Case Study

on
Pradesh Milk Federation

Presented by,

Vartika Shrivastava
Ankit Gindoria
Shashank pandey
Vinod Tripathi
Varun Shankhla
 Introduction
Pradesh milk Federation, a co-operative apex body of
5000 village level dairy co-operative societies
organized into 10 district level milk unions in the state
of Pradesh. It consist of a 3-tier structure. Milk is
transported in 40 lt. cans twice daily to the dairies.
 Positions
Mr. Mohan Kumar, Managing
Director(new)
Mr. Ethiraj Kasturi, Manager (Extentions)
Mr. Pradeep Kanga, Manager
(procurement)
Mr. Ashwin Prasad, Manager
(production)
Mr. Murlidhar Mathur, Manager
(sales & distribution)
Mr. Sailesh Suman, Manager
(Accounts)
 Problems (Increasing losses)
• Increasing costs of procurement
• Foreign competition
• Procurement system where the PMF has to
buy all the milk produced by the milkmen
• Dissatisfied customers demanding lower
prices
• Lack of storage facilities
 Extention Activity
• Providing education, training and other
services to farmers
• Appointing veterinary doctors
• Programs on feeding, hygiene
 Lapses in procurement activity
• Profit oriented farmers
• PMF has a very low share in the milk
processed in the state
• No differential pricing system
• Lack of schemes
• No centralized structure
• Low growth rate vis-à-vis increasing demand
 Drawbacks in Production
• Excess of reverse processing cost
• Shortfall in summer
• High Processing cost Rs. 9.50 + (0.005* 80)
+(0.01*70)
• Capacity of processing plants
 Sales & Distribution
• Limited market
• 40% market captured by other brands of
processed milk
• Inefficiency of local agents
• No refrigerators at the point of sale
• No motivation to the sellers with refrigerators
 Marketing
• Price sensitive market
• lack of delivery facilities
• Perception about PMF
• Failure of Aseptic packaging
• Back out o f retailers
 Solutions
• TFA packaging of milk should be stopped and
PMF should stick to the earlier packaging
method because milk is the product which is
consumed fresh so no reason for it pack in
such a way that it lasts for months. And it is
the reason for customer’s perception that milk
is not fresh. It will also help to cut the cost of
product(milk).
 Solutions
• They could diversify the product(milk) by
launching it into three qualities like premium,
normal and health plus. Where normal is
regular milk but premium milk would contain
more cream. And health plus will contain no
fat(cream would be taken out which could be
used to prepare ghee from it). These three
targeting different customers.
 Solutions
• They could offer monthly home delivery
services. As there are working women in the
Raajpur city they could not come to the retail
points, would prefer this and moreover
customer would not buy milk of the
competitors.
• Lack of storage facility in retail points, but as if
now cold storage could not be provided. But
control supply could help it. Later we could
provide them cold storages.
 Solutions
• Differential procurement price could be
provided in peak and lean season, in order to
stop the farmers selling the milk to the private
dairies. And it could be covered by increasing
selling price to some extent(1rs. Approx.) in
lean seasons which could be justified by the
quality of milk and customer will not mind
untill the quality is maintained.