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Highlights

Amul (Anand Milk Union Limited), formed in 1946, is a dairy cooperative movement in India.

Amul is the largest food brand in India and world's Largest Pouched Milk Brand with an annual turnover of US $1050 million (2006-07).

Dr Verghese Kurien, former chairman of the GCMMF, is recognized as the man behind the success of Amul.

Gujarat Cooperative Milk Marketing Federation Ltd. (GCMMF) is the apex body of 13 District Milk Unions having a membership of 2.7 million members, spread across 13,000 villages of Gujarat

In September 2007, Amul emerged as the leading Asian brand according to a survey by Synovate to find out Asia's top 1000 Brands.

Amul has entered overseas markets such as Mauritius, UAE, USA, Bangladesh, Australia, China, Singapore, Hong Kong and a few South African countries.

It is also the world's biggest vegetarian cheese brand

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Vital Facts: GCMMFType of industry : Dairy cooperative organization

Broad product line : Milk powders, milk, butter, ghee, cheese, curd,

Chocolate, ice cream, cream, shrikhand,

Jamuns, basundi, Nutramul brand and others.

Members :

13 district cooperative milk producers' Union

No. of Producer Members :

2.7 million

No. of Village Societies :

13,141

Total Milk handling capacity :

10.21 million liters per day

Milk collection (Total 2007-08) :

2.69 billion liters

Milk collection (Daily Average 2007-08):

7.4 million liters

Milk Drying Capacity: 626 Mts. per dayCattle feed manufacturing Capacity:

3090 Mts per day

Corporate office : Gujarat Cooperative Milk Marketing Federation ltd. Amul Dairy Road P B No.10, Anand 388 001, India

Phone: +91-2692-258506, 258507, 258508 Fax: +91-2692-240208 Email: [email protected]

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Company Profile History of Indian Dairy IndustryOrganized milk handling began in India with the establishment of Military Dairy Farms.

Handling of milk in Co-operative Milk Unions established all over the country on a small scale in the early stages.

Long distance refrigerated rail-transport of milk from Anand to Bombay since 1945

Pasteurization and bottling of milk on a large scale for organized distribution was started at Aarey (1950), Calcutta (Haringhata, 1959), Delhi (1959), Worli (1961), Madras (1963) etc.

Establishment of Milk Plants under the Five-Year Plans for Dairy Development all over India. These were taken up with the dual object of increasing the national level of milk consumption and ensuing better returns to the primary milk producer. Their main aim was to produce more, better and cheaper milk.

Amul: The origin

The mighty Ganges at its 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 Dairy Movement in India

The dairy cooperative movement in India continues to be unparalleled in the world in terms of its scope and scale. Launched in the Kaira district of Gujarat during India's independence, farmers were encouraged to form a cooperative to counter exploitatively

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low prices offered for their milk by the monopoly milk supplier, Polson Dairy. The Kaira cooperative launched its operations in 1946 and operated at two levels. The primary village dairy cooperative society of milk producers collaborated with others in the district to form the milk producers union, which procured and processed the milk. The union processed the milk that was procured from the village dairy cooperatives at its processing plants. In addition to collecting surplus milk, the Kaira union assisted members in expanding production. The father of the Indian dairy movement was Verghese Kurien. A mechanical engineer from the Michigan State University, US, Kurien helped India to become the largest producer of milk in the country.

As the number of district unions increased, the Kaira cooperative was transformed into the Gujarat Milk Marketing Federation Ltd (GCMMF) under the chairmanship of Kurien. GCMMF coordinated the operations of the union and marketed milk and milk products. As the operations were based in Anand, Gujarat, this came to be known as the Anand model. This model was replicated across India. In 1965, NDDB was formed under the chairmanship of Kurien and was mandated with the task of building cooperative dairies across the country. Operation Flood was launched in 1970, which sought to establish dairy cooperatives across India, get rid of middlemen, remove seasonal price variations and make it economically viable for farmers to undertake production and distribution of milk. Operation Flood achieved phenomenal success: trebling India's annual  milk production from 21 million tonnes  in 1968 to 74 million tonnes in 1999. Nearly 9 million small producers in 74,000 villages began supplying hygienic and  fair priced milk to 300 million consumers and earning revenues of Rs 25 billion in the process.

Of the Rs 2 billion invested by World Bank in the second phase of Operation Flood, the net return to  the rural economy has been in the region of Rs 240 billion.per year over a period of ten years or a total of Rs 2.4 trillion in all. No other development programme in the world has achieved such success. Several countries like Sri Lanka, Bangladesh, Nepal, the Philippines, Malaysia and some African countries have decided to implement similar projects.  The third phase of Operation Flood, implemented during 1985-96 aimed at consolidating the achievements of the first two phases. Infrastructure was strengthened, production enhanced and animal healthcare and nutrition improved. The Operation Flood III programmes was funded by a World Bank credit of US $365 million and food aid worth Rs 2226 million. By May 1995, Rs 15.78 billion had been invested in the three phases of Operation Flood. By the time the third phase came to an end, milk processing capacity had grown to 17.2 million litres per day. Chilling capacity of 6.9 million litres per day had been added and milk powder production capacity of 839 tonnes per day had been set up. By 1999, average milk procurement by the cooperatives had grown to 10.2 million litres per day, of which 9.4 million litres was marketed as liquid milk. The remainder was converted into milk powder, butter, cheese, ghee and other traditional milk products.

NDDB has been focusing on intensive R&D activities in animal husbandry through the late 1990s. It has set up an embryo transfer lab at Sabarmati Ashram Gaushala in Ahmedabad. NDDB has also been working on improving nutrition quality of the normal cattle feed. NDDB has made it possible to transport milk over long distances by using

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over 140 insulated rail milk tankers, each with a capacity of 40,000 litres. This has enabled the National Milk Grid to supply milk to milk-deficient regions in the country.

In 2000, NDDB announced a ten-year plan called Perspective 2010. It is aimed at strengthening the dairy cooperative movement. The major objectives include:

increasing milk procurement by cooperatives from 5.75 mt in 2000 to 17.8 mt in 2010;

increasing the number of dairy cooperative societies from 84,289 in 2000 to 129,480 in 2010;

increasing the membership in dairy cooperatives from 10.62 million in 2000 to 15.62 million in 2010; and

 increasing the amount of milk to be marketed from 4.7 mt in 2000 to 14 mt in 2010.

Milk Production

1950 – 17 million tonnes

1996 – 70.8 million tonnes

1997 – 74.3 mT

(Projected) 2020 – 240 mT

Expected to reach- 220 to 250 mT – 2020

India contributes to world milk production rise from 12-15 % & it will increase upto 30-35% (year 2020)

Average milk production / year

America 6874 Kg/ yearDenmark 6223 Kg/yearHolland 5751 Kg/yearIndia 552 Kg/year

  Average Productivity   2.4 kg/day or 732 kg/lactation/cow

China: 1600 kg/lactationAmerica 7200 kg/lactation

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Percapita availability: Recommanded – 210 gmIndia

1950 132 gm1997 214 gm2020 290 gm

India contributes 35% of total Asian milk

The Liquid Milk & Milk Products Market

Out of a total production of 88 mt of milk, 46per cent is consumed as liquid milk. Less than 30 per cent of milk production – i.e. 26.4 mt – is packaged. Currently barely 778 out of 3,700 cities and towns are served by the milk distribution network, dispensing hygienically packed wholesome, quality pasteurized milk. According to one estimate, the packed milk segment would double in the next five years.

The effective milk market is largely confined to urban areas, inhabited by over 25 per cent of the country's population. In urban India, an estimated 50 per cent of the total milk produced is consumed by a population of roughly about 350 million. The expected rise in urban population would be a boon to Indian dairying. Of the three A's of marketing - availability, acceptability and affordability, the dairy sector is at an advantage since Indians are a milk loving people. However what continues to be a challenge is the affordability factor. Volume sales could dramatically increase if small packs of 250 ml or less is made available. Sales of milk powders in mini-sachets, for two cups of tea or coffee, could also help in increasing volumes.

Flavoured Milk is increasingly becoming the toast of the milk market. The overall market for  flavoured milk in India is estimated to have grown 27 per cent in value terms in 2004-05. Milk-based drinks are the flavour of the season as consumers seek healthy lifestyles. Nestle’s Fruit and Milk and  Amrit Foods’ Gagan are the two brands that have a significant presence in this segment

Diet Milk, Fortified Milk and other such niche categories are expected to grow. Gagan, the Amrit Foods brand, has launched a Diet Milk which is recommended for people with high cholesterol and blood pressure since it has just 0.5 per cent fat content. This is  a long shelf life product.

Ultra Heat Treatment (UHT) milk or long-shelf-life milk sales is estimated to be in the region of 70 million litres and the segment is growing at a healthy pace of 20-25 per cent per year.

Packaged curd and curd products – such as lassi, buttermilk, chhas, set dahi, mishti

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doi, etc. – are new products and are witnessing a rapid pace of growth. In terms of volumes this just comprises 5 per cent of dairy products, but they are growing at 10 per cent per annum. Flavoured yoghurt, which is popular in the West, however, has not been successful in India.

Traditional products, such as paneer, mithai, khoa and khoa-based sweets, which are available in the unorganised market, is a huge segment. Apart from Amul which has launched paneer and its Mithaee brand which offers traditional Indian sweets, the organised sector has not tapped into the potential that this sub-category offers.

Dairy Products The organised cheese market including its variants like processed cheese,

cheese spreads, mozzarella, flavoured and  spiced cheese, is  valued at around Rs 4.5 billion. Processed cheese at 60 per cent of the overall market  (6000 tonnes) is estimated at Rs 2.7 billion and is growing at about 15 per cent annually. Cheese spread has a share of around 30per cent of the total processed cheese market.  Demand for processed cheese is an urban phenomenon and the demand for cheese cubes, slices and tins is growing. The flavoured cheese segment however has been declining. The demand for cheese is projected to grow from about Rs. 4.50 billion in 2003-04 to Rs. 6 billion in 2006-07 and to over  Rs 11 billion  by 2014-15. Cheese is becoming a popular item in the menu of all relatively affluent families.  Slowly but surely, it will penetrate into the rural markets. While the cheese market was growing at 20.6 per cent during the  1996-97 to 2001-02 period, the growth rate between 2004-05 and 2009-10 is estimated at 9.4per cent. Amul, the GCMMF brand, continues to dominate the market. Britannia Industries, which sells processed cheese under the Milkman brand, is another key player. Foreign brands like The Laughing Cow and the Dabur India-Bongrain joint venture, Dabon International's Le Bon has also grabbed a significant share of the market. Other foreign players too have prepared plans to launch their products.

The market for dairy whiteners-creamers and condensed milk is valued at Rs 3 billion, with volumes of about 200 metric tonnes in 2004. The segment is growing at the rate of 8-9 per cent over a 5-year period. Volumes are projected to go up to 284 metric tonnes by 2008-09. Nestle India (Everyday), Britannia and GCMMF’s Amul are the key players in this segment. Sapan, Vijaya, Mohan, Parag and other regional players too have entered the fray with their dairy whiteners and most are available in pouches and tetrapacks. There are plans to introduce mini-portion cups as well. Amul has nearly 45per cent share of the market followed by Nestle at 23 per cent. Britannia is the No. 3 player.

The ice cream market is estimated to be in the region of Rs 15 billion per annum, of which the organised sector is about Rs 9 billion (40 million litres). The unorganised market is shrinking. A key issue in the ice cream industry is the increase in excise levy – there have been six such hikes in five years. From a specific levy of Rs 2 per litre in February 1994, it as been increased to 16per cent ad valorem (equivalent to Rs 12 per litre) in 2000-01. GCMMF’s share in value

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terms is estimated at 27 per cent of the organised market, while Hindustan Lever’s share has declined to just 8 per cent. Mother Dairy has a share of 7 per cent and Vadilal too has 7per cent share.

Regulatory Environment

The dairy industry was de-licensed in 1991 with a view to encourage private investment and flow of capital and new technology in the segment. Although de-licensing attracted a large number of players, concerns on issues like excess capacity, sale of contaminated- substandard quality of milk etc induced the Government to promulgate the MMPO (Milk and Milk Products Order) in 1992. Milk and Milk Products Order (MMPO) regulates milk and milk products production in the country. The order requires no permission for units handling less than 10,000 litres of liquid milk per day or milk solids up to 500 tpa. MMPO prescribes State registration to plants producing between 10,000 to 75,000 litres of milk per day or manufacturing milk products containing between 500 to 3,750 tonnes of milk solids per year. Plants producing over 75,000 litres per day or more than 3,750 tonnes per year of milk solids have to be registered with the Central Government.

All  milk products except malted foods are covered in the category of industries for which foreign equity participation up to 51per cent  is automatically allowed. Ice cream, which was earlier reserved for manufacturing in the small-scale sector, has now been de-reserved. As such, no licence is required for setting up of large-scale production facilities for manufacture of ice cream. Subsequent to de-canalization, exports of some milk based products are freely allowed provided these units comply with the compulsory inspection requirements of concerned agencies like: National Dairy Development Board, Export Inspection Council etc. Bureau of Indian standards has prescribed the necessary standards for almost all milk-based products, which are to be adhered to by the industry.

A proposal to raise the exemption limit for compulsory registration of dairy plants, from the present 10,000 litres a day to 20,000 litres, is being considered by the Animal Husbandry Department. The 75,000-litre limit is likely to be raised either to 100,000 litres or 125,000 litres in the amended order. The new order would also do away with the provision for re-registration.

Obstacles: Springboards for success.

Each failure, each obstacle, each stumbling block can be turned into a success story. In the early years, Amul had to face a number of problems. With every problem came opportunity. A chance to turn a negative into a positive. Milk by

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products and supplementary yield which suffered from the same lack of marketing and distribution facilities became encumbrances. Instead of being bogged down by their fate they were used as stepping stones for expansion. Backward integration of the process led the cooperatives to advances in animal husbandry and veterinary practice.

Milk by products: An excuse to expand.

The response to these provided stimulus for further growth. For example, as the movement spread in the district, it was found that the Bombay Milk Scheme could not absorb the extra milk collected by the Kaira Union in winter, when the production on an average was 2.5 times more than in summer. Thus, even by 1953, the farmer-members had no assured market for the extra milk produced in winter. They were again forced to sell a large surplus at low rates to the middlemen. The remedy was to set up a plant to process milk into products like butter and milk powder. A Rs 5 million plant to manufacture milk powder and butter was completed in 1955. In 1958, the factory was expanded to manufacture sweetened condensed milk. Two years later, a new wing was added for the manufacture of 2500 tons of roller-dried baby food and 600 tons of cheese per year, the former based on a formula developed with the assistance of Central Food Technological Research Institute (CFTRI), Mysore. It was the first time anywhere in the world that cheese or baby food was made from buffalo milk on a large, commercial scale. Another milestone was the completion of a project to manufacture balanced cattle feed. The plant was donated by OXFAM under the Freedom From Hunger Campaign of the FAO.

To meet the requirement of milk powder for the Defense, the Kaira Union was asked by the Government of India in 1963 to setup additional milk drying capacity. A new dairy capable of producing 40 tons of milk powder and 20 tons of butter a day was speedily completed. It was declared open in 1965. The Mogar Complex where high protein weaning food, chocolate and malted food are being made was another initiative by Amul to ensure that while it fulfilled the social responsibility to meet the demand for liquid milk, its members were not deprived of the benefits to be had from the sale of high value-added products.

Cattle: From stumbling blocks to building blocks.

Traditionally dairying was a subsidiary occupation of the farmers of Kaira. However, the contribution to the farmer's income was not as prominent as his attachment to dairying as a tradition handed down from one generation to the next. The milk yield from

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animals, which were maintained mainly on the by products of the farm, was decidedly low. That together with the lack of facilities to market even the little produced rendered the scientific practice of animal husbandry irrational as well as unaffordable.  The return on the investment as well as the prospects of being able to market the product looked very bleak. It was a vicious cycle reinforced by generations of beliefs The Kaira Union broke the cycle by not only taking upon themselves the responsibility of collecting the marketable surplus of milk but also provided the members with every provision needed to enhance production. Thus the Kaira Union has full-fledged machinery geared to provide animal health care and breeding facilities. As early as late fifties, the Union started making high quality buffalo semen. Through village society workers artificial insemination service was made available to the rural animal population. The Union started its mobile veterinary services to render animal health care at the farmers' doorstep. Probably for the first time in the country, veterinary first aid services, by trained personnel, were made available in the villages. The Union's 16 mobile veterinary dispensaries are manned by fully qualified staff. All the villages are visited bi-monthly, on a predetermined day, to provide animal health care. A 24-hour Emergency Service is also available at a fee (Rs. 35 for members and Rs. 100 for non-members). All the mobile veterinary vans are equipped with Radio Telephones.

The Union runs a semen production center where it maintains high pedigreed Surti buffalo bulls, Holstein Friesian bulls, Jersey bulls and 50 per cent crossbred bulls. The semen obtained from these bulls is used for artificial breeding of buffaloes and cows belonging to the farmer members of the district. The artificial insemination service has become very popular because it regulates the frequency of calving in cows and buffaloes thus reducing their dry period. Not only that, a balanced feed concentrate is manufactured in the Union's Cattle Feed Plant and sold to the members through the societies at cost price.

Impressive though its growth, the unique feature of the Amul sagas did not lie in the extensive use of modern technology, nor the range of its products, not even the rapid inroads it made into the market for dairy products. The essence of the Amul story lies in the breakthrough it achieved in modernizing the subsistence economy of a sector by organizing the rural producers in the areas

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The Kaira experiment: A new beginning in more ways than one.

A system which involves participation of people on such a large magnitude does not confine itself to an isolated sector. The ripples of its turbulence affect other areas of the society as well. The cooperatives in the villages of Kaira are contributing to various desirable social changes such as:

The yearly elections of the management committee and its chairman, by the members, are making the participants aware of their rights and educating them about the democratic process.

Perpetuating the voluntary mix of the various ethnic and social groups twice-a-day for common causes and mutual betterment has resulted in eroding many social inequilibria. The rich and the poor, the elite and the ordinary come together to cooperate for a common cause.

Live exposure to various modern technologies and their application in day-to-day life has not only made them aware of these developments but also made it easier for them to adopt these very processes for their own betterment. One might wonder whether the farmer who knows almost everything about impregnating a cow or buffalo, is also equally aware of the process in the humans and works towards planning it.

More than 900 village cooperatives have created jobs for nearly 5000 people in their own villages -- without disturbing the socio-agro-system -- and thereby the exodus from the rural areas has been arrested to a great extent.

The income from milk has contributed to their household economy. Besides, women, who are the major participants, now have a say in the home economy.

Independent studies by various individuals and institutions have shown that as high as 48 per cent of the income of the rural household in Kaira District is being derived from dairying. Since dairying is a subsidiary occupation for the majority of the rural population, this income is helping these people not only to liberate themselves from the stronghold of poverty but also to elevate their social status.

Amul is one of the best examples of co-operative achievement in the developing world. "Anyone who has seen ... the dairy cooperatives in the state of Gujarat,

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especially the highly successful one known as AMUL, will naturally wonder what combination of influences and incentives is needed to multiply such a model a thousand times over in developing regions everywhere." The Amul Pattern has established itself as a uniquely appropriate model for rural development. Amul has spurred the White Revolution of India, which has made India the largest producer of milk and milk products in the world. It is also the world's biggest vegetarian cheese brand.

Amul is the largest food brand in India and world's Largest Pouched Milk Brand with an annual turnover of US $1050 million (2006-07). Currently Amul has 2.6 million producer members with milk collection average of 10.16 million liters per day. Dr Verghese Kurien, former chairman of the GCMMF, is recognized as the man behind the success of Amul. On 10 Aug 2006 Parthi Bhatol, chairman of the Banaskantha Union, was elected as the chairman of GCMMF.

AMUL TODAY:

2.5 million milk producers families – part of a fraternity of 13 million coop producers nationwide

13,000 village societies – there are over 113,000 coop milk societies pan India

8.1 million liters of milk procured in peak season on a single day – India is the largest producer of milk in the world.

Rs 100 million handled in cash daily – Milk is the biggest agricultural crop in India.

13 district Unions – there are 180 cooperative dairy unions across the country

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GCMMF-Operations

• India’s largest food products marketing organization • 4 Distribution Highways • 20 Product Groups • 400+ SKUs • 34 Supply Centers • 50 Sales Offices • 300 member sales team • 5000 Stockiest • 700,000 Retail outlets • Rs 4,500 crore (US$ 1 billion) annual Sales Turnover.

Major players in the dairy industry

Amul has been able to withstand the onslaught of private and foreign players in the dairy industry and has also been able to export products in limited quantities

National dairy development board (NDDB) with its brands like Mother dairy and Sugam.

Similar organizations set up by state governments like Milma in kerela, Vijaya in Andhra Pradesh, and Avin in Tamil nadu, Nandini / KMF in Karnataka or Sudha in Bihar etc.

With Amul entering the sports drink market, its rivals now include Coca Cola and PepsiCo

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Critical success factors Online order placements of Amul’s products on the web. Distributors can place their orders on the website www.amul2b.com

especially meant for accepting orders from stockiest and promoting Amul’s products via e-commerce.

Company has started receiving queries from overseas agents for distribution of its products in countries like US, Britain, New Zealand, Singapore and Thailand.

As a result of on-line initiatives, today, Amul exports products worth around US$ 25 million to countries in West Asia, Africa and USA

Huge reduction in processing time for effecting payments to the farmers from a week to couple of minutes after implementing the ERP.

Processing of 10 Million payments daily, amounting to transactions worth USD 3.78 million in cash.

Controlling the movement of 5000 trucks to 200 dairy processing plants twice a day in a most optimum manner.

Practicing just in time supply chain management with six sigma accuracy. Radical changes in business processes - eliminating middlemen and

bringing the producers closer to the customers. Improved delivery mechanisms and transparency of business operations.

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Products Bread spreads:

Amul Butter Amul Lite Low Fat Bread spread

Amul Cooking Butter

Cheese Range:

Amul Pasteurized Processed Cheddar Cheese Amul Processed Cheese Spread

Amul Pizza (Mozzarella) Cheese

Amul Shredded Pizza Cheese

Amul Emmental Cheese

Amul Gouda Cheese

Amul Malai Paneer (cottage cheese)

Utterly Delicious Pizza

Mithaee Range (Ethnic sweets):

Amul Shrikhand (Mango, Saffron, Almond Pistachio, Cardamom) Amul Amrakhand

Amul Mithaee Gulab jamuns

Amul Mithaee Gulab jamuns Mix

Amul Mithaee Kulfi Mix

Avsar Ladoos

UHT Milk Range:

Amul Shakti 3% fat Milk Amul Taaza 1.5% fat Milk

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Amul Gold 4.5% fat Milk

Amul Lite Slim-n-Trim Milk 0% fat milk

Amul Shakti Toned Milk

Amul Fresh Cream

Amul Snowcap Softy Mix

Pure Ghee:

Amul Pure Ghee Sagar Pure Ghee

Amul Cow Ghee

Infant Milk Range:

Amul Infant Milk Formula 1 (0-6 months) Amul Infant Milk Formula 2 ( 6 months above)

Amulspray Infant Milk Food

Milk Powders:

Amul Full Cream Milk Powder Amulya Dairy Whitener

Sagar Skimmed Milk Powder

Sagar Tea and Coffee Whitener

Sweetened Condensed Milk:

Amul Mithaimate Sweetened Condensed Milk

Fresh Milk:

Amul Taaza Toned Milk 3% fat Amul Gold Full Cream Milk 6% fat

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Amul Shakti Standardized Milk 4.5% fat

Amul Slim & Trim Double Toned Milk 1.5% fat

Amul Saathi Skimmed Milk 0% fat

Amul Cow Milk

Curd Products:

Yogi Sweetened Flavored Dahi (Dessert) Amul Masti Dahi (fresh curd)

Amul Masti Spiced Butter Milk

Amul Lassee

Amul Ice-cream:

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, Chocó crunch, Megabite, Cassata)

Utterly Delicious (Vanilla, Strawberry, Chocolate, Chocó chips, Cake Magic)

Chocolate & Confectionery:

Amul Milk Chocolate Amul Fruit & Nut Chocolate

Brown Beverage:

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Nutramul Malted Milk Food

Milk Drink:

Amul Kool Flavored Milk (Mango, Strawberry, Saffron, Cardamom, Rose, Chocolate)

Amul Kool Cafe

Health Beverage:

Amul Shakti White Milk Food

Product launch

    Amul1956      

                       

                             Ice cream

1996   Chocolates1973   Shrikhand

1980   Fresh Milk1956  

MilkPower1958

  Cheese1962  Breadsprea

d   Ghee1956

                             Fat Free Dessert

2002 Nutrauamul

1973   Gulabjamun1997   UHT Range

1980/99   Amulspray1968  

Cheese Spread1986

 Amul Butter1956  

Cow Ghee2002

                            Softy Mix

2001   Eclairs2001  

Gulabjamun mix

1999  

Condensed Milk1996

  Amul WMP1960   Paneer

1997   Amul Lite1994   

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Amul Shakti2003

  Kulfi Mix2001   Buttermilk

1998   Amulya1987  

pizza Cheese1998

  Margarine2004   

                               Chocozoo

2005   Laddoo2004   fresh Curd

1999  Amul IMF

1&22001

 Emmental

Cheese1999

                                      Basundi

2005  Flavoured

Milk2001

 Instant FCMP2002

 Frozen Pizza2002      

                                 Khoa

2006  Fresh Cream2002

    Gouda Cheese2002

                                      Kool Cafe

2005            

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GCMMF: PRODUCT PORTFOLIO CATEGORY BRAND NAME MKT SH % RANK IMF AMULSPRAY 65 # 1 DAIRY WHITENER AMULYA 60 #1FCMP AMUL WMP 80 #1S M P SAGAR SMP 40 #1BUTTER AMUL BUTTER 80 #1BREADSPREAD AMUL LITE 80 #1CHEESE AMUL CHEESE 60 #1CHEESE SPREAD AMUL CH SP. 90 #1EMMENTAL SWISS CHEESE 90 #1MOZARELLA PIZZA CHEESE 75 #1MILK AMUL  - #1 GHEE SAGAR GHEE 10 #1  AMUL GHEE 8 #2ICE CREAM AMUL ICECREAM 40 #1CONDENSED MILK MITHAI MATE 50 #1ETHNIC SWEET AMUL SHRIKHAND 50 #1CHOCOLATES AMUL CHOCOLATES 10 #3BROWN BEV NUTRAMUL 15 #4

Current market share

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Exports

Besides India, Amul has entered overseas markets such as Mauritius, UAE, USA, Bangladesh, Australia, China, Singapore, Hong Kong and a few South African countries. Its bid to enter Japanese market in 1994 had not succeeded, but now it has fresh plans of flooding the Japanese markets. Other potential markets being considered include Sri Lanka.

Key strengths

Launch of new Cheese varieties

Amul Emmental Cheese has brought a real Swiss taste to cheese that is made in India. This excellence in cheese making has been joined by the new Amul Pizza Cheese. Adding to the popular Amul Processed Cheeses has helped Amul to solidify its market leadership, despite aggressive competing brands.

A range of new products

Amul Malai Paneer, long shelf-life Amul Taaza UHT milk, the recently-launched "Ready-to-eat" Amul Masti Dahi (Curd), Amul Mithaee Gulabjamuns, Amul Gulabjamuns Mix all demonstrate the application of innovative technology in commercial manufacturing and national marketing of traditional Indian products. These products satisfy consumers' taste while ensuring Amul quality, hygiene and, most important, value-added for milk producers.

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Mother Dairy, Gandhinagar: The Mother Dairy is the solution in Amul’s strategy to eliminate the uncertainties of cyclical fluctuations, so common in Amul’s country's milk production. Amul’s goal is to collect every last drop of milk that its farmers want to pour, at a remunerative price. they are committed to giving their farmer owners a fair price for their produce and to protecting them from nature's vagaries. Amul’s aim, as a Co-operative enterprise, is to return the maximum possible to Amul’s farmers, but without exploiting the consumer. It is Amul’s aim that whether in times of plenty or scarcity, neither the producer, nor the consumer, will go home, empty handed.

In order to overcome future flush season limitations in the processing capacities of Amul’s individual member unions, Amul’s Federation, took up the MOTHER DAIRY" to create a state-wide feeder balancing dairy.

Packaging Film Project, Gandhinagar

Pouches are the most popular, convenient and accepted packaging for marketing of liquid milk. The Packaging Film Project (PFP) was established to give a competitive edge to the Co-operative Dairy, by ensuring access to the best quality food grade packaging pouch film, for high speed pouch filling machines, that operate at speeds 75 per cent higher than at present.

The PFP plant has achieved full capacity utilization and we expect to double the capacity in the coming year. Productivity has been enhanced by minimizing setup time, by sharp reduction in pouch leakage, by better preventive maintenance, all achieved by solid teamwork.

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Total Quality Management: For the last five years, we at GCMMF, Amuls twelve member dairies, their 10,000 village cooperative societies and 3,500 dealers have pursued excellence through "Total Quality Management". . A unique feature of our TQM Approach is the process of policy deployment known as Hoshin Kanri. This involves strategy formulation and implementation, involving every member of the value chain. 00.

Export

Amul has received the Government of India's APEDA award for excellence in exports of dairy products. During the year our products made a debut in Singapore, Philippines, Saudi Arabia and Tanzania, receiving a very encouraging consumer response.

Distribution Network

GCMMF's total number of Wholesale Dealers now stands at 3,500 extending our reach to more than 5 lac retailers. All our Wholesale Dealers have computerized operations with e-mail connectivity for greater speed and faster response time. As impressive as these statistics are, they don't tell the most important part of the story: it is the staunch support, brand loyalty and commitment of our Wholesale Dealers and Retailers, that makes it possible for products to reach consumers in the remotest parts of our country.

Co-Operative Development Program

Co-operative Development Program aims at building greater member understanding and loyalty, orienting our farmer-owners to their roles, rights and responsibilities while promoting the highest level of member participation in their co-operative. During the past seven years, Member Unions have taken the member education program to 6,405 village dairy co-operative societies, reaching 6, 34,080 women and 5, 43,362 men milk producers.

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The 'E-Comm' Road Ahead

People, today, talk of e-commerce as a tool of the future. The Internet, they say, will change everything - the freedom of choice, the way markets function, the nature of work, the meaning of leisure, the empowerment of Consumers. The Information Implosion rapidly expands the choices available to the consumers. Past objectives will be shaped by future solutions. The quickest, as also the best interaction, will take place in Cyberspace. All these activities are geared towards matching and satisfying the perceived as well as latent needs of consumers, through the effective use of information technology. In this Information-Communication-Entertainment Age, the barriers between the business organization and consumers, between manufacturers and end-users are all breaking down.

Amul is India's first food brand to have a dedicated website -- www.amul.com. Today, they operate India's first national cyber store, functioning in some 120 cities, and an Amul Cyber store Gifting Service capable of serving consumers in more than 220 of our cities, on specific occasions. This has been made possible by creating an IT network, which links their production, centers with sales offices and dealers by VSAT and e-mail connectivity. Their website has brought us closer to customers, improving interactivity, brand salience and the shopping basket experience. In fact, Amul are consciously targeting 'Generation@' like never before. Notable firsts among Amul’s web-achievements are:

March, 1996: Among the first Indian corporate on the net September, 1998: Launch of Amul Cricket Rankings

March, 1999: Launch of Amul Cyber store in the US

June, 1999: Launch of Amul Cyber store - India

September, 1999: Launch of Amulmail.com

October, 1999: Launch of Amul Gift Hamper Service - India

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Today, they have what the netpreneurs refer to as the 'first mover advantage' in the net business. Net Brands will matter. Net Brands will persevere. Net Brands will be a key and growing niche. Net Brands will have an interactive personality. Net Brands will deliver results. And, Net Brands will be savvy. Like their Marketers. How you do, what you do will be the acid test of fulfillment of Consumer expectations. Of critical importance will be the exercise of Logistics - that delivers not just the Brand but the Brand Promise, as well. Channel Conflict will be replaced by Channel Synergy, as the web channel gets linked to conventional channels. When E-tailing becomes supplementary to Re-tailing, by closing in on one transaction - Selling. By offering the Consumer the benefits of becoming an 'E-Consumer' and consequently, an 'M-Consumer'. The day is not far when every farmer, in each village society, will walk in with his Smart Card. This movement of co-operatives from Co-ops to e-Co-ops will make co-operatives that much stronger by bringing members together and closer to customers like never before.

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Promotional strategies

Advertising : Amul's first advertisements begun in 1966 by ASP, Mr. Sylvester daCunha who clinched the account for Amul butter. The strategy is based on a mascot, a cartoon character girl, who became the moppet who put Amul butter on India's breakfast table

Its advertising has also started using tongue-in-cheek sketches starring the Amul baby commenting jovially on the latest news or current events. The pun in her words has been popular. The Amul ads are one of the longest running ads based on a theme, now vying for the Guinness records for being the longest running ad campaign ever. Sylvester daCunha, was the managing director of the advertising agency, ASP, that created the campaign in 1967 whose charm has endured fickle public opinion, gimmickry and all else.

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Amul: Brand Management

•  Appointment of Professional Advertising Agencies since 1956 (ASP, dCA, Radeus, Ulka)•  Appointment of Professional Distribution Agency (Voltas, Spencers) till 1983 •  Creation of GCMMF in 1973 •  A marketing Team “Product Management Group” for brand care..

Amul : Brand Repositioning

•  Scenario post liberalization in 1992: •  Likely threat of competition in various categories •  Increasing media costs and fragmentation •  Decision to consolidate brand position as “The Taste of India ” in 1995

Brand Equity : Indicators •  Perceived Quality •  Perceived Value •  Loyalty •  Brand Awareness •  Market Share •  Leadership •  Brand Personality •  Distribution Coverage •  Price Premium •  Organizational Association

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Brand : Core Identity Augmented by :

•  Brand as Product •  Product Scope •  Product Attributes •  Quality/Value •  Uses & Users •  Brand as Organization •  Organization attributes •  Local v/s Global •  Brand as Person •  Brand Personality •  Brand - Customer relationship •  Brand as Symbol •  Visual imagery and metaphors •  Brand Heritage

Digital Marketing: Key Benefits Experienced

• Accessibility of brand & organization becomes global. Dramatic increase in export enquiries since 1996 – both from trade as well as consumers • High customer involvement due to ‘emotional attachment' with the brand • The topical advertising campaign (updated weekly) and Cricket Rankings (updated daily) helps in generating continuous interest • Regional Hubs (USA, Dubai, India, and Singapore) to facilitate ebusiness transactions in a highly restricted dairy product export market.

Next Steps

• Build Product specific sites• Build WAP site • Build each Member dairy web site • Enable e-transactions in village coops

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Corporate social responsibilityCSR-sensitive Organizational StructureAMUL is a three tier co-operative organization. The first tier is the co-operative society at the village, of which; milk producers are voluntary members, managing the co-operative through a democratically elected 9-member managing committee, and doing business by purchasing milk from members and selling it to the district level co-operative. There are more than 11,000 co-operatives in villages of Gujarat.

The second tier is the district co-operative that processes milk into milk products, markets locally and sells surplus to the state co-operative for national and international marketing. There are 12 district co-operatives each being managed by a 15-member board elected by the college comprising the nominated representatives or chairmen of the village co-operatives.

Third tier is the state level co-operative - the Gujarat Co-operative Milk Marketing Federation (GCMMF) responsible for national and international marketing of milk and milk products produced and sold to it. The GCMMF is managed by the board democratically elected by and from amongst the chairmen of the district co-operatives.

The entire three-tier structure with the GCMMF at its apex, is a unique institution because it encompasses the entire chain from production of raw material to reaching the consumer with the end product. Every function involves human intervention: 23.60 lakh primary milk producers; 35,000 rural workmen in more than 11,400 village societies; 12,000 workers in 15 dairy plants; 750 marketing professionals; 10,500 salesmen in distribution network and 600,000 salesmen in retail network. Accumulation of human capital is sine qua non for the development and growth of any enterprise or economy. The GCMMF is sensitive towards CSR. It believes that technology and capital are replicable inputs but not the human capital. Since men are the basis for achieving

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the CSR, the GCMMF lays emphasis on their development into competent, courteous, credible, reliable, responsive communicators and performers.

CSR-sensitive Business PhilosophyThe first step towards discharging the CSR is the business philosophy of the GCMMF. It is two-fold: one, to serve the interests of milk producers and second, to provide quality products to consumers as value for money. Evolution of an organizational system has ensured that the corporate social responsibility towards the primary milk producers, village and the ecological balance is fulfilled. The milk producers are paid for their milk in accordance with market forces and realisation of value for their produce. Invariably the price paid to the member-producers in Gujarat is higher by 15 per cent than the national average.

CSR-orientation To Distributors & Retailers

The GCMMF has identified the distributors and retailers are its important link in its vendor supply chain. Through surveys the GCMMF found that 90% of the distributors do not get any opportunity of exposure to latest management practices. The GCMMF realised that it was a corporate social responsibility to strengthen the core business processes of its distributors so as to keep them in mainstream business and compete with those with formal training in management. The GCMMF has developed and trained all its distributors through Value-Mission-Strategy Workshops, competence building, Amul Yatra, Amul Quality Circle meetings, computerisation, and electronic commerce activities.

Competency Building Module of the GCMMF is meant to infuse professional selling skills by making the distributors and their salesmen aware of latest sales management tools and techniques; enhance their knowledge of products; positioning and segmentation strategies for various products. Under Amul Yatra the distributors and their salesmen are taken on a visit to Anand. During this visit they are shown dairy plants, their upkeep, international standards of hygiene and quality; the practices adopted for clean milk production, and above all the cooperative philosophy. Through one to one talk with the farmers, the distributors and salesmen realise AMUL is a large business of small farmers. The visit leaves an everlasting impression on their minds that by selling AMUL products, they are discharging a social responsibility towards a large number of poor farmers whose livelihood depends upon their skill and integrity.

Earnings:Nurturing its primary members - the milk producers - is the first mission of the GCMMF. Discharge of this responsibility is reflected in the manner in which the GCMMF conducts its business and shares its earnings. The milk from the village co-operatives is purchased at an interim price. So as to maximise the earnings of the milk producers the GCMMF changes the product profile during the fiscal and directs its sales and

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marketing activities towards those products that would bring in maximum returns. True! Every business organization follows the same principle. But the GCMMF follows it with the central interest of the producers. During the fiscal, as the GCMMF finds that from its earnings it is possible to pay more to the producers for milk, the final price is declared higher than the interim price being paid. Before the GCMMF closes its financial accounts the co-operatives are paid ’price difference’, the amount between the interim price and the final price. Thus profit of the GCMMF is very low. The net profit (PADT) of the GCMMF during 2003-04 was Rs 7.31 crore against a turnover of Rs 2,947 crore, a meagre 0.25%. Further out of the net profit of Rs 7.31 crore, Rs 4 crore was given as share dividend to the co-operatives. To fulfill its corporate social responsibility towards its milk producers and co-operatives the GCMMF works on razor thin profits and retention of funds.

CSR-staffThe GCMMF hires and trains people to take advantage over its competitors. It has developed in-house modules for training and competence buil-ding to improve and up grade of their knowledge; communication skills to understand the customer, be responsive to customer requirements, and communicate clearly for trouble shooting of problems. They are expected to be courteous, frie-ndly, respectful, and considerate to the customer. To improve the credibility and trustworthiness of the managers it is important they perform consistently and accurately every time and at all times. The structure of salary and perquisites is altogether different. The first and foremost the staff must get satisfaction from the job they. They are recognised for their contribution (Climate Survey) CSR-AMUL WAY

Sales turnover

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Sales Turnover Rs (million) US $ (in million)

1994-95 11140 355

1995-96 13790 400

1996-97 15540 450

1997-98 18840 455

1998-99 22192 493

1999-00 22185 493

2000-01 22588 500

2001-02 23365 500

2002-03 27457 575

2003-04 28941 616

2004-05 29225 672

2005-06 37736 850

2006-07 42778 1050

2007-08 52554 1325

Recent news items

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Amul has recorded a 30% growth in turnover this year, despite stiff competition from multinational companies and big domestic players in the milk and dairy business. Gujarat Cooperative Milk Marketing Federation Ltd, which markets Amul products, is expecting a turnover of Rs 3,600 crore during 2005-06 from Rs 2,900 crore last year. B M Vyas, Managing Director, talks to P N V Nair, Editor - Food & Beverage News, about Amul's expanding business outside Gujarat, its promotional campaigns, its growth targets at home and abroad.

Reduced Salt Butter for high blood pressure patients by Amul

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Amul wins battle for butter

AHMEDABAD: The Gujarat Cooperative Milk Marketing Federation, which markets the `Amul' brand products in the country, has won a major battle against an Ahmadabad-based pharmaceutical company, which was allegedly giving misleading advertisements on butter.

On a federation complaint, the Advertising Standard Council of India on Friday asked the company to immediately withdraw the advertisement campaign for its `Nutralite,' which it claimed was a better substitute for butter. The federation contested the company's claim that butter was made of animal fat.

A federation spokesman said the campaign would have hurt the sensibilities of vegetarians and thus affected Amul butter sales.

Anand, Gujarat, June 24: Gujarat Co-operative Milk Marketing Federation (GCMMF) popularly known for its products brand name Amul has become India's first billion dollar co-operative unit after touching the record annual turnover of Rs 5,255.41 crores (52.554 billion rupees).


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