Professional Documents
Culture Documents
Amul
Amul
CONTENTS
CHAPTE T Page
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1 GENERAL INFORMATION
1.1 INTRODUCTION AND HISTORY 9
Consumer Satisfaction 50
3 Marketing Research 51
4 Research Methodology 56
5 Data Analysis And Interpretation 61
6 SWOT Analysis 71
7 News Articles 73
8 GCMMF Overview: 79
PREFACE
Today the business environment is rapidly changing in this competitive
environment the popular trend is also striving for maintaining its positions therefore
it become essential for the companies that they should know about their preference
& taste. Regarding a particular product it is of almost necessary to know the
consumers satisfaction to the value offered by the company in case of
dissatisfactory result it is essential to ascertain whether the dissatisfaction is for
entire product or part of it is and what value do the consumers expect from it?
The research will provide the relevant information to the organization about
consumer’s attitude towards their products & services.
The research work is sincere effort to find out the ultimate requirement of
consumers for the betterment of research as well as the organization.
Executive Summary
This final project was undertaken with the objective of “CONSUMER BUYING
PATTERN TOWARS AMUL MILK”
In the year 1946 the first milk union was established. This union was started with
250 liters of milk per day. In the year 1955 AMUL was established. In the year
1946 the union was known as KAIRA DISTRICT CO-OPERATIVE MILK
PRODUCERS’ UNION. This union selected the brand name AMUL in 1955.
The brand name Amul means “AMULYA”. This word derived form 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, Amulspray, 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”).
INTRODUCTION AND HISTORY
In the year 1946 the first milk union was established. This union was started with
250 liters of milk per day. In the year 1955 AMUL was established. In the year
1946 the union was known as KAIRA DISTRICT CO-OPERATIVE MILK
PRODUCERS’ UNION. This union selected the brand name AMUL in 1955.
The brand name Amul means “AMULYA”. This word derived form 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, Amulspray, 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”).
In the early 40’s, the main sources of earning for the farmers of Kaira
district was farming and selling of milk. That time there was high demand for milk
in Bombay. The main supplier of the milk was Polson dairy limited, which was a
privately owned company and held monopoly over the supply of milk at Bombay
from the Kaira district. This system leads to exploitation of poor and illiterates’
farmers by the private traders. The traders used to beside the prices of milk and the
farmers were forced to accept it without uttering a single word.
However, when the exploitation became intolerable, the farmers were
frustrated. They collectively appealed to Sardar Vallabhbhai Patel, who was a
leading activist in the freedom movement. Sardar Patel advised the farmers to sell
the milk on their own by establishing a co-operative union, Instead of supplying
milk to private traders. Sardar Patel sent the farmers to Shri Morarji Desai in order
to gain his co-operation and help. Shri Desai held a meeting at Samarkha village
near Anand, on 4th January 1946. He advised the farmers to form a society for
collection of the milk.
These village societies would collect the milk themselves and would decide
the prices at which they can sell the milk. The district union was also form to
collect the milk from such village co-operative societies and to sell them. It was
also resolved that the Government should be asked to buy milk from the union.
However, the govt. did not seem to help farmers by any means. It gave
the negative response by turning down the demand for the milk. To respond to this
action of govt., the farmers of Kaira district went on a milk strike. For 15 whole
days not a single drop of milk was sold to the traders. As a result the Bombay milk
scheme was severely affected. The milk commissioner of Bombay then visited
Anand to assess the situation. Having seemed the condition, he decided to fulfill the
farmers demand.
Thus their cooperative unions were forced at the village and district level to
collect and sell milk on a cooperative basis, without the intervention of
Government. Mr. Verghese Kurien showed main interest in establishing union
who was supported by Shri Tribhuvandas Patel who lead the farmers in forming
the Co-operative unions at the village level. The Kaira district milk producers union
was thus established in ANAND and was registered formally on 14th December
1946. Since farmers sold all the milk in Anand through a co-operative union, it was
commonly resolved to sell the milk under the brand name AMUL.
At the initial stage only 250 litres of milk was collected everyday. But
with the growing awareness of the benefits of the cooperativeness, the collection of
milk increased. Today Amul collect 11 lakhs litres of milk everyday. Since milk was
a perishable commodity it becomes difficult to preserve milk flora longer period.
Besides when the milk was to be collected from the far places, there was a fear of
spoiling of milk. To overcome this problem the union thought out to develop the
chilling unit at various junctions, which would collect the milk and could chill it, so
as to preserve it for a longer period. Thus, today Amul has more than 150 chilling
centres in various villages. Milk is collected from almost 1073 societies.
With the financial help from UNICEF, assistance from the govt. of New
Zealand under the Colombo plan, of Rs. 50 millions for factory to manufacture milk
powder and butter was planned. Dr.Rajendra Prasad, the president of India laid
the foundation on November 15, 1954. Shri Pandit Jawaharlal Nehru, the prime
minister of India declared it open at Amul dairy on November 20, 1955.
ACHIEVEMENTS:
Amul : Asia’s largest dairy co-operative was created way back in1946 to
make the milk producer self-reliant and conduct milk- business with pride. Amul
has always been the trend setter in bringing and adapting the most modern
technology to door steps to rural farmers.
Amul created history in following areas:
1988: “Best Productivity” awarded for the second successive year 1986-
87 by the president of India, Mr. R. Venkatrao to kaira union.
Moreover the Amul union has achieved the prestigious ISO 9001-2000 and
HACCP Certificate and effects are got to obtain ISO 14000.
Amul in abroad:
Amul is going places. Literally. After having established its presence in China,
Mauritius and Hong Kong, Gujarat Cooperative Milk Marketing Federation
Looking back on the path traversed by Amul, the following features make it a
pattern and model for emulation elsewhere.
The Union looks after policy formulation, processing and marketing of milk,
provision of technical inputs to enhance milk yield of animals, the artificial
insemination service, veterinary care, better feeds and the like - all through the
village societies. Basically the union and cooperation of people brought Amul into
fame i.e. AMUL (ANAND MILK UNION LIMITED), a name which suggest
THE TASTE OF INDIA.
Plants:
First plant is at ANAND, which engaged in the manufacturing of milk,
butter, ghee, milk powder, flavoured milk and buttermilk.
Second plant is at MOGAR, which engaged in manufacturing chocolate,
nutramul, Amul Ganthia and Amul lite.
Today, twelve dairies are producing different products under the brand name
Amul. Today Amul dairy is no. 1 dairy in Asia and no. 2 in the world, which is
matter of proud for Gujarat and whole India.
PRODUCT PROFILE:-
Major changes are not expected in dairy products basket. World butter
production increased for two years, in 2004 and 2005 and then
declined in 2006-07. It is expected to decline again in
2007-08. Industrial cheese production is continuing to grow. The major
cheese producing regions are Europe and North America and both areas
are expected to have a faster growth rate.
The production of condensed and evaporated milks is subject to a
declining trend for many years in the developed market. It has been
replaced by many other dairy products, especially liquid milks of UHT
type, coffee cream and coffee whitener including some of the non-dairy
origin.
Export of butter and butter-oil recovered in 2006-07 and this recovery continued
in early2007-08.
The total volume of the world trade in cheese has accelerated and this trend is
likely to continue in the year 2008.
The outlook for the trade in dairy commodities for 2007-08 appears
bright. However, since the new market equilibrium, in respect of
prices has to be found, the question is whether international trade
in dairy products will continue its growth in 2007-08 at the same
momentum as in previous years. Because of the price situation in 2007-
08, one may ask whether demand can follow the expected trends, but it
would be premature to expect stagnation in the trade. In established
markets, the potential for demand to reduce slightly can release the
additional supplies, which are needed to maintain the growth of trade.
IndianDairyIndustry—
A Profile:
The urban market for milk products is expected to grow at an accelerated pace of
around33% per annum to around Rs.83, 500 crores by year 2010.
Abstract
Introduction
Since the turn of 19th century, Cooperatives have existed as dominant forms
of organization in the dairy industry around the world. Sometimes they have played
the role of developing infant industry while at other times they have been used to
strengthen weak production bases in an environment where market failures tend to
be higher for marginal producers. In some other cases, a network of small producers
have organized themselves to better market their products. Management of these
cooperatives have also led to some interesting managerial insights for managers in
emerging as well as developed economies.
Large emerging economies, e.g., India and China, have complexities that
range from development of markets (where the largest segment of population is the
one which has low purchasing power) to integration of low cost suppliers who are
predominantly very small. For firms that aspire to conduct substantial business in
such markets, such complexities have to be recognized and then overcome. The
challenge is to understand the linkages between markets and the society. This would
also require development of a new business model that helps a firm grow in such
environments. This paper is about one such successful model. The Kaira District
Milk Cooperative Union or AMUL in India is an example of how to develop a
network of firms in order to overcome the complexities of a large yet fragmented
market like those in emerging economies by creating value for suppliers as well as
the customers. AMUL has led the milk dairy revolution in India that has now
emerged as one of the largest milk producers in the world.
In this article we will describe the breakthrough vision that led to the
simultaneous development of the market and supply side through a process of
social development and education at AMUL. Clearly, implementation of this vision
in a competitive environment and maintaining sustained growth and profitability
requires development of competitiveness on several dimensions and operational
effectiveness. This article provides insights into management of very large supply
chains by adapting and integrating a variety of strategies and techniques. This
includes building networks, developing trust & values in the network, developing
fair mechanisms for sharing benefits across the supply chain, coordination for
operational effectiveness, innovation and new technology for gaining
competitiveness. It is noteworthy that these successes were achieved within the
framework of a network of cooperatives organized in a hierarchical manner. There
are many lessons in AMUL’s success not only for the cooperative sector but also
for firms who intend to do business in emerging markets.
In the remaining part of the paper, we first review the role that cooperatives have
played in the development of dairy industry globally and how is this sector
adjusting to new global challenges. Next, we look at AMUL within this context and
highlight their journey towards excellence. Specifically, we study how AMUL
achieved this exalted status, what were the ingredients of its success, how did the
belief in cooperation transform the business environment and the lives of people,
and what lessons does it hold for other businesses.
While Kaira Union (or AMUL) had the support of national leaders who were at the
forefront of the Indian independence movement, its local leaders were trained in
Gandhian simplicity17 and had their feet rooted firmly amongst people whom they
had mobilized – the poor farmers of Anand. The foremost amongst them was
Tribhuvandas Patel18 who had led the movement for the formation of cooperatives
of small and marginal farmers in order to compete against investor owned
enterprises on one hand, and keep bureaucracy away on the other hand.
Tribhuvandas was the first Chairman of the cooperative. His skills lay in organizing
the village producers, in making them believe in the power of cooperation and their
rights towards improvement of human condition. He is remembered as fair and
honest person whose highest sense of accountability to the members of the union
laid the foundation of trust between network members 19. Another important aspect
of his remarkable management style was his gentleness and ability to repose trust in
people – he gave complete autonomy to managers of the union and earned complete
commitment from them20. Verghese Kurien21 was one such manager who would,
first, shape the destiny of the Union and then the milk movement throughout the
country.
Kurien emerged as the father of the dairy movement in India. He managed to keep
the government and bureaucrats away from the cooperative22 and gave shape to the
modern structure of the cooperative, worked tirelessly to establish the values of
modern economics, technology and concern for farmers within the cooperative. He
interfaced with global financing agencies to build new projects at AMUL. He
worked with the Unions to bring the best of technology to the plants. He worked
with marginal village farmers to create systems that would increase milk yields. He
understood that without meeting the needs of customers he would not be able to
satisfy his obligations to the farmers. In short, Kurien shaped the destiny of the milk
movement in India through NDDB (as its Chairman) and particularly at GCMMF
and cooperatives in Gujarat. He helped build a modern organization with
professional management systems that would support the aspirations of farmers and
customers.
Several young people left better paying jobs to help create a dream of making
India the milk capital of the world. Kurien had learnt the persuasive charm of
Tribhuvandas through plain speaking and had soon created a cadre of highly
capable managers to whom he had delegated both management as well as
commitment. These leaders were created at the village, district and state levels in
different organizations of the network.
Strategy
AMUL’s business strategy is driven by its twin objectives of (i) long-term,
sustainable growth to its member farmers, and (ii) value proposition to a large
customer base by providing milk and other dairy products a low price. Its strategy,
which evolved over time, comprises of elements described below.
Simultaneous Development of Suppliers and Customers: From the very early stages
of the formation of AMUL, the cooperative realized that sustained growth for the
long-term was contingent on matching supply and demand. Further, given the
primitive state of the market and the suppliers of milk, their development in a
synchronous manner was critical for the continued growth of the industry. The
organization also recognized that in view of the poor infrastructure in India, such
development could not be left to market forces and proactive interventions were
required. Accordingly, AMUL and GCMMF adopted a number of strategies to
assure such growth. For example, at the time AMUL was formed, the vast majority
of consumers had limited purchasing power and was value conscious with very low
levels of consumption of milk and other dairy products. Thus, AMUL adopted a low
price strategy to make their products affordable and guarantee value to the
consumer. The success of this strategy is well recognized and remains the main
plank of AMUL's strategy even today. The choice of product mix and the sequence
in which AMUL introduced its products is consistent with this philosophy.
Beginning with liquid milk, the product mix was enhanced slowly by progressive
addition of higher value products while maintaining desired growth in existing
products. Even today, while competing in the market for high value dairy products,
GCMMF ensures that adequate supplies of low value products are maintained.
On the supply side, as mentioned earlier, the member-suppliers were typically small
and marginal- farmers had severe liquidity problems, were illiterate and had no
prior training in dairy farming. AMUL and other cooperative Unions adopted a
number of strategies to develop the supply of milk and assure steady growth. First,
for the short term, the procurement prices were set so as to provide fair and
reasonable return. Second, aware of the liquidity problems, cash payments for milk
supply was made with minimum of delay. For the long-term, the Unions
followed a multi-pronged
strategy of education and support. For example, only part of the surplus generated
by the Unions is paid to the members in the form of dividends. A substantial part of
this surplus is used for activities that promote growth of milk supply and improve
yields. These include provision of veterinary services, support for cold storage
facilities at the village societies etc. In parallel, the Unions have put in place a
number of initiatives to help educate the members.
across issues – a process that has long-term benefits for any organization.
SAMPLING
3. Sample size : 50
The analysis and interpretation of the data involves the analyzing of the
collected data and interpretation it with pictorial representation such as bar charts,
pie charts and others.
NO. %
RESPONSE OF RESPONDED OF responded
YES 32 64
NO 18 36
What do you like?
a) Quality b) Taste
c) Price d) Availability
b)Loose milk in 20 40
litre……
What is your monthly expenditure in milk (in Rs.)?
a)) 500-1000
b) 1000-1500
c) 1500 and above
RESPONSE NO. %
OF RESPONDED OF CONSUMERS
500-1000 25 50
1000-1500 15 30
1500 and above 10 20
In pouch milk which brand do you prefer?
a)AMUL
b) MOTHER DAIRY
c) GOKUL
d) MAHANANDA
e) WARANA
f) OTHERS
RESPONSE NO. %
OF RESPONDED OF CONSUMERS
amul 15 30
Mother dairy 10 20
mahananda 10 20
Gokul 5 10
Warana 5 10
others 5 10
Do you think the price of the product is high/low compared to competitors product?
a) Strongly agree
b) Strongly disagree
c) Agree
d) Neither
RESPONSE NO. %
OF RESPONDED OF CONSUMERS
15 30
Strongly agree
Strongly disagree 10 20
Agree 15 30
Neither 10 20
If you buy AMUL milk pouch which pack you purchase?
a) AMUL Gold
b) AMUL Taaza
c) AMUL Slim & Trim
RESPONSE NO. %
OF RESPONDED OF CONSUMERS
AMUL Gold 25 50
AMUL Taaza 15 30
AMUL Slim & Trim 10 20
CONSUMER’S OPINION TOWARDS PRODUCT
The company is having Indian origin thus creating feeling of oneness in the mind of
the customers.
It manufactures only milk and milk products, which is purely vegetarian thus
providing quality confidence in the minds of the customers
It is aiming at rural segment, which covers a large area of loyal customers, which
other companies had failed to do.
People are quite confident for the quality products provided by Amul.
Amul has its base in India with its butter and so can easily promote chocolates
without fearing of loses.
Weaknesses
There are various big players in the chocolate market, which acts as major
competitors restricting their growth.
Opportunities
There is a lot of potential for growth and development as huge population stay in
rural market where other companies are not targeting.
Threats
The major threat is from other companies who hold the majority share of consumers
in Indian market i.e. Cadburys and Nestle.
There exists no brand loyalty in the chocolate market and consumers frequently
shift their brands.
New companies’ entering in Indian market like Fantasie fine poses lot problems for
Amul.
News articles
located at Anand in Gujarat to serve his bond period. By the end of 1949, Kurien
got release orders from his job at the creamery. Kurien joined Kaira District
Tribhuvandas Patel, the then dairy chairman. The dairy was formed at the
initiative of Sardar Vallabhabhai Patel. Later, Patel asked Kurien to help set up a
dairy processing plant, which saw the birth of Amul. Amul's co-operative model
became a success and it was replicated throughout Gujarat. The different dairy
unions were later brought under the banner of Gujarat Co-operative Milk
from 1973 to 2006, and Institute of Rural Management (IRMA) from 1979 to
2006. Kurien's tenure at Anand changed the destiny of Indian dairy industry. He
began helping the fledgling dairy co-operative. The first dairy co-operative
union in Gujarat was formed in 1946 with two village dairy co-operative
societies as its members. The number of member societies has now increased to
16,100, with 3.2 million members pouring milk. Kurien is also credited with
being the first one to produce powder from buffalo milk, when elsewhere in the
world, cow milk was used to produce milk powder. Impressed by the success of
Amul, then Prime Minister Lal Bahadur Shastri established the National Dairy
Development Board (NDDB) to replicate the Amul model across the country
and Kurien was made its chairman. NDDB launched 'Operation Flood' in 1970,
making India the largest milk producer in the world. He served as chairman of
NDDB for 33 years from 1965 to 1998. The Board ensured replication of Amul
20 million metric tonnes (MMT) per year in the 60s to 122 MMT in 2011. Dr
Interestingly, the 'milkman' of India did not consume milk himself. He used to
NEW DELHI: Read between the lines, however, Ms Patel's proposal entails
marketing of the milk products sourced from NDDB under the Mother Dairy brand
across the country, instead of the present arrangement where different state
federations market them under their own respective brands, for example, Verka in
Punjab and Milma in Kerala. Not only would this put Mother Dairy in direct
competition against Amul, but it would also cannibalise the state brands under
which milk is currently marketed.
The Amul Vs Mother Dairy competition is already being felt in Delhi. Amul has
launched its ice-cream here, while Mother Dairy has hit back by launching its
butter. Besides, Mother Dairy is now no longer buying the nearly 1 lakh litres of
milk from GCMMF, nor are its outlets here selling Amul products. So ugly has the
competition become that even the senior bosses at Amul and NDDB have been
washing their dirty linen in public.
Bring at the command of the rural milk producers the best of the technology
and harness its fruit for betterment.
Amul (Anand milk union ltd.) is based on four hands, which are
coordinated with each other. The actual meaning of this symbol is co-
ordination of four hands of different people by whom this
union is at the top position in Asia.
First hand is of farmers, without whom the organization would not have
existed.
Second hand is of processors, who process the row material (milk) into
finished goods.
Third hand is of marketer, without whom the product would have not reached
the customers.
Fourth hand is of customers, without whom the products would have not
carried on.
The Three Tier Amul Model
The Amul Model is a three-tier cooperative structure. This structure consists
of a Dairy Cooperative Society at the village level affiliated to a Milk Union at the
District level which in turn is further federated into a Milk Federation at the State
level. The above three-tier structure was set-up in order to delegate the various
functions, milk collection is done at the Village Dairy Society, Milk Procurement &
Processing at the District Milk Union and Milk & Milk Products Marketing at the
State Milk Federation.
This helps in eliminating not only internal competition but also ensuring that
economies of scale is achieved. As the above structure was first evolved at Amul in
Gujarat and thereafter replicated all over the country under the Operation Flood
Programme, it is known as the ‘Amul Model’ or ‘Anand Pattern’ of Dairy
Cooperatives.
Responsible for Marketing of Milk & Milk Products Responsible for Procurement
& Processing of Milk Responsible for Collection of Milk Responsible for Milk
Production.
Collection of surplus milk from the milk producers of the village &
payment based on quality & quantity
Providing support services to the members like Veterinary First Aid,
Artificial Insemination services, cattle-feed sales, mineral mixture sales, fodder
& fodder seed sales, conducting training on Animal Husbandry & Dairying,
etc.
Selling liquid milk for local consumers of the village
Thus, the VDCS in an independent entity managed locally by the milk producers
and assisted by the District Milk Union.
The Village Societies of a District (ranging from 75 to 1653 per Milk Union in
Gujarat) having surplus milk after local sales come together and form a District
Milk Union. The Milk Union is the second tier under the three-tier structure. It has
membership of Village Dairy Societies of the District and is governed by a Board
of Directors consisting of 9 to 18 elected representatives of the Village Societies.
The Milk Union further appoints a professional Managing Director (paid employee
and member secretary of the Board) for management of the day-to-day functions. It
also employs various people for assisting the Managing Director in accomplishing
his / her daily duties. The main functions of the Milk Union are as follows:
Establish Chilling Centres & Dairy Plants for processing the milk
received from the villages.
Process milk into various milk & milk products as per the requirement
of State Marketing Federation.
Decide on the prices of milk to be paid to milk producers as well on the prices
of support services provided to members.
State Cooperative Milk Federation (Federation)
The Milk Unions of a State are federated into a State Cooperative Milk Federation.
The Federation is the apex tier under the three-tier structure. It has membership of
all the cooperative Milk Unions of the State and is governed by a Board of Directors
consisting of one elected representative of each Milk Union. The State Federation
further appoints a Managing Director (paid employee and member secretary of the
Board) for management of the day-to-day functions. It also employs various people
for assisting the Managing Director in accomplishing his daily duties. The main
functions of the Federation are as follows:
Arranging transportation of milk & milk products from the Milk Unions to
the market.
Creating & maintaining a brand for marketing of milk & milk products
(brand building).
Pooling surplus milk from the Milk Unions and supplying it to deficit
Milk Unions.
Establish feeder-balancing Dairy Plants for processing the surplus milk of the
Milk Unions.
Decide on the prices of milk & milk products to be paid to Milk Unions.
We move to the year 2008. The dairy industry in India and particularly in the State
of Gujarat looks very different. India for one has emerged as the largest milk
producing country in the World. Gujarat has emerged as the most successful State in
terms of milk and milk product production through its cooperative dairy movement.
The Kaira District Cooperative Milk Producers’ Union Limited, Anand has become
the focal point of dairy development in the entire region and AMUL has emerged as
one of the most recognized brands in India, ahead of many international brands.
Today, we have around 176 cooperative dairy Unions formed by 1,25,000 dairy
cooperative societies having a total membership of around 13 million farmers on the
same pattern, who are processing and marketing milk and milk products profitably,
be it Amul in Gujarat or Verka in Punjab, Vijaya in Andhra Pradesh or a Nandini in
Karnataka. This entire process has created more than 190 dairy processing plants
spread all over India with large investments by these farmers’ institutions. These
cooperatives today collect approximately 23 million kgs. of milk per day and pay an
aggregate amount of more than Rs.125 billion to the milk producers in a year.
The effects of Operation Flood Programme are more appraised by the World Bank
in its recent evaluation report. It has been proved that an investment of Rs.
20 billion over 20 years under Operation Flood Programme in 70s & 80s has
contributed in increase of India’s milk production by 40 Million Metric Tonne
(MMT) i.e. from about 20 MMT in pre- Operation Flood period to more than
60 MMT at the end of Operation flood Programme. Thus, an incremental return of
Rs. 400 billion annually have been generated by an investment of Rs. 20 billion
over a period of 20 years. This has been the most beneficial project funded by the
World Bank anywhere in the World. One can continue to see the effect of these
efforts as India’s milk production continues to increase and now stands at 90 MMT.
Despite this fourfold increase in milk production, there has not been drop in the
prices of milk during the period and has continued to grow.
Due to this movement, the country’s milk production tripled between the years 1971
to 1996. Similarly, the per capita milk consumption doubled from 111 gms per day
in 1973 to 222 gms per day in 2000. Thus, these cooperatives have not just been
instrumental in economic development of the rural society of India but it also has
provided vital ingredient for improving health & nutritional requirement of the
Indian society. Very few industries of India have such parallels of development
encompassing such a large population.
These dairy cooperatives have been responsible in uplifting the social & economic
status of the women folk in particular as women are basically involved in dairying
while the men are busy with their agriculture. This has also provided a definite
source of income to the women leading to their economic emancipation.
The three-tier ‘Amul Model’ has been instrumental in bringing about the White
Revolution in the country. As per the assessment report of the World Bank on the
Impact of Dairy Development in India, the ‘Anand Pattern’ has demonstrated the
following benefits:
The Govt. of India has honoured Amul with the “Best of all categories Rajiv
Gandhi National Quality Award”.
GCMMF (AMUL) has the largest distribution network for any FMCG company. It
has nearly 50 sales offices spread all over the country, more than 3,000 wholesale
dealers and more than 5,00,000 retailers.
AMUL is also the largest exporter of dairy products in the country. AMUL is
available today in over 40 countries of the world. AMUL is exporting a wide variety
of products which include Whole and Skimmed Milk Powder, Cottage Cheese
(Paneer), UHT Milk, Clarified Butter (Ghee) and Indigenous Sweets. The major
markets are USA, West Indies, and countries in Africa, the Gulf Region, and
[SAARC] SAARCneighbours, Singapore, The Philippines, Thailand, Japan and
China.
In September 2007, Amul emerged as the leading Indian brand according to a
survey by Synovate to find out Asia's top 1000 Brands.
PRODUCTS
Amul's product range includes milk powders, milk, butter, ghee, cheese, Masti
Dahi, Yoghurt, Buttermilk chocolate, ice cream, cream, shrikhand, paneer, gulab
jamuns, flavoured milk, 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 .
In August 2007, Amul introduced Kool Koko, a chocolate milk brand extending its
product offering in the milk products segment. Other Amul brands are Amul Kool, a
low calorie thirst quenching drink; Masti Butter Milk; Kool Cafe, ready to drink
coffee and India's first sports drink Stamina.
Amul's sugar-free Pro-Biotic Ice-cream won The International Dairy Federation
Marketing Award for 2007.
Mascot
Since 1967 Amul products' mascot has been the very recognisable "Amul baby" (a
chubby butter girl usually dressed in polka dotted dress) showing up on hoardings
and product wrappers with the equally recognisable tagline Utterly Butterly
Delicious Amul.The mascot was first used for Amul butter. But in recent years in a
second wave of ad campaign for Amul products, she has also been used for other
product like ghee and milk.
Advertising
An Amul butter ad on Pakistan's Kargil Warfiasco. The image shows the "Amul
baby" in between George Fernandes and Atal Behari Vajpayee.
In 1966, Amul hired Sylvester daCunha, then managing director of the advertising
agency AS to design a new ad campaign for Amul Butter. daCunha designed an add
campaign as series of hoardings with topical ads, relating to day-to-day issues. The
campaign was widely popular and earned aGuiness world record for the longest
running ad campaign in the world. Since the 1980s, cartoon artist Bharat
Dabholkar has been involved with sketching the Amul ads, who rejected the trend
of using celebrities in advertisement campaigns. Dabholkar credited chairman
Varghese Kurien with creating a free atmosphere that fostered the development of
the ads.
Despite encountering political pressure on several occasions, daCunha's agency has
made it a policy of not backing down. Some of the more controversial Amul ads
include one commenting on Naxalite uprising in West Bengal, on the Indian
Airlines employees strike, and the one depicting the Amul butter girl wearing
a Gandhi cap.
In popular Culture
Organization Structure:
Organization Structure is divided into two parts:
State Level
Marketing
Federation
District Milk
Product Union
Ltd.
Village Milk
Product Union
Ltd.
Production Function:
Distribution Network:
Advertising by Amul:
Amul has two agencies that look after its entire range of products namely
FCB Ulka and Da cuna
FCB Ulka looks after a broad range of products namely, Amul Lite
Breadspread, Amul Shrikhand, Amul Chocolates, Amul Paneer, Amul
SnowCap Softy Mix Ice cream, Amul/Sagar Ghee, Amul Infant Milk
Formula 1 & 2, Sagar Tea and Coffee whitener, Amul Spray Infant
Milk Food, Amul Mithaee, Amul Gulab Jamun, Amulya Dairy
Whitener, Mithaimate Sweetened Condensed Milk, Amul Ice cream,
Sagar Skimmed Milk Powder and Amul Whole milk Powder
Areas of Operation:
Besides India, AMUL has entered overseas markets such as
Mauritius, UAE, USA, Bangladesh, Australia, China, Singapore,
Hong Kong and a few South African nations. Otherpotential
markets being considered include Sri Lanka.
List of
Products
Marketed:-
Bread spreads
• Amul Butter
• Amul Lite Low Fat Breadspread
• Amul Cooking Butter
Cheese Range
Pure Ghee
Milk Powders
Curd Products
Brown Beverage
Milk Drink
Health Beverage
that is based on stringent quality certifications that would distinguish them from
other small producers and for usage of common property resources. The example of
AMUL provides a number of lessons for such organizations to compete successfully
in the face of increasing globalization and competition. More generally, the AMUL
case presents a successful model for operating in emerging economies characterized
by either large under-developed suppliers and/or markets with high potential. The
largest segment of the market in emerging economies desires value for money from
its purchases. Development of such markets requires careful nurturing and a long-
term approach. Initial success in these markets is typically based on a low price
strategy (providing value for money) supported by cost leadership. This strategy
helps to grow the market exponentially by focusing on the largest segment of the
population, the middle and the lower middle class. In this context, it is important for
global players to note that the value proposition perceived by consumers is
influenced to a large extent by the state of markets and the economy and cultural
factors. Development of an appropriate value proposition suitable for large mass
markets in India requires a thorough understanding of the environment and a focus
on costs. This in turn, requires designing the organization structure and practices in
a manner that it delivers continued market share through cost leadership. AMUL is
a good example of this strategy. Firms that are able to develop control processes
through better use of operational practices and supply chain coordination are the
ones that are able to serve large volumes and enjoy top line growth in revenues.
Firms that are able to overcome the hesitation of deploying IT for achieving
operational excellence in emerging economies gain considerably from its network
effect. Most firms either automate decision making to such an extent that it
eliminates local initiatives (as many SAP implementations in India are finding out
that it has added more rigidity in decision making as opposed to using it in
conjunction with a more flexible “telephone” mode of communicating) or use
manual systems that lead to inaccurate data based decision-making.
• Mother Dairy - Delhi was set up in 1974 under the Operation Flood
Programme.
• Mother Dairy sources its entire requirement of liquid milk from dairy
cooperatives.
Websites:
i. www.google.co.in
ii. www.wikipedia.com
iii. www.amul.com.
iv. www.marketresearch.com
v. www.dairy.com