Report On Dairy MILK Operation

MILKO – Drink well Live well
Report on
MINI DAIRY
Milk Pasteurizing Unit
Submitted To
Mr. Muhammad Afaq Mazhar
Submitted By
Muhammad Adnan
Faisal Muhammad Ibrahim
Syed Imran Hussain
Anjum Siddiqui
Mirza Ali
Date of Submission
November 20, 2010
Institute of Business & Technology (BIZTEK) Page 1 Operation Management

ACKNOWLEDGEMENT
Report of this nature requires a great deal of effort. We owe a debt of gratitude to those
people who aided us in the compilation of this report.
Firstly, we thank Almighty Allah for giving us the strength to compile this report. We
specially express our gratitude to our course facilitator Mr. Muhammad Afaq Mazhar for
giving us the opportunity and confidence to prepare such kind of report. Without his
support, valuable information and continuous guidance and direction, compilation of this
report would not have been possible.
The preparation of this report has been most informational and rewarding, it truly helped
us to know and realize the magnitude and importance of operations functions.
Sincerely,
Muhammad Adnan
Faisal Muhammad Ibrahim
Syed Imran Hussain
Anjum Siddiqui
Mirza Ali

EXECUTIVE SUMMARY ……………………………………………………….………….. 4
INTRODUCTION ……………………………………………………………………………. 5
PROJECT BRIEF ………………………………………………….…………………….….. 12
VISION STATEMENT …………………………………………….………………….…….. 14
MISSION STATEMENT……………………………………………………………………... 15
DESIGN OF GOODS ……………………………………………………………………….. 16
MANAGING QUALITY …………………………….……………………………………….. 18
PROCESS STRATEGY ……………………………………………………….……………. 21
LOCATION STRATEGY ……………………………………………….…………………… 25
LAYOUT STRATEGY ………………………………………………….…………………… 26
HR STRATEGY ………………………………………………………………….………….. 27
SUPPLY CHAIN …………………………………………………………………….………. 28
PROJECT ECONOMICS …………………………………………………………………… 30
REFERENCES …….…………………………….…………………………………………... 31

Executive Summary
Our group has chosen to work on Mini Dairy Pasteurizing Unit which is most important
category as Milk is the very basic need of daily life. We have studied and plan the entire
business operations and make a comprehensive report on starting a business on Mini
Dairy Pasteurizing Unit.
Pakistan is an agriculture country and our basic source of earning is agriculture food.
Pakistan is the fourth largest producer of milk in the world with an average of 34 billion
litres of milk produced according to various estimates in year 2009 but there still is a large
room for improvement which can be seen by a comparison with the US and other
countries. The livestock and agriculture market is untapped and is expected to grow an
additional 3 billion litres in the next few years at a growth rate faster than most sectors
and 30 percent by 2015.
The company is planned to establish a unit in sub-urban areas of any major city and we
have chosen surrounding areas of Karachi such as Port Qasim / Landhi as it will fulfill our
basic requirement of set up a dairy plant such as Road, Electricity, Water, Gas,
Telephone etc and would be very feasible to collect the Raw Milk in near sub-urban areas
i.e. Bhens Colony and other rural areas through Indus High way.
Milko is the brand name of our product and it will be packed in 250ml, 500ml and 1000ml
as per current need of the customers. It would be packaged Long Shelf Life Milk with the
process of Ultra High Temperature (UHT) which can give expiry life near about six (06)
months.
This project will cost us around 27.5 million and 50% will be Debt from bank. Machinery
will be imported from India as it has the most advanced technology in dairy sector
through their representative office in Karachi – Pakistan. As per our expectation Pay back
period is near about 2.77 years.

1. Introduction
Milk is considered as one of the most nutritionally complete, natural liquid food. It is rich
in high quality protein, essential minerals, and vitamins that are beneficial for human
health. Along with all these essential nutrients, milk also contains a number of micro-
organisms. Most of these bacteria, present in milk are generally harmless. In fact, some
of them are beneficial for us in some way or the other. But several factors such as the
health of the animal, improper handling, pollutants from air and water etc. can
contaminate raw milk and make it potentially dangerous.
Milk is a valuable nutritious food that, if untreated, will spoil within a few days. However,
there are a number of preservation techniques that can be used at a small scale to
extend its shelf life by several days, weeks or months. Some of these processing
methods also produce foods that have different flavors and textures, which can increase
the value of the milk when these products are sold. This Technical Brief gives an
overview of the types of dairy processing that are possible at a small scale of operation
1.1 Milk Economy Overview
Pakistan is the world’s fourth largest milk producer with an annual milk production of 34
billion liters. The milk economy contributes an estimated 11 percent to Pakistan’s GDP
but most of it, around 97per cent, is informal. There has been a long awaited need for
initiating mega projects to bridge these gaps and to convert the 97% informal economy
into an organized one with a formal workforce.

Following are the figures of Pakistan milk producing capacity & its usage extracted from
the Tetra Pack’s site.
The annual milk production of 33.6 billion liters in Pakistan is shared between a 71%
share for the rural economy and a much smaller urban share of 29%. Only 4% of the total
production of milk is processed and marketed through formal channels. For the other
96%, a multi-layered distribution system of middlemen has evolved to supply milk.

Despite only a small percentage (4%) of milk being processed, the (UHT) market is
growing at a steady rate of 20% a year.
• Only 0.52 Billion liters UHT and 0.05 Billion liters pasteurized milk is available in
the country.
• In urban areas 4.7 Billion liters milk is provide by Gawalas.
• 1.27 Billion liters processed milk is sold by the milk shops.

There is a potential of about 5.5 billion liters of milk sold in the urban areas, because in
urban areas people are more health and quality conscious and secondly the income level
of urban population is also good so this segment has potential for UHT and Pasteurized
milk.
1.2 Methods of Milk Processing

There are four main methods used to process milk that are suitable for small-scale
operation:

• Cooling fresh milk to extend the shelf life by a day or two, or freezing it (also
making ice cream).
• Heating milk to destroy both contaminating micro-organisms and naturally
occurring enzymes that change the flavour of milk.
• Making the milk acidic to slow down or prevent the growth of spoilage bacteria or
food poisoning bacteria (this also changes the milk to a curd).
• Reducing the amount of water in milk products to slow down or prevent the growth
of bacteria. This may be combined with adding sugar (to make milk confectionery)
or salt (in cheese or butter production), both of which also prevent bacteria from
growing.
1.2.1 Cooling
Cooling does not destroy bacteria or enzymes but it slows down their activity. Cooled raw
milk keeps its quality for a few days before it is processed. Milk products such as yoghurt,
cheese, butter and pasteurized milk are also cooled to ensure they have the required
shelf life for distribution to shops and retail storage. At the smallest (micro-) scale of
operation, a refrigerator set at 4-5oC can be used to cool milk, but most dairy processors
use a milk cooler (Figure 3) or cold store to cool milk in bulk before it is processed.
Finished products should be stored in a separate dispatch store at 4oC +/- 2oC, or for
frozen milk and ice cream, frozen in a freezer operating at below -18oC.
1.2.2 Heating
There are regulations in most countries that specify the time and temperature that milk
should be heated to pasteurize it. Most specify that milk should be heated to 63oC for 30
minutes higher temperatures and shorter times are used in larger commercial operations
but the equipment needed to do this is more expensive.

1.2.3 Acidifying
Acid is produced in milk by the growth of certain types of harmless bacteria called 'lactic
acid bacteria'. They are normally present in milk and are also used as starter cultures in
the production of yoghurt (Technical Brief: Soured milk and yoghurt). Lactic acid bacteria
convert milk sugar (lactose) into lactic acid, which increases the acidity of the milk and
prevents the growth of harmful bacteria. The removal of lactose means that these
products can be eaten by people who suffer from lactose intolerance. The acid also
creates the characteristic curd of yoghurt. The shelf life is extended by several days and
the changes in flavour and texture make this a popular product in most regions.
1.2.3 Removing water
Separating milk fat from the watery part of milk produces cream. This can be made as a
product for sale, but care is needed because there is a greater risk of cream causing food
poisoning. Production of cream is not recommended except by the most experienced
smallscale dairies. However, cream is also used to make butter and ghee which have
lower moisture contents and are much safer. When butter is prepared and stored
correctly, it can have a shelf life of several months. Clarified butter (ghee) also has a shelf
life of several months. Both are high-value products and have a good market in most
countries. In cheese-making, a curd is produced and the watery part of milk is separated
as ‘whey’. ‘Cottage’ cheese or simple curd cheeses are relatively easy to make at a small
scale, but hard cheeses require greater levels of investment, and more skill and
expertise. It is recommended that market research is undertaken to find which types of
cheese are popular before contemplating production, because in some areas the demand
for hard cheese is small. Training in production should then be obtained from an
experienced cheese-maker. Another process is boiling milk to evaporate water and
produce a brownish gel that is eaten as a snack food or sweet. The product has a shelf
life of a few weeks and may have ingredients such as sugar, colour, spices, fruits or nuts
added to give a variety of products

1.3 Processed Milk Industry

The processors remain a key driver of the dairy industry with constant reinvestments and
diversification of product portfolio. The processors have a small share of 3-4% of the total
produced milk, whereas they invest the most and pay the highest taxes. The eight major
dairies of the country include Nestlé, Engro, Nirala, Halla, Noon, Milac, Dairy Bell, Dairy
Crest and Premier, while other smaller ones have also emerged. Nestle is the biggest
processing industry of the sector, collecting over 1000 tons of milk daily. Similarly Haleeb,
Noon Dairy, HALLA (Idare-e- Kisan), Dairy Crest, Nirala Dairy and Premier Dairies are
continuously investing to upgrade their plants.
The majority of Pakistani consumers continue to use loose milk. However, in urban areas
the trend is reversing and processed milk consumption is growing more than 20% per
year. Of the different types of processed liquid milk, UHT milk packs are by far the most
popular products
In 2007, dairy producers in Pakistan realized that consumers were buying small
packages (250ml) of plain white milk for use as creamer in the country’s most popular
beverage: tea. Consumers preferred the richer taste of tea made with UHT milk, and
smaller packages were more affordable. So producers began developing and marketing
special tea creamer recipes in 200ml packages. In addition to improving the taste profile
of tea, the new size also made tea creamer more affordable than plain white milk. Today,
a tea creamer represents more than 25% of the LDP market which will achieve a CAGR
of 28% from 2009 to 2012, according to Tetra Pak.


2. Project Brief
Mini Dairy – Milk Pasteurizing Unit
Mini dairy is a small scale-milk-processing unit where milk is pasteurized and packed into
aseptic carton boxes. Mini dairy is an economically a viable and financially a profitable
project.
2.1 Project Cost

Total project cost of this Milk Pasteurizing Unit is Rs. 27.411 million. Out of this, capital
cost of the project is Rs. 27.21 million, and the rest is the working capital.
2.2 Pasteurization
Pasteurization is the process of heating the milk up to 70ºC for a certain period of time
and then cooling it to 4ºC. The heat treatment must guarantee the destruction of
unwanted pathogenic microorganisms and should not affect the taste & nutritional value
of the milk. The commercial significance of pasteurizing milk is to increase the shelf life of
the milk.
For pasteurized milk, a standard formula of 3.5% fat contents and 9.5% SNF (solids not
fat) have to be maintained according to law. The fresh milk has 4 to 6% fats. The extra fat
contents are removed through cream separator during milk processing. After cream
separation, some milk powder is mixed and homogenized to make standardized milk of
3.5% fat and 9.5% SNF. This extra milk cream is sold to the sweet makers fetching
higher prices.
2.3 Forms of Pasteurization

There are two forms of pasteurization.
• HTST &
• UHT

The first, most common form of milk pasteurization is HTST, which stands for High
Temperature Short Time. This process involves heating milk to 72-75 degrees Celsius
with a holding time of 15-20 seconds before it is cooled. Along with correct cooling,
pasteurisation will supply milk with longer shelf life. With proper chilled distribution,
pasteurised milk has a shelf life of 5-15 days.
The second form of milk pasteurization is UHT, which stands for Ultra High
Temperature.
UHT (ultra-heat treated) is to kill all the microorganism in the milk at a temperature as
high as 135 to 152 centigrade in order to give the milk a longer shelf life.
2.4 Proposed Milk Processing Capacity

Mini dairy unit with 2000 liters milk intake capacity per hour is an economical size for
starting a milk processing business. However, due to the time required in installation and
running of the unit, it is expected that the plant would achieve 100% efficiency in sixth
year of operations.
2.5 Final Product

Packaged UHT pasteurized milk which has a longer shelf life.

VISION Statement
“To become the best household care company that
serve the needs of the markets we serve and meets
customers satisfaction“

MISSION Statement
To be the best Packaged Milk Company by focusing
on quality, consumer needs and marketing
excellence, while showing care towards employees &
being fair to all stake holders.

3. Design of Goods
UHT Pasteurized milk is a marketable product and its demand is increasing with the
increase in awareness among the consumers. Following are the reasons for increasing
the demand of processed milk:
• Mass sale of adulterated milk by Milkmen is letting the urban low-income segment
to shift from home delivered adulterated milk to self-purchased pasteurized milk
from branded companies.
• People are getting more quality and health conscious & they prefer branded food
items for both quality & status reasons
• The way milk is treated at the retail shops, people are attracting towards
processed milk
• Influence of media due to which people are moving towards packaged milk
3.1 Product or Brand Name

Our product name is MILKO which is a pure, safe & fresh milk for all purposes.
It is pure in terms of essential ingredients, safe from the harmful bacteria and fresh
because it is a healthy and nutritious drink.
Reason for choosing MILKO as a brand name is that our milk could be use for all
purposes and letter “O” mentioned in the name represent “all purposes”.
Our moto is “Drink well Live well”
3.2 Product Mix

The product mix consists of Packaged Milk of 1 liter, 0.5 liter & 250 ml in the following
ratio.
Product % of Production
1000 ml 30%
500 ml 30%
250 ml 40%

3.3 Packaging and Pricing

Initially we will launch our product in three most required packs i.e. 250m, 500ml, and
1000ml and further we can launch 2000ml economy pack as per need of our customers.
Our pricing strategy is on going pricing strategy. Here i:
• 250ml Rs.20/-
• 500ml Rs.37/-
• 1000ml Rs.70/-


4. Managing Quality
As we mentioned in our Vision statement, we serve and meet customer satisfaction
which surely impossible without focusing on Quality that’s why we have highlighted our
Mission statement that our focus in quality and consumer needs. We will briefly describe
how we will ensure the quality in our product.
4.1 Spoilage, food poisoning and preservation

Milk is not only nutritious for people, but also for bacteria. Because milk is a low-acid
food, bacteria are able to grow in it and contaminate any products that are made from it.
If milk is not properly processed or if it is contaminated after processing, bacteria can
change the flavor, texture or color of dairy products, to spoil them and make them
unacceptable for sale. Other dangerous bacteria can grow in milk and cause food
poisoning. Illnesses such as tuberculosis, brucellosis and typhoid fever can also result
from using poor quality milk or milk that is not properly processed. All types of dairy
processing therefore need careful control over the processing conditions and good
hygiene precautions to make sure that products are both safe to eat and have the
required shelf life. Processors must pay strict attention to hygiene and sanitation rules
throughout the process, from milking the animal to final sale of products. These are
described below and also in Technical Brief: Hygiene and safety rules in food processing.
4.2 Dairy building and facilities

It is important that a suitable room is set aside as a dairy and it is only used for
processing. The size of the room depends on the amount of milk being processed, but
typically a small-scale unit that processes 100-500 litres per day requires an area of
approximately 50m2.
The room should be hygienically designed and easily cleaned to prevent contamination of
products by insects, birds, rodents or micro-organisms. A panelled ceiling should be fitted
rather than exposed roof beams, which would allow dust to accumulate that might

contaminate products. There should be no holes in the ceiling or roof, and no gaps where
the roof joins the walls, which would allow birds and insects to enter.
4.3 Equipment
All dairy equipment should be designed and constructed so that it can be easily
dismantled for cleaning (e.g. there should be no blank ends to pipework that would
harbour stagnant milk). Mixing bowls, boiling pans etc. should have a smooth internal
surface without corners, and all welds should be ground to a smooth finish. Ideally, all
dairy equipment should be made from stainless steel, but alternatives include polished
aluminium, or food grade plastic for containers and equipment that are not heated. Mild
steel cannot be used because it will rust and contaminate products, and brass, iron or
copper cannot be used because they promote rancidity in milk fats. The layout of
equipment within the room (Figure1) should allow food to move between different stages
in a process without the paths crossing. This reduces the risk of contaminating finished
products with raw milk. There should also be sufficient room behind equipment for
cleaning.
4.4 Cleaning and sanitation

Good sanitation is essential in all dairy processing. Equipment should be thoroughly
cleaned after each day’s production, using a cleaning schedule that indicates which
equipment is to be cleaned, who is responsible for cleaning it, how it should be cleaned,
how frequently it is done, and who is responsible for checking that cleaning has been
done properly. All equipment should be washed with hot water and a cleaning agent that
is recommended for use with dairy products, and then rinsed with chlorinated water.
Equipment and surfaces should be allowed to dry in the air, because wiping with cloths
can re-contaminate them. If they are available, brushes with colored bristles are preferred
because the colored material can be seen easily if they are lost in machinery or in the
product. At the end of a working day, a slight ‘chlorine’ odor in the processing room
indicates that it has been properly cleaned.

Dairy processing creates large volumes of liquid effluents that contain milk fat, lactose
and protein, and this is highly polluting. Some wastes (e.g. whey from cheese-making)
should be used as animal feed or to make drinks or whey cheese, rather than being
discarded down the drain. Local regulations may require special treatment of dairy
effluents and producers should consult local authorities to plan proper effluent disposal. If
mains drainage is not available, at small scales of production a soak-away should be
constructed in a place that cannot contaminate drinking water supplies or pollute local
streams or lakes.

5. Process Strategy
As we know a process strategy is an organization’s approach to transform resources into
goods and to find out a way to produce goods that meet customer requirement and
product specifications within cost. It also has long term effect on efficiency and production
as well as flexibility, cost and quality of goods produced.
We have decided to adopt Product Focused Strategy in which all operations will be
proceeding one by one. It is also called Line Flow Production or Continuous production.
In this strategy facilities are organized by product which is give smooth operation flow.
5.1 Process
In a Pasteurizing unit we have set of procedures for processing of Milk which will give
desire output.
5.1.1 Milk Reception
Milk will be received through any contractor / agent or directly milk form houses will be
immediately forwarded to cold storage house for storing. As per routine procedure
Laboratory technician will test and measure this milk for quality assurance purpose. If it
would be appropriate for human health it will be stored for further process otherwise it will
be rejected and return to form house or destroyed as agreed.
5.1.2 Standardization
Standardization is defined as the industrial adjustment of milk or cream fat content to a

precisely specified or desired value. It is of key importance for our industry (dairy) which
faces the challenge of transforming a gift of nature into standardized serial products for
daily consumption.

In general, the fat content of raw milk is higher than the fat content of the various dairy
products to be manufactured. The standardized fat content of these products usually
ranges between a minimum of 0.5 and a maximum of 3.5 percent.
5.1.3 Homogenization
Since milk is an oil and water combination, it doesn’t stay mixed. Homogenized milk is
run through tiny tubes, sometimes during the pasteurization process to keep fat and liquid
molecules together. Fat molecules are reduced in size and tend to disperse more evenly
throughout the milk so that creaming on the top of milk doesn’t occur. You can also use
the homogenization process to reduce overall milkfat in milk. 2% milk is stripped of some
of the fat molecules to produce lower fat milk.
5.1.4 Pasteurization / Sterilization
Pasteurization is used to kill harmful microorganisms by heating the milk for a short time
and then cooling it for storage and transportation. Pasteurized milk still is perishable,
however, and must be stored cold by both suppliers and consumers.
Milk can be made commercially sterile by subjecting it to temperatures in excess of 100°

C, and packaging it in air-tight containers. The milk may be packaged either before or
after sterilization. The basis of UHT, or ultra-high temperature, is the sterilization of food
before packaging, then filling into pre-sterilized containers in a sterile atmosphere. Milk
that is processed in this way using temperatures exceeding 135° C, permits a decrease
in the necessary holding time (to 2-5 s) enabling a continuous flow operation.
5.1.5 Storage & Distribution
Sterilized / Pasteurized milk will be packed in Tetra Pak packaging which will give
extended shelf life. As per our country’s weather it is recommended to store it in cool
environment. From our cold store it will be distributed to our distributors / wholesalers for
consumers.

Process Flow

5.2 Plant and Machinery

In a pasteurization unit, the major cost of equipment is Mini Dairy Plant which is the
combination of pasteurization plant, boiler, chiller, cream separator, thermostatic tank etc,
which can be purchased from any growing country such as India, China, UK, Australia as
they have a advanced in agriculture and food technology.
We have decided to deal as follow:
For Plant:
SSP PVTLIMITED Representative Office

Registered & Corporate Office 921 – 924, Trade Tower
13, Milestone, Mathura Road Near Service Mess
Faridabad, Haryana – India Main Abdullah Haroon Road
Tel: +(91)(129)4183700 Karachi – Pakistan
Tel: +(92)(213)5651282/83
For Packaging:
Tetra Pak Pakistan Ltd
316, Upper Mall, Lahore
Tel: +(92)(423)5718542
Here is the cost break up of required plant and machinery.
16,075,000

6. Location Strategy
Location is the main factor for any industry as it will directly affect on Labor Productivity,
Costs, Market and suppliers.
It is highly recommended to choose any sub-urban area around the major cities should
be selected for Dairy Milk Pasteurizing unit. Following infrastructure requirement should
also be considered as it will improve the value of all over operations:
• Road
• Electricity
• Water
• Diesel Fuel arrangement
• Drainage
• Gas
• Telephone & Fax
We have selected the location, near Port Qasim or Landhi as major Raw Milk producing
area (Bhens Colony) is near around and we are also connected to other rural areas of the
province through Indus High way for our future needs.

7. Layout Strategy
Layout Strategy will always supportive to other strategies such as Product strategy,
Process strategy, HR Strategy, and location strategy.
Proper Layout will enables as to get the higher utilization of space, equipment, and
people. It will improve flow of information, materials and also people. It will also improve
employee moral and safer give safer work conditions.
As a Dairy Milk Pasteurizing Unit, we have selected Product Oriented layout in which we
seeks the best personnel and machine usage as per our plant need.
Here is the planned layout:
Delivery
Point

8. HR Strategy
Initially we have planned to hire a limited staff as it will reduce the fixed operating cost
which will surely affect on over all finance.
For advertising / marketing campaign we have plan to hire a outsourcing companies to

meet our requirement and later on we can hire our own brand managers as well as
marketing manager to meet our future goals. Here is the structure of our current staff with
its expected salary which can be added as per situation.

9. Supply Chain
As dairy plant our raw material is pure natural milk which we will obtain from various milk
farm houses. It can be collected through any Contractor or agent or later on we can get it
directly from good / reputable farm houses.
We will surely have to ensure the quality of raw milk (unprocessed) and have a set of
agreement that we will return (deduct the price of) the rejected milk by our Quality Control
persons and only approved milk will be sent to processing unit.
Processing Unit will precede it according to our requirement as initially we have planned
to produce Packaged Milk as Ultra High Temperature (UHT) for long shelf life. In
Processing we will also separated the additional Creamer which will be sold out to
various Bakers for sweet making etc.
After processing of Milk, it will be packed in Tetra Pak Packaging and forwarded to
warehouse for cold storage purpose for longer shelf life. From Warehouse, it will be
dispatched to Wholesale distributors and then retailers where any customer can buy it
and consume it as required.

Flow Chart of Supply Chain:
Milk Farm
Contractor /
Agent
Processing De-Creamer
Unit
Warehouse Bakers
Wholesale
Distributor
Retail Store
Customer /
Consumer

10. Project Economics

Finance factor is always contributes a major part in success of any project. No doubt our
primary aim is earning with addition to give quality products to our customers as per their
needs.
With the help of Small & Medium Enterprises Development Authority (SMEDA) we have
analyze and calculated the requirement of Land, Building Infrastructure, Plant &
machinery, Furniture / Fixture, Vehicle etc. and as per this calculation we require around
27.4 million for this project to establish.
We have planned to obtain a 50% financing from banks and 50% will be our investment
(13.7 million) as Equity. As per our planning Internal Rate of Return is around 43% and
Pay back period will be 2.77 years (approximately).
Here is the breakup of total project costing:

11. References
We have found all the materials from authentic websites and resources which are as
under:
Small Dairy Industry Guide Lines

www.smalldairy.com
Pakistan Dairy Development Company

http://www.pddc.com.pk/
Tetra Pak Pakistan Pvt Ltd.

http://www.tetrapak.com/business_solutions/from_idea_to_product/pages/default.aspx
http://www.tetrapak.com/Document Bank/Food_categories/Tetra_Pak_Dairy_Index_2009_1.pdf
Food and Agriculture Organization of United Nation

http://www.fao.org/
http://www.fao.org/DOCREP/003/X6511E/X6511E00.htm#ch0
Department for International Development - UK

http://www.dfid.gov.uk/
UK in Pakistan – British High Commission Islamabad

http://ukinpakistan.fco.gov.uk/
http://ukinpakistan.fco.gov.uk/en/news/?view=PressR&id=21766681
Pakistan Standards and Quality Control Authority

http://www.psqca.com.pk/
SSP Pvt. Ltd - India (Specialist in Dairy Processing Project)

http://www.sspindia.com/contact.html
Small & Medium Enterprises Development Authority

http://www.smeda.org/sector-development/dairy-sector-brief.html

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MILKO – Drink well Live well

Mr. Muhammad Afaq Mazhar

Institute of Business & Technology (BIZTEK) Page 1 Operation Management

Institute of Business & Technology (BIZTEK) Page 2 Operation Management

EXECUTIVE SUMMARY ……………………………………………………….………….. 4

PROJECT BRIEF ………………………………………………….…………………….….. 12

VISION STATEMENT …………………………………………….………………….…….. 14

DESIGN OF GOODS ……………………………………………………………………….. 16

MANAGING QUALITY …………………………….……………………………………….. 18

PROCESS STRATEGY ……………………………………………………….……………. 21

LOCATION STRATEGY ……………………………………………….…………………… 25

LAYOUT STRATEGY ………………………………………………….…………………… 26

SUPPLY CHAIN …………………………………………………………………….………. 28

PROJECT ECONOMICS …………………………………………………………………… 30

Institute of Business & Technology (BIZTEK) Page 3 Operation Management

Institute of Business & Technology (BIZTEK) Page 4 Operation Management

1.1 Milk Economy Overview

Institute of Business & Technology (BIZTEK) Page 5 Operation Management

Institute of Business & Technology (BIZTEK) Page 6 Operation Management

• In urban areas 4.7 Billion liters milk is provide by Gawalas.

• 1.27 Billion liters processed milk is sold by the milk shops.

1.2 Methods of Milk Processing

Institute of Business & Technology (BIZTEK) Page 7 Operation Management

Institute of Business & Technology (BIZTEK) Page 8 Operation Management

1.2.3 Removing water

Institute of Business & Technology (BIZTEK) Page 9 Operation Management

1.3 Processed Milk Industry

Institute of Business & Technology (BIZTEK) Page 10 Operation Management

Institute of Business & Technology (BIZTEK) Page 11 Operation Management

2.1 Project Cost

2.3 Forms of Pasteurization

Institute of Business & Technology (BIZTEK) Page 12 Operation Management

2.4 Proposed Milk Processing Capacity

2.5 Final Product

Institute of Business & Technology (BIZTEK) Page 13 Operation Management

“To become the best household care company that

serve the needs of the markets we serve and meets

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To be the best Packaged Milk Company by focusing

on quality, consumer needs and marketing

excellence, while showing care towards employees &

being fair to all stake holders.

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3.1 Product or Brand Name

Our moto is “Drink well Live well”

3.2 Product Mix

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3.3 Packaging and Pricing

Our pricing strategy is on going pricing strategy. Here i:

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4.1 Spoilage, food poisoning and preservation

4.2 Dairy building and facilities

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4.4 Cleaning and sanitation

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5.1.1 Milk Reception

Standardization is defined as the industrial adjustment of milk or cream fat content to a

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5.1.4 Pasteurization / Sterilization

Milk can be made commercially sterile by subjecting it to temperatures in excess of 100°