Professional Documents
Culture Documents
REPORT ON
A Study of Marketing Strategies of Amul
Fresh products in Nashik
FOR
AMUL INDIA
SUBMITTED TO
SAVITRIBAI PHULE
PUNE UNIVERSITY
SUBMITTED BY
AKASH MAGAR
I hereby declare that this report submitted in partial fulfillment of the requirement of the
award for the MBA course to Sandip Foundaation’s Institute of Management, is my
original work and not submitted for award of any degree or diploma fellowship or for
similar titles or prizes.
I further certify that I have no objection and grant the rights to Sandip Foundaation’s
Institute of Management to publish any chapter/ project if they deem fit in
Journals/Magazines and newspapers etc. without my permission.
Place : Nashik
Date : 25 -7-17
Roll No. :
Acknowledgement
A summer project is the golden opportunity for learning and self – development. I consider
myself very lucky and honored to have so many wonderful people lead me through in
completion of this project.
I wish to express my indebted gratitude and special thanks to “Gujarat Co-operative Milk
Marketing Federation Ltd.”& all the staff members especially my guide and mentor Mr.
Sameer Shinkar in spite of their busy schedule took time to hear guide and keep me on the
correct path and allowing me to carry out my project work.
The project title was “A Study of Competitors Analysis and Business Development of
fresh products in Nashik.” The entire Summer Internship was divided into three phases which
included Market research to understand information about Competitors; Business development
of fresh products and evaluating the business potential of the HORECA segment.
In the beginning of the study first task was to study about the sector, companies through
secondary sources like online articles, company website, projects related to Amul.
After then the steps taken are as follow:
To understand number of competitors in the market, a survey was conducted. Every day
One beat was targeted and minimum 25 outlets. And to follow or collect data from loose milk
suppliers the market starts at 6.30 am daily. This survey includes data collected from 739
retailers, in which it was found that Godavari, Thorat, Rajhans and Loose milk were the major
competitors of Amul. In loose milk Khatif dairy was dominant in Nashik. There were few brands
which were dominant in particular area. Brand like Atul was more popular in area like cidco and
Indira nagar. It was the most preferred brand in those areas. Atul was the only brand which was
sold in pouch as well as loose.
An exploratory survey was conducted for each retailer and customer, drawing a basic
questionnaire. This helps in understanding the retailers’ expectation from company and various
factors affecting the buying decision of Amul milk and Pouch Dahi. Through this it was found
that Godavari was the leading brand in Milk.
After research, sales activity was done for business development. For this activity a
strategy was made, to target new customers, for eg. if it’s a tea vendor or hotels or loose milk
suppliers.
To enhance business meeting was conducted with tea vendors, retailers, loose milk suppliers as
well as hotel managers.
Same steps were followed for this activity also, every day one beat. Most of the hotels were
using loose milk and due to good relation with their vendors they were avoiding AMUL’s
offers.
Most of the tea vendors were interested in using Amul as they were getting it at cheaper rate.
Raw milk supplier were targeted because most of them where having shortage of milk so
they can use Amul milk.
During this activity we found that one area (satpur) was not having any distributor. So the
next task was to hunt for new distributor in that area. For which competitor’s distributor were
targeted. One by one we met all the distributors in that area. In which two of the distributors
were interested in being a part of Amul.
Dugad Satpur
Name – Dugad
Address – Satpur -422007
Capacity – 300-400 not sure.
Area Covered – Satpur
Currently Selling Brands – Thorat
Network – Good
Time Period Project progress(work)
7rd May - 30th May Market research
4th June – 8th June Hunt For New Distributor in Vacant Area
12th June – 20th June Research and Sales in Retail and HoReCa Segment
21st June – 25th June Visiting and Converting Raw milk Suppliers and
Dairies
ANALYSIS
Overall from the given feedback & analysis it can be clearly stated the fact that the
Retailers recommendation is the top most factors which affects the buying decision of products
from retailers counter. Hence in order to increase the market share and sale we have to involve
retailers by providing more discounts and offers to retailers as well as and they will further
influence customers to use “Amul”.
Amul has a relatively good distribution network, but still company is not able to fulfill
the demand of outlet in areas like its competitor has their company outlet. So, distribution should
improve.
Chapter II
OBJECTIVES
2.1 Objectives
To analyse the marketing strategies used by other brands as compared to amul
brand
Chapter III
Company Profile
India ranks first in milk production, accounting for 18.5 % of world production, achieving an
annual output of 146.3 million tons during 2014-15 as compared to 137.69 million tons during
2013-14 recording a growth of 6.26 %. Whereas, the Food and Agriculture Organization (FAO)
has reported a 3.1 % increase in world milk production from 765 million tons in 2013 to 789
million tons in 2014.
The importance of dairying in a country like India hardly needs emphasizing. India has vast
resources of livestock, which play an important role in the national economy and also in the
socioeconomic development of millions of rural households. India has one of the largest stocks
of cattle and buffaloes: more than 50 percent of the world's buffaloes and 20 percent of its cattle.
The Indian dairy sector contributes a large share of the agricultural gross domestic product
(GDP). Although the contribution of agriculture and allied sectors to the national GDP has
declined during the past few decades, the contribution of the livestock sector has increased from
less than 5 percent in the early 1980s to over 6 percent in the late 1990s. Milk and milk products
constitute a major share of the value of output from the livestock sector; their share increased
from less than 50 percent in 1950-51 to about 65 percent in the late 1990s.
Year Production on (Million Per capita
Tones) Availability(gms/day)
2005-06 97.1 241
2006-07 102.6 251
2007-08 107.9 260
2008-09 112.2 266
2009-10 116.4 273
2010-11 121.8 281
2011-12 127.9 290
2012-13 132.4 299
2013-14 137.7 307
2014-15 146.3 322
The importance of dairying in a country like India hardly needs emphasizing. India has vast
resources of livestock, which play an important role in the national economy and also in the
socioeconomic development of millions of rural households. India has one of the largest stocks
of cattle and buffaloes: more than 50 percent of the world's buffaloes and 20 percent of its cattle.
The Indian dairy sector contributes a large share of the agricultural gross domestic product
(GDP). Although the contribution of agriculture and allied sectors to the national GDP has
declined during the past few decades, the contribution of the livestock sector has increased from
less than 5 percent in the early 1980s to over 6 percent in the late 1990s. Milk and milk products
constitute a major share of the value of output from the livestock sector; their share increased
from less than 50 percent in 1950-51 to about 65 percent in the late 1990s.
During the 1950s and 1960s, India was one of the largest importers of dairy products, importing
over 40 percent of milk solids in the total throughput of the dairy industry. The commercial
import of milk powder reached its peak at about 53 thousand tons in 1963-64 (Kanitkar, 1999).
This concerned policy makers, and a decision was made to achieve self-sufficiency in milk
production. The major step forward, which has had a far-reaching impact, came in mid-sixties
with the establishment of the National Dairy Development Board (NDDB) to oversee dairy
development in the country. The Operation Flood (OF) program, one of the world’s largest and
most successful dairy development programs, was launched in 1970; its main thrust was to
organize farmers' cooperatives in rural areas and link them with urban consumers. Operation
Flood has led to the modernization of India's dairy sector and has created a strong network for
procurement, processing, and distribution of milk by the cooperative sector. In 1989, the
Government of India launched the Technology Mission on Dairy Development (TMDD)
program to support and supplement the efforts of Operation Flood and to enhance rural
employment opportunities and income generation through dairying.
India is currently the largest producer of milk in the world, overwhelmingly thanks to the output
of millions of smallholder farms. Product wise consumption of the Dairy Industry
India’s organized dairy sector will see a ‘Cream run’ through 2018 with special focus on value-
added products. The sector will see capacity augmentation to around 1,050 lakh liters per day
(LLPD) with an overall capex infusion of around ₹15,000 crore in next three years, ratings
agency Crisil highlighted in its latest report on organised dairy players.
Increased disposable income and quality consciousness among the consumers along with greater
preference for branded milk and milk products would drive the growth for organised dairy
players, who would see faster growth in next three years as against 22 per cent seen in last five
years. Commenting on the report, Anuj Sethi, Director, Crisil Ratings, said, “Nearly a third of
the overall capex is expected to be undertaken by the largest domestic dairy player, Gujarat Co-
operative Milk Marketing Federation (which sells under the ‘Amul’ brand), through its member
co-operatives.”
“These expansions will be strategically planned to ensure there is geographical diversification
that strengthens milk procurement. The revenue share from the organised segment could rise to
25 per cent by 2018 from 19 per cent in 2015,” the report named ‘Cream Run’ stated.
Crisil rated 84 firms comprising 60 per cent of the organised dairy capacity in India. The
organised segment rakes up revenues of ₹75,000 crore currently.
According to NDDB and Crisil Research estimates, the country produces around 3,800 LLPD of
milk, accounting for a fifth of the global output. About 40 per cent of this is retained by
producers (farmers) for household consumption; another 41 per cent share is with the
unorganized segment. Only 19 per cent is procured, processed and sold through by organised
dairies currently.On the milk prices, Crisil maintained that increased availability would keep
milk prices stable in the near term. But it would affect cash generation of the players primarily
engaged into liquid milk.
The growth for organised dairy players is driven by value-added products, which grew 23 per
cent annually compared with 15 per cent for liquid milk. In the branded segment, consumption of
paneer, cheese, curd, butter, ice-cream and lassi has increased faster than milk.
The share of value-added products in fiscal 2015 is estimated at 43 per cent, up from 35 per cent
in fiscal 2010.
Future of Industry
Milk Prices
Cost is important since higher milk prices are a cause for concern for the government trying to
address inflation worries. Compared to countries like U S, milk production in India is costly
because land is expensive and interest rates are higher. But India enjoys the advantage of having
cheaper labour. Labour is also easily available. But the cost of cattle feed is high due to exports
and this has also contributed to high cost of milk. . The challenge is how to enhance milk output
with limited resources and meet the growing demand, particularly in the cities, while at the same
time keeping rising milk prices in check.
National Policy
Against this backdrop, the national policy on dairy is critical for the growth of dairy industry.
Milk production in US has been growing at a very good pace as a result of policies of the US
government which nurture and protect cooperative marketing by dairy farmers. Experts feel
India should also continue its emphasis on dairy development through cooperatives and private
investments to ensure long term growth and sustainability of the industry. India has the largest
bovine population in the world with a large processing capacity of 98.3 million litres per day.
Figures show, milk producers in India enjoy highest percentage share of consumers` rupee -- 70
to 86 per cent. This is more than double that in other countries like US, European countries and
New Zealand where the returns to milk producers is less than 40 per cent of the consumers’
spending on milk.
Challenges
However, there are challenges to dairy in India, mostly in the form of rapid urbanization, low
interest of younger generation in dairy farming and increasing real estate price that leads to loss
of farm lands. Due to these factors, some dairy regions may come under pressure. The preventive
measures would be to implement changes in the dairy production to make farming system more
competitive. In addition, there is a need to develop infrastructure to enhance production,
followed by investment at farm level and improving feeding methods. More importantly,
Government could consider giving relaxation in tax on farmer`s income from milk to encourage
him to invest in dairy.
Rising consumption
India is not only the largest producer of milk but also the largest consumer of milk. The policy
approach should be to create growth path for the dairy industry. Currently, milk constitutes 15
per cent of the average households’ expenditure on food. However, with increasing urbanization
and growing GDP, income rises are leading to fall in share of food as percentage of total
expenditure.
The Cooperatives
A big success story in India’s dairy development is of dairy cooperatives. In the forefront is
Gujarat Cooperative Milk Marketing Federation (CCMMF), the apex body of farmers` milk
cooperatives. It markets the milk products produced by its member cooperatives under the brand
name Amul and Sagar. Milk is sourced from 15,301 village dairy cooperatives where more than
three million farmers collect their milk produce. Amul apart from being Asia`s largest milk
brand is a vehicle for economic and social development through which farmers manage their
own resources. Amul has long been dedicated to providing best prices to its member producers
for their milk and at the same time providing value for money to its consumers. Amul is also
developing wide range of products to meet future demand, including calcium fortified milk,
flavored yoghurt, frozen yoghurt, sugar free ice-cream and pro-biotic products. In order to keep
pace with the growing market and production base, GCMMF has planned a total investment of
$600 million for milk processing and village level infrastructure enhancement in the next five
years.
Sustained Growth
Undoubtedly, dairying has provided gainful employment to millions, primarily women, in the
villages. Investments under ‘Operation Flood’ have resulted in sustained growth and self-
sufficiency in dairy: Amul Model has demonstrated the capacity of a single commodity to have
multi dimensional effect on producers, consumers as well as the economy of the country. This
model has also delineated the importance of commercial approach to development and nil
interference of government in commercial enterprise. By the year 2020, India`s GDP is targeted
to cross that of UK and will be ready for a steep rise till 2050. But it can be realized only by
active government support to vital sectors like dairying and implementation of well formulated
ideas provided by dairy scientists and experts.
Highlights of the DairyTech India 2015
The highlights of the DairyTechIndia 2015 exhibition were the presence of 400 national and
international exhibitors over 35,000 Visitors. Farmer delegations from over 22 states, presence of
delegations from Sri Lanka, Nepal, Bangladesh, among others. Participation from overseas
countries like Holland, USA, Canada, Spain, Italy, China, UK, Czech Republic, Turkey,
Denmark, Taiwan, Bulgaria, Germany, Thailand and Cyprus directly, apart from display of
products of overseas companies through their agents in India.
The 6th DairyTech India 2016 exhibition will held concurrently with 8th India FoodEx 2016, 5th
International Poultry & Livestock Expo 2016, 7th GrainTech India 2016 and 8th AgriTech India
2016. The event is actively supported, sponsored and guided by Union Ministry of Agriculture,
National Agricultural Cooperative Marketing Federation of India Ltd.(NAFED), Food
Processing and Packaging Machinery Industry Association (FPPMIA), Karnatka Milk Federation
(KMF) and National Center for Cold-chain Development (NCCD).
Source - http://dairytechindia.in/
1.3 Introduction to the Organization
Historical Background
Amul (Anand Milk Union Limited), formed in 1946, is a dairy cooperative movement in
India. It is a brand name managed by an apex cooperative organization, Gujarat Co-operative
Milk Marketing Federation Ltd. (GCMMF), which today is jointly owned by some 3.5 million
milk producers in Gujarat, India. It is based in Anand town of Gujarat and has been a sterling
example of a cooperative organization's success in the long term. 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. The brand name Amul means
“AMULYA”. This word derived from the Sanskrit
Word“AMULYA” which means “PRICELESS”. A quality control expert in Anand had
suggested the brand name “AMUL”. Amul products have been in use in millions of homes since
1946. Amul Butter, Amul Milk Powder, Amul Ghee, Amul spray, Amul Cheese, Amul
Chocolates, Amul Shrikhand, Amul Ice cream, Nutramul, Amul Milk and Amulya have made
Amul a leading food brand in India. (The total sale is Rs. 6 billion in 2005). Today Amul is a
symbol of many things like of the high-quality products sold at reasonable prices, of the genesis
of a vast co-operative network, of the triumph of indigenous technology, of the marketing savvy
of a farmers' organization. And have a proven model for dairy development (Generally known as
“ANAND PATTERN”).
DR. V. KURIEN, FATHER OF WHITE REVOLUTION
GCMMF
Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's largest food products
marketing organization. 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. Amul's product range includes milk
powders, milk, butter, ghee, cheese, curd, chocolate, ice cream, cream, shrikhand, paneer, gulab
jamuns, basundi, Nutramul brand and others. In January 2006, Amul plans to launch India's first
sports drink Stamina, which will be competing with Coca Cola's PowerAde and PepsiCo's
Gatorade.
The Amul model has helped India to emerge as the largest milk producer in the world. More than
15 million milk producers pour their milk in 1, 44,500 dairy cooperative societies across the
country. Their milk is processed in 184 District Co-operative Unions and marketed by 22 State
Marketing Federations, ensuring a better life for millions.
“SWOT” Analysis of Amul
STRENGTH
WEAKNESS
OPPORTUNITIES
1. Areas can be targeted to cover Retailers look for convenience and margin.
2. Promotions will pay good results, market is lacking with the same.
3. Weak up the entire market as per the demand.
THREAT
1. Most of the customers depends upon what a retailer gives them. This can be a threat because
competitors provide more margin to retailers and retailers preferred them when it comes to selling.
2. Psychological state of mind of retailers and consumers.
3. Competitors are cutting up the market share of Amul Product.
Company Profile
It is the Apex organization of the Dairy Cooperatives of Gujarat, popularly known as 'AMUL',
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. Its success has not
only been emulated in India but serves as a model for rest of the World. It is exclusive marketing
organization of 'Amul' and 'Sagar' branded products. It operates through 47 Sales Offices and
has a dealer network of 5000 dealers and 10 lakh retailers, one of the largest such networks in
India. Its product range comprises milk, milk powder, health beverages, ghee, butter, cheese,
Pizza cheese, Ice-cream Paneer, chocolates, and traditional Indian sweets, etc.
GCMMF is India's largest exporter of Dairy Products. It has been accorded a "Trading House"
status. Many of our products are available in USA, Gulf Countries, Singapore, The Philippines,
Japan, China and Australia. GCMMF has received the APEDA Award from Government of
India for Excellence in Dairy Product Exports for the last 13 years. For the year 2009-10,
GCMMF has been awarded "Golden Trophy' for its outstanding export performance and
contribution in dairy products sector by APEDA.
For its consistent adherence to quality, customer focus and dependability, GCMMF has received
numerous awards and accolades over the years. It received the Rajiv Gandhi National Quality
Awardin1999 in Best of All Category. In 2002 GCMMF bagged India's Most Respected Company Award
instituted by Business World. In 2003, it was awarded the The IMC Ramkrishna Bajaj National
Quality Award - 2003 for adopting noteworthy quality management practices for logistics
and procurement. GCMMF is the first and only Indian organization to win topmost International
Dairy Federation Marketing Award for probiotic ice cream launch in 2007.
GCMMF - An Overview
The Amul brand is not only a product, but also a movement. It is in one way, the representation
of the economic freedom of farmers. It has given farmers the courage to dream. Besides India,
Amul has entered overseas markets such as Mauritius, UAE, USA, Oman, Bangladesh,
Australia, China, Singapore, Hong Kong and a few South
African countries. Its bid to enter Japanese market in 1994 did not succeed, but it plans to
ventureagain. Its bid to enter Japanese market in 1994 did not succeed, but it plans to venture
again.
GCMMF Office.
Financial Structure
The Gujarat Cooperative Milk Marketing Federation (GCMMF) has crossed a sales turnover of
Rs 23,000 crore for financial year 2015-16. It clocked 11 per cent growth compared to the
previous fiscal when the turnover stood at Rs 20,733 crore
Growth Propositions
Gujarat Co-operative Milk Marketing Federation Ltd., which markets the popular Amul brand of
milk and dairy products has registered a provisional turnover of Rs. 23,005 crores for the
financial year 2015-16 which ended on 31st March. This is 11% higher than last financial year's
sales turnover of Rs 20733 crores. The entire sales turnover growth has come because of volume.
Turnover of GCMMF has increased by 187% during last six years. The provisional unduplicated
group turnover of member unions of Amul group has crossed Rs. 33,000 crores which is also
higher by 14% compare to last financial year. It may be noted that GCMMF has planned to
achieve sales turnover of Rs. 30,000 crores by 2017-18. GCMMF has been achieving a value
growth of more than 20% since last six years because of higher milk procurement, continuous
expansion in terms of adding new markets, launching of new products and adding new milk
processing capacities across India. In order to reach interior markets, GCMMF has started twelve
new branches in India during last three years.
In order to meet milk and milk product demand in major metros of India, the member unions of
GCMMF have started creating their own milk processing plants in states of Haryana, Uttar
Pradesh, Maharashtra, Madhya Pradesh, West Bengal and Rajasthan. The Member Unions of
GCMMF have also started milk procurement from other states so that milk producer members of
these states also benefit from “Amul Model. Shri Jethabhai Patel, Chairman, GCMMF,
emphasized the fact that mantra of rapid expansion has clearly yielded rich dividends for
GCMMF. “Based on estimated growth in market demand for Amul products and our future
marketing efforts, we anticipate at least 20% CAGR growth in the business of GCMMF during
the next five years. The Chairman added that Amul plans to enhance its milk processing capacity
from the current level of 281 lakh litres per day to 380 lakh litres per day in the next five years.
Shri Jethabhai Patel, Chairman, GCMMF, emphasized that the mantra of rapid expansion has
clearly yielded rich dividends for GCMMF. The company anticipates 20% CAGR growth in the
business of GCMMF during the next five years. Amul plans to enhance its milk processing
capacity from the current level of 281 lakh litres per day to 380 lakh litres per day in the next
five years.
Further he also added that globally prices of milk and dairy commodities have reduced by half
however farmers of Gujarat are continuously getting higher prices of their milk products. He
further informed that in New Zealand farmers were getting around Rs. 51.5 per liter of milk
during 2013-14 which is reduced to Rs. 21.7 per liter during 2015-16. On the other hand, farmers
of Gujarat are getting 8-10% higher price of milk every year. On behalf of 36 lakhs milk
producer members of Gujarat, Shri Jethabhai Patel has conveyed his sincere gratitude to
Government of Gujarat and Government of India for their continues and timely support for
various scheme related to producers. Shri R S Sodhi, Managing Director, GCMMF said that “We
have achieved volume sales growth in all product categories. Pouch milk which is highest
turnover products has shown volume growth in double digit. He also added that majority of our
products like butter, ghee, Ice Cream, UHT milk, flavored milk, Paneer and fresh cream has
shown double digit growth. He added that every year, we are getting better results because of
strong foundation laid and value system created by our founder chairman, late Dr. V Kurien and
selfless and visionary leadership of late Shri Tribhuvandas Patel and late Shri Motibhai
Chaudhary. It is important to note that GCMMF passes on 80-85% of consumer rupee back to
milk producer members thus by encouraging them to produce more milk.
Future Plans
R S Sodhi, Managing Director of GCMMF.
RS Sodhi, managing director, GCMMF, said, "We plan to touch a Rs 50,000 crore turnover by
2020. We are investing around Rs 5,000 crore in setting up ten new plants as well as expand
capacity at our existing plants. Our current processing capacity is around 23 million lpd, we aim
to take it up to 32 million lpd by 2020."
Of the new plants planned, that would come up within the next two to three years, two would be
in Delhi, three in Uttar Pradesh, one each in Kolkata and Maharashtra and the rest in
Gujarat. GCMMF at present has over 50 processing plants across the country.
It is currently procuring 19 million lpd for processing paying an average price of Rs 550-580 per
kg fat. With the new plants coming on stream, procurement is expected to rise to 25 million lpd
by 2020, Sodhi said.
India’s organised sector only constitutes 20 per cent of the Rs 4 lakh crore market size for dairy
products in the country.
Amul Plans Rs.5,000 Crore Investment, To Set Up 10 New Plants.
Industrial Recognitions
AWARDS
NATIONAL PRODUCTIVITY COUNCIL PRODUCTIVITY AWARDS 1985-86, 1986-
87,1991-92,1992-93,1993-94,1994-95,1995-96,1996-97,1998-99
Presented for Best Productivity Performance in Dairy Development and Production in Co-
operative sector by Shri G.S. Dhillion, Union Minister of Agriculture to Amul Dairy, Kaira
District Co-operative Milk Producers Union Limited, Anand (Gujarat) New Delhi 22nd April,
1987.
INDIAN MERCHANTS' CHAMBER BOMBAY 1988
A
WARD for Outstanding Performance in the field of R&D of Food Processing Industries Based
on Agricultural Products awarded to Kaira District Co-operative Milk Producers Union Limited,
Anand (Shri Mathurdas Vissanji Endowment) 1998.
On the occasion of 100 years the Co-operative Movement in Gujarat - we are proud to award
"shakari vikas ratna award" to Amul Dairy – Kheda District Co-operative Milk Producers' Union
Ltd, Anand, Gujarat State Co-operative Union, Ahmedabad, 23rd Apr 2005.
Amul Dairy received CII National Award for Food Safety 2013 for its Outstanding Performance
in the Dairy Sector Manufacturing, Large Food Business CategoryAPEDA EXPORT AWARD
2011-12
Amul Dairy, Anand received APEDA Export Award for the year 2011-12 for its outstanding
contribution in the export of Dairy products across the globe. ‘Silver Trophy’ & a Citation was
presented at the 21 st Annual APEDA Award function in New Delhi on 26 Th Nov 2014
Following are the product portfolio of Amul was allotted to me for studying.
All the research and sales activity concentrated only these products.
Pouch Dahi
Product Specification
Fat 3% 6% 3.5%
1. Segmentation
The segmentation of Amul is the mass population and in general, you will find
people of all different age groups and demography enjoying Amul products. This
is because Amul is not only present in Ice cream, but also in Milk, Butter, Cheese
and other such products.
2. Targeting
As it has a very deep product portfolio, it does not differentiate in its customers
but uses a mass marketing principle. And till date, this principle has worked very
well for the marketing strategy of Amul. Similarly, the target audience are the
regular middle class people.
3. Positioning
This is because higher end customers do have a lot of high end products as an
alternative in ice cream. However, for other products like Butter and cheese, both
high end and low end customers are the target. In terms of positioning, Amul has
top of the mind positioning because it is the first brand which comes in mind when
talking of Ice cream, milk, cheese, butter or any other milk based products.
(B) Marketing Mix of Amul
1. Product –
Amul has a very strong product portfolio. Amul milk, Amul Paneer and
Amul Dahi consumption is on the rise. In fact Amul milk has 26% of market
share in the packaged milk segment. Amul is preferred by many loyal
consumers and they won’t settle for any other brand.
2. Price–
Amul has a strategy of low cost pricing. Some may call it penetrative pricing. But
penetrative pricing strategy is used when the market has a high level of
competition and a player wants to establish itself in the market by giving low
prices. However, in the case of Amul, when Amul started, there were no national
players and the dairy market was unorganized. During the introduction stage
itself, Amul had a vision to provide their products to end customers at the best
affordable rates. And the same vision is in place even today.
3. Place:
Amul has a massive distribution network because its fresh products is found
practically everywhere. As it is a FMCG product, Amul follows the methodology
of breaking the bulk. The initial factory output is in bulk. Later on this bulk
becomes smaller and smaller and finally one individual Pouch of milk or dahi or
paneer is sold at the retail place.
Impact on customers:
1. Trust
Over the years Amul has emerged as a trustworthy brand due to its brand
image and quality products. Amul milk has its own loyal customers due to
its various quality specifications. Even commercial users like tea vendors
and restaurants prefer Amul fresh products due to consumer satisfaction.
2. Pricing
Since its inception, Amul had a vision to provide their products to end
customers at the best affordable rates.
e.g. Amul dahi 1kg pack is sold at around Rs. 55. Whereas the local price
for same is around Rs. 80.
Similar is the case for Amul milk and paneer. They are sold at a
considerable low price than local suppliers.
3. Availability
Amul products are available almost everywhere in the Nashik. Even in the
very remote places in the Nashik city and surrounding rural areas Amul
products are available easily.
Main reason for this being the effective distribution network and market
reach.Brand awareness of Amul is considerably strong even in less
populated and rural areas where you will rarely found branded products.
4. Brand awareness
As mentioned above Amul spends a considerable amount of its revenue
on branding and marketing. Amul provides the banners, posters, wall
pictures free to its retailers. You will find Amul banners and hoardings
throughout the city and most part of the surrounding rural areas.
Even retailers are keen to use Amul banners on their shops as it attracts
more customers and increases footfall. The main reason for this being the
brand value and strong image of Amul.
Amul milk provides margins which is around Rs. 1.40 for retailers and
distributors for 1 litre. Whereas the competitor local brands provide from
Rs. 2 to 4 for 1 litre milk which is considerably high.
Due to this margin difference many retailers encourage customers to
buy other brands rather than Amul.
Many brands provide offers like buy 10 get 1 free to retailers in order to
increase their sale. This is a win-win situation to both to brands,
retailers and distributors.
Such offers are mainly used by brands which are new in the market and
want to penetrate in a settled market
e.g. Mother Dairy came up with the offer of ‘buy 10 get 1 free’ for dahi
packets.
In Milk Industry, milk fat plays a very important role for deciding the
quality and price of product. Milk with more fat is used in many products like ice
creams, kulfi, shrikhand, dahi, cream etc. Even consumers prefer milk with more
fat as it makes tea or coffee more creamy and tasty.
These brands increase their fat content in order to attract more customers.
e.g. Mother dairy Full cream milk contains fat of 7.2 % while Amul Full cream
consists of 6%
Chapter IV
Theoretical Background
The article titled “In this article, there is deep dive into the topic of Market Research Techniques.
We will start with 1) an introduction to market research, explore then 2) primary and 3)
secondary market research, as well as finish with 4) the mistakes to avoid when doing
market research. “gives a proper and systematic overview of the various methods of market
research.
1. Indin dairy sector, if you have to grow then you have to increase milk handling capacity. We
are increasing our milk processing capacity to 320 lakh litre per day from the current 280 lakh
litre per day. We target to increase this capacity to 360 lakh litres per day by 2020," Sodhi told
reporters here.
The cooperative is setting up new plants in Uttar Pradesh, Maharashtra, Gujarat and West
Bengal as well as raising the capacity in existing plants, he added.
Asked about the investment, Sodhi said: "We are investing Rs 600-800 crore every year. We will
invest about Rs 3,000 crore by 2020 on expansion."
GCMMF achieved a turnover of Rs 23,005 crore in 2015-16 and aiming to reach Rs 50,000 crore
by 2020.
Elaborating on expansion, Sodhi said the new plants in Kanpur and Lucknow are expected to be
operational in next two months. A cheese plant in Gujarat will start operation soon.
"We are entering Assam market through third party manufacturing. We have plans to enter
Bihar, Jharkhand, Odisha and Kerala markets soon," Sodhi said.
On new products, he said the cooperative will soon launch sweet 'Rasmalai' with a shelf life of
one year.
The cooperative's milk procurement for 2015-16 increased to 186 lakh litres per day as against
148.50 lakh litres in the previous fiscal.
The Leading Dairy Product Companies in India, which are under the control of different state
governments, are generally cooperatives. These cooperatives buy milk from the dairy farmers at
minimum support price. Later these cooperatives process it to different high nutritious milk
products. The leading private milk product companies of India are more into producing and
further processing of these milks. Most of the Leading Dairy Product Companies in India are
well equipped to handle processing of bulk quantities of cow and buffalo milk. Further, the
technology used by these leading companies of India to process the milk is at at par with
international standards.
Furthermore, they strictly adhere to international quality manufacturing and environment safety
standards and such that they follow GMP and HACCP. Some of these Leading Dairy Product
Companies in India are having state-of-the-art R&D centers, aggressively working on
development of quality milk products rich in nutritious value. India is the largest producer of
milk and milk products in the world. However, the country has recorded the highest number of
malnourished children in the world. These Leading Dairy Product Companies in India are
working together with the National Dairy Development Board (NDDB) towards the elimination
of this problem. The Leading Dairy Product Companies in India are also working with the
National Dairy Development Board towards educating dairy farmers on producing quality milk,
cattle disease control, cattle feeding, genetic improvement of cattle, vaccination and other allied
education on dairy farming.
Britannia Industry, Mother Dairy, Nestle ltd, Havmor Ice Cream, Vaishno Devi Dairy, Parag
Milk Foods and Vadilal Dairy International, (Competitors)
4. Segmentation
The segmentation of Amul is the mass population and in general, you will find
people of all different age groups and demography enjoying Amul products. This
is because Amul is not only present in Ice cream, but also in Milk, Butter, Cheese
and other such products.
5. Targeting
As it has a very deep product portfolio, it does not differentiate in its customers
but uses a mass marketing principle. And till date, this principle has worked very
well for the marketing strategy of Amul. Similarly, the target audience are the
regular middle class people.
6. Positioning
This is because higher end customers do have a lot of high end products as an
alternative in ice cream. However, for other products like Butter and cheese, both
high end and low end customers are the target. In terms of positioning, Amul has
top of the mind positioning because it is the first brand which comes in mind when
talking of Ice cream, milk, cheese, butter or any other milk based products.
(D) Marketing Mix of Amul
1. Product –
Amul has a very strong product portfolio. Amul milk, Amul Paneer and
Amul Dahi consumption is on the rise. In fact Amul milk has 26% of market
share in the packaged milk segment. Amul is preferred by many loyal
consumers and they won’t settle for any other brand.
2. Price–
Amul has a strategy of low cost pricing. Some may call it penetrative pricing. But
penetrative pricing strategy is used when the market has a high level of
competition and a player wants to establish itself in the market by giving low
prices. However, in the case of Amul, when Amul started, there were no national
players and the dairy market was unorganized. During the introduction stage
itself, Amul had a vision to provide their products to end customers at the best
affordable rates. And the same vision is in place even today.
3. Place:
Amul has a massive distribution network because its fresh products is found
practically everywhere. As it is a FMCG product, Amul follows the methodology
of breaking the bulk. The initial factory output is in bulk. Later on this bulk
becomes smaller and smaller and finally one individual Pouch of milk or dahi or
paneer is sold at the retail place.
Impact on customers:
5. Trust
Over the years Amul has emerged as a trustworthy brand due to its brand
image and quality products. Amul milk has its own loyal customers due to
its various quality specifications. Even commercial users like tea vendors
and restaurants prefer Amul fresh products due to consumer satisfaction.
6. Pricing
Since its inception, Amul had a vision to provide their products to end
customers at the best affordable rates.
e.g. Amul dahi 1kg pack is sold at around Rs. 55. Whereas the local price
for same is around Rs. 80.
Similar is the case for Amul milk and paneer. They are sold at a
considerable low price than local suppliers.
7. Availability
Amul products are available almost everywhere in the Nashik. Even in the
very remote places in the Nashik city and surrounding rural areas Amul
products are available easily.
Main reason for this being the effective distribution network and market
reach.Brand awareness of Amul is considerably strong even in less
populated and rural areas where you will rarely found branded products.
8. Brand awareness
As mentioned above Amul spends a considerable amount of its revenue
on branding and marketing. Amul provides the banners, posters, wall
pictures free to its retailers. You will find Amul banners and hoardings
throughout the city and most part of the surrounding rural areas.
Even retailers are keen to use Amul banners on their shops as it attracts
more customers and increases footfall. The main reason for this being the
brand value and strong image of Amul.
Amul milk provides margins which is around Rs. 1.40 for retailers and
distributors for 1 litre. Whereas the competitor local brands provide from
Rs. 2 to 4 for 1 litre milk which is considerably high.
Due to this margin difference many retailers encourage customers to
buy other brands rather than Amul.
Many brands provide offers like buy 10 get 1 free to retailers in order to
increase their sale. This is a win-win situation to both to brands,
retailers and distributors.
Such offers are mainly used by brands which are new in the market and
want to penetrate in a settled market
e.g. Mother Dairy came up with the offer of ‘buy 10 get 1 free’ for dahi
packets.
In Milk Industry, milk fat plays a very important role for deciding the
quality and price of product. Milk with more fat is used in many products like ice
creams, kulfi, shrikhand, dahi, cream etc. Even consumers prefer milk with more
fat as it makes tea or coffee more creamy and tasty.
These brands increase their fat content in order to attract more customers.
e.g. Mother dairy Full cream milk contains fat of 7.2 % while Amul Full cream
consists of 6%
Chapter V
RESEARCH METHODOLOGY
Research type was descriptive. The research was done through retailers. I have collected the
primary data through questionnaire which was filled by retailers and customers. Questions were
both open and close ended. The secondary data was collected from various website from internet.
Primary Research
1. Survey Method – In this method information was gathered directly from individual
respondents, through personal interview or through through questionnaire.
2. Observational method – During market survey this method was used, where retailer’s
actions were observed.
In Quantitative research data was collected and analyse through questionnaire and in
qualitative research data was collected and analyse through personal interviews.
Secondary Research
Sampling Design
2. Sample Unit – Retailers and people who buy milk fresh products available in retail
outlets, supermarket etc
Chapter VI
DATA ANALYSIS AND INTERPRETATION
Survey Analysis from 7th May to 30th May
Q1. Do you stock Amul products?
a) Yes b) No
50
40
Yes
30 No
3-D Column 3
20
10
Interpretation:
From above data we can interpreat that 60 retailers have Amul stock. And 40 retailer are not.
Interpreation:
From above data we can interpreat that 55 retailers have sufficient stock and 45 retailers was not
sufficient stock.
40
35
Expiry date
30 products
25 Low margin
20
No replacement
15 for leakage
10 Low leakage
5
0
Interpretation:
From above data we can say that most of the retailers reason is Amul products have a low
margin that why they can’t purchase Amul stock.
Q.4. Which other brands do you stock?
a) Godavari b) Rajhans c)Thorat d) Dairy power
Brands No. of retailers
Godavari 30
Rajhans 40
Thorat 15
Dairy power 15
Total sample size 100
40
35
30
25 Godavari
Rajhans
20
Thorat
15 Dairy power
10
Interpretation:
From above data we can interpret that 40 retailers have rajhans stock, 30 retailers have Godavari
stock. And remaininng have thorat and dairy power.
35
30
25 Godavari
Rajhans
20
Thorat
15 Dairy power
10
Interpretation:
From above data most of the retailers are intrested to sell rajhans products. 25 retailers prefered
Godavari, 15 retailer prefered Thorat, and 20 retailers prefered dairy power.
Interpretation:
From above data we interpret that most of the consumer satisfied with Amul.
45
40
35
30
200ml
25 500ml
20 1lit
6lit
15
10
Interpretation:
From above representation we can say that most of the retailers prefered 500ml quantity
of packet. 35 retailers prefered 1 lit. packet. 15 retailer prefered 200ml quantity.
Q.9. Would you like to recomanded the brand to your social circle?
a) Always b) Sometimes c) Never d) Rarely
Answers No. of respondents
Always 40
Sometimes 30
Never 10
Rarely 20
Sample size 100
40
35
30
25 Always
Sometimes
20
Never
15 Rarely
10
Interpretation:
40 retailers say that they like to always recommended the brand to their social circle. 30
retailers say sometimes recommended the brand. 10 retailers saythey never recommended
the brand.
Option No. of respondents
Yes 70
Q.10. If No 30 preferred
brand is Sample size 100 not
available, will you
buy Amul?
a) Yes b) No
70
60
50
40 Yes
No
30
20
10
Interpretation:
70 retailers are interested to buy Amul if their preferred brand is not available. And 30
retailers say no.
Chapter VII
Findings
There are more than 35 competitors of Amul in Nashik
Distribution and margin of Amul is the main problem for retailers
Amul is the leading brand in butter
Rajhans is the leading brand followed by Amul and Thorat
Loose milk is the leader in Market
Most of the retailers are not satisfied with margin
Chapter VIII
Conclusions
The factors considered by the customers before purchasing Amul milk are Quality, freshness,
thickness and easy availability. People in Nasik market mostly stick with loose milk. But when it
comes to pouch milk they prefer Rajhans pouch milk which is easily available in Nasik.
Quality is the dominating aspects which influences consumer to purchase Amul product, but prompt
availability of other milk brands and aggressive promotional activities by others influences the
consumers towards them and also leads to increase sales.
Amul’s distribution network needs to improve. There are total 17 distributors of Amul in Nasik.
Amul has a good reputation and name because of existence in the market for so many years
especially through the name of “Amul Butter”.
It’s been great experience working with Amul and doing promotional activity for new products of
“Amul Pouch Dahi”. The market survey has helped a lot in understanding forward integration of
Amul to link directly with the customer. It has helped me in not only knowing the business potential
of Amul as a brand through its sales in parlours and outlets but also knowing Amul in leap and bound
like knowing it’s pattern of distribution, depth of the Amul products, margin associated with Amul
products, business structure of Amul.
Finally I would like to conclude that, majority of the customers are satisfied with the Amul milk of
its good quality.
Some customers are not satisfied due to lack of availibilty and retailers because of low margin and
distribution. Amul needs to provide schemes to retailers and increase their distribution in areas like
satpur.
Suggestion
DISCOUNT SCHEMES - Incentives & schemes should be given to the retailers and
some scrutiny should be follow to check the scheme get being communicated properly by
distributors or sales person.
DISTRIBUTION - Amul has a relatively good distribution network, but still company is
not able to fulfill the demand of outlet in areas like its competitors has their company
outlet. Here company should consider on the supply of product in the peak season
PENETRATION - Supply should be regular to all the outlets including those that lie in
the pocket roads and not just in the outlets which lie on the easily accessible routes.
TIMINING - Improve delivery schedule to provide products on time for the retailers
about who claimed that Amul milk is not available to them on time.
Limitations
Some outlets did not co-operate with us as they though; it is just wastage of time
Most of the retailers where busy working so they didn’t interacted.
The sample size taken was small, therefore it can be said that the chosen sample is not the
representative of the whole population.
The sample size of taken of customers was 65 which was less to predict anything.
India ranks first in milk production, accounting for 18.5 % of world production, achieving an
annual output of 146.3 million tons during 2014-15 as compared to 137.69 million tons during
2013-14 recording a growth of 6.26 %. Whereas, the Food and Agriculture Organization (FAO)
has reported a 3.1 % increase in world milk production from 765 million tons in 2013 to 789
Million tons in 2014
The Leading Dairy Product Companies in India, which are under the control of different state
governments, are generally cooperatives.
Most of the Leading Dairy Product Companies in India are well equipped to handle processing
of bulk quantities of cow and buffalo milk. Further, the technology used by these leading
companies of India to process the milk is at at par with international standards
To sustain its leadership in the branded dairy sector in India, Gujarat Co-operative Milk
Marketing Federation (GCMMF), which sells Amul dairy products, is expanding its distribution
and processing capacity therefore this study include improvement in existing retail network of
Amul product, retailers expectation , competitors analysis, to increase sale of milk and Amul
Masti Pouch Dahi.
To understand number of competitors in the market, a survey was conducted. Every day
one beat was targeted and minimum 25 outlets. And to follow or collect data from loose milk
suppliers the market was started at 6.30 am daily. This survey includes data collected from 739
retailers, in which it was found that Godavari,Thorat, Rajhans and Loose milk were the major
competitors for Amul. In loose milk Khatif dairy was dominant in Nashik. There were few
brands which were dominant in particular area. Brand like Atul was more popular in area like
cidco and Indira nagar. It was the most preferred brand in that areas. Atul was the only brand
which was sold in pouch as well as loose.
An exploratory survey was conducted for each retailer and customer, drawing a basic
questionnaire. This helps in understanding the retailers’ expectation from company and various
factors affecting the buying decision of Amul milk and Pouch Dahi. Through this it was found
that Godavari was the leading brand in Milk.
After research, sales activity was done for business development. For this activity a strategy was
made, to target new customers, for ex. if it’s a tea vendor or hotels or loose milk suppliers.
To enhance business I met tea vendors, retailers, loose milk suppliers as well as hotel managers
Same steps were followed for this activity also, every day one beat. Most of the hotels were
using loose milk and due to good relation with their vendors they were avoiding our offers.
Most of the tea vendors were interested in using Amul as they were getting it at cheaper rate.
Raw milk supplier were targeted because most of them where having shortage of milk so
they can use amul milk.
During All this activity it was found that one area (satpur) was not having any distributor. So the
next task was to hunt for new distributor in that area. For which competitor’s distributor were
targeted. One by one we met all the distributors in that area. In which two of the distributors
were interested in being a part of Amul.
The factors considered by the customers before purchasing Amul milk are Quality, freshness,
thickness and easy availability.
People in Nasik market mostly stick with loose milk. But when it comes to pouch milk they
prefer Godavari pouch milk which is easily available in Nasik.
Quality is the dominating aspects which influences consumer to purchase Amul product, but
prompt availability of other milk brands and aggressive promotional activities by others
influences the consumers towards them and also leads to increase sales.
Amuls Distribution needs to improve. There are total 17 distributors of Amul in Nasik.
Amul has a good reputation and name because of existence in the market for so many years
especially through the name of “Amul Butter”.
It’s been great experience working with Amul and doing promotional activity for new products
of “Amul Pouch Dahi”. The market survey has helped a lot in understanding forward integration
of Amul to link directly with the customer. It has helped me in not only knowing the business
potential of Amul as a brand through its sales in parlours and outlets but also knowing Amul in
leap and bound like knowing it’s pattern of distribution, depth of the Amul products, margin
associated with Amul products, business structure of Amul.
Finally I would like to conclude that, few Retailers are not satisfied due to lack of availibilty of
Amul products, low margin and distribution. Amul needs to provide schemes to retailers and
increase their distribution in areas like satpur.
ANNEXURES
A. DSR of Amul
Amul Cooperative
DAILY MARKET WORKING REPORT
NAME OF THE STUDENT Prakash Gulve DATE 06/06/2016 TIME FC 6.45am
LOCATION Nashik Road TIME LC 10:00 AM
Market Worked MDC/DC Area Jail Road Bytco point TC 25
PC 8
Name of outlets Address Brands Rate/ltr Rate/ltr Quantity lts Margin Contact Person Contact no ORDER PLACED QTY
Cow Buffalo
Bhawani Sweets Jail Road Loose Milk 36 44 100 to 120 Laxman Sign 9021815965 DAHI 200grm 5Pouch
Dahi 100/kg 15 to 16
Paneer 320/kg
Sai Tea Stall Jail Road Loose Milk 55 5 to 6 Lal Singh GOLD 6Ltr 1 Bag
Omkar Kirana Jail Road Godavari 36 10 to 12 2 Vasant Jagtap 7083283608
Sanjivani Dahi(200) 20 5 to 6 5
Prabhat Dahi (200) 20 5
Shinde Kirana Jail Road Godavari 40 15 2.5 Anil Shinde 8055303787 DAHI 200grm 5pouch
Rajhans dahi (200) 20 4
Kadam Dairy Kanaiya Dahi (200) 20 5
Kavde Kirana Jail Road Amul 40 48 20 1 Kadve 9272790447 DAHI 200grm 10Pouch
Godavari 36 20 2.5
Shailar milk farm Jail Road Godavari 36 18 2 Suresh 8149480627
Godavari(dahi) 20 12 32
MH 15 Hotel Jail Road Loose Milk 38 5 Vinod Borade 9028187621
Dahi 100/kg
Rajmilen Sweets Jail Road Amul 38 48 5 to 7 1 Babu Bhai 9175028973 Dahi 5kg 1pack
Godavari 35 15 to 20 2.5
Dahi, Paneer Home made
Shri Mauli Prasad Kirana Jail Road Godavari 37 20 2 DB Jagtap 8793523209
Dahi 20 5 to 6
Chandan Hotel Jail Road Godavari 35 7.5 2 Satish 9960328583
Ashok Kure Jail Road Loose Milk 40 50 10 kure 950359835 Gold 6ltr 1bag
Samartha wadewale Bytco point Gold 6ltr 1bag
Shree sai shradha snacks Jail Road Gorace 20 3 Gupta 7745861287 Gold 6ltr 1bag
Santosh tea stall Bytco point Dairypower 20 9 Santosh Taja 6ltr 1bag
3) If No, why?
a) Expiry date products
b) Low margin
c) No replacement for leakage
d) Low distribution
a) 0.5 lit
b) 1lit
c) 1.5lit
d) 2lit
e) 2.5 and above
a) Yes
b) No
Bibliography