any regulations that you would be subject to? How strict are those regulations? Which are the implementing authorities or institutions and how you will deal with them?

When starting a business, there are many risks that need to be considered. One way to think about the various risks an entrepreneur is faced with--or, for that matter, an investor in an entrepreneurial venture is faced with--is to break them down into several buckets. Let's start with the first bucket, the company bucket. Well, here, the biggest sources of risk are the founders. Do they have the wherewithal not just to start the company, but also grow the company? Experience has shown that the prevalence of individuals such as Bill Gates or MichaelDell , Steve Jobs, that can not only start companies, but also manage its growth--the prevalence of such individuals is relatively limited.

A second source of risk is technology risk. To the extent that your company employs technology, there are obviously issues of, how long will this technology be the leading edge? Secondly, are there any intellectual property issues that need to be addressed? Lastly, there exists the product risk. If you haven't developed a product yet, can you manufacture it? Will it work? All these issues are under the bucket of company risk.

A second bucket for the sources of risk is the market for the product. You need to be aware of two big uncertainties. First, what is the customer's willingness to buy? And second, what is the pace, if you're successful, at which competitors will be able to imitate you? One of the things you have to think about when you enter that market is how you can create barriers to imitation, so that if you're successful, the competition won't be able to imitate you very quickly.

A third bucket consists of risks associated with the industry. Are there any factors in that industry that relate to availability of supply? In some cases, you need to have certain raw materials that are in limited supply, and that some suppliers might be able to take advantage of that. Barriers to entry might change. Regulations might change and adversely or positively affect your business. Lastly, there are financial risks. And here, the question is, will you be able to raise the money early on? At what valuation will you be able to do it? Will you be able to raise follow-up money?

It is common knowledge that there are thousands of small and large companies in the food sector of Pakistan. Any bazar or market you visit will have a bakery and other food related businesses. Yet it is only a select few like GOURMET that have really explored and exploited opportunities and grown their business exponentially. How did it do it remains a key question to answer in order to understand the difference between any business and an entrepreneurial business.

Question

(Opinion Question): Read the Case on Gourmet Foods and provide your views about how the Company has attempted to explore and exploit opportunities with regards to innovation in their business.jQuery22407793143526732114_1598341348794???

answer should be from the case first read the case carefully.