amul
TRANSCRIPT
SUMMER INTERNSHIP PROGRAM
A
PROJECT REPORT
ON
“DEMAND ESTIMATION OF AMUL MILK , BUTTER, CHEESE, GHEE, CHOCOLATE, ETC IN MODINAGAR
MARKET”
IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE DEGREE OF
BACHELOR OF BUSINESS ADMINISTRATION (B.B.A.)
SUBMITTED TO:Mr. Mohit Garg (Project Guide)
SUBMITTED BY:Garima Tyagi
ROLL NO -9052576BBA-VI SEM
INSTITUTE OF MANAGEMENT & RESEARCH
GHAZIABAD
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“Hard Work: The power that pulls everything successfully”
No task is a single man’s effort. Cooperation and coordination of various
people at various places go into the successful implementation. It is a great
pleasure to have the opportunity to extend my heart–felt thanks to everybody
who helped me through the successful completion of this project It would be
prudent to commence this report with a sincere tribute to all those who played
an indispensable role in the accomplishment of this work and obliged
whenever and wherever their able guidance was required.
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ACKNOWLEDGEMENT
I would like to express my gratitude and deep regards to my esteemed
and revered company guide Mr. ANANT NAG for the help rendered by
him, for providing me the right way to approach the business problem,
and for constantly guiding me with his most valuable suggestions in spite
of having a busy schedule. My project would not have been possible
without his expert guidance. I would also like to thank, Mr. VISHAL
CHOPRA and all my colleagues of. Amul India (Gujarat Co-operative
Milk Marketing Federation Ltd) Who helped me during the training
process and made this project a learning experience for me. My
acknowledgement would be incomplete without paying my gratitude to
my college mentor Mr. Rahul Gupta for providing his timely and
valuable suggestions as and when required. Without his guidance and
support this project would not have been the way it has come out.
Thanking you, With Regards
Garima Tyagi
BBA-VI Sem.
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PREFACE
Summer Training is a necessary part for fulfillment of BBA- Vis
Sem. course. The emphasizes in the project is providing the study and
an insight in to Indian FMCG business scenario. The Summer Training
has given a chance to try and apply the academic knowledge and gain
insight in to corporate culture. This helps in developing decision-making
abilities and emphasizes on active participation by the student.I undertook
my training in Amul India (Gujarat Co-operative Milk Marketing
Federation Ltd.) , a leading milk, icecream, butter manufacture
company. During the training I had worked on the project “TO FIND
OUT THE DEMAND ESTIMATION OF MILK, BUTTER,
ICECREAM, GHEE, CHOCOLATE IN MODINAGAR
REGION” working depot under Amul India(gujrat co-operative milk
marketing federation ltd.) I gained valuable experience & knowledge
during the survey. The project consists of my findings after tabulation
of collected data, then analyzed conclusions were drawn and finally
suggestions were put forward.The preface say about the working
culture of AMUL INDIA which is a FMCG type of organization,
competitive market of soft milk,butter, chocollate industry shows the
promotion scheme of AMUL as to make a higher sales in the market.
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TABLE OF CONTENTS
CHAPTER 1
EXECUTIVE SUMMARY
a) INTRODUCTION ..................................................................
b) GCMMF TODAY …………………………………………
c) VARIOUS TYPE OF PRODUCT……………………….
AMUL BRIEF PROFILE
a) ABOUT AMUL…………………………………………….
b) MISSION & VISSION……………………………………..
C) MARKETING STRATEGIES……………………………..
d) SWOT ANALYSIS………………………………………...
e) ORGANISATIONAL STRUTURE…………………………
CHAPTER 2
a)OBJECTIVE OF STUDY…………………………………….
b)NEED OF THE STUDY……………………………………...
c) RESEARCH METHODOLOGY OF THE STUDY……..
CHAPTER3
a) DATA ANALYSIS AND INTERPRETATION……………
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b) FINDING AND RECOMMENDATION……………………
CHAPTER 4
CONCLUSION……………………………………………………
CHAPTER 5
BIBLIOGRAPHY & ANNEXURES……………………………
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Chapter-1
Executive Summary
a)Introduction
Amul: The origin
The mighty Ganges at it's origin is but a tiny stream in the Gangotri
ranges of the Himalayas. Similar is the story of Amul which inspired
'Operation Flood' and heralded the 'White Revolution' in India. It began
with two village cooperatives and 250 liters of milk per day, nothing but
a trickle compared to the flood it has become today. Today Amul collects,
processes and distributes over a million liters of milk and milk
products per day, during the peak, on behalf of more than a thousand
village cooperatives owned by half a million farmer members. Further, as
Ganga-ma carries the aspirations of generations for moksha, Amul too
has become a symbol of the aspirations of millions of farmers.Creating a
pattern of liberation and self-reliance for every farmer to follow.
The moppet who put Amul on India's breakfast table
50 years after it was first launched, Amul's sale figures have jumped from
1000 tonnes a year in 1966 to over 25,000 tonnes a year in 1997. No
other brand comes even close to it. All because a thumb-sized girl
climbed on to the hoardings and put a spell on the masses.
Bombay: Summer of 1967. A Charni Road flat. Mrs. Sheela Mane, a 28-
year-old housewife is out in the balcony drying clothes. From her second
floor flat she can see her neighbours on the road. There are other people
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too. The crowd seems to be growing larger by the minute. Unable to curb
her curiosity Sheela Mane hurries down to see what all the commotion is
about. She expects the worst but can see no signs of an accident. It is her
four-year-old who draws her attention to the hoarding that has come up
overnight. "It was the first Amul hoarding that was put up in Mumbai,"
recalls Sheela Mane. "People loved it. I remember it was our favourite
topic of discussion for the next one week! Everywhere we went somehow
or the other the campaign always seemed to crop up in our conversation."
Call her the Friday to Friday star. Round eyed, chubby cheeked, winking
at you, from strategically placed hoardings at many traffic lights. She is
the Amul moppet everyone loves to love (including prickly votaries of
the Shiv Sena and BJP). How often have we stopped, looked, chuckled at
the Amul hoarding that casts her sometime as the coy, shy Madhuri, a
bold sensuous Urmila or simply as herself, dressed in her little polka
dotted dress and a red and white bow, holding out her favourite packet of
butter.
For 30 odd years the Utterly Butterly girl has managed to keep her fan
following intact. So much so that the ads are now ready to enter
the Guinness Book of World Records for being the longest running
campaign ever. The ultimate compliment to the butter came when a
British company launched a butter and called it Utterly Butterly, last year.
It all began in 1966 when Sylvester daCunha, then the managing director
of the advertising agency, ASP, clinched the account for Amul butter.
The butter, which had been launched in 1945, had a staid, boring image,
primarily because the earlier advertising agency which was in charge of
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the account preferred to stick to routine, corporate ads. In India, food was
something one couldn't afford to fool around with. It had been taken too
seriously, for too long. Sylvester daCunha decided it was time for a
change of image.
The year Sylvester daCunha took over the account, the country saw the
birth of a campaign whose charm has endured fickle public opinion,
gimmickry and all else.
The Amul girl who lends herself so completely to Amul butter, created as
a rival to the Polson butter girl. This one was sexy, village belle, clothed
in a tantalising choli all but covering her upper regions. "Eustace
Fernandez (the art director) and I decided that we needed a girl who
would worm her way into a housewife's heart. And who better than a
little girl?" says Sylvester daCunha. And so it came about that the famous
Amul Moppet was born.
That October, lamp kiosks and the bus sites of the city were splashed with
the moppet on a horse. The baseline simply said, Thoroughbread, Utterly
Butterly Delicious Amul,. It was a matter of just a few hours before the
daCunha office was ringing with calls
Not just adults, even children were calling up to say how much they had
liked the ads. "The response was phenomenal," recalls Sylvester
daCunha. "We knew our campaign was going to be successful."
For the first one year the ads made statements of some kind or the other
but they had not yet acquired the topical tone. In 1967, Sylvester decided
that giving the ads a solid concept would give them extra mileage,
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more dum, so to say. It was a decision that would stand the daCunhas in
good stead in the years to come.
In 1969, when the city first saw the beginning of the Hare Rama Hare
Krishna movement, Sylvester daCunha, Mohammad Khan and Usha
Bandarkar, then the creative team working on the Amul account came up
with a clincher -- 'Hurry Amul, Hurry Hurry'. Bombay reacted to the ad
with a fervour that was almost as devout as the Iskon fever.
That was the first of the many topical ads that were in the offing. From
then on Amul began playing the role of a social observer. Over the years
the campaign acquired that all important Amul touch.
India looked forward to Amul's evocative humour. If the Naxalite
movement was the happening thing in Calcutta, Amul would be up there
on the hoardings saying, "Bread without Amul Butter, cholbe na cholbe
na (won't do, won't do). If there was an Indian Airlines strike Amul
would be there again saying, Indian Airlines Won't Fly Without Amul.
There are stories about the butter that people like to relate over cups of
tea. "For over 10 years I have been collecting Amul ads. I especially like
the ads on the backs of the butter packets, "says Mrs. Sumona Varma.
What does she do with these ads? "I have made an album of them to
amuse my grandchildren," she laughs. "They are almost part of our
culture, aren't they? My grandchildren are already beginning to realise
that these ads are not just a source of amusement. They make them aware
of what is happening around them .Despite some of the negative reactions
that the ads have got, DaCunhas have made it a policy not to play it safe.
There are numerous ads that are risque in tone.
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"We had the option of being sweet and playing it safe, or making an
impact. A fine balance had to be struck. We have a campaign that is
strong enough to make a statement. I didn't want the hoardings to be
pleasant or tame. They have to say something," says Rahul daCunha.
"We ran a couple of ads that created quite a furore," says Sylvester
daCunha. "The Indian Airlines one really angered the authorities. They
said if they didn't take down the ads they would stop supplying Amul
butter on the plane. So ultimately we discontinued the ad," he says
laughing. Then there was the time when the Amul girl was shown
wearing the Gandhi cap. The high command came down heavy on that
one. The Gandhi cap was a symbol of independence, they couldn't have
anyone not taking that seriously. So despite their reluctance the hoardings
were wiped clean. "Then there was an ad during the Ganpati festival
which said, Ganpati Bappa More Ghya (Ganpati Bappa take more). The
Shiv Sena people said that if we didn't do something about removing the
ad they would come and destroy our office. It is surprising how vigilant
the political forces are in this country. Even when the Enron ads (Enr On
Or Off) were running, Rebecca Mark wrote to us saying how much she
liked them."
There were other instances too. Heroine Addiction, Amul's little joke on
Hussain had the artist ringing the daCunhas up to request them for a blow
up of the ad. "He said that he had seen the hoarding while passing
through a small district in UP. He said he had asked his assistant to take a
photograph of himself with the ad because he had found it so funny," says
Rahul daCunha in amused tones. Indians do have a sense of humour,
afterall.
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From the Sixties to the Nineties, the Amul ads have come a long way.
While most people agree that the Amul ads were at their peak in the
Eighties they still maintain that the Amul ads continue to tease a laughter
out of them.
Where does Amul's magic actually lie? Many believe that the charm lies
in the catchy lines. That we laugh because the humour is what anybody
would enjoy. They don't pander to your nationality or certain sentiments.
It is pure and simple, everyday fun.
The Birth of Amul and development of India’s Dairy Cooperative Movement
The birth of Amul at Anand provided the impetus to the cooperative dairy
movement in the country. The Kaira District Cooperative Milk
Producers’ Union Limited was registered on December 14, 1946 as a
response to exploitation of marginal milk producers by traders or agents
of existing dairies in the small town named Anand (in Kaira District of
Gujarat). Milk Producers had to travel long distances to deliver milk to
the only dairy, the Polson Dairy in Anand. Often milk went sour as
producers had to physically carry the milk in individual containers,
especially in the summer season. These agents arbitrarily decided the
prices depending on the production and the season. Milk is a commodity
that has to be collected twice a day from each cow/buffalo. In winter, the
producer was either left with surplus / unsold milk or had to sell it at very
low prices. Moreover, the government at that time had given monopoly
rights to Polson Dairy (around that time Polson was the most well known
butter brand in the country) to collect milk from Anand and supply it to
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Impressed with the development of dairy cooperatives in Kaira District &
its success, Shri Lal Bahadur Shastri, the then Prime Minister of India
during his visit to Anand in 1964, asked Dr. V Kurien to replicate the
Anand type dairy cooperatives all over India. Thus, the National Dairy
Developed Board was formed and Operation Flood Programme was
Bombay city in turn. India ranked nowhere amongst milk producing
countries in the world in 1946.Angered by the unfair and manipulative
trade practices, the farmers of Kaira District approached Sardar
Vallabhbhai Patel (who later became the first Deputy Prime Minister and
Home Minister of free India) under the leadership of the local farmer
leader Tribhuvandas Patel. Sardar Patel advised the farmers to form a
Cooperative and supply milk directly to the Bombay Milk Scheme
instead of selling it to Polson (who did the same but gave low prices to
the producers). He sent Morarji Desai (who later became Prime Minister
of India) to organize the farmers. In 1946, the farmers of the area went on
a milk strike refusing to be further oppressed. Thus the Kaira District
Cooperative was established to collect and process milk in the District of
Kaira in 1946. Milk collection was also decentralized, as most producers
were marginal farmers who were in a position to deliver 1-2 litres of milk
per day. Village level cooperatives were established to organize the
marginal milk producers in each of these villages.
The Cooperative was further developed & managed by Dr. V Kurien
along with Shri H M Dalaya. The first modern dairy of the Kaira Union
was established at Anand (which popularly came to be known as AMUL
dairy after its brand name). Indigenous R&D and technology
development at the Cooperative had led to the successful production of
skimmed milk powder from buffalo milk – the first time on a commercial
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scale anywhere in the world. The foundations of a modern dairy industry
in India were thus laid since India had one of the largest buffalo
populations in the world.
The success of the dairy co-operative movement spread rapidly in
Gujarat. Within a short span five other district unions – Mehsana,
Banaskantha, Baroda, Sabarkantha and Surat were organized. In order to
combine forces and expand the market while saving on advertising and
avoid a situation where milk cooperatives would compete against each
other it was decided to set up an apex marketing body of dairy
cooperative unions in Gujarat. Thus, in 1973, the Gujarat Co-operative
Milk Marketing Federation was established. The Kaira District Co-
operative Milk Producers’ Union Ltd. which had established the brand
name AMUL in 1955 decided to hand over the brand name to GCMMF
(AMUL). With the creation of GCMMF (AMUL), we managed to
eliminate competition between Gujarat’s cooperatives while competing
with the private sector as a combined stronger force. GCMMF (AMUL)
has ensured remunerative returns to the farmers while providing
consumers with products under the brand name AMUL.This was possible
due to the leadership of the founder Chairman of AMUL, Tribhuvandas
Patel and the vision of the father of the White Revolution, Dr. Verghese
Kurien who worked as a professional manager at AMUL. Numerous
people contributed to this movement which would otherwise not have
been possible.
Dr. Verghese Kurien, the World Food Prize and the Magsaysay Award
winner, is the architect of India’s White Revolution, which helped India
emerge as the largest milk producer in the world.
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Launched for replication of the Amul Model all over India.
Operation Flood, the world’s largest dairy development programme, is
based on the experience gained from the ‘Amul Model’ dairy
cooperatives. The facilities at all levels are entirely farmer-owned. The
cooperatives are able to build markets, supply inputs and create value-
added processing. Thus, Amul Model cooperatives seem to be the most
appropriate organizational force for promoting agricultural development
using modern technologies and professional management and thereby
generating employment for the rural masses and eradicating poverty in
these undeveloped areas. India has already demonstrated the superiority
of this approach.
Every day Amul collects 447,000 litres of milk from 2.12 million
farmers (many illiterate), converts the milk into branded, packaged
products, and delivers goods worth Rs 6 crore (Rs 60 million) to over
500,000 retail outlets across the country.Its supply chain is easily one of
the most complicated in the world. How do managers at Amul prevent the
milk from souring?
Walk in to any Amul or Gujarat Cooperative Milk Marketing Federation
(GCMMF) office, and you may or may not see a photograph of Mahatma
Gandhi Image, but you will certainly see one particular photograph. It
shows a long line of Gujarati women waiting patiently for a union truck
to come and collect the milk they have brought in shining brass matkas.
The picture is always prominently displayed. The message is clear: never
forget your primary customer. If you don't, success is certain. The proof?
A unique, Rs 2,200 crore (Rs 22 billion) enterprise.
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Organisation structure
It all started in December 1946 with a group of farmers keen to free
themselves from intermediaries, gain access to markets and thereby
ensure maximum returns for their efforts.Based in the village of Anand,
the Kaira District Milk Cooperative Union (better known as Amul)
expanded exponentially. It joined hands with other milk cooperatives, and
the Gujarat network now covers 2.12 million farmers, 10,411 village
level milk collection centers and fourteen district level plants (unions)
under the overall supervision of GCMMF.
There are similar federations in other states. Right from the beginning,
there was recognition that this initiative would directly benefit and
transform small farmers and contribute to the development of society.
Markets, then and even today, are primitive and poor in infrastructure.
Amul and GCMMF acknowledged that development and growth could
not be left to market forces and that proactive intervention was required.
Two key requirements were identified.
The first, that sustained growth for the long term would depend on
matching supply and demand. It would need heavy investment in the
simultaneous development of suppliers and consumers.
Second, that effective management of the network and commercial
viability would require professional managers and technocrats.
To implement their vision while retaining their focus on farmers, a
hierarchical network of cooperatives was developed, which today forms
the robust supply chain behind GCMMF's endeavors. The vast and
complex supply chain stretches from small suppliers to large fragmented
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markets.Management of this network is made more complex by the fact
that GCMMF is directly responsible only for a small part of the chain,
with a number of third party players (distributors, retailers and logistics
support providers) playing large roles.
Managing this supply chain efficiently is critical as GCMMF's
competitive position is driven by low consumer prices supported by a low
cost system.
Developing demand
At the time Amul was formed, consumers had limited purchasing power,
and modest consumption levels of milk and other dairy products. Thus
Amul adopted a low-cost price strategy to make its products affordable
and attractive to consumers by guaranteeing them value for money.
Introducing higher value products
Beginning with liquid milk, GCMMF enhanced the product mix through
the progressive addition of higher value products while maintaining the
desired growth in existing products.
Despite competition in the high value dairy product segments from firms
such as Hindustan Lever , Nestle and Britannia GCMMF ensures that
the product mix and the sequence in which Amul introduces its products
is consistent with the core philosophy of providing milk at a basic,
affordable price.
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The distribution network
Amul products are available in over 500,000 retail outlets across India
through its network of over 3,500 distributors. There are 47 depots with
dry and cold warehouses to buffer inventory of the entire range of
products.
GCMMF transacts on an advance demand draft basis from its wholesale
dealers instead of the cheque system adopted by other major FMCG
companies. This practice is consistent with GCMMF's philosophy of
maintaining cash transactions throughout the supply chain and it also
minimizes dumping.
Wholesale dealers carry inventory that is just adequate to take care of the
transit time from the branch warehouse to their premises. This just-in-
time inventory strategy improves dealers' return on investment (ROI). All
GCMMF branches engage in route scheduling and have dedicated vehicle
operations.
Umbrella brand
The network follows an umbrella branding strategy. Amul is the common
brand for most product categories produced by various unions: liquid
milk, milk powders, butter, ghee, cheese, cocoa products, sweets, ice-
cream and condensed milk.
Amul's sub-brands include variants such as Amulspray, Amulspree,
Amulya and Nutramul. The edible oil products are grouped around Dhara
and Lokdhara, mineral water is sold under the Jal Dhara brand while fruit
drinks bear the Safal name.
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By insisting on an umbrella brand, GCMMF not only skillfully avoided
inter-union conflicts but also created an opportunity for the union
members to cooperate in developing products.
Managing the supply chain
Even though the cooperative was formed to bring together farmers, it was
recognised that professional managers and technocrats would be required
to manage the network effectively and make it commercially viable.
Coordination
Given the large number of organisations and entities in the supply chain
and decentralised responsibility for various activities, effective
coordination is critical for efficiency and cost control. GCMMF and the
unions play a major role in this process and jointly achieve the desired
degree of control.
Buy-in from the unions is assured as the plans are approved by
GCMMF's board. The board is drawn from the heads of all the unions,
and the boards of the unions comprise of farmers elected through village
societies, thereby creating a situation of interlocking control.
The federation handles the distribution of end products and coordination
with retailers and the dealers. The unions coordinate the supply side
activities.These include monitoring milk collection contractors, the
supply of animal feed and other supplies, provision of veterinary services,
and educational activities.Managing third party service
providers
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From the beginning, it was recognised that the unions' core activity lay in
milk processing and the production of dairy products. Accordingly,
marketing efforts (including brand development) were assumed by
GCMMF. All other activities were entrusted to third parties. These
include logistics of milk collection, distribution of dairy products, sale of
products through dealers and retail stores, provision of animal feed, and
veterinary services.It is worth noting that a number of these third parties
are not in the organized sector, and many are not professionally managed
with little regard for quality and service.This is a particularly critical issue
in the logistics and transport of a perishable commodity where there are
already weaknesses in the basic infrastructure.
Establishing best practices
A key source of competitive advantage has been the enterprise's ability to
continuously implement best practices across all elements of the network:
the federation, the unions, the village societies and the distribution
channel.
In developing these practices, the federation and the unions have adapted
successful models from around the world. It could be the implementation
of small group activities or quality circles at the federation. Or a TQM
program at the unions. Or housekeeping and good accounting practices at
the village society level.More important, the network has been able to
regularly roll out improvement programs across to a large number of
members and the implementation rate is consistently high.
For example, every Friday, without fail, between 10.00 a.m. and 11.00
a.m., all employees of GCMMF meet at the closest office, be it a
department or a branch or a depot to discuss their various quality
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concerns.Each meeting has its pre-set format in terms of Purpose, Agenda
and Limit (PAL) with a process check at the end to record how the
meeting was conducted. Similar processes are in place at the village
societies, the unions and even at the wholesaler and C&F agent levels as
well.
Examples of benefits from recent initiatives include reduction in
transportation time from the depots to the wholesale dealers,
improvement in ROI of wholesale dealers, implementation of Zero Stock
Out through improved availability of products at depots and also the
implementation of Just-in-Time in finance to reduce the float.
Kaizens at the unions have helped improve the quality of milk in terms of
acidity and sour milk. (Undertaken by multi-disciplined teams, Kaizens
are highly focussed projects, reliant on a structured approach based on
data gathering and analysis.) For example, Sabar Union's records show a
reduction from 2.0% to 0.5% in the amount of sour milk/curd received at
the union.The most impressive aspect of this large-scale roll out is that
improvement processes are turning the village societies into individual
improvement centers.
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Technology and e-initiatives
GCMMF's technology strategy is characterized by four distinct
components: new products, process technology, and complementary
assets to enhance milk production and e-commerce.Few dairies of the
world have the wide variety of products produced by the GCMMF
network. Village societies are encouraged through subsidies to install
chilling units. Automation in processing and packaging areas is common,
as is HACCP certification. Amul actively pursues developments in
embryo transfer and cattle breeding in order to improve cattle quality and
increases in milk yields.
GCMMF was one of the first FMCG (fast-moving consumer goods) firms
in India to employ Internet technologies to implement B2C
commerce.Today customers can order a variety of products through the
Internet and be assured of timely delivery with cash payment upon
receipt.Another e-initiative underway is to provide farmers access to
information relating to markets, technology and best practices in the dairy
industry through net enabled kiosks in the villages.
GCMMF has also implemented a Geographical Information System
(GIS) at both ends of the supply chain, i.e. milk collection as well as the
marketing process.
Farmers now have better access to information on the output as well as
support services while providing a better planning tool to marketing
personnel.
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The Three- tier "Amul Model"
The Amul Model is a three-tier cooperative structure. This structure
consists of a Dairy Cooperative Society at the village level affiliated to a
Milk Union at the District level which in turn is further federated into a
Milk Federation at the State level. The above three-tier structure was set-
up in order to delegate the various functions, milk collection is done at
the Village Dairy Society, Milk Procurement & Processing at the District
Milk Union and Milk & Milk Products Marketing at the State Milk
Federation. This helps in eliminating not only internal competition but
also ensuring that economies of scale is achieved. As the above structure
was first evolved at Amul in Gujarat and thereafter replicated all over the
country under the Operation Flood Programme, it is known as the ‘Amul
Model’ or ‘Anand Pattern’ of Dairy Cooperatives.Responsible for
Marketing of Milk & Milk Products Responsible for Procurement &
Processing of Milk Responsible for Collection of Milk Responsible for
Milk Production.
Dairy Village Cooperative Society (VDCS)
The milk producers of a village, having surplus milk after own
consumption, come together and form a Village Dairy Cooperative
Society (VDCS). The Village Dairy Cooperative is the primary society
under the three-tier structure. It has membership of milk producers of the
village and is governed by an elected Management Committee consisting
of 9 to 12 elected representatives of the milk producers based on the
principle of one member, one vote. The village society further appoints a
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Secretary (a paid employee and member secretary of the Management
Committee) for management of the day-to-day functions. It also employs
various people for assisting the Secretary in accomplishing his / her daily
duties. The main functions of the VDCS are as follows:
Collection of surplus milk from the milk producers of the village &
payment based on quality & quantity.
Providing support services to the members like Veterinary First
Aid, Artificial Insemination services, cattle-feed sales, mineral
mixture sales, fodder & fodder seed sales, conducting training on
Animal Husbandry & Dairying, etc.
Selling liquid milk for local consumers of the village.
Supplying milk to the District Milk Union.
Thus, the VDCS in an independent entity managed locally by the milk
producers and assisted by the District Milk Union.
District Cooperative Milk Producers’ Union (Milk Union)
The Village Societies of a District (ranging from 75 to 1653 per Milk
Union in Gujarat) having surplus milk after local sales come together and
form a District Milk Union. The Milk Union is the second tier under the
three-tier structure. It has membership of Village Dairy Societies of the
District and is governed by a Board of Directors consisting of 9 to 18
elected representatives of the Village Societies. The Milk Union further
appoints a professional Managing Director (paid employee and member
secretary of the Board) for management of the day-to-day functions. It
also employs various people for assisting the Managing Director in
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accomplishing his / her daily duties. The main functions of the Milk
Union are as follows:
Procurement of milk from the Village Dairy Societies of the
District
Arranging transportation of raw milk from the VDCS to the Milk
Union.
Providing input services to the producers like Veterinary Care,
Artificial Insemination services, cattle-feed sales, mineral mixture
sales, fodder & fodder seed sales, etc.
Conducting training on Cooperative Development, Animal
Husbandry & Dairying for milk producers and conducting
specialised skill development & Leadership Development training
for VDCS staff & Management Committee members.
Providing management support to the VDCS along with regular
supervision of its activities.
Establish Chilling Centres & Dairy Plants for processing the milk
received from the villages.
Selling liquid milk & milk products within the District
Process milk into various milk & milk products as per the
requirement of State Marketing Federation.
Decide on the prices of milk to be paid to milk producers as well
on the prices of support services provided to members.
25
State Cooperative Milk Federation
The Milk Unions of a State are federated into a State Cooperative Milk
Federation. The Federation is the apex tier under the three-tier structure.
It has membership of all the cooperative Milk Unions of the State and is
governed by a Board of Directors consisting of one elected representative
of each Milk Union. The State Federation further appoints a Managing
Director (paid employee and member secretary of the Board) for
management of the day-to-day functions. It also employs various people
for assisting the Managing Director in accomplishing his daily duties.
The main functions of the Federation are as follows:
Marketing of milk & milk products processed / manufactured by
Milk Unions.
Establish distribution network for marketing of milk & milk
products.
Arranging transportation of milk & milk products from the Milk
Unions to the market.
Creating & maintaining a brand for marketing of milk & milk
products (brand building).
Providing support services to the Milk Unions & members like
Technical Inputs, management support & advisory services.
Pooling surplus milk from the Milk Unions and supplying it to
deficit Milk Unions.
26
Establish feeder-balancing Dairy Plants for processing the surplus
milk of the Milk Unions.
Arranging for common purchase of raw materials used in
manufacture / packaging of milk products.
Decide on the prices of milk & milk products to be paid to Milk
Unions.
Decide on the products to be manufactured at various Milk Unions
(product-mix) and capacity required for the same.
Conduct long-term Milk Production, Procurement & Processing as
well as Marketing Planning.
Arranging Finance for the Milk Unions and providing them
technical know-how.
Designing & Providing training on Cooperative Development,
Technical & Marketing functions.
Conflict Resolution & keeping the entire structure intact.
We move to the year 2008. The dairy industry in India and particularly in
the State of Gujarat looks very different. India for one has emerged as the
largest milk producing country in the World. Gujarat has emerged as the
most successful State in terms of milk and milk product production
through its cooperative dairy movement. The Kaira District Cooperative
Milk Producers’ Union Limited, Anand has become the focal point of
dairy development in the entire region and AMUL has emerged as one of
the most recognized brands in India, ahead of many international brands.
Today, we have around 176 cooperative dairy Unions formed by
1,25,000 dairy cooperative societies having a total membership of around
13 million farmers on the same pattern, who are processing and
27
marketing milk and milk products profitably, be it Amul in Gujarat or
Verka in Punjab, Vijaya in Andhra Pradesh or a Nandini in Karnataka.
This entire process has created more than 190 dairy processing plants
spread all over India with large investments by these farmers’ institutions.
These cooperatives today collect approximately 23 million kgs. of milk
per day and pay an aggregate amount of more than Rs.125 billion to the
milk producers in a year.
28
Amul Hits of 2010 - 2011
"Butter khana , not gymkhana!" , "INCOME ATTAX!", "Bharat
Obama?"
"Kochi toh log kahenge!" , "Flight dis 'eruption'!" , "IPL
Commission....err!"
"CHENNAI 'SAPAAD' KINGS!" , "Celebrating 50 years of
Gujarat" , "Swarnim india Swarnim gujarat Swarnim amul"
"MAHA NASHTA DAY!" , "BAS AB AUR NAHIN! KASAB
AUR NAHIN!" , "Bites !"
"THE SNACKS EFFECT!" , "Party pooped!" , "Share your
snakes!"
"Beat the heat, just eat!" , "From bye bye to Bhai Bhai!" , "Yahan
der bhi hai, andher bhi......"
"Toh ab goalie kha.....!" ,"Messi ko Maska dona.....!","OIL SLICK!
BUTTER LICK!"
"Kashmir ki kali ko khilne Do!", "Jhat makhni pat byah!", "Sabka
Paul khol diya!",
"WOH KHA!WOH KHA!", "Symbol for BUTTER", "BLED
TIME STORY!", "Casting coach!"
"ONCE UPON A SLICE IN MUMBAI!!" , "Get buttered, not
battered!" , "Prevent malaria.Spread amularia" , "Common wealth
kha gaya?" , "POLLUTION TEL LAGAANE GAYA!" , "Butter?
Jam?" , "RAI' BOT!" , "The No ball Prize !" , "Vishwa ke nath,
Bharat ke kuch nahin? " , "For bookies! For bhookas!"
29
"EATEN 24 HOURS A DAY" , "BHARAT BANDH? ISKO
KHOLO!" , "MASKA KHOLA HAI, DARLING TERE LEYE!" ,
"Jigrr mat haaro!" ,"Incurable India !"
"Divide......and unite !" , "He slices 1000 loaves with one finger!" ,
"I declare this pack open"
Management of a Gymkhana in Mumbai, evicted a trangender
activist from a dinner party hosted by one of its member- April'10
Anand : Gujarat Cooperative Milk Marketing Federation (GCMMF),
renowned for marketing milk & milk products under ‘Amul’ & ‘Sagar’
brands, announced record Sales Turnover of Rs. 8005 crores. The results
of the apex body of the dairy cooperatives in Gujarat, were declared
today in the 36th Annual General Meeting of the Federation. While
30
commenting on the results, Shri Parthibhai G. Bhatol, Chairman,
GCMMF informed that last year, our turnover was 6711 crores (Rs 67
billion) and our Federation registered a quantum growth of 19.3% to
reach Rs 8005 crores (Rs 80 billion).“This is an extremely impressive
growth when viewed from the perspective of drought effect and resultant
drop in milk procurement as well as 27.7% growth that we achieved in
the year 2008-09” Shri Bhatol commented. He further informed,
“Federation has justified its undisputed leadership in milk business by
achieving sales growth in pouch milk category by more than 21% and in
value terms by 32% from existing markets only. We have achieved
number one status in pouch milk sales in Delhi this year. With this
achievement, Amul milk has emerged as the largest selling brand of milk
in all major metro markets of Delhi, Mumbai, Kolkata and
Ahmedabad”.Further commenting, he said “Our Masti Dahi sales grew at
an impressive rate of 46%. Ice-cream sales registered a value growth of
22%. Amul Cheese sales increased by 20%. UHT milk also grew strongly
at 14% along with Fresh Cream registering 39% growth. Our beverage
sales grew by 25% and our chocolate sales also registered an encouraging
growth of 30%”.Regarding retail experiment of Amul, Shri Bhatol
informed “Federation has created 5000 Amul preferred outlets which
exclusively sell wide range of Amul products. 2000 of these parlours
have been added during the current year which speaks volumes about the
quantum of scale and speed with which the expansion has been dealt
with. It is unthinkable for any competition to create such massive network
of exclusive outlets. The Retailing business alone fetched a turnover of
Rs. 300 Crore during the current financial year”. Regarding exports, Shri
Bhatol commented, “We have been able to maintain and strengthen our
31
presence in consumer pack export markets. This year too we have crossed
a mark of Rs 100 crore in foreign exchange earnings. We have been able
to achieve this figure for the 5th time by now”.Regarding future plan of
the dairy cooperative, Shri Bhatol informed, “During last year, we
prepared a perspective.
32
GCMMF Today GCMM F is India's largest food products marketing organisation ]. It is a
state level apex body of milk cooperatives in Gujarat, which aims to
provide remunerative returns to the farmers and also serve the interest of
consumers by providing affordable quality products. GCMMF markets
and manages the Amul brand. From mid-1990s Amul has entered areas
not related directly to its core business. Its entry into ice cream was
regarded as successful due to the large market share it was able to capture
within a short period of time - primarily due to the price differential and
the brand name. It also entered the pizza business, where the base and the
recipes were made available to restaurant owners who could price it as
low as 30 rupees per pizza when the other players were charging upwards
of 100 rupees.
33
GCMMF: An Overview
Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's
largest food products marketing organisation. It is a state level apex body
of milk cooperatives in Gujarat which aims to provide remunerative
returns to the farmers and also serve the interest of consumers by
providing quality products which are good value for money.
34
Members: 13 district cooperative milk
producers' Union
No. of Producer
Members:
2.79 million
No. of Village Societies:
13,328
Total Milk handling capacity:
11.22 million litres per day
Milk collection (Total - 2008-09):
3.05 billion litres
Milk collection (Daily Average 2008-09):
8.4 million litres
Milk Drying Capacity:
626 Mts. per day
Cattle feed mfg. cap. 3500 Mts per day
Sales Turnover Rs (million) US $ (in million)1994-95 11140 3551995-96 13790 4001996-97 15540 4501997-98 18840 4551998-99 22192 4931999-00 22185 4932000-01 22588 5002001-02 23365 5002002-03 27457 5752003-04 28941 6162004-05 29225 6722005-06 37736 8502006-07 42778 10502007-08 52554 13252008-09 67113 15042009-10 67242 1594
35
c) Various Type Of Product
Amul is the acronym for Anand Milk Union Limited, a dairy cooperative
company in Gujarat, India that markets a wide range of products
including milk powders, milk, butter, ghee, cheese, chocolate, Shrikhand,
Gulab Jamun, ice cream, cream, Nutramul brand and others making it the
largest food brand in India with an annual turnover in excess of US $1
billion (2006-07). The complete listing is below.
Bread spreads
Pure Ghee
Milk Powders
Sweetened Condensed Milk
Sweets
Fresh Milk
Amul Icecreams
Chocolate & Confectionery
Brown Beverage
Milk Drink
Health Beverage
References
External links
Breadspreads
Amul Butter
Amul Lite Low Fat Breadspread
Amul Cooking Butter
36
Delicious Margarine
Amul / Sagar Pure Ghee
Milk Powders
Amul Full Cream Milk Powder
Amulya Dairy Whitener
Sagar Skimmed Milk Powder
Sagar Tea and Coffee Whitener
Sweetened Condensed Milk
Amul Mithaimate
Sweets
Amul Shrikhand & Amrakhand
Amul Mithaee Khoya Gulabjamaun
Amul Basundi
Fresh Milk
Amul Taaza Toned Milk 3% fat
Amul Gold Full Cream Milk 6% fat
Amul Shakti Standardised Milk 4.5% fat
Amul Slim & Trim Double Toned Milk 1.5% fat
Amul Saathi Skimmed Milk 0% fat
Amul Cow Milk
Amul Yogi, A Flavoured Yoghurt
Amul Masti Dahi (Fresh Curd)
Amul Lite Dahi (Fresh Low Fat Curd)
37
Amul Prolife probiotic Dahi (Fresh Probiotic Curd)
Amul Buttermilk (Available Fresh in Pouch Pack)
Amul Masti Spiced Butter Milk
Amul Lassee
Amul Icecreams
Vanilla Royale
Royal Treat Range (Butterscotch, Rajbhog, Malai Kulfi)
Nut-o-Mania Range (Kaju Draksh, Kesar Pista Royale, Fruit
Bonanza, Roasted Almond)
Nature's Treat (Alphanso Mango, Fresh Litchi, Shahi Anjir, Fresh
Strawberry, Black Currant, Santra Mantra, Fresh Pineapple)
Sundae Range (Mango, Black Currant, Sundae Magic, Double
Sundae)
Assorted Treat (Chocobar, Dollies, Frostik, Ice Candies, Tricone,
Chococrunch, Megabite, Cassatta)
Utterly Delicious (Vanila, Strawberry, Chocolate, Chocochips,
Cake Magic)
Amul SUGAR FREE Frozen Foods (Milk Based Sweet)
Amul ProLife Probiotic Ice cream
Chocolate & Confectionery
Amul Fruit & Nut Chocolate
Amul Bindazz
Amul Rejoice
Amul kesar
38
Brown Beverage
Nutramul Malted Milk Food
Milk Drink
Amul Kool Flavoured Milk (Mango, Strawberry, Saffron, Cardamom,
Rose, Chocolate,Butterscotch)(Right now AMUL stopped its AMUL
KOOL Production)
Amul Kool Cafe amul sexy gums
Amul Kool Koko
Health Beverage
Amul Shakti White Milk Food
GCMMF is India's largest exporter of Dairy Products. It has been
accorded a "Trading House" status. GCMMF has received the APEDA
Award from Government of India for Excellence in Dairy Product
Exports for the last 11 years.
The major export products are:
Consumer Packs
Amul Pure Ghee
Amul Butter
Amul Shrikhand
Amul Mithaee Gulabjamun
Nutramul Brown Beverage
39
Amul Cheese
Amul Malai Paneer
Amul UHT Milk (Long Life)
Amul Gold Milk
Amul Taaza Full Cream Milk
Amul Lite Slim and Trim Milk
Amul Fresh Cream
Bulk Packs
Amul Skimmed Milk Powder
Amul Full Cream Milk Powder
Many of our products are now available in the USA, Gulf
Countries and Singapore.
AWARD
Rajiv Gandhi National Quality Award - 1999
40
After creating ripples in the
market whether it be with a Rs.
20/- Pizza or with a "real" Ice
Cream, Amul has done it again.
But this time, it is not only for
new product launches or giving
a tough fight to best of the food
companies in extremely
competitive segments, it has
now topped as the winner of
t "Best of All" Rajiv Gandhi National Quality Award for the year,
1999.The award which is considered equivalent of Malcolm Baldrige
National Quality Award of USA and European Quality Award, is the
most prestigious award which recognizes achievements of an
organization in terms of excellence in business results, business
processes, customer satisfaction as well as societal and environmental
impact. GCMMF, the apex marketing body of well known Amul, Sagar
and Dhara brands of products is a Cooperative Federation of more than 2
million milk producers of Gujarat. Pioneered by Dr. Verghese Kurien, the
father of white revolution, GCMMF is today nation's largest food
company with an annual turnover exceeding Rs 2300 Crores. Looking at
the emerging trends of liberalization and impact of WTO, the GCMMF
proactively embarked upon Total Quality Management as a change
management initiatives to strengthen all its functional processes to
effectively combat emerging competition. It undertook successfully a
number of TQM initiatives like Kaizen, Housekeeping, Small Group
Activities, Hoshin Kanri (Policy Deployment) across the organization.
41
Realising that unless the TQM initiatives are accepted by all the business
partners, the same would remain ineffective. As a very unique measure
Amul extended all the TQM initiatives to its business partners whether it
was the farmer producer in the village or a wholesale distributor in a
metro town or its most sophisticated production unit.
Shri B.M. Vyas, Managing Director, who championed this movement
realized way back in 1994 that with emerging competition, doing
business would become more exciting yet extremely competitive which
would require at times not only a whole set of new skills and
competencies but quick adaptability to change without much stress or
turbulence. The initiation of TQM was to work with the well known
quality management initiatives which have proven to be effective
elsewhere to create a culture of transparency, openness and leadership in
the organization. Employees of GCMMF have done more than 1.60 lakhs
Kaizen since May, 1995 which has impacted in bringing in a culture of
continuous improvement. The housekeeping initiatives have helped
keeping the offices/warehouses neat, clean and more productive, be it be
the Office premises or the godowns or even Computers. More than 150
SGAs (Small Group Activity) have been carried out in cross functional
groups to address the problem and pain areas of the organization, be it an
issue of sales, marketing, HR or IT. The organization has implemented a
customized ERP for seamless integration of its 40 odd sales offices from
Jammu to Port-Blair and Head Office. All its wholesale dealers are
computerized and GCMMF is moving on a B2B model for integration
interface with its dealers be it for placing order for buying its products,
sharing information or for tracking logistic of dispatch/receipt of goods.
42
One of the unique initiatives has been in terms of involvement of its
wholesale dealers in a common platform to address issues of
market/customers. All the wholesale dealers from across the country have
visited Anand in a unique programme called "AMUL YATRA". In the
next phase, the organization has already started inviting the salesmen of
these wholesale dealers for this programme. It also intends to invite the
top retailers of various cities/towns to Anand. The purpose is not as much
to orient them to GCMMF's business plans, but to inculcate a super-
ordinate goal in their heart that when they are associated with AMUL,
they are working for a modest milk producer in the rural hinterland of the
country and that is what true progress is about. GCMMF has more than
200 Amul Quality Circles in the country where all the above wholesale
Dealers meet in group on every third Saturday of the month to discuss
their business, quality initiatives and also pain areas. This has impacted
tremendously not only in communication but also in improving the
transparency in the organization.
GCMMF has also embarked upon for last 4 years, 'Hoshin Kanri' a
ployment initiative where more than 100 Officers/Heads participate twice
in a year to review its business goals/processes and implement new
initiatives. These are further cascaded to the wholesale dealers in
different territories in a two day exercise called Vision Mission Strategy
(VMS) Workshop. These initiatives have resulted common understanding
of goals, eliminating communication barrier. The initiative of TQM six
years back has made the organization efficient whether it be in launch of
brands, or in implementing ERP's or expanding its distribution network.
More striking feature of GCMMF's TQM experience is the integration of
43
its business linkages at the village level to the forward linkage through its
sales offices/wholesale dealers in the market. In a glittering function
organized at Vigyan Bhawan, New Delhi on 12th November, 2001, Shri
Shanta Kumar, Hon'ble Minister of Consumer Affairs, Food and Public
Distribution gave away the awards to Shri B.M. Vyas, MD of GCMMF.
AMUL BRIEF PROFILE
Amul was formally registered on December 14, 1946. Dr Verghese
Kurien is recognised as the man behind the success of Amul. The 'Amul
44
revolution' started as awareness among the farmers, grew and matured
into a protest movement that was channeled towards economic prosperity.
Over five decades ago, the life of a farmer in Kheda District was very
much like that of his/her counterpart anywhere else in India. His/her
income was derived almost entirely from seasonal crops. The income
from milk buffaloes was undependable. Private traders and middlemen
controlled the marketing and distribution system for the milk. As milk is
perishable, farmers were compelled to sell it for whatever they were
offered. Often, they had to sell cream and ghee at throw-away prices. In
this situation, the private trader made a killing. Gradually, the realization
dawned on the farmers that the exploitation by the trader could be
checked only if marketed their milk themselves. Amul was the result of
that realization. The Kaira Union began pasteurizing milk for the Bombay
Milk Scheme in June 1948. By the end of 1948, more than 400 farmers
joined in more Village Society, and the quantity of milk handled by one
Union increased from 250 to 5,000 liters a day. The success of Amul was
instrumental in launching the White Revolution that resulted iincreased
milk production in India. It is termed as "Operation Flood" by Amul.
Currently Amul has 2.41 million producer members with milk collection
average of 5.08 million litres/day. Amul's sales turnover in 2004-05 was
672 million US $.
Company info
The Gujarat Cooperative Milk Marketing Federation Ltd, Anand
(GCMMF) is the largest food products marketing organisation of India. It
is the apex organization of the Dairy Cooperatives of Gujarat. This State
45
has been a pioneer in organizing dairy cooperatives and our success has
not only been emulated in India but serves as a model for rest of the
World. Over the last five and a half decades, Dairy Cooperatives in
Gujarat have created an economic network that links more than 2.8
million village milk producers with millions of consumers in India and
abroad through a cooperative system that includes 13,141 Village Dairy
Cooperative Societies (VDCS) at the village level, affiliated to 13 District
Cooperative Milk Producers’ Unions at the District level and GCMMF at
the State level. These cooperatives collect on an average 7.5 million litres
of milk per day from their producer members, more than 70% of whom
are small, marginal farmers and landless labourers and include a sizeable
population of tribal folk and people belonging to the scheduled castes.
The turnover of GCMMF (AMUL) during 2008-09 was Rs. 67.11 billion.
It markets the products, produced by the district milk unions in 30 dairy
plants, under the renowned AMUL brand name. The combined
processing capacity of these plants is 11.6 million litres per day, with four
dairy plants having processing capacity in excess of 1 million Litres per
day. The farmers of Gujarat own the largest state of the art dairy plant in
Asia – Mother Dairy, Gandhinagar, Gujarat - which can handle 2.5
million litres of milk per day and process 100 MTs of milk powder daily.
During the last year, 3.1 billion litres of milk was collected by Member
Unions of GCMMF. Huge capacities for milk drying, product
manufacture and cattle feed manufacture have been installed. All its
products are manufactured under the most hygienic conditions. All dairy
plants of the unions are ISO 9001-2000, ISO 22000 and HACCP
certified. GCMMF (AMUL)’s Total Quality Management ensures the
quality of products right from the starting point (milk producer) through
46
the value chain until it reaches the consumer. Ever since the movement
was launched fifty-five years ago, Gujarat’s Dairy Cooperatives have
brought about a significant social and economic change to our rural
people. The Dairy Cooperatives have helped in ending the exploitation of
farmers and demonstrated that when our rural producers benefit, the
community and nation benefits as well.
The Gujarat Cooperative Milk Marketing Federation Ltd. cannot be
viewed simply as a business enterprise. It is an institution created by the
milk producers themselves to primarily safeguard their interest
economically, socially as well as democratically. Business houses create
profit in order to distribute it to the shareholders. In the case of GCMMF
the surplus is ploughed back to farmers through the District Unions as
well as the village societies. This circulation of capital with value
addition within the structure not only benefits the final beneficiary – the
farmer – but eventually contributes to the development of the village
community. This is the most significant contribution the Amul Model
cooperatives has made in building the Nation.
Achievements of GCMMF
2.8 million milk producer member families
13,759 village societies
13 District Unions
8.5 million liters of milk procured per day
Rs. 150 million disbursed in cash daily
47
GCMMF is the largest cooperative business of small producers
with an annual turnover of Rs. 53 billionss
The Govt. of India has honoured Amul with the “Best of all
categories Rajiv Gandhi National Quality Award”.
Largest milk handling capacity in Asia
Largest Cold Chain Network
48 Sales offices, 3000 Wholesale Distributors, 5 lakh retail outlets
Export to 37 countries worth Rs. 150 crores
Winner of APEDA award for nine consecutive years
Amul Brand Building
GCMMF (AMUL) has the largest distribution network for any FMCG
company. It has nearly 50 sales offices spread all over the country, more
than 3,000 wholesale dealers and more than 5,00,000 retailers. AMUL is
also the largest exporter of dairy products in the country. AMUL is
available today in over 40 countries of the world. AMUL is exporting a
wide variety of products which include Whole and Skimmed Milk
Powder, Cottage Cheese (Paneer), UHT Milk, Clarified Butter (Ghee)
and Indigenous Sweets. The major markets are USA, West Indies, and
48
countries in Africa, the Gulf Region, and [SAARC] SAARCneighbours
Singapore, The Philippines, Thailand, Japan and China. In September
2009, Amul emerged as the leading Indian brand according to a survey by
Synovate to find out Asia's top 1000 Brands.
b) MISSION AND VISSION OF AMUL
GCMMF plans Rs 2,600 cr investment for vision 2020
After having prepared its vision 2020, Gujarat Co-operative Milk
Marketing Federation (GCMMF), which owns and markets Amul brand,
plans to pump in around Rs. 2,600 crore to achieve its mission."As part of
our mission, we intend to double the existing capacity of all our member
union by 2020. Around Rs. 2,600 crore are planned to be infused by 2020
to ramp up production as well as infrastructure capacities", said Parthi
49
Bhatol, in-charge chairman, GCMMF."Whatever infrastructure and
capacities we have today, will be doubled to achieve mission 2020",
added BM Vyas, managing director, GCMMF. GCMMF has come up
with a long term plan, which envisages increasing the turnover of all its
member dairy co-operatives to Rs. 27,000 crore by 2020 from current
level of Rs. 10,000 crore. Currently, the marketing federation has 13
member unions.The total milk procurement by its member union
averaged at 87.19 lakh kgs per day in 2008-09, which represented the
growth of 14.87 per cent over 75.90 lakh kgs per day. GCMMF also
wants to double this milk procurement capapcity by 2020. Apart from
this, these dairy co-operatives also demonstrated their ability to process
110 lakh kgs of milk per day.The expansion under mission 2020 includes
increasing productivity of milk cattle, higher processing infrastructure to
handle the peak milk procurement of 195 lakh per day. It also has plans to
capture liquid milk market of major metro cities.GCMMF has further
decided to focus more on retail expansion. As per the available details,
the federation plans to add 6,000 Amul parlours across the country in
financial year 2009-10.At present, it has retailing network of 4,000 Amul
parlours. The apex body of dairy co-operatives plan to take the total tally
of Amul parlours to 10,000 by adding 8,000 parlours during 2010-11.
MISSION
Amul Vidyashree & Amul Vidya Bhushan Awards
The foundation of every state is the sound education of its youth and
hence is the most basic constituent for a developing nation like India.
50
Towards this, we at Amul have always contributed our best towards
ensuring development and encouraging the spirit of enlightenment among
today’s youth. As a continuation towards this endeavour, Amul has
instituted Vidyashree Award to recognize the academic excellence of the
class 10 school topper in the examination in each State/Central Board
enrolled school every year.The objective of the awards is to recognize
the efforts of the academic merit toppers and build equity for Amul
among the young India. We are proud to constitute this award which is
the first of its kind in India and operate Pan-India in such a large scale.
By winning this award, not only the student gets recognized, but it also
help the schools to enhance their image as an academy that imparts
quality education, putting it at par with other premier institutions in India.
Both “Amul Vidyashree” & “Amul Vidyabhushan” Award
consist:
A specially designed Trophy.
A Certificate of excellence signed by MD, GCMMF and A Cash
Award of Rs.1000/- Listed along with photograph on our website
www.amul.com.
Feature in press advertisement in a leading national
newspaper
The inception of this award too ar 2004-05, whereby in the first year we
51
honoured the award to students of 500 schools in South India, East India
and Gujarat. In the second year (2005-06) we further acknowledged 2267
students across schools in India. For the academic year 2006-07, we have
till date recognized the academic excellence of around 3077 for
Vidyashree Award across India. Moving ahead, in 2006-07 we have
instituted the “Amul Vidyabhushan Award” to recognize the toppers of
12th Standard examinations. In the first of year of inception, we have
awarded students 2073 students across India.For the academic year 2007-
08, we plan to recognize the efforts of 10,000 Class X & Class XII merit
rankers (5000 students each for Vidyashree and Vidyabhushan Awards).
We further intend to increase the award number every year so that
maximum students are recognized for their academic excellence through
our Awards. All this is towards Amul’s vision to see educated, talented
and strong youth in future India and hence work our best towards nation
building.
c)MARKETING STRATEGIES
Amul is the largest co-operative movement in India with 2.2 million milk
producers organised in 10,552 co-operative societies in 2009-2010.
The country's largest food company, Amul, is the market leader in butter,
whole milk, cheese, ice cream, dairy whitener, condensed milk, saturated
fats and long life milk .Amul follows a unique business model, which
aims at providing 'value for money' products to its consumers, while
protecting the interests of the milk-producing farmers who are its
suppliers as well as its owners. Despite being a farmers' co-operative,
52
Amul has given multinationals a run for their money.
In butter, cheese and saturated fats, Amul has remained the undisputed
market leader since its inception in 1955, by offering quality products at
competitive prices. In other categories, Amul has nullified its late mover
disadvantage through aggressive pricing, better quality, innovative
promotion, and superior distribution .
d) SWOT ANALYSIS
Strengths:
Demand profile: Absolutely optimistic.
Margins: Quite reasonable, even on packed liquid milk.
Flexibility of product mix: Tremendous. With balancing
equipment, you can keep on adding to your product line.
Availability of raw material: Abundant. Presently, more than 80
per cent of milk produced is flowing into the unorganized sector,
which requires proper channelization.
53
Technical manpower: Professionally-trained, technical human
resource pool, built over last 30 years
Weaknesses:
Perishability: Pasteurization has overcome this weakness partially.
UHT gives milk long life. Surely, many new processes will follow
to improve milk quality and extend its shelf life.
Lack of control over yield: Theoretically, there is little control over
milk yield. However, increased awareness of developments like
embryo transplant, artificial insemination and properly managed
animal husbandry practices, coupled with higher income to rural
milk producers should automatically lead to improvement in milk
yields.
Logistics of procurement: Woes of bad roads and inadequate
transportation facility make milk procurement problematic. But
with the overall economic improvement in India, these problems
would also get solved.
Problematic distribution: Yes, all is not well with distribution. But
then if ice creams can be sold virtually at every nook and corner,
why can’t we sell other dairy products too?Moreover, it is only a
matter of time before we see the emergence of a cold chain linking
the producer to the refrigerator at the consumer’s home!
Competition: With so many newcomers entering this industry,
competition is becoming tougher day by day. But then competition
has to be faced as a ground reality. The market islarge enough for
many to carve out their niche.
54
Opportunities:
"Failure is never final, and success never ending”. Dr Kurien bears out
this statement perfectly. He entered the industry when there were only
threats. He met failure head-on, and now he clearly is an example of
‘never ending success’! If dairy entrepreneurs are looking
for opportunities in India, the following areas must be tapped:
Value addition: There is a phenomenal scope for innovations in
product development, packaging and presentation. Given below are
potential areas of value addition:Steps should be taken to introduce
value-added products like shrikhand, ice creams, paneer, khoa,
flavored milk, dairy sweets, etc. This will lead to a greater presence
and flexibility in the market place along with opportunities in the
field of brand building.
Addition of cultured products like yoghurt and cheese lend
further strength - both in terms of utilization of resources and
presence in the market place.
A lateral view opens up opportunities in milk proteins
through casein, caseinates and other dietary proteins, further
opening up export opportunities.
Yet another aspect can be the addition of infant foods,
geriatric foods and nutritionals.
Export potential: Efforts to exploit export potential are already on.
Amul is exporting to Bangladesh, Sri Lanka, Nigeria, and the
Middle East. Following the new GATT treaty, opportunities will
55
increase tremendously for the export of agri-products in general
and dairy products in particular.
Threats:
Milk vendors, the un-organized sector: Today milk vendors are
occupying the pride of place in the industry. Organized dissemination of
information about the harm that they are doing to producers and
consumers should see a steady decline in their importance. The study of
this SWOT analysis shows that the ‘strengths’ and ‘opportunities’ far
outweigh ‘weaknesses’ and ‘threats’. Strengths and opportunities are
fundamental and weaknesses and threats are transitory. Any investment
idea can do well only when you have three essential ingredients:
entrepreneurship (the ability to take risks), innovative approach (in
product lines and marketing) and values (of quality/ethics).
The Indian dairy industry, following its delicensing, has been attracting a
large number of entrepreneurs. Their success in dairying depends on
factors such as an efficient yet economical procurement network,
hygienic and cost-effective processing facilities and innovativeness in the
market place. All that needs to be done is: to innovate, convert products
into commercially exploitable ideas. All the time keep reminding
yourself: Benjamin Franklin discovered electricity, but it was the man
who invented the meter that really made the money.
56
e)ORGNISATION STRUCTURE
CHAIRMAN
BOARD OF DIRECTORS
MANAGING DIRECTORS
GENERAL MANAGER
MARKETING MANAGER
57
ASST. GEN. MANAGER HEAD OFFICE
ASST. GEN. MANAGER ZONE-5
ASST. GEN. MANAGER ZONE-1
ASST. GEN. MANAGER ZONE-4
ASST. GEN. MANAGER ZONE-2
ASST. GEN. MANAGER ZONE-3
Assistant general manager
Head office
58
CH
BOARD OF DIRECTORS
MANAGING dDDDIRECTORS
MARKETING MANAGER
ASST. GEN. MANAGER
HEAD
OFFICEANAND
ASST. GEN. MANAGER
ZONE-4CHENNAI
ASST. GEN. MANAGER
ZONE-3KOLKATTA
ASST. GEN. MANAGER
ZONE-5AHMEDABAD
ASST. GEN. MANAGER
ZONE -1NEW
DELHI
ASST. GEN. MANAGER
ZONE-2
MUMBAI
HUMAN RESOURSE DEVLOPMENT
PRODUCT MANAGEMENT CONTROL GROUP
QUALITY SALE INFORMATION SYSTEM
DEPUTY MANAGER MARKETING
ASSISTANT MANAGER MARKETING
SENIOR EXECUTIVE MARKETING
JUNIOUR EXECUTIVE MARKETING
EXECUTIVE MARKETING
CHAPTER- 2
Objectives of the study
To find out market share of AMUL.
To find out the demand estimation of milk, butter,cheese ghee,
paneer, chocolate
To understand the marketing strategy of AMUL.
To analyze the customer’s needs regarding the product and policies
formulated by the company.
To find out the brand image of AMUL
Need for the study
59
Management is like a coin having two sides. One is the theoretical part
and second is the practical part. In the theoretical part of management we
learn in our classroom from the lectures, seminars, group discussions
thatare arranged from time to time.To know the practical aspect of
management a practical training is provided to the students. The main
idea behind practical training is to bring the management students face to
face with the actual environment of practical management so that he/ she
will be able to apply theory to practical situation before finally moving
into the professional world to show the efficiency and capability.The
project study focused on “AMUL” as a product and the subject is to
understand the mind set of different customers about the product.
CHAPTER-3
Analysis of demand estimation of amul product
Place: Modinagar
Analysis of household survey
Census:113218
(1)Higher income group:
Sample size:10
Consumption of amul product kg/day(a)liquid milk 23775
60
(b)Butter 79(c)ghee 22(d)paneer 34.4 (e)cheese 22(f)ice cream 12(g)chocolate 15
(2)upper medium income group Sample size:10 Consumption of amul product kg/day(a)liquid milk 47551(b)Butter 106(c)ghee 59(d)paneer 142(e)cheese 52(f)ice cream 105(g)chocolate 9
(3) middle income group Sample size:10Consumption of amul product kg/day(a)liquid milk 23775(b)Butter 49.9(c)ghee 47.5(d)paneer 73.7(e)cheese 38(f)ice cream 6.4(g)chocolate 4
(4)lower income group Sample size:10 Consumption of amul product kg/day(a)liquid milk 40418
61
(b)Butter nil(c)ghee 17(d)paneer 13(e)cheese nil(f)ice cream 2(g)chocolate 2
Analysis of retailer survey
Class-A
sample size:30
selling of amul product kg/day
(a)liquid milk 50512
(b)Butter 90.5
(c)ghee 30kg/m
(d)paneer 76
(e)cheese 46
(f)ice cream 156.4
(g)chocolate 6
62
CLASS-B
sample size:10
selling of amul product kg/days
(a)liquid milk 35856
(b)Butter 54
(c)ghee 24kg/m
(d)paneer 6.4
(e)cheese 13
(f)ice cream 10
(g)chocolate 6p/m
Method of calculation:
In this first I find out the population of that area where I went to find out
the demand estimation.
Place: Modinagar
Census: 113218
As the example of milk for higher income group:
Average consumption of milk = total consumption of milk/no of
household.
Population of higher income group in modinagar is :7%
Total population of higher income group in modinagar is:-7925
So demand estimation of milk in higher income group
is:7925*3lit=23775
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Interpretation
During the survey I asked about the satisfaction level of household as well as
retailer about the product and services after analysis it was found that
(1) Amul product is widely accepted by higher, middle and lower
income group people.
(2) Amul product always be in reach of people easily.
(3) It shows that Amul has a strong distribution channel.
(4) Due to its brand image, quality, price and taste Amul is undisputed
leader in retails with an evenly distributed Retail outlet in
modinagar, which results for higher sales for Amul milk.
FINDINGS OF THE STUDY
The collected data that analyzed come out with following findings:-
The result of analysis of dairy product in modinagar is as follows
(1) Amul is first largest dairy milk in modinagar and Mother dairy is
the second.
(2) The percentage of market share of Amul liquid milk is 52% and
share of mother dairy is 46% and other is 2%.
(3) As far as Ice- cream and chocolate is concerned the competition is
tough with reputed brands which fighting for their share in the
modinagar market.
64
(4) Rest of product sell Like: -( Butter, ghee, paneer and cheese) is not
so good due to lack of quality.
(5) The total percentage of promotional activities that help to increase
the sales.
RECOMMENDATION:-
1 A healthy relationship should be developed by the company
executive with the retailers.
2 Service of Amul should be improved in the ease of repairing of its
misleaders (Refrigerators) and glow sign boards which are out of
order in an outlet up to the level thus it is parallel or even better
than the competitor.
3 No.of route vehicles for delivery of goods should be increased in
the entire area of modinagar effectively and efficiently.
65
4 The company should supply its glow sign board Banners
etc……… as an advertisement media to the retailers of few areas,
which will as usual become sales promotion tool for them .
5 The commitment of supplying gift items or incentive should be
carried out on or before the schedule time.
6 The sales schemes and incentive should be properly communicated
to the consumer ( retail outlets/ confectionary) and it should be
time.
7 The company should be regular of its goods such as different
flavors so as for proper availability at each and every retail/
confectionary shop. Otherwise it may lose its consumer and
prospects thus distorting the image of the company.
8 Distributor and confectionary shop feed back should be taken time
to time so as to trace the actual existing problem related to there
and the market.
CONCLUSION
Working for an organization like GCMMF in the ghaziabad region is a
pride for me and gave me a chance to learn the marketing skill and help
me to understand the real environment of business in modinagar market
potential for dairy product helps me lot.In an area like modinagar need a
lot of planning has to be made before making any offer to the customer.
As far as ice cream, milk is concerned the competition is tough with
reputed brands which fighting for their share in the market. But owing to
66
its brand image, quality, price and taste Amul is undisputed leader in
retails with an evenly distributed retail outlet in modinagar, which results
for higher sales for Amul milk. As far as other avenues for sales is
concerned like pushcarts, institutional selling and other bulk deals etc.
Amul is far behind and has to cover a long distance and more efforts have
to be done in this field, to increase its total revenue. At last it was a great
experience to me working with Amul, a reputed brand in FMCG sector
because many of the management guru’s sai work successfully in FMCG
sector than you can survive easily in any sector.
BIBLIOGRAPHY
1. WWW.AMUL.COM
2. WWW.NDDB.COM
3. WWW.GOOGLE..COM
4. MARKETING MANAGEMENT: BY PHILIP KOTLER
5. RESEARCH METHODOLOGY : BY C.R.KOTHARI
67
ANNEXURE-1
Chairman's Speech: 36th Annual General Body Meeting held
on 18th August, 2010
The year that passed by was challenging one, not just for the global
economy as a whole but also for India and its dairy industry.
68
During the last year, India witnessed one of the worst monsoons in two
decades leading to drop in agricultural production mainly in case of
Wheat, Rice, Sugar and Pulses with its impact varying across different
geographies and categories. With record buffer stock of Rice and Wheat
accumulated by the Government during previous year, the nation could
meet demand of Rice and Wheat from within. However in case of Sugar
and Pulses, we had to resort to large-scale imports. India being one of the
largest consumers of Pulses and Sugar in the World, import of these
commodities resulted into record International prices and domestic prices
too, shot up leading to price increases not only in these commodities but
also in their substitutes and by-products. Compared to these commodities,
there was relatively lower impact of draught on milk production in the
country and substantial growth has also been achieved.
Due to the sound procurement and distribution network as well as
immaculate planning, in Gujarat we were able to wither the draught and
also achieve 6.68% growth in milk procurement. We could foresee the
impact of below normal monsoon in August 2009 itself and started
planning to maintain milk production, procurement and inventory levels.
At a time when due to lower production of cereals, fodder prices had
jumped almost two-fold, we enhanced our supplies of cattle-feed to milk
producers and maintained its prices below cost and were able to provide
better returns to the milk producers to overcome the stress of draught.
Our cooperative system stood by their members on one hand and also
tried to be more cautious in keeping the consumers prices of milk and
milk products at the barest minimum. Our cooperatives have therefore
been successful in enhancing trust amongst its members as well as
69
consumers during such difficult time. We are sure that with these
measures and near normal monsoon during the next year, would lead to
major increase in milk production as well as procurement. The current
drought can be mainly attributed to the phenomenon of world-wide
climate change. Developed nations in their quest for industrialisation,
have perpetrated unhealthy levels of carbon emissions in the atmosphere.
Developing nations including India have also joined the league. While
every nation has a right of economic development, the current carbon
emissions are not desirable and must be immediately brought down in
order to provide a better tomorrow to our future generations. Our dairy
cooperatives have initiated various activities to tackle this challenge
prominent being; Tree Plantation Programme for afforestation,
installation of Bio-gas plants for curbing methane emissions, installation
of solar power packs at village level, adoption of energy efficient
methods for milk processing and distribution, etc. While the previous
year led to the world-wide economic recession, the year in retrospect was
more of a global effort to overcome from the recession and all major
economies announcing stimulus packages to provide necessary
momentum to the economies. All these measures have restricted the fall
in growth rates of developed nations, large-scale Government spending
and cut in taxes have led to huge sovereign debts and many countries
especially in Western Europe are battling to address this issue. In case of
India however, the effect of economic recession was lower due to the
inherent nature of the domestic consumption led growth story of the
economy. Further, the slew of stimulus measures announced by the
Government has provided necessary momentum to the economy and the
economy is again geared to achieve double-digit growth in the coming
70
years. Apart from the tax breaks provided to various Industries in form of
stimulus package, the economy also got a boost from the increase in
Government spending, which had a cascading effect leading to higher
consumption. Further, increase in procurement prices [minimum support
price for agriculture products] along with implementation of various
Government schemes for rural development and loan waiver for farmers,
which was introduced in the last Union Budget; have contributed to a rise
in rural demand. The increase in rural purchasing power is reflected in
rural growth across a number of categories. With increasing disposable
incomes in urban as well as rural areas, there has also been significant
shift in the food habits with a bias towards more value-added food
products. This has led to higher demand for milk and milk products. At
the same time, due to draught and resultant decline in agricultural
production, significant demand-supply mismatch was evident during the
last year. As a result, food prices have jumped and there has been
considerable increase in the prices of almost all major agricultural
commodities including fruits and vegetables and even the headline food
inflation touched 20% over the last year.
This has also resulted in steep price increase of all the cattle-feed
ingredients such as; prices of de-oiled rice bran which constitutes 25-35%
of cattle-feed have increased from Rs. 3483/MT in 2005-06 to Rs.
6380/MT in 2009-10 (83% increase), prices of molasses which
constitutes 10-12% of cattle-feed have increased from Rs. 3546/MT in
2005-06 to Rs. 8448/MT in 2009-10 (138% increase), prices of Rapeseed
extraction which constitutes 10-12% of cattle-feed have increased from
Rs. 5141/MT in 2005-06 to Rs. 11781/MT in 2009-10 (131% increase),
71
prices of Rice Polish which constitutes 10-12% of cattle-feed have
increased from Rs. 5612/MT in 2005-06 to Rs. 9630/MT in 2009-10
(72% increase), prices of Jowar which constitutes 10-12% of cattle-feed
have increased from Rs. 5918/MT in 2005-06 to Rs. 9157/MT in 2009-10
(55% increase). The price rise in these raw materials has been particularly
severe in the last year with prices increasing in the range of 25-35%. This
has put tremendous cost burden on the milk producers. Further Molasses,
which being a by-product of Sugar, has seen significant price increase in
recent past. Apart from these high prices, Molasses attracts Excise Duty
and VAT at the highest rate. Thus, total tax burden on Molasses is around
30% of its basic cost and there is no special consideration in taxes for
Molasses used in manufacture of cattle-feed.
Therefore, the average price of cattle-feed charged by our dairy
cooperatives has increased from Rs. 6600 per MT in April 2008 to Rs.
10000 per MT in March 2010, an increase of above 50%. However, our
dairies are not charging the actual cost of manufacturing cattle-feed and
are subsidizing it for the milk producer members. This has put pressure
on the viability of cattle-feed plants. It is ironic that at this juncture India
is exporting nutrition in large quantity in form of de-oiled cakes, which is
rich in crude protein. The escalation in feed cost leads to increase in
production cost of milk and contributes to inflation in the consumer
prices of milk. Hence, India should discourage export of de-oiled cakes.
This will boost availability of nutrition in the country.
All the above factors have led to increase in cost of production for milk
and milk products. Since dairy farmers are also consumers of these
agricultural commodities, such high level of food inflation affects their
72
livelihood and they need to be compensated for the same. Therefore, your
Federation has been forced to increase the prices of its products.
However, the price increase affected by us is quite lower as compared to
above increase in input cost.
While the Government is contemplating introduction of uniform Goods &
Service Tax (GST) across the country, we would like to highlight that
many dairy products like Baby Milk Food, Butter, Ghee, Cheese, Ice-
cream, etc. are now-a-days products of mass consumption. Dairy
cooperatives provide these products at very reasonable rates to the
consumers of India. This has led to affordability for the common man to
include these products in her daily consumption. However, these products
are classified under the category of 12.5% VAT in the most of the States.
In the interest of consumers from all sections of society, we firmly
believe that if VAT rates applicable to dairy products are reduced to the
minimum rate of 4%, it would increase consumer demand, boost milk
products consumption and improve their health by way of better nutrition.
It has been observed that there is a general lack of recognition of
cooperatives as economic institutions both amongst the policy makers
and public at large. It is therefore necessary to consider the importance of
a progressive and enabling legislation, which provides a level playing
field for cooperatives with other corporate entities. As per the directives
of the Central Government, the Reserve Bank of India focuses on the
“priority sector” for its lending as those sectors that impact large sections
of the populations, the weaker sections and sectors which are
employment intensive. However, when it comes to disbursement of short
term and long term loans for dairy cooperatives, our activities are not
73
treated as “priority sector” category for direct finance to agriculture. The
entire finances to District Unions and State Federation of Cooperative
Dairies should be treated as direct finances to farmers, covered under
priority sector lending norms as these organisations have been created
under three-tier Amul Pattern, for the betterment of rural farmers and are
nothing but the forward integration of farmers for better price-realisation.
Similarly, the agricultural income of farmers is exempted from the
purview of Income tax. Income earned from the dairy business is nothing
but the part of agricultural as animal husbandry is supplementary to
agriculture. However, currently, Milk Cooperatives are taxable in the
highest Income Tax bracket of 30% + cess. About 15 years ago, tax on
the cooperatives was always lower than the corporate rates and same
difference be maintained as dairy cooperatives are primarily engaged in
the activity of removal of rural poverty and economic development of
farmers in the country.
Milk is the largest agriculture commodity in the country with its
production estimated at 110 Million MTs during the previous year and its
revenues expected to be around Rs. 2.2 lakh crores in value terms.
Further, milk today touches the lives of millions of rural milk producers,
especially women engaged primarily in this vocation. All across the
world, governments keep buffer stocks of milk powders, butter, etc. in
order to support the milk producers on one hand and to check undue price
fluctuations on the other hand. These systems of buffer stock mechanism
for milk products are very well established in US and European countries.
In case of India too, similar systems exists for other agricultural
commodities like wheat, rice, etc. A mechanism of buffer stocking of
74
milk products is also required in India in order to provide cushion to milk
producers as well as consumers.
After entering a slump during the previous year, international dairy
product prices has been rising rapidly in recent months, sparking
speculation about a repeat of the large price spike that took markets by
surprise three years earlier. All dairy products are showing signs of strong
recovery with the largest increase been displayed by butter, the price of
which has doubled over the year. However, prices for both skimmed milk
and whole milk powder have also increased by over 90 per cent. The
economic recovery underway in major countries may be an important
factor in renewed import demand. The sustainability of the rise in prices
is uncertain, though contingent on the responses of the European Union
and other exporting countries which hold dairy product stocks. On the
domestic front however, dairy farmers now face a real squeeze from both
the fronts; higher cost of production and threat of subsidised imports
flooding our dairy markets. When International prices of milk
commodities increased to unprecedented levels during 2007, Government
banned exports of these commodities, which has later been revoked while
withdrawing the export incentives provided on exports of these
commodities, thus effectively closing the door on exports of milk
commodities and not providing the dairy farmers an opportunity to reap
higher rates. Now in order to contain high inflation of food products in
the country, Government has completely removed import duty on 30000
MT milk powder and 15000 MT of Butteroil / Butter with effect from
March 2010. This will jeopardise the returns of milk producers of the
75
country while allowing developed nations to dump their excess
commodities backed by heavy subsidies.
It is important to note that milk and milk products forms the largest share
of expenditure on food item in a consumer basket and hence the rise in
milk prices affect common man of India the most. Thus, in today’s
critical situation affecting every citizen of the country, Government
urgently needs to act and protect dairy farmers of India by supporting
them. We had represented to the Government in form of a memorandum
submitted to the Hon. Prime Minister way back on 31st August, 2009.
Further, dairy cooperative leaders of the country also had a meeting with
the Hon. Prime Minister on 31st March, 2010 and discussed the following
issues:
1. Amendment in the Cooperative Act.
2. Reduction in Income Tax on Dairy Cooperatives
3. Increase in prices of cattle-feed raw material and corrective actions
required thereof.
4. VAT on all value-added Dairy products to be fixed at minimum rate of
4%.
5. Removal of VAT & Excise Duty on use of Molasses in cattle-feed.
6. Restrict imports of Skimmed Milk Powder and Butter Oil.
7. Classification of Advances to dairy co-operatives under Priority Sector
Lending.
However, till date dairy cooperatives have not received any reprieve on
any of the above issues.
76
Food security is of paramount concern for every nation. A comprehensive
strategy for food and nutrition security in the country is required in order
to move towards the goal of universal food security. Food security
involves every individual gaining physical, economic, social and
environmental access to a balanced diet. With more than 65% of the
Indian population residing in rural areas and rural economy being centred
on agriculture, the real impact of this year’s drought is immense. While
the share of agriculture in GDP of the country is reducing with each
passing year, it is pertinent to note that the economic growth achieved by
the country has to be inclusive. With rural folks too, sharing the fruits of
this development. The three-tier Amul pattern provides the right mix of
rural employment on one hand while providing nutrition to the masses on
the other hand. The need is to recognise the power of this movement,
which has been tested over last six decades and provide due importance
for strengthening the same. I now present to you, our Federation’s Annual
Report and the Audited Accounts for the year 2009-10.
MILK PROCUREMENT
Total milk procurement by our Member Unions during the year 2009-10
averaged 93.02 lakh kilograms (9.30 million kgs) per day representing a
growth of 6.68% over 87.19 lakh kgs (8.7 million kgs) per day achieved
during the year 2008-09. The highest procurement as usual was recorded
during January, 2010 at 122.5 lakh kgs per day.
SALES
During the year, sales of our Federation registered a quantum growth of
19.3% to reach Rs. 8005.36 crores (Rs. 80 billion). Last year, our
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turnover was Rs. 6711.31 crores (Rs. 67.11 billion). This is an extremely
impressive growth when viewed from the perspective of draught effect
and resultant drop in milk procurement as well as 27.7% growth that we
achieved in the year 2008-09. Our Federation has justified its undisputed
leadership in milk business by achieving sales growth in pouch milk
category by more than 21% and achieving average sales volume of 38.30
LLPD (lakh litres per day). The Sales growth in value terms is 32% from
existing markets only. We have achieved number one status in pouch
milk sales in Delhi this year. With this achievement, Amul Milk has
emerged as the largest selling brand of milk in all major metro markets of
Delhi, Mumbai, Kolkata and Ahmedabad. Our Masti Dahi sales grew at
an impressive rate of 46%. Ice-cream sales registered a value growth of
22%. Amul Cheese sales increased by 20%. UHT milk also grew strongly
at 14% along with Fresh Cream registering 39% growth. Our beverage
sales grew by 23% and our chocolate sales also registered an encouraging
growth of 30%.
RETAILING
Our Federation has created 5000 Amul preferred outlets which
exclusively sell wide range of Amul products. 2000 of these parlours
have been added during the current year which speaks volumes about the
quantum of scale and speed with which the expansion has been dealt
with. It is unthinkable for any competitors to create such massive network
of exclusive outlets. This has been possible due to strong brand equity,
consumer pull and relentless efforts on part of our entire sales
organisation which includes our wholesale dealers. These parlours have
not only enhanced the Amul brand visibility but also are giving an easy
78
access to millions of discerning consumers to our unmatched range of
existing products and new products which we launch on regular basis.
Moreover, these parlours have increased the efficiency in distribution by
reducing the distribution costs significantly. The Retailing business alone
fetched a turnover of Rs. 300 crores during the current financial year
which is approximately 4% of the Federation’s total turnover.
EXPORT
We have been able to maintain and strengthen our presence in consumer
pack export markets. This year too we have crossed a mark of Rs. 100
crores in foreign exchange earnings. We have been able to achieve this
figure for the 5th time by now. You will be pleased to learn that during
the year we have been able to expand our reach to New Zealand with
exports of Paneer, Shrikhand, Butter, etc. We have also started export of
our Cheese and Butter to Sri Lankan market. Our traditional market of
Middle East and Far East are doing very well especially in newer
products like Paneer as well as in case of established products like ghee,
butter, etc.
DISTRIBUTION NETWORK
Amul range of products continues to penetrate deeper and deeper across
the country simultaneously through our four distribution highways
created with specialist distributors handling ambient milk products,
chilled milk products, fresh milk products and frozen products. This
unique combination of managing distribution highways has always been
our huge competitive advantage. Distributors are considered to be
Marketing Managers of Federation in true sense. To develop Self
79
Leadership amongst each individual distributor, a major initiative called
SLDP (Self Leadership Development Programme) has been implemented
since last year. Distributors along with their stake-holders undergo a
Vision Mission Strategy (VMS) workshop at their level which would
eventually integrate each of them in the process of organisation’s
strategic planning and enable them to manage their own business
efficiently by meeting the challenges of competitive environment. In the
process, Distributor prepares his Mission statement and business plan for
next few years. To get exposure to our network of cooperative
Institutions, we organise Amul Yatra for our channel partners.
Distributors and major retailers from across the country come to Anand in
Amul Yatra programme. So far more than 7700 distributors and other
channel partners have visited Anand in Amul Yatra. This year too the
initiative continued with inclusion of more distributors and retailers.
MISSION 2020
In the last year’s report, I had shared with you our perspective plan for
the year 2020 for our member unions envisaging a capital investment of
Rs. 2600 crores (Rs. 26 billion) and a projected group sales turnover of
Rs. 27000 crores (Rs. 270 billion). I am glad to inform you that all of our
dairies have started activities to achieve the planned targets. It may be
noted that Kaira Union has commissioned a state-of-the-art Paneer Plant
and also a whey drying plant. Our Sabarkantha Union too is in process of
commissioning a similar Paneer Plant. Our Mehsana Union has expanded
capacity to 9.61 lakh litres per day at its dairy at Manesar near Delhi.
80
Banaskantha Union too has embarked on installing new powder plant and
cattle-feed plant which shall be commissioned soon. New cattle-feed
plants are being put up by Mehsana and Valsad Unions as well.
SUSTAINABLE ECOLOGICAL DEVELOPMENT ‘GREEN
AMUL GREEN INDIA’ CAMPAIGN
Dairy farming like agriculture is dependent on nature. It draws resource
from the nature and needs nature’s support for its growth and
development. Generally agriculture and dairying go hand in hand and are
mutually beneficial activities in India. Over the years, due to intensive
agriculture and deforestation, various natural resources have been
depleted in Gujarat. We, therefore, gave a serious thought in this direction
and discovered a novel idea for giving back to nature. The idea was Tree
Plantation by milk producer members of Dairy Cooperatives on every
Independence day.
The idea was put in to the practice first time in the year 2007. Immaculate
planning was done to execute the idea of “One member One tree”
plantation. On the day of plantation, after the flag hoisting ceremony,
each milk producer member took an oath to plant a sapling and ensure
that it grew in to a tree. The milk producers planted sapling on their own
at their identified locations like their farm, near their home, on farm
bunds, etc. and thus in Gujarat, they planted 18.9 lakh trees across 19
districts of Gujarat on our 60th Independence day, 15th August, 2007.
This was just the beginning. Enthused by the success of the campaign,
Milk Producers of Gujarat decided that every year they shall celebrate
15th August (Independence Day) as a “Go Green Revolution Day by Tree
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Plantation to Protect Mother Earth from Pollution, Climate Change and
Global Warming”. On 15th August, 2008, a more ambitious target was
planned and we planted around 52.74 lakh tree saplings on “One member,
Three tree” basis across 21 districts of Gujarat. In 2009, the third year of
the programme, we took up an ambitious plan to plant one crore trees on
“One member, Five tree” basis and successfully planted around 84.04
lakhs tree saplings across Gujarat despite acute rain shortage. During last
three years, our members have planted more than 155.6 lakh trees and
demonstrated their commitment towards preserving and contributing to
improvement of the environment. For this activity, we have received
Good Green Governance award from Srishti for three consecutive years
during 2007, 2008 and 2009. It is heartening to note that the International
Dairy Federation has awarded the “Amul Green” movement the best
environment initiative in the “sustainability category” at the 4th Global
Dairy Conference held at Salzburg Congress Centre, Austria on 28th
April, 2010. I would like to dedicate this award to all our milk producer
members and the respective team of our committed employees in our
unions since this will now inspire all milk producers across the world. I
am sure all of us will continue to work harder to achieve more milestones
in future.
CO-OPERATIVE DEVELOPMENT
During the year, Junagadh and Kutch Milk Unions have become nominal
members of GCMMF. Along with nominal membership of Amreli and
Bhavnagar Milk Unions, the Federation’s reach to milk producers has
been extended to 24 out of 26 districts of Gujarat. During the last ten
years, our Member Unions are implementing Internal Consultant
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Development (ICD) intervention for developing self leadership among
member producers and thereby enabling them to manage their dairy
business efficiently leading to their overall development. During the year,
Member Unions continued to implement the module on Vision Mission
Strategy (VMS) for primary milk producer members and Village Dairy
Cooperatives. Facilitated by specially trained consultants, 736 Village
Dairy Cooperative Societies (VDCS) have conducted their Vision
Mission Strategy Workshops, prepared their Mission Statements and
Business Plans for next five years. Till date, 6508 VDCS have prepared
their mission statement and Business plan under the initiative. During the
year, 5173 VDCS have also reviewed their business plan under annual
revisit of VMS and have prepared action plan for next year to propel the
momentum gained through VMS. During the year three member unions
namely Rajkot, Bharuch and Gandhinagar have initiated VMS
programme in their VDCS. The core group have trained 145 consultants
of these Unions for expanding the reach of the initiative. In order to
strengthen knowledge and skill base of young girls and women of the
villages about milk production management, our Federation with
technical collaboration and resources of Anand Agriculture University,
has initiated “Mahila Pashupalan Talim Karyakram” for women resource
persons of the member unions and during the year, 739 women resource
person have been trained under this programme. For strengthening
infrastructure for quality and clean milk production, our member unions
have identified 4000 potential VDCS for installation of Bulk Milk
Coolers (BMC) and till date, 1806 BMC have already been installed.
Continuing the cleanliness drive at village level, till March 2010, member
unions have implemented cleanliness module at 9507 VDCS. To enhance
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the level of cleanliness this year 7735 VDCS celebrated Red Tag Day on
“Gandhi Jayanti” - 2nd October and the Unions also awarded best
performing VDCS. Considering a long term vision to improve the
productivity of animals and to reduce infertile animal from their
milkshed; our Board decided to implement Fertility Improvement
Programme (FIP) from year 2007-08. The concept of FIP is an integrated
one, addressing the aspects of animal nutrition, breeding and health in a
holistic manner and thereby converting a non-productive animal into
productive asset. To implement FIP, milk unions have deployed 44 FIP
teams of veterinary consultants and they are working in 974 villages.
During last three years, they have registered 2.32 lakhs non-productive
milch cattles and buffaloes under FIP and out of this, 1.14 lakh milch
animals have been made productive. FIP is being monitored through a
dedicated system on www.amul.org.in Encouraged by the success of FIP,
it has been decided to implement a more comprehensive Productivity
Enhancement Programme from the year 2010-11 to improve the
productivity of milch animals. In collaboration with Institute of Rural
Management, a year-long Certificate Programme in Dairy Management
(CPDM) has been evolved. The basic objective of the programme is to
create a pool of talented managers in order to meet the future manpower
requirement of the member unions. Till date, two CPDM programme
have been conducted and 39 candidates have been trained for member
unions and Mother Dairy, Gandhinagar.
INFORMATION TECHNOLOGY INTEGRATION
We are glad to inform that in order to stay technologically advanced,
simplify business operations across the supply chain and strengthen the
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linkages between GCMMF and its member unions; your Federation is
implementing a common Enterprise Resource Planning (ERP)
solution across GCMMF and its member unions. The ERP solution is
expected to bring the entire supply chain on a single common platform
and improve efficiency. As a first step, your Federation has set up a
centralized state-of-the-art data center for its entire IT operations at
Anand. We have further advanced our Information Technology solutions
by integrating Milk Marketing Depots and Milk Plants on a common
communication backbone to strengthen and automate the Milk marketing
operations. We have also extended customized ERP solution to all our
warehouses for improve the distribution process.
ACKNOWLEDGEMENTS
Before closing, I would like to thank all those who have helped to make
our Federation’s operations successful.
We are grateful to the Government of India for the immense support
received on numerous occasions. We are also thankful to the Government
of Gujarat for all the help and cooperation, extended to our organisation.
National Cooperative Dairy Federation of India had been providing us
with invaluable support in coordination with other agencies and
organisations. National Dairy Development Board had played a role in
our growth and development. I am very grateful to them. Institute of
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Rural Management, Anand, as always, has contributed to the perspective
building and professionalization of the management of the cooperative
sector. We express deep gratitude for its support. We are indebted to
Vidya Dairy for having organised training programmes on dairy
technology for our employees. We are also grateful to SMC College of
Dairy Science, Anand and National Dairy Research Institute, Karnal for
strengthening the dairy cooperative sector, by providing technically
skilled manpower. We express our sincere thanks to the College of
Veterinary Science and Animal Husbandry, Anand. Our advertising
agencies, bankers, insurers, management consultants, suppliers and
transport contractors have been of great help to us in managing our
growth and are our partners in success. We acknowledge their
contributions and commit ourselves to continue and strengthen this
fruitful alliance in all times to come. The Indian Railways has played a
crucial role in the growth of our dairy cooperatives since inception. We
thank them for their continuous support. We depend on the efficiency of
our WC&F agents, distributors, retailers and most important of all, the
patronage of our consumers, who have come to regard our brands as
synonymous with quality and value. While thanking them for their
support, we assure them that we shall strive endlessly to delight them.
Our Member Unions are our strength. We thank them for their guidance,
support and cooperation without which we would not exist. Lastly, we
thank the officers and staff of our Federation for their continued
perseverance, loyalty and unflinching efforts devoted to our cause.
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ANNEXURE- 2
SOME ARTICLES RELATED WITH AMUL
Amul Help during Flood, by donates 6 Lac packs of Tetra Pack Milk for
the Flood Victims Gujarat had never witnessed such fury of the rains. It
rained relentlessly for about a week throwing life out of gear completely
in central Gujarat, including the Milk Capital of India - Anand. There was
knee-deep to neck deep water in most parts of the town. With
communication links snapped, no electricity and ironically no drinking
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water, Anand remained practically cut off for a few days. The citizens of
the milk capital of India braved it all. They were united in their misery
and lent a helping hand to those who were worse off than them. From
Sunday with the rain gods relenting, things started improving slowly. Life
is slowly limping back to normal though even today some parts of the
town are inundated and still without power. Schools are slowly re-
opening, trickle of vegetables are coming to the market and road links
have slowly been restored though trains links between Vadodara and
Ahmedabad still remains cut off. The people of Anand once again
showed their grit and determination to face any odd and emerge
triumphant.As in earlier occasions, the Gujarat Cooperative Milk
Marketing Federation Ltd. has once again come to the aid of the victims
of the worst ever floods in Gujarat. It will supply 6 lac packs of Amul
Milk in 200 ml tetra pack for the flood relief operations. The approximate
cost of the milk would come to Rs. 28.00 lacs. The milk will be supplied
as a contribution to the Chief Minister's Relief Fund.This follows the
discussions Shri B.M. Vyas, Managing Director, GCMMF had with Shri
Bhupendrasinh Chudasama, Minister of Agriculture & Cooperation,
Govt. of Gujarat regarding the need to provide safe milk for distribution
in the flood affected areas of Gujarat when the minister visited Anand on
Monday.
Marginal drop in Milk Procurement
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In spite of the unprecedented floods in Gujarat, milk procurement by the
Member Unions of Gujarat had shown only a marginal decline of 7% last
week. However, with an improvement in the situation, milk procurement
is slowly expected to return to normal.. On an average the milk
procurement was about 51 lakh liters per day. Milk procurement in
Baroda & Kaira Unions has been affected more than the other Unions.
The priority now is to supply milk rather than go in for products whose
stocks are available across the country.The resilience of the farmer
members was demonstrated when Members from many Societies who
were not able to deliver milk in their Village Society due to floods, came
all the way to Amul Dairy in tractors and unloaded the milk themselves.
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Amul Focuses on Ice-Cream; Eyes 17% Growth to Rs 3,200 Crore
Mohini Bhatnagar
Anand: Gujarat Cooperative Milk Marketing Federation (GCMMF), one
of India's greatest success stories with its Amul brand, is now aiming at a
17-per cent growth in sales to Rs 3,200 crore this fiscal against sales of
Rs 2,746 crore in the previous year ended 31 March 2003.The federation
is expecting each of its products to contribute higher sales this year as
new products are being added to each product line.The big hope is not
surprisingly the Amul brand of ice-creams, which is expected to
contribute Rs 250 crore to the turnover, up from Rs 150 crore last year.
Says GCMMF managing director B M Vyas: "Last year we saw a good
growth in ice-cream, cheese, butter and ghee. We are planning to launch
new products in almost every line that we are in, with specific stress on
ice-creams."For its ice-cream and milk business, GCMMF has begun
investing in increasing its milk capacity. It recently firmed up plans to
invest Rs 100-120 crore to expand this from 1.1 million litres a day to 1.8
million litre a day at its Gandhinagar factory. The investment will take
place over the next two years.The cooperative is also planning to expand
its production facilities beyond Gujarat to service other regions in India.
GCMMF recently bought an ice-cream manufacturing unit in Nagpur and
is installing a dairy unit alongside. Through this unit, the organization has
also extended its milk supply to over 10 cities spread over Rajasthan,
Madhya Pradesh and Maharashtra.
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Amul is now focusing on its supply system. Efforts are on to ensure
greater availability of Amul ice-cream at pushcarts and small outlets. The
company feels that availability is the most important factor in ice cream
sales. Thus, Amul ice-cream can be found in 'just around the corner
shops,' local STD booths, local kirana shops, chemists and bakers, who
stock the ice-cream in deep freezers.The idea is to ensure visibility and
availability, which more often than not ensures a sale as ice-cream
consumed out of home is most often an impulsive purchase. For ensuring
a presence in southern India, the cooperative has tie-ups with various
state marketing federations in that region. For production of ice-creams it
is considering expanding the agreements with other state-cooperatives as
well.Amul expects to clock sales of 34 million litres during the current
year and the accent will be on offering 'value for money' products. The
new ice-creams to be launched from Amul this year include a mega-bite
almond cone (the largest volume cone in the country), an orange ice-
cream (Santra Mantra), a Bouncer ice-cream with nuts and essential
proteins, vitamins and minerals for the growing children, a cheese ice-
cream and a sundae in cone for kids in different variants. Both Amul and
Hindustan Lever's (HLL) Kwality Walls claim to be the largest selling
ice-cream brands in India. While HLL quotes a market research study by
AC Nielson, which puts Kwality Walls at the No 1 spot, an independent
study by Ahmedabad-based Consumer Education and Research Society
(CERS) ranks Amul as No 1, followed by Kwality Walls (among four
brands including Vadilal and four loose samples) on various parameters
of taste, melting quality, weight, fat and sugar content. Amul ice-cream is
positioned as 'real ice-cream' made from real milk cream, while HLL's
Kwality Walls is made from vegetable oil and its items are dubbed as
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Frozen Deserts. Last year, Amul ice-cream made its entry into New
Delhi, India's biggest ice-cream market, where its anti-compete
agreement with Mother Dairy has expired. Amul has been outracing its
entire ice-cream requirement for the northern market (including Delhi)
from its own Gandhinagar plant.
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Americans to get a taste of India
Amul makes it to the shelves of Wal-Mart, the largest US retailer
The recent news that Gujarat Cooperative Milk Marketing Federation had
signed an agreement with Wal-Mart to stock its shelves with products
under its Amul brand name is proof that the 'the taste of India' has finally
arrived. But this is not the first time that Amul will be stepping foot on
US soil. Amul has been in the US since 1998 through Kanan Dairy,
which markets Amul processed cheese, pure ghee, Shrikhand, Nutramul,
Amul's Mithaee Gulab Jamuns to more than 1,000 ethnic Indian grocery
stores in the US through a network of seven distributors.
And this may just be the right time to go full-fledged into the US market
via discount stores like Wal-Mart. Dairy prices — milk, yogurt, ice
cream, cheese — are at record highs primarily due to lower dairy cattle
and high gasoline prices in the milk trucking industry. Mozzarella cheese
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prices have been increasing in the past one year. And mozzarella cheese
is an important part of Amul's product portfolio. Amul decided to go up
the food chain and into the mini-pizza market in India only to proliferate
the consumption of mozzarella cheese, thus giving Britannia a run for its
money in the cheese market.Now, since milk is an integral part of the
American diet, consumption levels will be almost maintained. But,
consumers may seek out low-priced stores like Wal-Mart not only for
milk but other dairy products as well. This will work to the advantage of
Amul.While the potential is enormous, the key to Amul's success will be
its ability to localize. For instance, when big MNCs came looking to
capture a slice of the pie of the growing emerging markets, they decided
to customize their offerings. Like McDonald's introduction of Aloo Tikki,
in deference to the Indian palate or when Pepsi coined the Yeh Dil
Maange More tag-line in India. Amul will have to customize its products
and look outside the ethnic box to suit the American and other ethnic
palates. It simply cannot use its home-ground strategies in the US and
expect to make a mark, even if Wal-Mart plans to push the brand only in
stores and only in states like New York and New Jersey, where the Indian
community is very strong.
Still, with more than 50 per cent of Americans being medically obese,
and if Amul is really looking to capture the hearts of the second- and
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third-generation Indians, offering low-fat versions of its brands, would
make a lot of commercial sense.
And baiting the two-million strong Indian community with an estimated
disposable income of more than $88 billion with ethnic products like
Amul Mithai makes commercial sense for the $257-billion Wal-Mart. As
such riding piggyback on chain stores like Wal-Mart, which has 3,200
stores in the US and another 1,000 internationally, augurs well for Amul.
Amul can be a potentially strong brand in the US. There is certainly
evidence of foreign brands capturing a large part of the domestic market.
It has happened in India — a classic case being Unilever, which adapted
and created products to suit the needs of the Indian population. It has
happened in the US, when Japanese automakers flooded the US car
market with cheap cars. And, it can happen with Amul in the US dairy
market. While Amul wants to focus only on the Indian market for the
moment and is just 'testing' the foreign waters, it has already travelled to
India's neighbouring countries, Singapore and Hong Kong. And it will
now be available in Dubai and other Middle Eastern countries as well.
Amul's export strategy seems to be paying off. In fiscal 2003-04, Amul's
innovative marketing strategies achieved around a 20 per cent increase in
sales to Rs2,893 crore, including export revenue of Rs50 crore. Amul has
come a long way from 1946 — when it collected only 247 litres of milk a
day — to the six million litres of milk per day it now collects from about
10,675 separate village co-operative societies throughout Gujarat. With
access to low cost milk, an innovative and almost 'just-in-time' supply
chain, a ready market among the Indian community and 50 years of
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understanding milk, Amul can definitely build the 'taste of India' in the
US. The only question is — when?
Amul "Utterly Delicious" Parlors
Amul has recently entered into direct retailing through "Amul Utterly Delicious"
parlors created in major cities Ahmedabad, Bangalore, Baroda, Delhi, Mumbai,
Hyderabad and Surat. Amul has plans to create a large chain of such outlets to be
managed by franchisees throughout the country. We have created Amul Parlors at
some prominent locations in the country, which are run by the company or its
wholesale dealers:
1. Delhi Metro Rail Corporation
2. Indian Space Research Organization
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3. The Somnath Temple
4. National Institute of Design
5. Infosys Technologies in Bangalore, Mysore & Pune
6. Wipro campus in Bangalore
7. Ahmadabad Municipal Corporation
8. Surat Municipal Corporation
9. Delhi Police
10.Gujarat State Road Transport Corporation
"Amul Utterly Delicious" parlors are an excellent business opportunity for
investors, shopkeepers and organizations. In order to come closer to the
customer, we have decided to create a model for retail outlets, which would be
known as "Amul Preferred Outlets"(APO).
1. The criteria for selection of APOs would be –
a. Visibility - How prominent is the location of your shop?
b. Shop area: 100 - 300 sq. ft.
c. Good Business potential
d. Exclusive Amul outlet - no other products
e. Willingness to sell the entire range of Amul Products
f. Creditworthiness and past business experience
2. On your inquiry - our Field force would visit your site. He/She would
fill the APO proposal form with your passport size photograph. You would
require:
a. Shops and Establishment license
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b. Layout of the shop and frontage - The layout of the shop designed by a local
architect/local contractor.
c. 2 Passport size photographs
3. Renovation Work of the Shop to give it a standard look - would be done to
meet the design and specifications at your cost. The cost of renovation of a
typical shop would normally be between Rs. 60,000 to Rs. 1 lac.
4. Branding- The APOs would be branded as "Amul Utterly Delicious". The
cost of the signage fabrication and installation would be borne by GCMMF
office operating in your region.
5. Equipment- You would require the following equipment:
a. 1or 2 deep freezers can be purchased through Hamara Apna Deep Freezer
Scheme
b. 1 Refrigerator through Hamara Apna Refrigerator Scheme
c. 1 pizza oven
d. 1 Chest Milk Cooler for Pouch Milk
6. Security Deposit- You would be required to furnish an interest free
refundable security deposit of Rs. 25,000 to us. An amount of Rs. 5000/-
would be deducted towards refurbishing the signage, in the event of closure
of APO before 3-year of operation.
7. Supplies- The delivery of products would be done through our wholesale
dealers
8. We feel that the shop has good potential, and needs support in the initial
days, we can offer additional margins up to maximum of 1% on dairy
products and 2% on Ice cream. The additional margin shall be target based
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and shall be given in kind. The support at best would be given only for he
first year of business.
9. Agreement- An agreement bringing us together would be signed.
Amul Enters Delhi Ice Cream Market –
In 'Co-Operative Competition ' With Mother Dairy
NEW DELHI, April 25
THE Gujarat Cooperative Milk Marketing Federation (GCMMF or
Amul) has launched its ice cream in Delhi, setting the stage for a three-
cornered tussle with Kwality Walls and Mother Dairy for the country's
largest market for ice creams. Delhi currently accounts for around 18 per
cent of the country's estimated Rs 525 crore organized ice cream market
of 80.8 million litres. It also boasts of a per capita annual ice cream
consumption of 1.45 litres, as against the national average of 0.25 litres.
The Delhi market is currently dominated by Hindustan Lever Ltd's (HLL)
Kwality Walls and Mother Dairy, which is a brand of Amul's sister
cooperative concern, National Dairy Development Board (NDDB). Both
Kwality Walls and Mother Dairy now sell 6.5-7 million litres each of ice
creams in Delhi. "As a third entrant, we hope to capture 25 per cent of the
market in two years' time. And this will come not at the expense of
Mother Dairy, but Kwality Walls," said Mr Vipul Mittal, Manager
(Sales), GCMMF. Amul has priced its ice cream at Rs 65 for a 1,250 ml
Vanilla brick, which is what Kwality Walls and Mother Dairy are
charging for a similar pack of 750 ml and 1,200 ml respectively.
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Similarly, it is selling a 100 ml Vanilla cup for Rs 10, which is the same
as Mother Dairy, whereas Kwality Walls is charging the same for an 80
ml cup. "By ensuring that our prices are more or less the same as that of
Mother Dairy, but much lower than that of Kwality Walls, we hope to
increase the market share of the cooperative sector in the Delhi market,"
Mr Mittal said. He ruled out the possibility that Amul's `cooperative
competition' with Mother Dairy would actually end up in the two
cooperatives eating into each other's rather than KwalityWalls' share.
Delhi is a market that is expanding by 20 per cent each year. On the other
hand, Mother Dairy's plant here has capacity constraints to cater to this
expanding market. Our presence would ensure that the incremental
market will not accrue to Kwality Walls alone," he added. In fact, Amul,
till recently, was using Mother Dairy's facility to manufacture its ice
cream for the neighboring markets such as Faridabad, Gurgaon and
Ghaziabad. But from now on, Amul will source its entire ice cream
requirement (including for Delhi) from its own Gandhinagar plant. Amul
claims to have already deployed 1,000-odd deep freezers in the last 15
days in Delhi under its `Hamara Apna Deep Freezer (HADF)' scheme.
Under this, retailers are encouraged to buy their own deep freezers for
vending ice creams, with Amul negotiating a discounted price on their
behalf with refrigeration companies like Blue Star, Voltas and Carrier.
This is as against the practice of the ice cream company itself providing
the freezer at the retailer's end, subject to the latter depositing a
refundable security amount. "In the HADF scheme, the retailer not only
saves on the security deposit, but also enjoys the flexibility arising from
owning the asset and availing a direct five-year guarantee from the
manufacturer. These, together with our negotiating a discounted price on
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their behalf, entails cost savings of Rs 5,000-8,000 per freezer depending
on capacity and make," Mr Mittal said.
Summer has started unusually early this year. And, as the mercury rises
nobody is happier than the ice-cream manufacturers who are already
filling their ice-boxes with dollops of new, mouthwatering flavours.Out
there in front is the hungry-for-growth Rs 3,500-crore (Rs 35 billion)
Anand-based Gujarat Co-operative Milk Marketing Federation which
markets the Amul brand of ice-creams.After wooing the masses with its
economy range, it has a new cooling strategy this summer and aims to
take a bigger scoop from the premium ice-cream segment. Also, it
planning to flex its muscles even more and strengthen its distribution
clout. More than six months ago, Amul launched its super premium ice -
creams -- Amul Utterly Delicious -- in the 100 million litres per annum
organized ice -cream market. But with Hindustan Lever's Kwality Wall's
forsaking volumes for value, Amul is pitching for another head on battle
with the foods and toiletries giant. The new weapons in Amul's armoury
are flavours like litchi, anjeer and cheese almonds. "With a premium
product, this is like taking the battle into HLL territory," says an ice-
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cream maker. it was only a couple of years ago that HLL changed its
strategy mix for ice-creams. And in keeping with this strategy, it also
began focusing on just the six big metros.” With low priced competitors,
it was decided that we focus on scooping value share rather than volume
share," says an HLL manager. What has this done to the market? Amul is
the market leader in this frozen category with a 27 per cent share. It is
followed by Kwality-Wall's at 8 per cent, Vadilal and Mother Dairy,
Delhi at 7 per cent each with Dinshaw and Arun each having a 4 per cent
share of the market. The rest of the cone is filled up by regional brands.
The ice-cream mix was completely different two years ago with both
Amul and Kwality Wall's running almost neck-to-neck. But, Amul's low-
priced offerings were something that HLL couldn't take on for long. And
a couple of years ago, HLL abandoned the masses to chase value shares
in the Rs 2,000 crore (Rs 20 billion) ice-cream market.Of this, the
organized sector which is growing at 20 per cent per annum, accounts for
only Rs 200 crore (Rs 2 billion).Now, look at what the strategy change
has done to ice- cream volumes for both HLL and Amul over the years.
During the last five years, HLL's ice-box was filled with acquisitions. On
its ice-cream shopping spree, it picked up Kwality from the Ghais,
Cadbury's Dollop's and Milk Food combined with their very own Wall's
brand. Eventually, most of the brands were phased out and Kwality
Wall's emerged as the mother brand. In 1997, HLL churned out 24.60
million litres of ice-cream that resulted in sales of Rs 152.63 crore (Rs
1.526 billion). In comparison, Amul's 4 million litre ice-cream box
notched up a turnover of Rs 27.40 crore (Rs 274 million). In 2001, while
HLL's volumes were stagnant, its sales were marginally up at Rs 156.39
crore (Rs 1.563 billion).In the same period, Amul's Rs 115.01 crore (Rs
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1.150 billion) sales were up more than four-fold to touch 17.80 million
liters. In calendar 2002, with HLL deciding to concentrate only on the
premium segment, its volumes halved to 10 million litres which resulted
in sales worth only Rs 107.25 crore (Rs 1.072 billion).Last fiscal, it sold
8.60 million litres of ice-cream and earned Rs 93 crore (Rs 930
million).During the same time Amul was selling 27 million litres with Rs
160 crore (Rs 1.60 billion) sales.
Now look at the other competitors. The National Dairy Development
Board's Mother Dairy is available only in the north.
Amul entered the Delhi market last year. Vadilal is largely a Gujarat
brand while the rest of the players each take a lick off the regional
markets. Or take the multinationals. Already, the $600-million Iowa-
based Wells Dairy Inc-owned Blue Bunny ice-cream launched early this
millennium has melted. Distributed and marketed in India by Sno Shack
Frozen Foods Pvt Ltd, it pulled out citing reasons like high excise
structure and low volumes. Even the Allied Domecq-promoted Baskin
Robbins has been in a restructuring mode for the past five years. First it
shrunk the size of its outlets, then it slashed prices and finally halved its
network. Today a Baskin Robbins outlet has become a rarity.No wonder
then, with such casualties Amul is going all out to grab the market.
Although Amul is known for its lackluster supplies, it is seeking more
visibility. "Now that Amul has achieved critical mass and emerged as a
market leader, we are now embarking on increasing consumption," says
R S Sodhi, general manager GCMMF.He knows there is enough scope
for that even though Indians aren't eating that much ice-cream. "Price has
been the main hindrance," says a multinational player.The per capita
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consumption of ice-creams in India is a paltry 250 ml per annum while
the average global consumption is 2 litres. Even countries like Sri Lanka
and Pakistan consume much more than India. That's why, like Kwality
Wall's, Amul too wants to take its frozen and ambient platter on the road
through push carts and smaller outlets. It plans to supply freezers to
bakeries and chemists to mom-and-pop shops and even STD booths.At
the same time, GCMMF is investing around Rs 120 crore (Rs 1.20
billion) over the next two years to expand capacity from 1.1 million litres
a day to 1.8 million a day.To build a national presence, GCMMF has
bought an ice-cream manufacturing unit in Nagpur. By installing a dairy
unit on the premises, it plans to extend its milk supply to states like
Maharashtra, Rajasthan and Madhya Pradesh.Then, with the NDDB
entering into joint ventures with state co-operatives to market their milk
and milk products, GCMMF too is doing the same. There are also new
offerings. In the last one year, it introduced the largest volume cone in the
country. There's Santra mantra, an orange ice-cream coupled with other
low fat and vitamin-packed offerings for children. All this is likely to
push up volumes to 34 million litres with value sales almost doubling.
Even HLL has been trying hard to create excitement around its brands. Its
Kwality Wall's Max, for children, was relaunched with offerings, like
Rainbow and Twister, supported by a new look Max lion.The last festive
season, it introduced Vanilla Surprise to distinguish from the low-priced
commodity vanilla products, and a range of new sundaes.All these
offering are no doubt welcome in the sweltering heat. But as a marketing
consultant put it: "With everyone on a health binge, it would be
challenging for players to increase consumption."Renowned for
marketing milk and milk products under the brands of ‘Sagar’ and
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‘Amul’, Gujarat Cooperative Milk Marketing Federation (GCMMF), has
announced today its Rs. 8005 crores record sales. In the 36th Annual
General Meeting of the Federation, the apex body results of the dairy
cooperatives in Gujarat were just announced today.GCMMF Chariman
Parthibhai G. Bhatol, informed, while commenting on the results, that last
year, they turnover was Rs 67 billion and their Federation filed a quantum
growth of 19.3 percent to accomplish Rs 80 billion or 8005 crores.He said
that the Federation justifies its leadership in the milk business by
attaining the pouch more than 21% sales growth in pouch milk category
and 32% in value terms from existing markets. They’ve reached the
number 1 status in New Delhi’s pouch milk sales this year. And, Amul
milk, with this achievement, emerges as the largest selling brand of milk
in all major metro markets of Mumbai, Ahmedabad, Delhi and
Kolkata.Concerning about Amul’s retail experiment, Bhatol said that the
Federation has produced 5,000 outlest which exclusively sell huge range
of Amul products and 2,000 of those have been added during the recent
year that speaks volumes about the scale’s quantum and speed with which
the expansion has been covered with. It is unconceivable for any
competitor to produce such substantial network of exclusive outlets.
Bhatol commented regarding the exports that they’ve been able to keep
and toughen their presence in the markets of consumer pack export and
also this year, they’ve reached Rs 100 core in foreign exchange profits
and it’s the 5th time by now that they’ve been able to reach this
figure.Shri Bhatol said, about the novel concept of the efforts of the
Federation in controlling global warming through tree plantation, that
during the 3 years, their members have already planted more than 155
trees and showed their dedication towards contributing and preserving
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towards the development of the environment. And for this one, they’ve
received Good Greeen Governance award from Srishti for 3 consecutive
eyar already from 2007 until 2009.Amul received the International Dairy
Federation Award for the best environmental initiative during the 4th
Global Dairy Conference which was held last April 28, 2010 at the
Salburg Congress Centre, Salsburg, Australia.Parthibhai said that their 29
milk lakh milk producers in more than 14,000 villages, have already
planted about one crore sapling
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RESEARCH METHODOLOGY OF THE STUDY
sample survey method
a)sample size:-20
b)sample group:-retailer and household
QUESTIONNAIRE SAMPLE FOR HOUSEHOLD
AMUL
NAME:…. DATE:
(1) Are you using Amul product
(a) Yes (b) no
(2) Which product you are using?
(a)milk (b)butter (c)ice-cream (d) others ?
(3) What is your daily consumption of butter?
(a) Below 100gm (b)100-200gm (c)more than 200g
(4) Which milk you are using?
(a)milk powder (b)liquid milk
(5) What is your daily milk consumption?
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(a) ½ lit. (b) 1 lit. (c) 2-4 lit. (d) more than 4 lit.
(6) What is your consumption of cheese?
(a) Below 100gm. (b)100-200gm. (c)more than 200gm.
(7) What is your daily consumption of Ghee?
(a) Below 100gm (b)100-200gm (c)more than 200gm
(8) what is your daily consumption of paneer?
(a)100gm (b)200-300gm (c)more than 300gm
(9) How much chocolate you are using?
(a) Below 100gm (b)100-200gm (c)more than 200gm
(10)How much do you consume fresh cream?
(a) Below 100gm (b)100-200gm (c)more than 200gm
(11) Would u like to prefer other brand instead of Amul?
(a) yes (b) no (c) may be
(12) What you think about product availability of Amul?
(a) 20% (b) 40% (C) 60% (d) more than 80%
SUGGESTION OR COMMENT:
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QUESTIONNAIRE SAMPLE FOR RETAILERShop no:-
AMUL
NAME:…. DATE:
(1) What is your daily selling of butter?
(a) Below1kg (b)1-2kg (c)2-4kg (d)more than4kg
(2) What is your daily liquid milk selling?
(a) Below20-30 lit. (b)30-40 lit. (c)40-50lit. (d)more than 50lit
(3) What is your daily powder milk selling?
(a) Below 5 kg (b) 5-10kg. (c) 10-15kg. (d) more than15kg.
(4) What is your daily selling of cheese?
(a) Below1kgm. (b)1-2kg. (c)2-4kg. (d)more than 4kg.
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(5) What is your daily selling of Ghee?
(a)1- 2kgm (b)2-4kg (c)4-6kg (d)more than 6kg
(6) What is your daily selling of paneer?
(a)2-4kg (b)4-6kg (c)6-8kg (d)more than10kg
(7) How much chocolate you are selling on the daily basis?
(a) Below100gm (b)100-200gm (c)more than 200gm
(8)what is your daily selling of buttermilk/lassi?
(a) Below 2-4lit. (b)4lit.-6lit. (c)6-8lt (d)more than10lit
(9)what is your daily selling of curd?
(a)below1kg (b)1-2kg (c)2-3kg (d)more than 3 kg.
(10)what is your daily selling of ice-cream?
(a)below 1 kg (b)1-2kg (c)2-3kg (d)more than 3 kg.
SUGGESTION OR COMMENT:
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