Analysis of applied strategy, internal

analysis and external analysis of AMUL

 Presented by:
Name ID
Fahad Islam Shad 2016010000186
Shifat Ara Alam 2015110000180
Ummus Shohada 2015110000171
Syeda Aysha Siddiqua 2015110000174
Sifat E Monzur 2015010000121
 Introduction of AMUL
• Amul is an Indian dairy cooperative, based at Anand in the state of Gujarat,
India. The word amul (अमूल) is derived from the Sanskrit word amulya (अमूल्य),
meaning priceless. The co-operative was initially referred to as Anand Milk
Federation Union Limited hence the name AMUL.
• Formed in 1946, it is a brand managed by a cooperative body, the Gujarat Co-
operative Milk Marketing Federation Ltd. (GCMMF), which today is jointly
owned by 3 million milk producers in Gujarat.
AMUL’s business model
 Growth rate of amul of AMUL
The Amul federation has been
achieving a compound annual growth
rate of more than 18% for the past
eight years.
 An overview of AMUL
Number of Producer Members 6,94,271

Number of Village Dairy Cooperative Societies 1713

Total Milk Handling Capacity 5 Million liters per day

Milk Collection (Daily Average) 2.5 Million liters

Milk Drying Capacity 150 Mts per day

Whey Drying Capacity 60 Mts per day

Cattle Feed Manufacturing Capacity 2500 Mts per day

 Strategy Analysis
Low-Cost Strategy justification:
1. Introduction of economic variants of
chocolates were prized ₹1, 3 and 5.
2. Amul produces dahi on a mass production
scale, hence, it is able to provide better prices.
3. AMUL Masti Buttermilk – Spice offered only for
₹12 (200ml pack).
4. AMUL Pure Ghee- 1 litter only at ₹450.
Focus Strategy justification:
1. Amul concentrated on niche segments such as
health chocolates.
2. Amul Spray Baby Milk Tin 500 gm.
3. Amul to make paneer, ghee at NRI's dairy plant
near New Jersey.
Best-Cost Strategy justification:
1. Amul ensures several quality checks before the
product reaches the consumer.
2. Comparatively Amul provides best quality
products to their consumers.
 Internal Analysis
Tangible Resources: Intangible Resource: Capabilities:

Labor Brand name Research and Development

Land Good will Product Development
Location Licenses Marketing and Sales
Equipment’s Trademarks Customer Management
Machineries Copyrights Human Resource
Factory Customer Lists Management
Furniture’s Customer relationships Supply Chain Management
Vehicles Financial and Accounting
Management
Inventory
External Analysis
Threats of new Entrants

• Economies of Scale
• Cost and Resources advantages
• Brand preferences and consumer loyalty
• Inability to much the technology and
specialized know
Bargaining power of supplier

• There is appropriate bargaining power of

the supplier
• Cost of switching to competitor brands
• Large no. of buyers
Bargaining power of buyers

• Cost of switching to competitor brands

• Large no. of buyers
Rivalry among competitors

• Demand for the product

• Nature of competitors
• Mergers and acquisition
Threats of Substitute

• Availability of attractive priced

substitutes
• Satisfaction level of substitutes
• Not immediate substitutes
PESTEL Analysis of Amul
Political Factors:
The ground of the Amul is on politics. At the beginning Polson (the sole trader) acted unethical
practice of purchasing the milk from the farmers in cheaper rate. Then with the help of political
strength the co-operative society is being established.

Economical Factors:
The year when Amul Co-operative society was formed, India was on growing stage. From that
point of time, Amul foothold the way of economic development for India. Since then it
contributes a major portion of the national income and GDP
Social Factors:
The social factors influence most for any organization situated in India. India combines of
different types of cultures and languages so the concurrent effect is different types of lifestyle
and food habits.

Technological Factors:
India is a developing country and developing in every sector. The aggressive development takes
place in technology of India. Amul uses this resource to improve the distribution channel, supply
management, enables e-commerce, automation process and value addition.
Environmental Factors:
The product is not made out of any unnatural composition. The base of every product of Amul is
milk, which is not at all harmful for the environment. So there are no threats for the co-
operative society in respect of environmental factors.

Legal Factors:
The legal factors which work as opportunity for Amul are PFA act, Trademarks, Industrial
Development & Regulation Act. There are threats also like Child Labor (ILO).
SWOT Analysis
Strengths

• Demand Profile
• Margins
• Flexibility of product mix
• Availability of raw material
• Technical Manpower
• Transportation
• Vast Resources
Weaknesses

• Lack of control over yield

• Logistics of procurement
• Erratic power supply
• Underdeveloped systems
• Lack of proper implementation
• Infrastructure
Opportunities

• Competition
• Export Potential
• Markets
• IT Support
Threats

• Milk vendors, the unorganized sector

• Infestation
• Quality
• Exploitation
• Subsidy by Western Nations
 Conclusion
• Amul has risen from Indian soil and it remains Indian in every sense.
• There is ample scope in the low priced segment as also in other categories.
• There are a significant number of retailers who are currently stocking more
than two brands.
• Amul has the opportunity to capture the more evolved young adults and
children who are open to new products provided they meet their expectations.