Continuous innovation as a means for business sustainability: the case of a small food and beverage manufacturing firm in Kelantan.

Innovation plays an important role towards SMEs growth, contributing to company’s competitive advantage and sustainability. In Malaysia, food and beverages industry is the second largest industry monopoly by SMEs, which is 50 percent from total SMEs. This case study aims to analyze the innovation process in small food and beverage manufacturing firm in Kelantan, focused on types of innovation employed and barriers faced by the firm to innovate. A qualitative study was conducted to gather the information; innovation activities and barriers to innovate, from the selected firm. A semi-structured, face-to-face and open-ended interview was a method used to conduct interviews with the employee and company’s founder. The conversations conducted in local dialect were recorded and transcribed into text. Then, the text was manually analyzed to extract the information related to this study. From the finding, the said firm focused its resources by adapting and adopting innovation in production, processing and marketing. Innovation activities in processing offers a great competitive advantage towards the firm. However, the firm faced difficulties in finding expertise and financial shortage to handle advanced and complicated innovation activity within the firm itself. In conclusion, application of the open innovation can offer a solution to address the said issues. This case study serves as a platform for future detailed research on the effect of adaptation open innovation principles in small food and beverage manufacturing firm in Malaysia and developing countries.