EXECUTIVE SUMMARY

In India dairy is considered as one of the main instruments for social and economic development. Small farmers, possessing about 70% of the milk cattle, dominate milk production. Their income was undependable, and too small, so dairy was not considered a viable business option. But the Operation Flood changed the scenario, to the extent of Revolution. Amul has become a symbol of farmers liberation and self-reliance. The project aims to study the evolution of Indian dairy industry and that of Amul. The primary focus will be on the marketing strategy and competitor analysis, over the years, which has made Amul the most recalled brand. As it moves into newer products, and, Amul is perusing a different advertising strategy. The entry of MNCs, evolution in the customer profiles, and a changing Market calls for a massive shift in the strategy. In the project we examine how the company is geared up to meet the challenge.

DAIRY INDUSTRY IN INDIA

India has the highest livestock population in the world with 50% of the buffaloes and 20% of the worlds cattle population, most of which are milch cows and milch buffaloes. Indias dairy industry is considered as one of the most successful development programmes in the post-Independence period. Uttar Pradesh, Punjab, Haryana, Rajasthan, Gujarat, Maharashtra, Andhra Pradesh, Karnataka and Tamil Nadu are the milk surplus states in India. The manufacturing of milk products is obviously high in these milk surplus States. Exports of dairy products have been growing at the rate of 25% per annum in the terms of quantity terms and 28% in terms of value since 2001. Significant investment opportunities exist for the manufacturing of value-added milk products like milk powder, packaged milk, butter, ghee, cheese and ready-to-drink milk products. India has emerged as the largest milk producing country in the world with present level of annual milk production estimated as 94.5 million tonnes. We expect a production level of 135 million tonnes by the year 2015. India has a large livestock population base constituting 278 million livestock including 180.5 million cattle, 82.8 million buffaloes, 4 million sheep and 9.2 million goats. The livestock population is projected to increase to 322 million by the year 2015. The large livestock population is raised primarily on crop residues and grazing in the common property including basement. The forest area, which was a major source of grazing, is no longer available to livestock breeders especially landless people. As a consequence, the available feed resources fall short of the nutritional requirement. The shortfall is estimated as 59.9 million tonnes for the green fodder and 19.9 million tonnes for dry fodder. This shortfall is likely to increase by 2015 to 63.5 million tonnes of green fodder and 23.56 million tonnes of dry fodder. Gujarat Cooperative Milk Marketing Federation (GCMF) with the Amul brand continues to be the main operator in the branded cheese market in India. It pioneered the market for processed, branded cheese. What GCMF did was to develop the technology to make cheese from buffalo milk. World over it is made from cow milk.
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With the increase in the availability of liquid milk and Western dairy products, refinement in the marketing network and significant improvement in per capita income, there is an increased pressure for the restructuring of the indigenous milk product industry. Now, the organized sector has started showing keen interest in processes and equipment for manufacturing traditional products standardization of products, as well as refinement in packaging and improvement in safety and shelf life. Any innovation which can enable the organized sector to manufacture and market indigenous milk products on an industrial scale can have a far reaching impact on the dairy industry as well as on the economic condition of milk producers. The market for indigenous products far exceeds that for Western dairy products like butter, milk powder and cheese. A great scope exists for further expansion of the market for indigenous milk products, provided quality and safety are ensured and the shelf life is extended to facilitate distribution over larger areas. Major innovations are needed in manufacturing, quality assurance, packaging and process engineering to adapt these products to current marketing and consumer requirements. Some commercial processes have been developed to manufacture ghee, khoya, shrikhand and gulabjamun, but much is required to be done. The dairy industry is dominated by the co-operative sector. About 60% of the installed processing capacity is in the co-operative sector. The National Dairy Development Board (NDDB) is a major player in the market with its major brand, Amul. Leading brands like Amul, Nestle, Mother Dairy and Britannia are in the race to tap the growing market.

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AMUL- THE TASTE OF INDIA

GCMMF: AN OVERVIEW
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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. Members: No. of Producer Members: No. of Village Societies: Total Milk handling capacity: Milk collection (Total - 2002-03): Milk collection (Daily Average 2002-03): Milk Drying Capacity: Cattle feed manufacturing Capacity: 12 district cooperative milk producers' Union 2.28 million 11,132 6.7 million litres per day 1.86 billion litres 5.08 million litres 510 metric Tons per day 1450 Mts per day

The main stakeholder of GCMMF is the farmer member for whose welfare GCMMF exists. GCMMF states that its main objective is the carrying out of activities for the economic development of agriculturists by efficiently organizing marketing of milk and dairy produce, veterinary medicines, vaccines and other animal health products, agricultural produce in raw and/or processed form and other allied produce.

THE BRAND NAME - AMUL

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AMUL means "priceless" in Sanskrit. The brand name "Amul," from the Sanskrit "Amoolya," was suggested by a quality control expert in Anand. Variants, all meaning "priceless", are found in several Indian languages. Today Amul is a symbol of many things: Of 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. Of a proven model for dairy development.

HISTORY OF AMUL
In 1929, Peston Edul Polson established Polson Model Dairy at Anand to manufacture butter, ghee and casein and in 1944; the Bombay Municipal Corporation Milk Supply was inaugurated. Monopoly rights were awarded to Polson for Procuring milk from Kaira. Amul's genesis is linked to the freedom movement in India. Sardar Vallabhbhai Patel, an eminent Indian freedom fighter encouraged the dairy farmers from the Kaira district in Gujarat to form a cooperative to counter the 'exploitatively' low prices offered for their milk by the monopoly milk supplier of the area, Polson's Dairy. The dairy farmers met in Samarkha (Kaira district, Gujarat) on the 4th of January 1946, and decided to set up a milk producers' cooperative that would deal directly with the Bombay government, the final buyer of their milk. This was the origin of the Anand model. Initially, when the Bombay government refused to deal with the cooperative, the farmers called a strike. The government finally relented when Bombay went without milk for a fortnight. The successful union registered itself as the Kaira District Cooperative Milk Producers' Union Ltd. (KCMPUL), Anand, in Gujarat in December 1946. And so did GCMMF and brand AMUL establish consequently.

AMUL FACT-FILE
Type: Cooperative Headquarters: Anand, India Key people: Chairman, GCMMF - P. G. Bhatol Industry :Dairy Products Revenue :INR 67.11 billion, $15.04 billion USD (08-09) Employees: 735 employees of Marketing Arm. However, real pool consist of 2.8 million

MISSION
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GCMMF endeavour is to satisfy the taste and nutrition requirements of the customers of the world through excellence in marketing by their committed team. Through cooperative marketing, they are committed to offer quality products that provide best value for money. Their mission is expansion of distribution network, creative marketing, consumer education and product innovation.

VISION 2020
In the last years report, the chairman of Amul, Dr. V.Kurien, had shared their perspective plan for the year 2020 for the member unions envisaging a capital investment of Rs. 2600 crores (Rs. 26 billion) and a projected group sales turnover of Rs. 27000 crores (Rs. 270 billion). Their Mehsana Union has expanded capacity to 9.61 lakh litres per day at its dairy at Manesar near Delhi. Banaskantha Union too has embarked on installing new powder plant and cattle-feed plant which shall be commissioned soon. New cattle-feed plants are being put up by Mehsana and Valsad Unions as well.

AMUL PLANTS
First plant is at ANAND, which engaged in the manufacturing of milk, butter, ghee, milk powder, flavoured milk and butter milk. It is establish in 1973.

Second plant is at MOGAR , which engaged in manufacturing chocolate, Nutramul, Amul Ganthia and Amul Bite. This plant establish in 1973. It is situated on Anand Vadodara Highway No. 8.

Third plant is at Kanjari, which produces cattle feed. Old plant establish in 1964 &new plant in 1980.

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Fourth plant is at Khatraj, which engaged in producing cheese. It is situated between Nadiad Ahmadabad

STRATEGY
Amul follows a systematic and well defined pattern of strategy, which can be categorized as: Minimum expenditure on advertisement Focus on delighting customers Expanding its distribution network for maximum reach of customers Minimize its expenditure and pay only 0.5% of its turnover on salaries against other 7% FMCG Companies

AMULS JOURNEY TOWARDS EXCELLENCE

AMULs journey towards excellence is marked by some critical understanding of the business environment in large emerging economies like India where markets have to be developed by combining efficiency related initiatives with increasing the base of marginal suppliers and consumers. The essence of AMULs efforts was as follows: It combined market and social development in an emerging economy. It recognized the inter-linkages between various environments that governed the lives of marginal milk farmers and the unmet needs of consumers. It also changed the supply chain paradigm in order to reduce the cost to the consumer while increasing the return to the supplier. It realized that in order to achieve their objectives, it had to benefit a large number of people both suppliers and consumers. While large scale had the danger of failure due to poor control and required more resources, it also had the advantage of creating a momentum that would be necessary to bring more people into the fold and thereby help more suppliers and consumers. It also realized that its goal could only be achieved in the long run and this required developing values in people and processes that were robust, replicable and transparent. It also realized that the cooperative would not be independent and viable in the face of competition if it were not financially sound. This implied that AMUL had to develop distinct capabilities that would deliver competitive advantage to its operations.

AMUL'S SECRET OF SUCCESS

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The system succeeded mainly because it provides an assured market at remunerative prices for producers' milk besides acting as a channel to market the production enhancement package. What's more, it does not disturb the agro-system of the farmers. It also enables the consumer an access to high quality milk and milk products. Contrary to the traditional system, when the profit of the business was cornered by the middlemen, the system ensured that the profit goes to the participants for their socioeconomic upliftment and common good. Looking back on the path traversed by Amul, the following features make it a pattern and model for emulation elsewhere. Amul has been able to: Produce an appropriate blend of the policy makers farmers board of management and the professionals: each group appreciating its rotes and limitations, Bring at the command of the rural milk producers the best of the technology and harness its fruit for betterment. Provide a support system to the milk producers without disturbing their agroeconomic systems, Plough back the profits, by prudent use of men, material and machines, in the rural sector for the common good and betterment of the member producers and Even though, growing with time and on scale, it has remained with the smallest producer members. In that sense. Amul is an example par excellence, of an intervention for rural change. 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.

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THE AMUL MODEL

The Amul Model of dairy development is a three-tiered structure with the dairy cooperative societies at the village level federated under a milk union at the district level and a federation of member unions at the state level.

Establishment of a direct linkage between milk producers and consumers by eliminating middlemen Milk Producers (farmers) control procurement, processing and marketing

Professional management

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The Amul model has helped India to emerge as the largest milk producer in the world. More than 13 million milk producers pour their milk in 1,28,799 dairy cooperative societies across the country. Their milk is processed in 176 District Co-operative Unions and marketed by 22 State Marketing Federations, ensuring a better life for millions.

THE PRODUCT RANGE

Breadspreads Cheese Range Amul Butter, Amul Lite, Delicious Table Margarine Amul Pasteurized Processed Cheddar Cheese, Amul Processed Cheese Spread, Amul Pizza (Mozarella) Cheese,Amul Emmental Cheese, Amul Gouda Cheese, Amul Malai Paneer (cottage cheese), Utterly Delicious Pizza Amul Gold Full Cream Milk 6% fat, Amul Shakti Standardised Milk 4.5% Fat, Amul Taaza Toned Milk 3% fat,Amul Slim & Trim, Amul Cow Milk Amul Gold 4.5% fat Milk, Amul Shakti 3% fat Milk, Amul Taaza 1.5% fat Milk, Amul Lite Slim-n-Trim Milk, Amul Fresh Cream

Fresh Milk

UHT Milk Range

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Milk Powders

Milk Drink

Health Drink Brown Beverage Curd Products Pure Ghee Sweetened Condensed Milk Mithaee Range (Ethnic Sweets) Ice-cream Chocolate & Confectionery

Amul Full Cream Milk Powder, Amulya Dairy Whitener, Sagar Skimmed Milk Powder, Amulspray Infant Milk Food, Sagar Tea and Coffee Whitener Amul Kool Flavoured Milk, Amul Kool Caf, Amul Kool Koko,Amul Kool Millk Shaake, Amul Kool Chocolate Milk,Nutramul Energy Drink Stamina Instant Energy Drink Nutramul Malted Milk Food Amul Masti Dahi (fresh curd), Amul Masti Spiced Butter Milk,Amul Lassee, Amul Flaavyo Yoghurt Amul Pure Ghee, Sagar Pure Ghee Amul Mithaimate Amul Shrikhand, Amul Mithaee Gulabjamuns, Amul Basundi,Avsar Ladoos Sundae Range, probiotic, sugarfree and probiotic Amul Milk Chocolate, Amul Fruit & Nut Chocolate, Amul Chocozoo, Amul Bindass, Amul Fundoo

AMUL RECENT ACHIEVEMENTS

The organization which symbolizes taste of India achieved a historical milestone by crossing the 2 billion dollar mark. During the financial year 2010-11, GCMMF registered impressive top line growth of 22.1%, achieving turnover of Rs. 9774 crores. While commenting on the results, Shri Parthibhai G. Bhatol, Chairman, GCMMF informed that this performance is even more remarkable, when viewed from the perspective that the organization was able to achieve 1 billion dollar turnover in the 33rd year of its formation while it took only just four more years to add another 1 billion dollar to its turnover. Turnover of GCMMF registered CAGR of 23% during the last 4 years. During the year 2010-11, GCMMF paid Rs. 8345 crores to its 30 lakhs farmer members. Payout to farmers also registered 23% CAGR in last 4 years. Sales of Amul Butter have also shown an impressive growth of 26% in 2010-11. Sales of Amul Milk in pouches have grown by 34%. Sales of Amul Processed Cheese have shown consistent and very impressive growth of 29%. Amul beverage range including Flavoured milk, Buttermilk and Lassi has shown an impressive growth of 28% over the last year. Sales of Amul Masti Dahi also grew by 39%. With enhanced focus on fresh and fermented products, GCMMF launched Amul Probiotic Lasee in ready to drink cups,
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Amul Probiotic Buttermilk in PET bottles and flavoured yoghurt under the brand name Amul Flaavyo. In the Infant Milk Food category, their brand Amulspray registered growth of 20% and achieved the unique distinction of becoming a Rs. 1000 crore megabrand.

AMULs BEST PRACTICES

Developing demand
At the time Amul was formed, consumers had limited purchasing power, and modest consumption levels of milk and other dairy products. Thus Amul adopted a low-cost price strategy to make its products affordable and attractive to consumers by guaranteeing them value for money.

Introducing higher value products

Beginning with liquid milk, GCMMF enhanced the product mix through the progressive addition of higher value products while maintaining the desired growth in existing products. Despite competition in the high value dairy product segments from firms such as Hindustan Lever, Nestle and Britannia, GCMMF ensures that the product mix and the sequence in which Amul introduces its products is consistent with the core philosophy of providing milk at a basic, affordable price.

The distribution network

Amul products are available in over 500,000 retail outlets across India through its network of over 3,500 distributors. There are 47 depots with dry and cold warehouses to buffer inventory of the entire range of products. GCMMF transacts on an advance demand draft basis from its wholesale dealers instead of the cheque system adopted by other major FMCG companies. This practice is consistent with GCMMF's philosophy of maintaining cash transactions throughout the supply chain and it also minimizes dumping. Wholesale dealers carry inventory that is just adequate to take care of the transit time from the branch warehouse to their premises. This just-in-time inventory strategy improves dealers' return on investment (ROI). All GCMMF branches engage in route scheduling and have dedicated vehicle operations.

Umbrella brand
The network follows an umbrella branding strategy. Amul is the common brand for most product categories produced by various unions: liquid milk, milk powders, butter, ghee, cheese, cocoa products, sweets, ice-cream and condensed milk. Amul's sub-brands include variants such as Amulspray, Amulspree, Amulya and Nutramul. The edible oil products are grouped around Dhara and Lokdhara, mineral water is sold under the Jal Dhara brand while fruit drinks bear the Safal name.

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By insisting on an umbrella brand, GCMMF not only skillfully avoided inter-union conflicts but also created an opportunity for the union members to cooperate in developing products.

Managing the supply chain

Even though the cooperative was formed to bring together farmers, it was recognised that professional managers and technocrats would be required to manage the network effectively and make it commercially viable.

Coordination
Given the large number of organisations and entities in the supply chain and decentralised responsibility for various activities, effective coordination is critical for efficiency and cost control. GCMMF and the unions play a major role in this process and jointly achieve the desired degree of control. Buy-in from the unions is assured as the plans are approved by GCMMF's board. The board is drawn from the heads of all the unions, and the boards of the unions comprise of farmers elected through village societies, thereby creating a situation of interlocking control. The federation handles the distribution of end products and coordination with retailers and the dealers. The unions coordinate the supply side activities. These include monitoring milk collection contractors, the supply of animal feed and other supplies, provision of veterinary services, and educational activities.

Managing third party service providers

From the beginning, it was recognised that the unions' core activity lay in milk processing and the production of dairy products. All other activities were entrusted to third parties. These include logistics of milk collection, distribution of dairy products, sale of products through dealers and retail stores, provision of animal feed, and veterinary services. It is worth noting that a number of these third parties are not in the organized sector, and many are not professionally managed with little regard for quality and service. This is a particularly critical issue in the logistics and transport of a perishable commodity where there are already weaknesses in the basic infrastructure.

Establishing best practices

A key source of competitive advantage has been the enterprise's ability to continuously implement best practices across all elements of the network: the federation, the unions, the village societies and the distribution channel. In developing these practices, the federation and the unions have adapted successful models from around the world. It could be the implementation of small group activities or quality circles at the federation. Or a TQM program at the unions. Or housekeeping and good accounting practices at the village society level. More important, the network has been able to regularly roll out improvement programs across to a large number of members and the implementation rate is consistently high.
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For example, every Friday, without fail, between 10.00 a.m. and 11.00 a.m., all employees of GCMMF meet at the closest office, be it a department or a branch or a depot to discuss their various quality concerns. Each meeting has its pre-set format in terms of Purpose, Agenda and Limit (PAL) with a process check at the end to record how the meeting was conducted. Similar processes are in place at the village societies, the unions and even at the wholesaler and C&F agent levels as well. Examples of benefits from recent initiatives include reduction in transportation time from the depots to the wholesale dealers, improvement in ROI of wholesale dealers, implementation of Zero Stock Out through improved availability of products at depots and also the implementation of Just-in-Time in finance to reduce the float. The most impressive aspect of this large-scale roll out is that improvement processes are turning the village societies into individual improvement centres.

Technology and e-initiatives

GCMMF's technology strategy is characterized by four distinct components: new products, process technology, and complementary assets to enhance milk production and e-commerce. Automation in processing and packaging areas is common, as is HACCP certification. Amul actively pursues developments in embryo transfer and cattle breeding in order to improve cattle quality and increases in milk yields. GCMMF was one of the first FMCG (fast-moving consumer goods) firms in India to employ Internet technologies to implement B2C commerce. Today customers can order a variety of products through the Internet and be assured of timely delivery with cash payment upon receipt. Another e-initiative underway is to provide farmers access to information relating to markets, technology and best practices in the dairy industry through net enabled kiosks in the villages. GCMMF has also implemented a Geographical Information System (GIS) at both ends of the supply chain, i.e. milk collection as well as the marketing process. Farmers now have better access to information on the output as well as support services while providing a better planning tool to marketing personnel.

Advertising and Sales Promotion

Over the years, Amul's advertising philosophy had been "to be simple, fresh and innovative". The clean, emotion-based ads refrained from using hi-tech special effects, and aimed at maintaining the perfect balance between the traditional and the modern.

Looking Ahead
Analysts wondered whether a co-operative with limited financial means could stand up to the might of these MNCs, and if its low pricing strategy would continue to stay relevant. MNCs like Pizza Hut, Domino's, Hindustan Lever Limited and Cadbury had also
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become competitors. Amul had proved its detractors wrong and firmed up ambitious growth plans.

4 PS OF MARKETING 1. PRODUCT
Over the years, Amul has come up with many products. There has been product line extension as well as product category extension. The picture below is a snapshot of various SBUs of Amul.

Using the BCG matrix for product analysis, we can know which of these SBUs is of utmost importance to the company or the brand Amul.

Looking at the matrix above, we may say that Amul needs to perform product innovation if it wants to convert Amul chocolates, masti dahi , Amul mithai mate, Amul lassi to star products. The above matrix also indicates that, Amul may also choose to disinvest in Nutramul and Amul shakti. The following table describes the market share that Amul holds for each product line.

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In ice cream, HUL is just above the market share i.e., 28.22 %, with Mother Dairy in the 3rd place with 8.66 %. In chocolates, Cadbury has the maximum share of 70 % and Nestle has 20 % of the market share. AMUL, being a co-operative union offers variety of services to the members of village and district level co-operative societies. The main services offered by AMUL are: Medical Facilities for the Cattle of Farmers AMUL provides medical facilities to cattle of farmer at a concessional rate of Rs. 50/- includes medicines, treatment charge. Cattle Feeding AMUL provide the Dan to the cattle of member farmers. AMUL produces the by pass protein Dan and Purk Dan to the cattle of farmers at reasonable cost. Artificial Insemination (Cattle Breeding) AMUL has established Artificial insemination center at Ode village near Anand. Free Animal Vaccination Often Animals are caught up in unknown diseases. To protect the animals from such diseases periodical Vaccination programme are arranged by AMUL. Farmer Education Programmed Generally, farmers believe in superstitions. Further, he is often not aware about how the animal should be taken care which things should be given prime concern while milking the animal. AMUL provide guidance and education through arranging seminar on periodic basis.

2. PRICING
Decided by the GCMMF by conducting market surveys to check the validity and feasibility of prices in the market and accordingly decides the prices of AMUL products. Price is inclusive of several elements like, Cost of milk
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Labour cost Processing cost Packaging cost Advertising cost Transportation cost Sales promotion costs Taxes etc.

3. PLACE
Amuls success today is partly because of its strong supply chain design. Below is the schematic diagram of Amuls supply chain.

With products being highly perishable, the supply chain ought to have to maintain correct temperature, humidity etc and the chain should move fast. To reach out its consumers more directly and let them the total brand experience, Amul has come up with Amul parlours. These are called Utterly delicious parlours. They have come up in major cities like Ahmadabad, Bangalore, Baroda, Delhi, Mumbai, Hyderabad and Surat already, and many more starting up real soon. Till date there are about 400 Amul parlours across the country. These parlours are set at prominent locations such as campuses of Infosys, Wipro, IIM-A, IIT-B, temples, Metros etc. Amul has franchisee plans in regards of the Amul parlours. This might start pretty soon, since the talks are almost at the end.
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Now, going back to the supply chain of Amul, Amul has gone the e- commerce way. The 1st initiatives taken for an ERP system was in 94. Tata Consultancy Services was hired to guide in its implementation. The implementation project was named as Enterprisewise Integrated Application System (EIAS). Automatic Milk Collection System units (AMCUS) at village societies were installed in the first phase to automate milk producers logistics. Amul also connected its zonal offices, regional offices and members dairies through VSATs for seamless exchange of information. Amul is also using Geographic Information Systems (GIS) for business planning and optimization of collection processes. Indian Institute of Management Ahmedabad supplemented Amuls IT strategy by providing an application software Dairy Information System Kiosk (DISK) to facilitate data analysis and decision support in improving milk collection. There are plans to introduce features like Internet banking services and ATMs which will enable the milk societies to credit payments directly to the sellers bank account. Distributors can place their orders on the website www.amul2b.com especially meant for accepting orders from stockists and promoting Amuls products via e-commerce.

4. PROMOTION
One of the most conservative FMCG entities GCMMF spends a mere 1% of its turnover on promotions. Amul has written and re- written the rules of the game. Amul butter girl is one of the longest run ad campaigns in the country for 43 years!!! The reason Amul topicals are so successful because, it doesnt plead the customer to go buy Amul instantly. Instead, Amul captures latest news headlines and showcases them in such a way that the moment we see it, we register it in our brains. The basic aim here is to make butter synonymous to Amul. Next time we go to buy butter, the first brand that will come to the mind is Amul. Amul uses rotational promotion strategy to be in touch with customers/ consumers throughout. After every 3-4 years, Amul comes up with something new and a promotional campaign for the same is placed. Amul Ice-cream 1996 Category re-visited in 1999, in order to improve availability of the product and make it affordable Amul Cheese in 2001 Amul Masti Chaas in 2004-05 Nutramul and Kool Kafe in 2006 Amul Koko cold chocolate drink in 2009 Amul promotes itself by conducting various contests such as: Chef of the year- in this, the participants are required to use as many Amul products as possible. Amul Maharani of the year in this, the participants are required to fill up questionnaires and then there is a lucky draw.

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Amul promotes itself by sponsoring various movies, and TV shows. For example

Amul publishes some books periodically. Basically they are related to Amul or dairy industry as such.

Amul also gives away academic excellence awards for school children every year. They are called Vidya Shree for 10th std. and Vidya Bhushan for 12th std students.

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Amul Hits

Amul hits of the year 2012

Amul hits of the year 2011

Amul hits of the year 2010

Amul hits of the year 2009

Amul hits of the year 2008

Amul hits of the year 2007

Amul hits of the year 2006

Amul hits of the year 2005

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Amul hits of the year 2004

Amul hits of the year 2003

Amul hits of the year 2002

Amul hits of the year 2001

Amul hits of the year 2000

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AMULS STP
SEGMENTATION
Segmentation is not so easy because of mixed audience and various culinary applications of Amul products. Nevertheless, we may do segmentation based on: Consumer type: For Kids- Amul kool, Amul chocolates, Nutramul, etc For Women-Amul Calci + For Youth-Utterly delicious pizza, cheese variants etc For the calorie conciuos-Amul lite, Amul lite slim trim milk etc For health conscious-Nutramul, Amul shakti etc. Industry type: Milk- Ice cream manufacturer, restaurants, coffee shops etc Butter/Cheese/Ghee-Bakery, pizza retailers, snack retailers

TARGETING
After segmentation, one has to decide where to find this market segment and what should be the size of this segment. Example, Amul has identified youth as one of its potential segments. Now it has to decide where to find youth who will actually go get their product and the number of youth that the company, i.e., Amul requires. Amul has come up with Amul parlours for this reason.

POSITIONING
A mass market player, no premium offerings USP Quality with affordability Amul as Taste of India - creating value for everyone in the value chain, both customers and farmers. New offerings for health conscious and vibrant India in the form of Probiotic wellness ice-cream, sugar free delights for the diabetic patients and Amul kool caf for the youth of today.

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3 CS MODEL
1.

COMPANY
Largest milk brand in Asia. It is no. 1 in Asia and no. 2 in the world More than 30 dairy brands Market leader in ghee and butter with 85% market share Very strong supply chain Enjoys fine reputation. Though the company has grown so big, it never left its key players- the milk suppliers Quality with affordability

2. CUSTOMER Are extremely satisfied Moved from loose milk to packaged milk. Moving consumers from loose mil to packaged milk and then gradually moved them up the value chain i.e., the tetra packs. Being exposed to a brand, its natural for a customer to try more products. This the Umbrella strategy that Amul follows. Improved socio-eco conditions of the customers, has changed their lifestyle and thus the scope for product innovation has increased. 3. COMPETITOR Amul has to defend against Mahananda, Vijaya, Milma, and other cooperative milk brands Aggressive moves against Britannia, Nestle, Mother Dairy, Kwality Amul has a competitive sustainable advantage. This lies in the procurement part. Its ability to collect 7 million liters of milk from 2.6 million farmers and convert it into Rs. 6 crore worth products and distribute them to 5 lakhs retailers is a tough job. Intelligent marketing

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SWOT ANALYSIS OF AMUL

STRENGTHS
Demand profile: Absolutely optimistic. Milk being a necessity product, the demand will stay and the sales at GCMMF are bound to increase over a period of time. Margins: Quite reasonable, even on packed liquid milk. The margins are enough to limit the entry of potential entrants. Flexibility of product mix: Tremendous. With balancing equipment, GCMMF has kept adding a wide array of products to its product line. Availability of raw material: Abundant. Presently, more than 80 per cent of milk produced is flowing into the unorganized sector, which requires proper channelization. Amul & GCMMF have leveraged this and has got itself a strong base of suppliers who provide them milk throughout the year. Technical manpower: Professionally trained, technical human resource pool, built over last 30 years is the strength that GCMMF has. The employees of GCCMF are highly recognized in the industry and have earned name for themselves as well as the federation. Enhanced Milk Production: Increase in the milk production with consequently increased availability of milk processing has led to increase in consumption and faster access to the consumers through effective distribution. The technology is brought from Denmark and the production of milk has benefited from that. Transportation: The transportation facilities and the easy availability of the special trucks have provided a boost. Cold refrigerated trucks are there in place and the warehouses also have the cold storage facilities that facilitate the transportation. Vast resources: Country has vast natural resources which offer immense potential growth and development for dairying. Moreover the financial resources available with the federation are immense and the reputation is such that in case

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of any further requirements, it can approach any institution and raise any form of capital. Increasing purchase power and changing tastes of the consumers: The purchasing power of the residents is increasing. As a result a lot of products are being consumed. Moreover, the consuming habits are changing. As a result, the demand for products such as butter and cheese is increasing at a very rapid rate.

WEAKNESSES
Perishability: Pasteurization has overcome this weakness partially. UHT gives milk long life. Still perishability is there at the milk vendors end. This does result in loss of some production. But Amul Dairy is taking steps to store milk at the vendors end. Surely, many new processes will follow to improve milk quality and extend its shelf life. Lack of control over yield: Theoretically, there is little control over milk yield. A lot depends upon the monsoon in the country. This is because of the quality of cattle feed that would be available will not have the required nutritional content. Steps are taken to provide awareness regarding these and the penetration of quality feed is being increased. Moreover, increased awareness of developments like embryo transplant, artificial insemination and properly managed animal husbandry practices, coupled with higher income to rural milk producers should automatically lead to improvement in milk yields. Logistics of procurement: Woes of bad roads and inadequate transportation facility make milk procurement problematic. All these factors lead to perishability of the procured milk. But with the overall economic improvement in India, these problems would also get solved. Erratic power supply: The erratic power supply would cause harm in the processing of milk. Underdeveloped systems: There still exist underdeveloped raw milk collection systems in some parts of the country. However steps are being taken such as setting up of cold storage points at key collection centers to combat the situation. Lack of proper implementation: Dairy development programmes have not been fully implemented as per the needs of the region in different agro-climatic zones. Infrastructure: The infrastructure that is available is not up to the current world standards. Also lack of infrastructure for offering dairy business management programmes to the trained personnel is creating a hindrance.

OPPORTUNITIES
"Failure is never final, and success never ending. Dr Kurien bears out this statement perfectly. He entered the industry when there were only threats. He met failure headon, and now he clearly is an example of never ending success! If dairy entrepreneurs are looking for opportunities in India, the following areas must be tapped:

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Competition: With so many newcomers entering this industry, competition is becoming tougher day by day. But then competition has to be faced as a ground reality. The market is large enough for many to carve out their niche. Moreover due to competition, there is a chance to better serve the market with innovative products. Value addition: There is a phenomenal scope for innovations in product development, packaging and presentation. Given below are potential areas of value addition. Export potential: Efforts to exploit export potential are already on. Amul is exporting to Bangladesh, Sri Lanka, Nigeria, and the Middle East. Following the new GATT treaty, opportunities will increase tremendously for the export of agri-products in general and dairy products in particular. There is a strong basis of cost efficiency, which GCMMF can leverage in the world market. Markets: The market for the traditional as wells as processed dairy products is expanding both at the domestic and international front. IT support: Software is now available for project formulation for dairy enterprise. It has also computerized its production processes. Mother Dairy was the first fully computerized dairy in India. In its Anand plant all products are processed computerized, which does not have any hand touch during any stage of process.

THREATS
Milk vendors, the un-organized sector: Today milk vendors are occupying the pride of place in the industry. Organized dissemination of information about the harm that they are doing to producers and consumers should see a steady decline in their importance. Infestation: There are increasing incidents of chemical contaminants as well as residual antibiotics in milk. Quality: The quality of the milk is found to be poor as compared to the international standards. One of the reasons for these according to the EU and America is the method of milching the milk. In these nations the milk is hands by the farmers owning the cattle do milched with the help of machines, while in India. Exploitation: The liberalization of the Dairy Industry is likely to be exploited by the multinationals. They will be interested manufacturing the milk products, which yield high profits. It will create milk shortage in the country adversely affecting the consumers. Subsidy by Western Nations: There have been incidences wherein the Western nations subsidizing the dairy products by a few means like transportation. Because of such reasons the final price of the product goes below the prices prevailing in the Indian Market. Hence it proves a threat to GCMMFs and other Indian dairy products.

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Creation of Non Tariff Barriers by Developed Nations: The Developed Nations have created Non Tariff Barriers related to Quality of the milk specifically. They want that the milk be processed with potable Air and Water. They also want that the milching of cattle be done with the help of machines. However this type if system is yet to evolve in India. Because of these reasons they are reducing the market potential of Indian made products, where GCMMF holds a lions share.

MICHAEL PORTERS FIVE-FORCE ANALYSIS

The success of the national and local competitors brands includes effective distribution system, advertising, good pricing policy etc. The factors ascribed by porter are: Threats of new entrants Bargaining power of suppliers Bargaining power of buyers Rivalry among competitors Threats from substitutes

These factors can be explained in context to GCMMF as below:

THREATS OF NEW ENTRANTS

Economies of Scale: GCMMF enjoys economies of scale, which is difficult to match by any other competitor. It is because of this reason that no regional competitor has grown to a national level.

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Cost and Resource advantages: Amul dairy is co-operative society. That means cooperation among competitive is the fundamental principle. Amul dairy is managed under the norms of GCMMF and market the products under the brand name Amul, which has a very good reputation at domestic and international level. Here, the raw material procurement is very difficult for the new entrants. Consequently Capital requirement is also high. Still new entrants are emerging such as domestic and international players. So the threats of new entrants are moderate. Brand Preferences and Consumer Loyalty: There is an immense level of Brand Preference of Amul in the minds of the people. The level of preference specifically in the liquid milk sector is that they would go to other retailer if the retailer does not have milk. Access to Distribution Channels: The distribution channel of GCMMF is a very planned and perfect one. For any new entrant to enter it would be a very difficult task. For GCMMF the result is years of hard work and its investment in its employees as well as at different levels in the distribution network. Inability to match the technology and specialized know-how of firms already in the industry: The technology used by Amul is imported from Denmark. It is a state of art technology. To get this technology in India, a firm would require a huge amount of resources. Capital Requirements: The total investment required in the industry is huge and is a decision worth considering even for MNCs. The investment decisions cover the processing costs as well as the marketing costs. To compete with the brand Amul in India is difficult as Amul is synonymous to Quality.

BARGAINING POWER OF SUPPLIER

The objective of Amul dairy is not profiting. As it is a part of co-operative society, it runs for the benefit of farmers those are the suppliers of milk and users of milk products. According the concept of the cooperative society supplier has bargaining power to have a good return on his or her supply. However, supplier has limited rights to bargain with the cooperative society because it is made and run for the sake of mass and not for individual benefit. But it is made sure that the supplier gets his fair share of return. There is appropriate bargaining power of the supplier. In olden days there were not any kind of cooperative societies as the farmer was exploited. But, nowadays the farmers rights are protected under the cooperative rules and regulations, which ultimately results in moderate power of bargaining from the supplier.

BARGAINING POWER OF BUYERS

Cost of switching to competitor brands: The switching of brands is seen very much in products such as ice cream, curd, milk powders, milk additives etc. but it can be seen comparatively less in liquid milk category. Even if the buyers shift to
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the other brands of milk, the value that they get is less than they would get from consuming Amul. Large no. of buyers: Milk is a necessity product and hence is a mass product. It has a considerable share of the rupee spent by any Indian. Moreover the buyers are spread evenly over the country and do not have any bargaining power.

RIVALRY AMONG COMPETITORS

Demand for the product: The demand of the products of GCMMF is increasing at a very healthy rate. To stand against the rivalry GCMMF is coming with a wide range of products. Nature of Competitors: In different business category GCMMF faces competition from different players. In the Milk powder category it faces competition from Cadbury & Nestle, in the chocolate category also I faces competition from Cadbury & Nestle. While in the ice cream market it faces competition from Kwality Walls Max and Havmor. In butter and chesses it faces competition from Britannia. Moreover in almost all categories there is presence of local retailers and processors and milk vendors. Rivalry intensifies as each of the competitors has different lines and this would in turn depend on the importance the line holds for the competitor. Mergers and Acquisitions: As such in the industry there are no mergers or acquisitions. However if any MNC wishes to enter through this route then the competition might be severe.

THREATS OF SUBSTITUTE
Availability of attractive priced substitutes: Different substitutes are available for different category of products. There is ample availability of low priced substitutes from local vendors and retailers. This is a front where GCMMF is still finding hard to combat. Satisfaction level of substitutes: Customers do consider these products as equal on quality if not better then the products of GCMMF. Hence the rate of customers switching to the substitutes is very high. Moreover the buyers also can switch to the customers easily without any hurdles. Not immediate substitutes: Distant substitutes are present in many of the categories of business of GCMMF. For example in the Masti Buttermilk category it faces competition from cold drinks and ice cream.

These 5 forces interact among themselves at different degrees over a period of time. Moreover it will get intense or loosen up depending upon the moves of its competitors, buyers, suppliers, etc. However GCMMF has been able to outperform on almost all fronts excluding a few lines of business.

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MOTHER DAIRY

MOTHER DAIRY
Mother Dairy was set up in 1974 under the Operation Flood Programme. It is a wholly owned company of the National Dairy Development Board (NDDB). Mother Dairy
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manufactures, markets & sells milk and milk products under the Mother Dairy brand (Milk, Cultured Products, Ice Creams, Paneer and Ghee), Dhara range of edible oils, Safal range of fresh Fruit & vegetables, Frozen Vegetables, Processed Fruit & Vegetable Products, Fruit Pulps & Concentrates in bulk aseptic packaging and fruit juices at a national level through its sales and distribution networks for marketing food items. Mother Dairy sources significant part of its requirement of liquid milk from dairy cooperatives. Similarly, Mother Dairy sources fruits and vegetables from farmers / growers associations. It is Mother Dairys constant endeavour to ensure that milk producers and farmers regularly and continually receive market prices by offering quality milk, milk products and other food products to consumers at competitive prices and uphold institutional structures that empower milk producers and farmers through processes that are equitable. Mother Dairy markets approximately 3.2 million litres of milk daily in the markets of Delhi, Mumbai, Saurashtra and Hyderabad. Its milk has a market share of 66% in the branded sector in Delhi where it sells 2.5 million litres of milk daily and undertakes its marketing operations through around 1400 retail outlets and over 1000 exclusive outlets of Mother Dairy. The company derives significant competitive advantage from its unique distribution network of bulk vending milk booths, retail outlets and mobile units. Mother Dairy ice creams launched in the year 1995 have shown continuous growth over the years and today boasts of approximately 62% market share in Delhi and NCR. Mother Dairy also manufactures and markets a wide range of dairy products that include Butter, Mishti Doi, Paneer, Dahi, Ghee, Cheese, UHT Milk, Pro-biotic Products, Lassi & Flavored Milk and most of these products are available across the country. Safal is the market leader in the organized fruit & vegetable retail business in Delhi NCR where it sells an average of 300 MT/day through a network of 350+ exclusive retail outlets under brand name Safal/ Safal Pure Veg, supported by a state-of-the-art large and ultramodern Central Distribution Facility located in Delhi with an annual capacity to handle and process 2, 00,000 MT of fresh fruits and vegetables. The Dhara range of edible oils is marketed by Mother dairy. Today it is one of the leading brand of edible oils and is available across the country in over 2, 00,000 outlets. The brand is known for its PURITY and focuses on the indigenous oil. The brand is currently available in the following variants: Refined Vegetable Oil, Refined Soybean Oil, Refined Sunflower Oil, Refined Rice Bran Oil, Kachi Ghani Mustard Oil and Filtered Groundnut Oil.

National Dairy Development Board

National Dairy Development Board NDDB is the National Dairy Development Board. It is an institution of national importance setup by an Act of Parliament of India in 1965. Dr.
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Amrita Patel is the current Chairman of the National Dairy Development Board, Anand. NDDB's subsidiaries include Mother Dairy, Delhi. The main office is located in Anand, Gujarat with regional offices throughout the country.

NDDBs ROLE
NDDBs ROLE It is the central cooperative board of the country and was created to promote, finance and support producer-owned and controlled organizations that we have mentioned. Of these, two main players Amul of GCMMF and Mother Dairy of NDDB are the leading brand in India. It has now integrated 96,000 dairy co-operatives in what it calls the Anand Pattern, linking the village society to the state federations in a three-tier structure. NDDB launched its Perspective Plan 2010 with four thrust areas: Quality Assurance, Productivity Enhancement, Institution Building and National Information Network.

VISION & MISSION

Vision- Provide quality food and beverages to consumers at affordable prices while
ensuring fair returns to the producers.

Mission- Mother Dairys heritage is intrinsically linked to the cooperative movement

in India. With determination & pride we will continue to serve our farmers, rural India & our consumers. Our values reflect who we are & what we firmly believe in.

The objective of Mother Dairy is to:

Ensure that milk producers and farmers regularly and continually receive market prices by offering quality milk, milk products and other food products to consumers at competitive prices and; Uphold institutional structures that empower milk producers and farmers through processes that are equitable. At Mother Dairy, processing of milk is controlled by process automation whereby stateof-the-art microprocessor technology is adopted to integrate and completely automate all functions of the milk processing areas to ensure high product quality/ reliability and safety. In addition to its market leadership in India, Mother Dairy is also active in the global arena, exporting its range of dairy products to various international markets.

PRODUCT MIX

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S.No.

Product Name

Brand Name

Items Packaged Milk (Full Cream, Standardised, Toned, Double Toned Skimmed and Probiotic), Butter, Dahi, Ghee, Cheese, IceCreams, UHT Milk, Lassi & Flavoured Milk Refined Vegetable Oil, Refined Soyabean Oil, Refined Sunflower Oil, Refined Rice Bran Oil, Kachi Ghani Mustard Oil and Filtered Groundnut Oil.

1.

Milk & Milk Products

Mother Dairy

2.

Edible Oils

Dhara

3.

Fresh & Frozen Fruits & Vegetables

Safal

Fruits, Vegetables, Rice, Processed items (jams, juices, ketchup, pulp, etc.)

Financial Status of Mother Dairy

Financial Status of Mother Dairy Mother Dairy Foods Processing Ltd, also known as Mother Dairy Fruit & Vegetable Private Limited, Patparganj, Delhi, has a turnover of about $500 million. Mother Dairys turnover has been growing at the rate of 20% (CAGR) over the last 3 years and has crossed the Rs.2700 crores mark in the fiscal 200809. Mother Dairy plans to achieve a turnover of $1 billion USD by end of 2009.

Supply Chain Management

Supply Chain Management Milk Procurement: Mother Dairy sources its requirement of liquid milk from dairy co-operatives and producer institutions. Milk is received from farmer cooperatives through insulated road/rail tankers at very low temperature in order to retain its freshness. Milk Distribution: 79 tankers in the morning and 75 tankers in the evening bring in milk from the regional collection centres. After collection the same tankers are utilized for the delivery of the processed milk to the vendors and outlets. Mother Dairy has over 820 Milk Distribution Outlets in the National Capital Region. Each of these outlets place their demand by raising an invoice one day in advance. The demand is also calculated using the Calendar Scheme, in this depending on the pre-calculated seasonal demands the outlets place their orders accordingly. In order to satisfy immediate demand, 20 to 25 tankers are provided with a buffer stock of 500 litres each day so that they can be mobilized to cater the demand in an area. To coordinate its operations all the tankers are equipped with HAM radios.
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STRATEGIES IMPLEMENTED BY MOTHER DAIRY

Focused Approach
The cooperative is expanding its product portfolio further to match rival offerings particularly those of Amul. For the first 22 years of its existence, liquid milk was the only dairy product that Mother Dairy offered. It was in 1996 that it came up with icecreams. But the real spurt came about four years ago, when it introduced curd, flavored milk, lassi and mishti doi. It introduced butter a year-and-a half ago; ghee and UTH milk a year ago; and cheese, about 10 months ago. And under its frozen foods and vegetables brand Safal, besides the introduction of corn and mixed vegetables, it has plans to come out with frozen potato-based snacks in a few months. So, while the product portfolio has been growing, Mother Dairy has plans for reach out to newer markets - but the strategy here is more product-specific. In liquid milk, it will initially concentrate only on four markets - Delhi, its home ground; the Junagarh region and Ahmedabad in Gujarat; Mumbai, which it entered a year ago; and Hyderabad, where it moved in a little more than a year ago. They have no plans to go everywhere with liquid milk. What's the need to get into those markets that already have strong co-operative brands? Their objective of getting into newer locations is not to make Mother Dairy larger, but to ensure that there is a large viable distribution network and consumer brand to take care of surplus milk.

Wider Spread
However, as far as other dairy products are concerned, Mother Dairy plans to expand across the board. Other than milk, for most state federations, dairy products are still a small part of their operations. So they are taking their products to regions across India, where they see enough market potential. In ice creams, it was only two years ago that Mother Dairy entered its first market outside Delhi - UP and Punjab. Today, it's extended its operation to Haryana, Jaipur,
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Mumbai and Kolkata as well. Next year, it plans to go south to Hyderabad and Bangalore.

Product Differentiation
While Mother Dairy still may not have a product portfolio as large as Amul, which is also expanding across the country in a big way and is a much bigger player, it's doing its bit. Mother Dairy says the idea is not just to enter new markets, but to do well in those markets - which mean bigger market shares in the different product categories in whichever market it is present. The drivers will be value created through quality of the offerings as well as innovations in products. This will, of course, be backed by relevant marketing and promotion campaigns. Mother Dairy is bringing in mass Indian flavors which are building up in terms of absolute percentage of contribution. Their attempt is to make the taste experience in ice creams as familiar as possible so as to increase consumption. Take the case of curd. It started off very slow but today, Mother Dairy claims it's growing at close to 60 per cent year-on-year in Delhi. Here again, the Indian flavour formula seems to have worked. They formulated it to taste as close to home-made curd as possible. If the offering fits well with the Indian consumer, the resistance is lower and acceptance more.

PERSPECTIVE STRATEGIES APPLIED BY MOTHER DAIRY

Mother Dairy maps the future of dairying in India, setting realistic goals for Strengthening Cooperative Business Production Enhancement Assuring Quality Creating an Information and Development Research. The plan was realized with the successful completion of the Operation Flood Programme and has been developed by the State Milk Marketing Federations and the Milk Producers' Cooperative Unions in consultation with the Dairy Board. The goals and strategies to meet them have been drawn by its actual implementers - Federation and Unions and supported by NDDB.

1. Strategy for Strengthening Cooperative Business

Recruit, train and motivate increasing numbers of women to work for Mother Dairy to achieve significant improvements in dairy husbandry, as they primarily shoulder animal husbandry related responsibilities in rural India. Consolidation and growth in milk and milk product marketing, promoting better equity for regional cooperative brands and developing qualified and skilled manpower. Education of producer members, opinion leaders and trained professionals to be expanded and strengthened.

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Empower local leaders, strengthen societies and equip their staff and members with the skills and information they need. Persuade the State and Central Governments to remove the shackles on cooperative laws so dairy can compete on equal terms with other forms of enterprise.

2. Strategy for Production Enhancement

Improve the production potential of indigenous breeds of cattle such as Sahiwal, Gir, Rathi and Kankrej and breeds of buffalo such as Murrah, Mehsana and Jaffarbadi through appropriate selection programme. Cross non-descript cattle with Holestein Friesian in areas with adequate feed and fodder and with Jersey in resource-poor areas. Increase the production and use of high quality feed appropriate to local conditions. Increase production and availability of green and ensiled fodder Encourage unions, NGOs and cooperatives to put common property area under improved pasture and fodder tree. Expand first-aid coverage through village level societies. Increase vaccination of animals against HS, BQ and FMD Develop Mastitis and Brucellosis control strategies

3. Strategy for Assuring Quality

Identify and address quality related problems at every stage from the producer at the village cooperative, to the dairy plant and the process of final delivery to the consumer. Facilitate improvement of hygiene, sanitation, food safety and operating efficiency in the dairy plants and sensitize dairy personnel to product quality aspects as per international standards.

4. Strategy for Creating an Information and Development Research

Link large cooperatives, Unions, Federations and NDDB in a national network that collects, adds value and disseminates information. Ensure availability of analytical information for Policy Planning and Decision Support. Mother Dairy has different plans for its dairy business, which includes flavoured milk, lassi, curd, butter and cheese besides its toned milks. Each of these products has a regional stronghold, with a shelf life of 10 days. However, the company is looking at alternatives that would increase the shelf life and allow the products to be distributed in other parts of the country as well. In the ice cream segment, the company has been able to capture 15 per cent of the market, and hopes to increase it to 20 per cent by 2008.

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CURRENT CHANNELS
Mother Dairy is the market leader in the Ice cream segment. Currently it has five channels of distribution which are:1) Milk Shops 2) Retail 3) Vending 4) Modern Retail Formats 5) Mother Dairy Food services

MILK SHOPS
Or booths are the most important channels of Mother Dairy. Mother Dairy products are available in over 5000 outlets out of which about 680 are exclusive Mother Dairy booths. Mother Dairy Booths are strategically located all across Delhi and NCR, making it convenient to pick up the daily requirement of Milk, Flavoured milk, Butter, Dahi, Lassi and Ice Creams. The lifeline of Delhi, Mother Dairy booths all across the city provide milk early in the morning and at evenings. The supply of milk and other milk products to these booths are made directly from the Mother dairy plant. Each Booth in the NCR region is identified with its Booth ID Number. The booth owners are currently given a margin of 5% on the sale of Mother Dairy products. Mother Dairy is providing ready built and fully equipped milk shops/booths to the ExServicemen, while its Fruit and Vegetable (Safal) Shops are opened for the ESM and their dependent sons. A security deposit (refundable on termination) is required to be made to Mother Dairy on selection. The concessionaire will undergo free training for two to four weeks with Mother Dairy prior to allotment of booths/shops.

RETAIL CHANNEL
The retail channel includes small and big shops which sell Mother Dairy products with a margin of 15%. Mother Dairy caters to the ice cream demands of this segment that includes provision stores, bakeries, confectionaries, restaurants etc.

MODERN RETAIL
This is a relatively newer channel which includes all the major retail outlets like Spencers daily, Big Bazaar, More, Reliance retail, etc. Through this, Mother Dairy taps the overwhelmingly successful organized retail format.

MOTHER DAIRY FOOD SERVICES (MFS)

This channel caters to hotels, banquet halls, the railways as well as airways. All these come under the MFS. It is a one window stop to provide all Mother Dairy products (including Dhara oil) to such customers. The margin given to them varies, as it is a tender- based process. The purpose of this channel is to maintain a strong presence of Mother Dairy in these areas and in the process gain profit.

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VENDING
It is the prime channel of sales of Mother Dairy Ice Creams. These vending carts are placed strategically in high footfall areas for example outside schools, colleges, parks, colonies, bus stops, cinema halls, major markets and therefore provides the mobility and flexibility The supply of ice creams to the vending machines and the maintenance is done by VRS (Vending Redistribution Stockist). Ice Cream vending Cart is ideal as a light weight cart that is very easy to push and store ice creams. They are charged by plugging in to a power supply for 8 to 10 hours. These vehicles are ideal for vending pre-packaged novelty ice cream. There are also high capacity freezer on wheels which are specially located at India Gate. Dry ice carts are also used in areas where no electricity is available. The Vendor gets a margin of 14% on MRP on mother dairy ice creams. One vending cart can store up to Rs. 5000 worth of ice creams at one time. The typical timings of vendors going out for vending operation is from afternoon till midnight, depending on their allocated area. Push carts are a key driver of growth as it contributes around 17% to the total revenues. Mother Dairy has a chain of about 1850 vending carts in Delhi region.

DIVERSIFICATION MOVES BY MOTHER DIARY

After becoming a pan-India player recently, dairy chain Mother Dairy, a subsidiary of the National Diary Development Board is now eyeing a turnover of one billion dollar in the next two years. The dairy chain's topline has been growing at a rate of 22-25 per cent per annum and is expecting a turnover of Rs 2,700 crore this fiscal. Mother Dairy will be the second dairy chain in the country after Amul to cross the one billion turnover milestone, if it achieves the target. For over three decades, Mother Dairy restricted its presence mainly in the National Capital Region in the fresh milk and other milk products segment. This year it went for a market expansion across the country. They have a plan to capture all the top six markets in the milk and milk products segment in the country. It has recently entered the fresh milk market in Hyderabad and simultaneously made foray into curd, ice-cream and lassi segments in Mumbai market. Mother Dairy markets dairy products such as fresh liquid milk, ice-creams, and other milk products. It also markets Dhara range of edible oils and the Safal range of fresh fruits and vegetables and fruit juices.

COMPETITION IN DIFFERENT PRODUCTS

The nature of competition varied among the different products. In the case of liquid milk, competition is from private dairies and contractors. There was also competition from newly emerging private dairies that had started supplying milk to the consumers as well as sweet makers. There was intense competition for the supply of milk, which was sought after, especially in the festival seasons, by the sweet makers who derived
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large profits from the sale of their sweets. Consumers were generally not very particular about the brand of liquid milk, so that the sales depended to a large extent on dealer push. However, there was scope to establish differentiation through apprising the customers of the quality not only of the initial milk itself, but also the quality of the supply chain, which ensured the stability of milk. For butter and cheese, new entrants were making their mark. Britannia, a firm engaged in manufacture and sale of biscuits, had entered into foods business, and more particularly in milk and milk related products such as butter. Britannia had introduced new forms of cheese such as cheddar cheese slices, and supported its products with extensive advertising campaigns. It was believed that advertisements played a powerful role in the demand for particular brands of butter and cheese. The ice creams market was an emerging market in India, witnessing the entry of numerous players. The national scene was dominated by Hindustan Lever with its Kwality and Wallsbrands, accounting for about 45 percent of the market. GCMMF was the other national player, with about 30 percent of the market. There were, in addition, very powerful regional players such as Vadilal Ice Creams in the Western India who commanded substantial (in excess of 30 percent) of the regional market shares. Ice creams were largely promoted through local promotions, hoardings (billboards) and advertisements. It could be expected that these companies would also expand their operations in the coming years.

ADVERTISEMENT AND PROMOTION BY MOTHER DAIRY

On the marketing front, Mother Dairy says it's trying to take its product campaigns and communications to a higher platform. For instance, in the case of milk, the campaigns do not talk about the obvious benefits - milk is good for health, it has calcium and so on - but rather it targets children and are created around ideas such as "The country needs you, grow faster". As far as products such as butter, cheese and ice creams go, the campaigns have been created around "taste". For butter again, the focus is on children. "Amul butter may be selling the most, but the advertising and promotions are almost always targeted at adults," points out an analyst citing Amul's popular Utterly-Butterly campaigns. Here, Mother Dairy has dared to go different. Since 60 per cent butter is consumed by kids, the company wants them to sit up and take notice of its butter. Makkhan Singh, a sturdy jovial cow (a cartoon character) has been made its brand ambassador. While Mother Dairy has been carrying out school programmes - games and activities involving Makkhan Singh in Delhi, it has plans to take such activities to Mumbai and Kolkata as well. It also runs a gaming website on the character to attract children. Equity and empathy are being built for the brand, the values for which it stands, and the
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various other Mother Dairy products, which draw their core values from Mother Dairy milk. It's cheese for children again. A couple of months ago, Mother Dairy carried out a retail activity: "Cheese khao superhero ban jao", where kids buying cheese at a retail outlet were invited for a photo op - dressed as superheros - through Polaroid cameras; and the framed photograph was presented to them. The activity was carried out in about 150 outlets in Delhi and Mumbai, with about 20,000-25,000 snaps being taken. It claims that the exercise resulted in better ties with retailers. A positive response made Mother Dairy to repeat it in Kolkota as well. Clearly, Mother Dairy has aggressive plans. But, strong regional brands and other co-operatives will continue to give it tough competition. It will not be a cakewalk anymore.

SWOT ANALYSIS OF MOTHER DAIRY

STRENGTHS
Indias best-known brand across all categories. Mother Dairy has Indias one of the biggest frozen highway. Well-established distribution and delivery network for dairy based product. Biggest sourcing base for milk and dairy based product. Mother Dairy has a wide portfolio in the pure milk based ice cream, rather than frozen dessert. Large variety of ice cream and its reasonable price gives the value for money to customer. Consumers have trust on the brand name of Mother Dairy, which is helping to Mother Dairy build up a formidable image.

WEAKNESSES
The main weakness of Mother Dairy is that the advertising strategy is not as competitive as Kwality walls and other brand. The replacement policy of Mother Dairy is very tough, and because of this many retailer dont want to go with Mother Dairy. One of the major weaknesses is availability of product & services in odd seasons. Company have no strategy for those canteen owners who dont want to invest in deep freezer or financially weak.

OPPORTUNITIES
Mother Dairy has the opportunity to capture the most evolved young adult and children market. Take an advantage of other companys outlet by convincing the retailer and provide them extra benefits for selling Mother Dairy ice cream. In many areas people are not interested to invest big amount on ice cream so Mother Dairy has a great chance to excel by introducing Ice cream of Rs. 2 or 3.

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THREATS
Increasing competition from the other brands. Strong supply chain management by the competitors. Strong marketing strategy by competitors by offering The discount coupons to consumers and providing healthy commissions to the retailers.

PORTERS FIVE FORCE MODEL

BUYER POWER
Buyer power is determined by various factors such as switching costs, the relative volume of purchases, the standardization of the product, elasticity of demand, brand identity, and quality of the products. On one end are the large institutional buyers i.e. big hotels and restaurants which ask for discounts, extended credit periods and the other end are small retail outlets like general stores which have no power to negotiate with the firms. The power of buyers is relatively high when buyers are large, consisting of individual customers, grocery stores, convenience stores, and restaurants nationwide. Since retailers purchase ice cream products in large quantities, this gives buyers substantial leverage over price. Customers are able to substitute one brand of ice cream to another at any point in time. There are many ice cream products to choose from, so the buyers cost of switching to competing brands is relatively low.

Mother Dairys strategy must include strong product differentiation so that buyers are less able to switch over without incurring large costs. Mother Dairy upholds a strong Brand Identity in the Delhi/NCR market. It is perceived as having a higher quality. Thus, it is a strong point of differentiation.

SUPPLIER POWER
The suppliers to the ice cream industry include dairy farmers, paper container manufacturers, and suppliers of various flavourings. The principal inputs are commodities available in competitive markets. Factors affecting the bargaining power of suppliers include the threat of forward integration and the concentration of suppliers. There exist numerous potential suppliers of ingredients. The ingredients provided by each supplier are not unique or greatly differentiated. Furthermore, ice cream manufacturers are able to switch between suppliers quickly and cheaply. Also, many of the suppliers viability is tied to the well-being of large, established companies. Therefore, the bargaining power of suppliers of ingredients is rather low.

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However, Mother Dairy being a milk co operative has to empower the milk producers and farmers so that they get a remunerative return. Therefore, a certain power is vested in the hands of the farmer societies.

THREAT OF SUBSTITUTES
There is no perfect substitute to ice creams because of its very nature. However, many substitute products are available within the dessert and frozen food industry (cookies, pies, Popsicles, cakes, chocolates, soft drinks) which are basically food items consumed at leisure. Since substitute products are readily available and attractively priced, the competitive pressures posed by substitute products can be considered moderate.

POTENTIAL ENTRANTS
The barriers to entry within the ice cream industry are moderate due to the brand preferences and customer loyalty towards the larger and more established companies. Other obstacles to new entrants include the requirement for large sources of capital, specialized mixing facilities and manufacturing plants. In addition, the accessibility of distribution channels can be difficult for an unknown firm with little or no brand recognition.

INDUSTRIAL RIVALRY
The principal competitors in the ice cream industry are large, diversified companies with significantly greater resources such as Amul, Kwality Walls, Vadilal and Cream Bell, besides a lower threat from local manufacturers (kulfi etc. manufacturers). Rivalry can be characterized as intense, given that numerous competitors exist, the cost of switching to rival brands is low, and the sales-increasing tactics employed by other rivals threatens to boosts rivals unit volume of production. Also, recently there has been a surge in the number of ice cream parlours (such as Baskin Robbins, Gianis) in and around Delhi. The growing popularity of such premium ice cream parlours providing specialty ice creams will also tend to affect the business of existing companies.

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BIBLIOGRAPHY
www.amul.com/ en.wikipedia.org/wiki/Amul www.amulind.com/ www.motherdairy.com/ en.wikipedia.org/wiki/Mother_Dairy economictimes.indiatimes.com Topics www.business-standard.com www.livemint.com/2007/12/.../Mother-Dairy-to-take-on-Amul-m.ht... recomparison.com Comparisons Business www.indiadairy.com/ indiandairy.co.i mofpi.nic.inn/ www.entrepreneurswebsite.com/2011/04/18/dairy-industry-of-india/ www.dairyuniverseindia.com/

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