Amul The Taste of India: College of Business Administration Lingaraj College

Amul THE TASTE OF INDIA
Contents
The Indian milk man The Amul saga About Indian diary industry The birth of and development of indias diary cooperativemovement Operation flood About GCMMF Product mix Customers Competitors brand building Distribution network Amul Parlours Cooperative development programme Action@ amul Mission 2020 CSR the amul way The milkmans exist
College of Business Administration Lingaraj College
Dr.VERGHESE KUREIN
Dr. VERGHESE KURIEN was born on 26 November 1921 in Calicut. He went to the Loyola college of Madras when he was 14yrs. Of age and completed is degree in physic when he was 18yr of age in 1940. He represented the college in four games namely tennis, cricket, badminton and boxing .He was the outstanding cadet of Madras Battalion. He did Mechanical Engineering from Madras University. After completing his degree, he joined the Tata Steel Technical Institute, Jamshedpur from where he graduated in 1946. He then went to USA on a government scholarship to earn his Master of Science in Mechanical Engineering (with distinction) from Michigan State University. Kurien has since then built this organization into one of the largest and most successful institutions in India The pattern of cooperatives had been so successful; he created the National Dairy Development Board (NDDB) to replicate the program on a nationwide. Kurien also set up GCMMF in 1973 to sell the products produced by the dairies. Today GCMMF sells brand products not only in India but also overseas. He quit the post of GCMMF Chairman in 2006 following disagreements with GCMMF management. Kurien's life story is chronicled in his memoirs 'I too had a dream'.
Kurien and his team were pioneers in inventing the process of making milk powder and condensed milk from buffalo's milk instead of cow's milk. This was the reason became so successful and competed well against Nestle who only used cow milk to make powder and condensed milk. In India buffalo milk was the main raw material unlike Europe where cow milk is abundant.
India's first Prime Minister Jawaharlal Lal Nehru visited Anand to inaugurate "factory" and he embraced Kurien for his groundbreaking work.
The amul saga

THE success of the brand name has, no doubt, resulted in my being asked to comment on its history and the reasons for its success. I have, therefore, reflected on the long history of the brand to see if I could distil reasons why is a name widely recognized and respected, not just in our cities and towns, but in our villages as well. Probably the easy, but nonetheless wrong, answer is that has been advertised well. Certainly it has helped that those responsible for keeping the name in the public eye have used considerable imagination and, if I do say so, The taste of India is nothing short of brilliant. However, there is much more to it. A successful consumer product is the object of thousands, even tens of thousands of transactions every day. In these transactions, the brand name serves in lieu of a contract. It is the assurance to the buyer that her specifications will be met. It is the sellers assurance that quality is being provided at a fair price. If has become a successful brand if, in the trade lingo, it enjoys brand equity then it is because we have honored our contract with consumers for close to fifty years. If we had failed to do so, then would have been consigned to the dustbin of history, along with thousands of other brands. The tough part of the use of a brand as a contract is that every day is a renewal; if, just once, the brand fails to meet the customers expectations or, more exactly, if it fails to delight the customer, then the contract loses its value. If s sales continue to rise, it is because that contract has been honored, again and again. I would like to think that the granddaughters of some of our first customers are now contracting with us to buy their butter, cheese, baby food, chocolates and other fine products. It is also a fact that when we first thought of exporting to West Asia and even to the United States, it was because of the loyalty of customers who, even when far from home, still craved our taste of India. What goes into the contract that is a brand name? First is quality. No brand survives long if its quality does not equal or exceed what the buyer expects. There simply can be no compromise. Thats the essence of the contract. In the case of a food product, this means that the brand must always represent the highest hygienic, bacteriological and organoleptic standards. It must taste good, and it must be good. Second, the contract requires value for money. If our customer buys an product, she gets what she pays for, and more. We have always taken pride in the fact that while we earn a good income for our owners the dairy farmers of Gujarat we dont do it at the cost of exploiting the consumer. Even when adverse conditions have reduced supplies of products like butter, we have resisted the common practice of raising prices, charging what the market would bear. Rather, we have kept prices fair and done our best to ensure that retailers do not gain at the consumers expense.
The third element of the contract is availability. A brand should be available when and
where the customer wants it. There is no benefit achieved in creating a positive brand image, and then being unable to supply the customer who wants to buy it. In our case, over the years we have built what is probably the nations finest distribution network. We reach hundreds of cities and towns through a cold chain that not only ensures that our products are available, but they reach the customer at the farthest end of the country with the same quality as you would find in Ahmadabad or Vadodara. The fourth part of the contract is service. We have a commitment to total quality. But, occasionally, we may make a mistake or, our customer may think weve made a mistake, and the customer, as they say, is always right. That is why, for , every customer complaint must be heard not just listened to. And, every customer complaint must be rectified to the extent humanly possible. For close to fifty years now, has honored its contract with the consumer. The contract that is symbolized by the brand means quality. It means value for money. It means availability. And it means service.
How did the
brand become what it is? To answer that, we must journey back in time, to the history books, to the time of Indias independence because s birth is indelibly linked to the freedom movement in India. It was Sardar Vallabhbhai Patel who said that if the farmers of India are to get economic freedom then they must get out of the clutches of the middlemen. The first cooperative was the result of a farmers meeting in Samarkha (Kaira district, Gujarat) on 4 January 1946, called by Morarji Desai under the advice from Sardar Vallabhbhai Patel, to fight rapacious milk contractors. It was Sardars vision to organise farmers, to have them gain control over production, procurement and marketing by entrusting the task of managing these to qualified professionals, thereby eliminating the middle men, the bane in farmers prosperity. The decision was taken that day in January 1946: Milk producers cooperatives in villages, federated into a district union, should alone handle the sale of milk from Kaira to the government-run Bombay Milk Scheme. This was the origin of the Anand pattern of cooperatives. The colonial government refused to deal with the cooperative. The farmers called a milk strike. After fifteen days the government capitulated. This was the beginning of Kaira District Cooperative Milk Producers Union Ltd., Anand, registered on 14 December 1946. Originally the Anand pattern included dairy cooperative societies at the village level, and a processing unit called a union at the district level. Inspired by the Kaira Union, similar milk unions came up in other districts too. In 1973, in order to market their products more effectively and economically, they formed the Gujarat Cooperative Milk Marketing Federation Limited (GCMMF Ltd.). GCMMF became the sole marketer of the original range of products including milk powder and butter. That range has since grown to include ice
cream, ghee, cheese, chocolates, shrikhand, paneer, and so on. These products have made a leading food brand in India.
The brand name, from the Sanskrit Amoolya, meaning priceless, was suggested by a quality
control expert in Anand. The first products with the brand name were launched in 1955. Since then, they have been in use in millions of homes in all parts of India, and beyond. Today is a symbol of many things: Of high quality products sold at reasonable prices, of availability, of service. There is something more, though, that makes the brand special and that something is the reason for our commitment to quality and value for money. is the brand name of 2 million farmers, members of 10,000 village dairy cooperative societies throughout Gujarat. This is the heart of, it is what gives strength to, and it is what is so special about the saga. In the early days of Kaira Union there was no dearth of cynics. Could natives handle sophisticated dairy equipment? Could western-style milk products be processed from buffalo milk? Could a humble farmers cooperative market butter and cheese to sophisticated urban consumers? The team farmers and professionals confounded the cynics by processing a variety of high-grade dairy products, several of them for the first time from buffalo milk, and marketing them nationally against tough competition.
What began way back in 1946 was really an effort to carve out a truly Indian company that
would have the involvement of millions of Indians and place direct control in the hands of the farmers. It was a mandate for producing, owning and marketing and above all, building your own truly Indian Brand. And successfully at that. You will appreciate that when the lives of lakhs of farmers depend on a brand, and when your history is grounded in the Independence movement, when not only competitors but even your own government questions you, then your resolve to be the best is like the finest steel. , therefore, is a brand with a difference. That difference manifests itself in a larger than life purpose. The purpose freedom to farmers by giving total control over procurement, production and marketing. and all other milk products produced by cooperatives were born in struggle. It was the producers struggle for command over the resources that they create, a struggle to obtain equitable returns and a struggle for liberation from dependence on middlemen. It was a struggle against exploitation. A refusal to be cowed down in the face of what others believed to be the impossible. s birth was thus a harbinger of the economic independence of our farmer brethren. s mission was the development of farmers, nutrition to the nation, and heart in heart, the real development of India.
Given Indias vast geographical spread, the country had very few dairy plants at the time of independence. As the then Prime Minister Lal Bahadur Shastri had said, One is not sufficient. Many s are the need of the hour. This led to replication of the Anand pattern through the Operation Flood programme which has, amongst others, three major achievements to its credit, namely: making dairying Indias largest self-sustainable rural employment programme, bringing India close to self-sufficiency in milk production, and trebling the nations milk production within a span of two and a half decades to make India the worlds largest milk producer.
Today, 173 milk producers cooperative unions and 22 federations play a major role in
meeting the demand for packed milk and milk products. Quality packed milk is now available in more than 1,000 cities throughout the length and breadth of India. And this is milk with a difference pasteurized, packaged, branded, owned by farmers carrying the milk drop logo, like, a symbol of quality. Over the course of Operation Flood, milk has been transformed from a commodity into a brand, from insufficient production to self sufficient production, from rationing to plentiful availability, from loose, unhygienic milk to milk that is pure and sure, from subjugation to a symbol of farmers economic independence, to being the consumers greatest insurance policy for good health. What of the future? Indias population has risen from 350 million in 1950 to 1,000 million today. As cities draw people to new employment opportunities, the current urban-rural ratio of 26:74 is likely to become 33:67 by the year 2010. As per available projections, the population by the year 2010 would touch 1,190 million people. This means that by the year 2010, rural India will be required to support some 800 million people, an increase of 11% over 1999s 720 million rural people.
Based on the current population demographics and projections, we estimate that there will be
260 million women in the age-group of 15-59 years in India by the year 2010 and this would further increase to 302 million by the year 2020, of which only 100 million would be literate. This means that rural women will comprise 21% of Indias total population. In our country, most rural women contribute to agricultural and dairying activities apart from the household work and their activities are not included in Indias GDP despite their significant contribution. Dairying is, therefore, very important to our rural women. For many, it is their main source of employment and income, incomes that they often manage themselves. Population gives us one picture. The other is provided by the demand for household commodities. By 2010, the national requirement for food grains will touch 266 million metric ton, rising to 343 mmt by 2020. For milk, estimated consumption will be 153 mmt by 2010
and 271 mmt by 2020. For edible oils, demand will soar to 9 mmt by 2010 and 13 mmt by 2020. It should be clear that agriculture will remain the most important engine of our economy. and its cooperative sister brands are aware of this challenge. The future, they say, is at best a mystery. But, it should be clear that the needs of a nation on the move must be met. The country is young. There are more working women. The needs of an ever-growing population have to be met with sustainable economic development. And the demand for milk and milk products, therefore, is only going to grow further. Couple this with the nutritional needs of the new and the old generations and it is equally clear that there will be a need for more value added milk products. This calls for production to be enhanced at even faster rate than it is at present. There is also something very special about milk, something which requires that any brand for milk and milk products to act not simply as a seller, but as a trustee. Milk is not a white good or a brown good. It is not something people save their entire lives in order to buy like a car, or a house. Milk is not a status symbol; rather it is the symbol of nutrition. Milk is a nearly complete food, providing protein, vitamins, minerals and other nutrients so essential to maintaining good health. We realize the value of milk on the day the milkman does not bring it to our doorstep, when our children have to go to school without it, when we go without our daily cup of coffee or tea. And what would our lives be like without ghee, butter, cheese, curd, lassi, chaas and the like. Milk is not only an ingredient in our favorite recipes; it is an essential ingredient of life itself. And, by its very indispensable nature, it has one of the biggest markets a whopping 82 mmt at a very conservative consumption of just 214 grams per day per person in India alone. Our commitments to the producer and our contract with the consumer are the reasons we are confident that cooperative brands, like, will have an even bigger role to play in the next fifty years. Resources need to be deployed with a purpose and a commitment to deliver better results. There is no limit for a marketing exercise then. It must build India and its culture a second time round. An India that is the land of our dreams.
INDUSTRY PROFILE
India with 134mn cows and 125mn buffaloes has the largest population of cattle in the world. More than fifty percent of the buffaloes and twenty percent of the cattle in the world are found in India and most of these are milch cows and milch buffaloes.
Indian dairy sector contributes the large share in agricultural gross domestic products. Presently there are around 70,000 village dairy cooperatives across the country.
The co-operative societies are federated into 170 district milk producers unions, which is turn has 22-state cooperative dairy federation. India is the leading producer of milk in the world followed by USA. Number one producer of milk. Despite being the worlds largest milk producer, Indias share in the world dairy trade is almost negligible.
80% of the Indian dairy industry is unorganized In India about 55% of the total milk is produced by buffalo.
Emerging Dairy Markets
Food service institutional market: It is growing at double the rate of consumer

market
Defense market: An important growing market for quality products at reasonable

prices
Ingredients market: A boom is forecast in the market of dairy products used as raw
material in pharmaceutical and allied industries
Parlour market: The increasing away-from-home consumption trend opens new

vistas for ready-to-serve dairy products which would ride piggyback on the fast food revolution sweeping the urban India
COMPANY PROFILE
Type : Cooperative Founded: 1946 Headquarters: Anand, India Industry: Dairy Revenue:
$868 million USD (06-07) Employees: 2.41 million milk producers. HISTORY Gujarat
Cooperative Milk Marketing Federation (GCMMF) is India's largest food products marketing
organisation. It is a state level apex body of milk cooperatives in Gujarat which aims to
provide remunerative returns to the farmers and also serve the interest of consumers by
providing quality products which are good value for money Amul (Anand Milk-producers
Union Limited), formed in 1946, is a dairy cooperative movement in India. The brand name
Amul, sourced from the Sanskrit word Amoolya, means priceless. It was suggested by a
quality control expert in Anand. It is a brand name managed by an apex cooperative
organisation, Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), which today
is jointly owned by some 2.41 million milk producers in Gujarat, India[1]. It is based in
Anand town of Gujarat and has been a sterling example of a co-operative organization's
success in the long term. The Amul Pattern has established itself as a uniquely appropriate
model for rural development. Amul has spurred the White Revolution of India, which has
made India the largest producer of milk and milk products in the world. It is also the world's
biggest vegetarian cheese brand [2]. Amul's product range includes milk powders, milk,
butter, ghee, cheese, curd, chocolate, ice cream, cream, shrikhand, paneer, gulab jamuns,
basundi, Nutramul brand and others. Situation of farmers Over five decades ago, the life of an
average farmer in Kheda District was very much like that of his/her counterpart anywhere
else in India. His/her income was derived almost entirely from seasonal crops. The income
from milk buffaloes was undependable. Milk producers had to travel long distances to deliver milk to the only dairy, the Polson Dairy in Anand often milk went sour, especially in the
summer season, as producers had to physically carry milk in individual containers. Private
traders and middlemen controlled the marketing and distribution system for the milk. These
middlemen decided the prices and the off-take from the farmers by the season. As milk is
perishable, farmers were compelled to sell it for whatever they were offered. Often, they had
to sell cream and ghee at throw-away prices. In this situation, the private trader made a
killing. Moreover, the government at that time had given monopoly rights to Polson Dairy
(around that time Polson was the most well known butter brand in the country) to collect milk
from Anand and supply to Bombay city in turn (about 400 kilometers away). India ranked
nowhere amongst milk producing countries in the world in 1946. Gradually, the realization
dawned on the farmers with inspiration from then nationalist leaders Sardar Vallabhbhai Patel
(who later became the first Home Minister of free India) and Morarji Desai (who later
become the Prime Minister of India) and local farmer, freedom fighter and social worker
Tribhovandas Patel, that the exploitation by the trader could be checked only if they marketed
their milk themselves. Amul was the result of the realization that they could pool up their milk and work as a cooperative. PRODUCT AMUL BUTTER : UTTERLY BUTTERLY DELICIOUS AMUL BUTTER was the first product which was officially launched by
AMUL in 1945. It has been a market leader during the last 4 decades. AMUL BUTTER is
made from Butter, Common Salt, permitted natural colour- Annatto Composition: Milk Fat
80% Moisture 16% Salt 2.5% Curd 0.8% Calorific Value: 720 kcal./100g Special Features:
Made from fresh cream by modern continuous butter making machines. Marketed in India
since 4 decades. Product Specification: Meets AGMARK standard and BIS specifications
No.IS:13690:1992 PRICE: Amul Pricing Strategies 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. 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 butter at a basic, affordable
price to appeal the common masses. This helped AMUL BUTTER to create its brand image
in the household sector of the society. Rs.87 Rs.18 PLACE: A Global Distributor GCMMF is
India's largest exporter of Dairy Products. It has been accorded a "Trading House" status.
GCMMF has received the APEDA Award from Government of India for Excellence in Dairy
Product Exports for the last 9 years. Currently Amul has 2.41 million producer members with
milk collection average of 5.08 million litres/day. Besides India, Amul has entered overseas
markets such as Mauritius, UAE, USA, Bangladesh, Australia, China, Singapore, Hong Kong
and a few South African countries. Its bid to enter Japanese market in 1994 had not
succeeded, but now it has fresh plans of flooding the Japanese markets [6]. Other potential
markets being considered include Sri Lanka. PROMOTION: Initial Promotional Strategy The
butter, which had been launched in 1945, had a staid, boring image, primarily because the
earlier advertising agency which was in charge of the account preferred to stick to routine, corporate ads. They didnt help in creating a brand image of AMUL butter which was their then motive. The image they presented was, well, boring. A brand - Amul A Taste of India
However, in 1966, a man named Sylvester daCunha, from the ad agency of ASP, took over
the Amul account. And in 1967 it began, innocently enough. In India, food was something
one couldn't afford to fool around with. It had been taken too seriously, for too long.
Sylvester daCunha decided it was time for a change of image. Scott Bradbury, the marketing genius behind Nike and Starbucks, once said A great brand is a story that is never completely told. A brand is a metaphorical story thats evolving all the time. Stories create the emotional context people need to locate themselves in the larger experience He could
easily have been talking about the Amul moppet. The moppet who put Amul on India's
breakfast table The year Sylvester daCunha took over the account, the country saw the birth
of a campaign whose charm has endured fickle public opinion, gimmickry and all else. The
Amul moppet, the little girl who created a home in the hearts and minds of millions and
millions of Indians. No easy task. And to be there for almost 34 years! Call her the Friday to
Friday star because Every Friday, since 1967, this little girl appears at billboards, strategically placed all over India, focusing on the item of the week tongue in cheek, of course. Round
eyed, chubby cheeked, winking at you, from strategically placed hoardings at many traffic
lights. She is the Amul moppet everyone loves to love (including prickly votaries of the Shiv
Sena and BJP). How often have we stopped, looked, chuckled at the Amul hoarding and
product wrappers with the equally recognisable tagline Utterly Butterly Delicious Amul that
casts her sometime as the coy, shy Madhuri, a bold sensuous Urmila or simply as herself,
dressed in her little polka dotted dress and a red and white bow, holding out her favourite
packet of butter. There are no boundaries and nothing is off limits. From the political scene,
to entertainment, from local news to international, from sports to stars, she has a line for everything. Often said to be playing the role of a social observer with evocative humor, the billboards became, and still are, a topic of conversation amongst millions. With their hinglish (a combination of Hindi and English) punch-lines, they have won the maximum number
of awards in India for any ad campaign ever! This little thumbalina, seems to have the masses, right where she wants them wanting more of her and of Amul. No other brand
comes close to what Amul has been able to accomplish. ADVERTISING Its advertising has
also started using tongue-in-cheek sketches starring the Amul baby commenting jovially on
the latest news or current events. This formed a large chunk of the collective memory of us
Indians. We grew with them as the ads grew with us. They are quirky, poke fun at no one in
particular and are pure eye-candy! We almost admire the speed with which the ad-people
come up with copy and illustration for the ads, that change every few days!! From the Sixties
to the Nineties, the Amul ads have come a long way. While most people agree that the Amul
ads were at their peak in the Eighties they still maintain that the Amul ads continue to tease a
laughter out of them The Amul ads are one of the longest running ads based on a theme, now
vying for the Guinness records for being the longest running ad campaign ever. Where does
Amul's magic actually lie? Many believe that the charm lies in the catchy lines. That we
laugh because the humour is what anybody would enjoy. They don't pander to your
nationality or certain sentiments. It is pure and simple, everyday fun. BRANDING The first
products with the Amul brand name were launched in 1955. Since then, they have been in use
in millions of homes in all parts of India, and beyond. There is something more, though, that
makes the Amul brand special and that something is the reason for the commitment to quality
and value for money. Amul is the brand name of 2 million farmers, members of 10,000
village dairy cooperative societies throughout Gujarat. This is the heart of Amul, it is what
gives strength to Amul, and it is what is so special about the Amul saga. The Amul Pattern
has established itself as a uniquely appropriate model for rural development. Amul has made
India one of the largest milk producers in the world. Amul, therefore, is a brand with a difference. That difference manifests itself in a larger than life purpose. The purpose
freedom to farmers by giving total control over procurement, production and marketing. Our
commitment to the producer and our contract with the consumer is the reasons we are
confident that cooperative brands, like Amul, will have an even bigger role to play in the next
fifty years. MARKETING STRATEGIES 4 MAIN STRATEGIES What goes into the contract that is a brand name? First is quality. No brand survives long if its quality does not
equal or exceed what the buyer expects. There simply can be no compromise. Thats the
essence of the contract. In the case of a food product, this means that the brand must always
represent the highest hygienic, bacteriological and organoleptic standards. It must taste good,
and it must be good. Second, the contract requires value for money. If our customer buys an
Amul product, she gets what she pays for, and more. We have always taken pride in the fact that while we earn a good income for our owners the dairy farmers of Gujarat we dont do
it at the cost of exploiting the consumer. Even when adverse conditions have reduced
supplies of products like butter, we have resisted the common practice of raising prices,
charging what the market would bear. Rather, we have kept prices fair and done our best to ensure that retailers do not gain at the consumers expense. The third element of the contract
is availability. A brand should be available when and where the customer wants it. There is
no benefit achieved in creating a positive brand image, and then being unable to supply the
customer who wants to buy it. In our case, over the years we have built what is probably the nations finest distribution network. We reach hundreds of cities and towns through a cold
chain that not only ensures that our products are available, but they reach the customer at the
farthest end of the country with the same quality as you would find in Ahmedabad or
Vadodara. The fourth part of the contract is service. We have a commitment to total quality.
But, occasionally, we may make a mistake or, our customer may think weve made a
mistake, and the customer, as they say, is always right. That is why, for Amul, every customer complaint must be heard not just listened to. And, every customer complaint must
be rectified to the extent humanly possible. For close to fifty years now, Amul has honoured
its contract with the consumer. The contract that is symbolised by the Amul brand means
quality. It means value for money. It means availability. And it means service.
The birth of and development of IndIas diary cooperative movement

Every day Amul collects 447,000 litres of milk from 2.12 million farmers (many illiterate), converts the milk into branded, packaged products, and delivers goods worth Rs 6 crore (Rs 60 million) to over 500,000 retail outlets across the country. Its supply chain is easily one of the most complicated in the world. How do managers at Amul prevent the milk from souring? Walk in to any Amul or Gujarat Cooperative Milk Marketing Federation (GCMMF) office, and you may or may not see a photograph of Mahatma Gandhi, but you will certainly see one particular photograph. It shows a long line of Gujarati women waiting patiently for a union truck to come and collect the milk they have brought in shining brass matkas. The picture is always prominently displayed. The message is clear: never forget your primary customer. If you don't, success is certain. The proof? A unique, Rs 2,200 crore (Rs 22 billion) enterprise. Organisation structure It all started in December 1946 with a group of farmers keen to free themselves from intermediaries, gain access to markets and thereby ensure maximum returns for their efforts. Based in the village of Anand, the Kaira District Milk Cooperative Union (better known as Amul) expanded exponentially. It joined hands with other milk cooperatives, and the Gujarat network now covers 2.12 million farmers, 10,411 village level milk collection centres and fourteen district level plants (unions) under the overall supervision of GCMMF. There are similar federations in other states. Right from the beginning, there was recognition that this initiative would directly benefit and transform small farmers and contribute to the development of society. Markets, then and even today, are primitive and poor in infrastructure. Amul and GCMMF acknowledged that development and growth could not be left to market forces and that proactive intervention was required. Two key requirements were identified. The first, that sustained growth for the long term would depend on matching supply and demand. It would need heavy investment in the simultaneous development of suppliers and consumers. Second, that effective management of the network and commercial viability would require professional managers and technocrats. To implement their vision while retaining their focus on farmers, a hierarchical network of cooperatives was developed, this today forms the robust supply chain behind GCMMFs endeavors. The vast and complex supply chain stretches from small suppliers to large fragmented markets.
Management of this network is made more complex by the fact that GCMMF is directly responsible only for a small part of the chain, with a number of third party players (distributors, retailers and logistics support providers) playing large roles. Managing this supply chain efficiently is critical as GCMMF's competitive position is driven by low consumer prices supported by a low cost system. 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.
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. Accordingly, marketing efforts (including brand development) were assumed by GCMMF. 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. 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. Kaizens at the unions have helped improve the quality of milk in terms of acidity and sour milk. (Undertaken by multi-disciplined teams, Kaizens are highly focussed projects, reliant on a structured approach based on data gathering and analysis.) For example, Sabar Union's records show a reduction from 2.0% to 0.5% in the amount of sour milk/curd received at the union. The most impressive aspect of this large-scale roll out is that improvement processes are turning the village societies into individual improvement centers. 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. Few dairies of the world have the wide variety of products produced by the GCMMF network. Village societies are encouraged through subsidies to install chilling units. 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.
Operation Flood
In 1970 through NDDB Varghese kurien initiated operation flood a rural development intivative. Its main objective was to create a nation wide milk grid by increasing milk production. The other objective was to provide fair wages to consumers.
PHASE I (1970-1980)
During this phase 18 premier milk sheds in the country were linked to the four metropolitan cities namely Delhi, Calcutta, Chennai and Mumbai.
PHASE-II (1981-1985)
Number of milk sheds Increased from 18 to 136. Self sustaining system -43,000 village co-ops with 4.25million milk producers.
PHASE III (1985-1996)

Increases in participation of women and women co-ops Expand and strengthen the infrastructure for procurement and production. Large number of new co-ops added.
Emphasis on Research & Development in animal health & nutrition and to

enhance productivity of milch animal.
Gujarat Cooperative milk Marketing Federation Ltd

It was established in 1973.Its members are the 17 district cooperative milk producers unions, 15 members and four nominal members. GCMMF is India's largest food products marketing organisation. 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 affordable quality products. GCMMF markets and manages the brand. Over the last five and a half decades, Dairy Cooperatives in Gujarat have created an economic network that links more than 2.8 million village milk producers with millions of consumers in India. These cooperatives collect on an average 7.5 million litres of milk per day from their producer members, more than 70% of whom are small, marginal farmers and landless labourers and include a sizeable population of tribal folk and people belonging to the scheduled castes. It is an institution created by the milk producers themselves to primarily safeguard their interest economically, socially as well as democratically. Business houses create profit in order to distribute it to the shareholders. In the case of GCMMF the surplus is ploughed back to farmers through the District Unions as well as the village societies. Gujarat Cooperative Milk Marketing Federation Ltd. (GCMMF), is India's largest food product marketing organisation with annual turnover (2010-11) US$ 2.2 billion. Its daily milk procurement is approx 12 million lit (peak period) per day from 15,712 village milk cooperative societies, 17 member unions covering 24 districts, and 3 million milk producer members.
GCMMF is India's largest exporter of Dairy Products. It has been accorded a "Trading House" status. Many of our products are available in USA, Gulf Countries, Singapore, The Philippines, Japan, China and Australia.
GCMMF has received the APEDA Award from Government of India for Excellence in Dairy Product Exports for the last 13 years. For the year 2009-10, GCMMF has been awarded "Golden Trophy' for its outstanding export performance and contribution in dairy products sector by APEDA.
For its consistent adherence to quality, customer focus and dependability, GCMMF has received numerous awards and accolades over the years. It received the Rajiv Gandhi National Quality Award in1999 in Best of All Category. In 2002 GCMMF bagged India's Most Respected Company Award instituted by Business World. In 2003, it was awarded the The IMC Ramkrishna Bajaj National Quality Award - 2003 for adopting noteworthy quality management practices for logistics and procurement. GCMMF is the first and only Indian organisation to win topmost International Dairy Federation Marketing Award for probiotic ice cream launch in 2007.
Member unions
1. Kaira District Cooperative Milk Producers' Union Ltd., Anand 2. Mehsana District Cooperative Milk Producers' Union Ltd, Mehsana 3. Sabarkantha District Cooperative Milk Producers' Union Ltd., Himatnagar 4. Banaskantha District Cooperative Milk Producers' Union Ltd., Palanpur 5. Surat District Cooperative Milk Producers' Union Ltd., Surat 6. Baroda District Cooperative Milk Producers' Union Ltd., Vadodara 7. Panchmahal District Cooperative Milk Producers' Union Ltd., Godhra 8. Valsad District Cooperative Milk Producers' Union Ltd., Valsad 9. Bharuch District Cooperative Milk Producers' Union Ltd., Bharuch 10. Ahmedabad District Cooperative Milk Producers' Union Ltd., Ahmedabad 11. Rajkot District Cooperative Milk Producers' Union Ltd., Rajkot 12. Gandhinagar District Cooperative Milk Producers' Union Ltd., Gandhinagar 13. Surendranagar District Cooperative Milk Producers' Union Ltd., Surendranagar 14. Amreli District Cooperative Milk Producers Union Ltd., Amreli 15. Bhavnagar District Cooperative Milk Producers Union Ltd., Bhavnagarvvb
the three tIer model

The 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 an economy of scale is achieved.
Village Dairy Cooperative Society (VDCS)

The main functions of the VDCS are as follows:
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 Supplying milk to the District Milk Union
Thus, the VDCS in an independent entity managed locally by the milk producers and assisted by the District Milk Union.
dIstrIct cooperatIve mIlk producers unIon (mIlk unIon)
The main functions of the Milk Union are as follows:

Procurement of milk from the Village Dairy Societies of the District Arranging transportation of raw milk from the VDCS to the Milk Union. Providing input services to the producers like Veterinary Care, Artificial Insemination services, cattle-feed sales, mineral mixture sales, fodder & fodder seed sales, etc.
Conducting training on Cooperative Development, Animal Husbandry & Dairying for milk producers and conducting specialised skill development & Leadership Development training for VDCS staff & Management Committee members.
Providing management support to the VDCS along with regular supervision of its activities.
Establish Chilling Centres & Dairy Plants for processing the milk received from the villages.
Selling liquid milk & milk products within the District 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)
Marketing of milk & milk products processed / manufactured by Milk Unions. Establish distribution network for marketing of milk & milk products. 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).
Providing support services to the Milk Unions & members like Technical Inputs, management support & advisory services.
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.
Arranging for common purchase of raw materials used in manufacture / packaging of milk products.
Decide on the prices of milk & milk products.
Product categories
Amul milk
Bread spreads
Cheese
UHT Milk
Beverage Range
Ice cream
Paneer
Dahi
Ghee
Milk powder
Nutramul
Mithai range
Mithai mate
Choclate
Fresh cream
pouch butter milk
Brand building
Amul Butter Girl The moppet who put Amul on India's breakfast table 50 years after it was first launched, Amul's sale figures have jumped from 1000 tonnes a year in 1966 to over 25,000 tonnes a year in 1997. No other brand comes even close to it. All because a thumb-sized girl climbed on to the hoardings and put a spell on the masses. Bombay: Summer of 1967. A Charni Road flat. Mrs. Sheela Mane, a 28-year-old housewife is out in the balcony drying clothes. From her second floor flat she can see her neighbours on the road. There are other people too. The crowd seems to be growing larger by the minute. Unable to curb her curiosity Sheela Mane hurries down to see what all the commotion is about. She expects the worst but can see no signs of an accident. It is her four-year-old who draws her attention to the hoarding that has come up overnight. "It was the first Amul hoarding that was put up in Mumbai," recalls Sheela Mane. "People loved it. I remember it was our favourite topic of discussion for the next one week! Everywhere we went somehow or the other the campaign always seemed to crop up in our conversation." Call her the Friday to Friday star. Round eyed, chubby cheeked, winking at you, from strategically placed hoardings at many traffic lights. She is the Amul moppet everyone loves to love (including prickly votaries of the Shiv Sena and BJP). How often have we stopped, looked, chuckled at the Amul hoarding that casts her sometime as the coy, shy Madhuri, a bold sensuous Urmila or simply as herself, dressed in her little polka dotted dress and a red and white bow, holding out her favourite packet of butter. For 30 odd years the Utterly Butterly girl has managed to keep her fan following intact. So much so that the ads are now ready to enter the Guinness Book of World Records for being the longest running campaign ever. The ultimate compliment to the butter came when a British company launched a butter and called it Utterly Butterly, last year. It all began in 1966 when Sylvester daCunha, then the managing director of the advertising agency, ASP, clinched the account for Amul butter. The butter, which had been launched in 1945, had a staid, boring image, primarily because the earlier advertising agency which was in charge of the account preferred to stick to routine, corporate ads. One of the first Amul hoardings
In India, food was something one couldn't afford to fool around with. It had been taken too seriously, for too long. Sylvester daCunha decided it was time for a change of image.
The year Sylvester daCunha took over the account, the country saw the birth of a campaign whose charm has endured fickle public opinion, gimmickry and all else. The Amul girl who lends herself so completely to Amul butter, created as a rival to the Polson butter girl. This one was sexy, village belle, clothed in a tantalising choli all but covering her upper regions. "Eustace Fernandez (the art director) and I decided that we needed a girl who would worm her way into a housewife's heart. And who better than a little girl?" says Sylvester daCunha. And so it came about that the famous Amul Moppet was born. That October, lamp kiosks and the bus sites of the city were splashed with the moppet on a horse. The baseline simply said, Thoroughbread, Utterly Butterly Delicious Amul,. It was a matter of just a few hours before the daCunha office was ringing with calls. Not just adults, even children were calling up to say how much they had liked the ads. "The response was phenomenal," recalls Sylvester daCunha. "We knew our campaign was going to be successful." For the first one year the ads made statements of some kind or the other but they had not yet acquired the topical tone. In 1967, Sylvester decided that giving the ads a solid concept would give them extra mileage, more dum, so to say. It was a decision that would stand the daCunhas in good stead in the years to come. In 1969, when the city first saw the beginning of the Hare Rama Hare Krishna movement, Sylvester daCunha, Mohammad Khan and Usha Bandarkar, then the creative team working on the Amul account came up with a clincher -- 'Hurry Amul, Hurry Hurry'. Bombay reacted to the ad with a fervour that was almost as devout as the Iskon fever. That was the first of the many topical ads that were in the offing. From then on Amul began playing the role of a social observer. Over the years the campaign acquired that all important Amul touch. India looked forward to Amul's evocative humour. If the Naxalite movement was the happening thing in Calcutta, Amul would be up there on the hoardings saying, "Bread without Amul Butter, cholbe na cholbe na (won't do, won't do). If there was an Indian Airlines strike Amul would be there again saying, Indian Airlines Won't Fly Without Amul. There are stories about the butter that people like to relate over cups of tea. "For over 10 years I have been collecting Amul ads. I especially like the ads on the backs of the butter packets, "says Mrs. Sumona Varma. What does she do with these ads? "I have made an album of them to amuse my grandchildren," she laughs. "They are almost part of our culture, aren't they? My grandchildren are already beginning to realise that these ads are not just a source of amusement. They make them aware of what is happening around them." Despite some of the negative reactions that the ads have got, DaCunhas have made it a policy not to play it safe. There are numerous ads that are risque in tone. "We had the option of being sweet and playing it safe, or making an impact. A fine balance had to be struck. We have a campaign that is strong enough to make a statement. I didn't want the hoardings to be pleasant or tame. They have to say something," says Rahul daCunha.
"We ran a couple of ads that created quite a furore," says Sylvester daCunha. "The Indian Airlines one really angered the authorities. They said if they didn't take down the ads they would stop supplying Amul butter on the plane. So ultimately we discontinued the ad," he says laughing. Then there was the time when the Amul girl was shown wearing the Gandhi cap. The high command came down heavy on that one. The Gandhi cap was a symbol of independence, they couldn't have anyone not taking that seriously. So despite their reluctance the hoardings were wiped clean. "Then there was an ad during the Ganpati festival which said, Ganpati Bappa More Ghya (Ganpati Bappa take more). The Shiv Sena people said that if we didn't do something about removing the ad they would come and destroy our office. It is surprising how vigilant the political forces are in this country. Even when the Enron ads (Enr On Or Off) were running, Rebecca Mark wrote to us saying how much she liked them." Amul's point of view on the MR coffee controversy There were other instances too. Heroine Addiction, Amul's little joke on Hussain had the artist ringing the daCunhas up to request them for a blow up of the ad. "He said that he had seen the hoarding while passing through a small district in UP. He said he had asked his assistant to take a photograph of himself with the ad because he had found it so funny," says Rahul daCunha in amused tones. Indians do have a sense of humour, afterall. From the Sixties to the Nineties, the Amul ads have come a long way. While most people agree that the Amul ads were at their peak in the Eighties they still maintain that the Amul ads continue to tease a laughter out of them. Where does Amul's magic actually lie? Many believe that the charm lies in the catchy lines. That we laugh because the humour is what anybody would enjoy. They don't pander to your nationality or certain sentiments. It is pure and simple, everyday fun.
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Compitators
Brittania Nestle HLL Cadboury Mother Diary
Distribution network
THE COMPANYAMUL means "priceless" in Sanskrit. A quality control expert in Anand suggested the brand name Amul, from the Sanskrit Amoolya, Variants, all meaning "priceless", are found in several Indian languages. 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. (Turnover: Rs. 25 billion in 2002). TodayAmul is a symbol of many things. Of high-quality products sold at reasonable prices, ofthe genesis of a vast co-operative network, of the triumph of indigenous technology, ofthe marketing savvy of a farmers' organization and have a proven model for dairy development. List of Products Marketed: Breadspreads: Amul Butter Amul Lite Low Fat Breadspread Cheese Range: Amul Pasteurized Processed Cheddar Cheese Amul Processed Cheese Spread Amul Mozarella Cheese Amul Emmental Cheese Amul Gouda Cheese Amul Malai Paneer (cottage cheese) Utterly Delicious Pizza Mithaee Range (Ethnic sweets): Amul Shrikhand (Mango, Saffron, Almond Pistachio, Cardamom) Amul Amrakhand Amul Mithaee Gulabjamuns Amul Mithaee Gulabjamun Mix Amul Mithaee Kulfi Mix 2 UHT Milk Range: Amul Taaza 3% fat Milk Amul Gold 4.5% fat Milk Amul Slim-n-Trim 0% fat milk Amul Chocolate Milk Amul Fresh Cream Amul Snowcap Softy Mix Pure Ghee: Amul Pure Ghee Sagar Pure Ghee Infant Milk Range: Amul Infant Milk Formula 1 (0-6 months) Amul Infant Milk Formula 2 ( 6 months above) Amulspray Infant Milk Food Milk Powders: Amul Full Cream Milk Powder Amulya Dairy Whitener Sagar Skimmed Milk Powder Sagar Tea and Coffee Whitener Sweetened Condensed Milk: Amul Mithaimate Sweetened Condensed Milk Fresh Milk: Amul Taaza Toned Milk 3% fat Amul Gold Full Cream Milk 6% fat Amul Shakti Standardised Milk 3% fat Amul Smart Double Toned Milk 1.5% fat Curd Products: Amul Masti Dahi (fresh curd) Amul Butter MilkAmul Icecreams: 3 Royal Treat Range (Rajbhog, Cappuchino, Chocochips, Butterscotch, Tutti Frutti) Nut-o-mania range (Kaju Drakshi, Kesar Pista, Roasted Almond, Kesar Carnival, Badshahi Badam Kulfi, Shista Pista Kulfi) Utsav Range (Anjir, Roasted Almond) Simply Delicious Range (Vanilla, Strawberry, Pineapple, Rose, Chocolate) Nature's Treat (Alphanso Mango, Fresh Litchi, Anjir, Fresh Strawberry, Black Currant) Sundae Range (Mango, Black Currant, Chocolate, Strawberry) Millennium Icecream (Cheese with Almonds, Dates with Honey) Milk Bars (Chocobar, Mango Dolly, Raspberry Dolly, Shahi Badam Kulfi, Shahi Pista Kulfi, Mawa Malai Kulfi, Green Pista Kulfi) Cool Candies (Orange, Mango) Cassatta Tricone Cones (Butterscotch, Chocolate) Megabite Almond Cone Frostik - 3 layer chocolate Bar Fundoo Range - exclusively for kids SlimScoop Fat Free Frozen Dessert (Vanilla, Banana, Mango, Pineapple) Chocolate & Confectionery: Amul Milk Chocolate Amul Fruit & Nut Chocolate Amul Eclairs Brown Beverage: Nutramul Malted Milk Food THE CHANNEL NETWORK Distribution channel GCMMF Manufacturing Head office First leg (from manufacturing units) Depot...1 Depot...n Second leg WD1 WDn Third leg Retail1 Retail...n 5
Downstream flow Procurement Channel Distribution GCMMF Head office MU1 MU...n VCS1 VCSn Village1 Villagen Upstream flow 6 SCM AND MARKET LOGISTICS The networkMilk is procured from the villages and collected at Village Cooperative Societies (VCS), from there the milk is taken to manufacturing units where the milk is processed into various products. The products are then transporters to the company Depots located in various parts of the country. The products are then sent to Wholesale Distributors (WD) and from there to the retailers. The fact sheet Milk is procured twice a day from 2 million from Gujarat alone The payment is made under twelve hours of procurement There are 10000 village cooperative societies There are 3600 wholesale distributors in the country 45 depots The C&F agents are not fixed and are decided by the local company offices There are aproxx. 4,50,000 retailers spread all over India Total house hold consumers covered are 100,000 The milk procured per day is 5 million liters Where the total capacity of operation is 7 million liters per day The peak processing till date has been 6 million liters per day These co operative societies are bound to supply there produce only to GCMMF SCM and Market Logistics Enterprise resource planning: the company at has implemented an ERP program as low as Rs. 3 corers in collaboration with TCS ltd. The company uses it, the data right from the procurement from the farmers till the delivery of goods to the retailers is fed into the system. The software enabling the channel members to use for the synchronized working and best possible utilization of the available resources maintains details regarding the inventory management. Market logistics deals with the implementation of the SCM of the company. Upstream Channel in which milk is procured from the farmers to the manufacturing units. 1. In the first step, the milk is taken to the VCS by the farmers on foot or bicycles in small quantities 2. The second step involves the transportation of milk from the co-operatives to the manufacturing units this is done in special trucks which are equipped with tankers to carry milk. Downstream Channel, it is the distribution part of the supply chain. From the manufacturing units to the retailers. 1. First leg of transport is from the manufacturing unit to the company depots. This is done using 9 and 18 MT trucks any lesser quantity will be uneconomical to the company there fore is some time the quantity ordered is lesser then club loading is done which means that the product ordered is supplied with some other products. a. Frozen food the temperature of these trucks is kept below -18C b. Dairy wet the temperature of these trucks is kept between 0-4C 2. Second leg is from the depot to the WDs, this transport is carried out in insulated 3 and 5 MT TATA 407s here a permanent dispatch plan (PDP) is prepared where the distributor plans out the quantity of various products to be ordered on a particular date. 8 Third leg this is the flow of good from WDs to retailers, a beat plan is prepared and transportation is done on auto-rickshaws, rickshaws and bicycles. SELECTION, MOTIVATION & EVALUATION OF CHANNEL MEMBERS Selection: The company takes into consideration a host of factors while selecting the channel members. This is because GCMMF believes that selection of channel members is a long run decision & the rest of the decision regarding the supply chain depends upon the efficiency & coverage by the channel members. The following are the host of factors considered by the company in selecting the channel members: Authentication is required by the regarding the identity of the channel members, which includes the name & address, photograph of the location. Proof of solvency which requires name & address of the channel members bankers Safety of the inventory, which means that the distributor/ dealer should get the stock of the company insured. Inventory or the perishable goods kept by the distributor/ dealer should be in good
condition which means a detail of storage space & Refrigeration facility is to be provided. Refrigeration system should have deep freezers, cold room & walk in coolers. Details of the delivery vehicle, which includes Light Commercial Vehicles, Matador, 3 Wheeler Van, Tricycle Van & Hand/Push cart. The number & model of each of the vehicle needs to be furnished to the company. GCMMF acknowledges the fact that it needs to be sensitive to the market demands. For this it requires that a number of salesmen needs to be present on the field. The salesmen too are divided into various categories like the Field salesmen & Counter salesmen. Also the details of Clerical Staff & Mazdoors are to be provided. The technical competence of the salesmen needs to be mentioned Details of the product kept of other companies have to be provided. The annual sales of these products too have to be mentioned. Also details of complementary products & product lines need to be mentioned. Dealers of the company must carry a good reputation. This is due to the fact that the company believes reputation of the dealer affects the clientele. Market coverage by the distributors needs to be defined which includes details of Geographic coverage & Outlets per market area. The company also requires the dealers to furnish any Advertising & Sales initiative undertaken by them on behalf of the company. Motivation of Channel Members GCMMF strongly believes in maintaining a good relationship with the channel members so that they are genuinely motivated to work for the company. Also if the channel members are motivated, they can also initiate advertising & sales promotion schemes on behalf of the company. However to keep the channel members motivated to work, the company has to incur certain costs but the benefits of it are felt in the long run. The following are the motivation programs run by the company: Distributors One of the main factors, which keep the distributors motivated, is the margin. Usually the margins offered by the company are 8% & it is raised to 8.5%. Volume wise this comes out to be a big figure since Amuls product has a good demand in the market. However compared to the other companies the margins are still lower since the new players in the market offer a much higher margin. But the very fact that Amuls products have good demand in the market motivates the distributors to stock it. Amul being a cooperative cannot afford to give heavy monetary incentives. Amuls products are considered to be value for money since the company does not believe in charging high margins. In fact all monetary incentives are just the short run means to promote the companys product. In order to keep the Channel members motivated in the long run, Amul builds on the concept of Trade Marketing which makes the dealers & the distributors believe that the companys products are worthy of being pushed in the market. The company is organizing various Total Quality Management initiatives & workshops. Here various counseling measures are undertaken by the company to improve the overall working of the distribution network. Vision and mission statement: the company cascades down the vision to the various channel members, this is done through various events organized by the company at different locations where the values of the company are made clear and enforced to the channel members. Also the fact that Amul being a cooperative society cannot Afford to spend exorbitantly on such events therefore it has a very traditional way of organizing these get together which leaves an impact on the members. Amul yatras: this includes taking the channel members on a guided tour of the manufacturing and procuring facilities in Gujarat. So that the channel members can have an experience of the working of the company and can pick up some quality measures that can help them to synchronize and improve their own functioning at various levels. This in turn help the company to co ordinate the entire value chain, as the channel members understand the various constraints and liberties the company goes through. The company has already got the
Rajiv Gandhi award for quality. The Retailers Trade schemes: these are undertaken by the company only for the hard selling items e.g. Ice creams, flavored milk etc. for these the company raises the margins by 2%, also schemes like good packaging incase of butter and cheese is undertaken by the company. However this is only a short-term initiative to push the products of the company. Glow boards: the company puts up glow boards at the retailer and pays the major portion of the cost. Schedule of the salesmen: they provide the retails with this schedule so the retailers can pre estimate the quantities of the various products needed. Infrastructure facilitation: the company facilitates the retailers to buy freezers and fridges by formulating an easy payment program and a commitment to buy back the equipment at a reasonable price when the value of the equipment has depreciated. Evaluation of channel members Beat plan: this plan is generated for the various product categories i.e. diary dry, diary wet, Dhara and ice cream. A weekly schedule is prepared for various markets and the retailers the turnover for each of the product is calculated for the wholesale dealers. Cumulative performance: the performance of the dealers is averaged out over a period of three years where a comparison is made of the present performance vis- -vis the previous ones. Target versus achievement: the performance and the targets are compared and therefore the gaps are identified which help in evaluating the WD and planning for the next year as well. This is done for each of the product category. Other criterion o Details of the bank guaranty o Photographs of the offices o Details of the WD salesmen and the product lines he deals in o The computerization facility available o The storage space o Refrigeration facility with photograph o Details of the delivery vehicle with photograph o Summary of the monthly potential sales of markets o Summary of the product wise monthly sales potential of institutions Note: the evaluation form in original attached. 12 CONFLICTS AND CO-OPERATION AMONG CHANNEL MEMBERS Conflicts Ownership of assets: Previously the company used to give the cooling equipment on lease to the retailers, when the company wanted the stuff back; the retailer disagreed to comply and created issues of ownership. Stocking issues: The company doesnt want the retailers to stock the competing brand in the company leased fridges, which at times s hard to manage as retailers tend to do it often. Replacement of products: The deterioration in the product calls for fail in replacement by the company this major issue of vertical conflict. Credit policy: Compared to the market, the companys credit period is less that specially incase of institutional sales is very important. Packaging: The channel members for easy storing demand a better quality of packaging. Replenishment: The replenishment of the stocks is not prompt in case of amul cheese and all hard selling items. Margins: The Company provides least margins to all the channel members. For e.g. The retailers margin in case of butter is 8% as compared to Britannias 12% 13 Co-operation among channel members Amul quality circles: The members of the local channel meet together every month to share issues and the achievements of the channel members. This is an ongoing activity facilitated by the company offices in different locations; this enables the channel members to learn together and reduces the horizontal conflicts among the WDs. Pilot salesmen scheme: To reduce the financial burden of the distributors this scheme is run whereby half the cost of the salesmen is born by the company and the rest half by the distributor Scheduling of sales: The WDs provides Schedule of the distributors sales men to the retailers so that the retailers can plan out and place the orders in advance. Agreement defining rights: The company makes the distributors sign an agreement
where the areas of operation for each of the distributors are defined, therefore avoiding any conflict amongst the distributors regarding their areas of operation.
Amul parlours
Cooperative development programme Action @amul

Amul ranked No. 1 "Indian" Brand for third consecutive year in Asia The "Campaign" magazine published from Hong Kong and Singapore has ranked Amul as the No. 1 "Indian" brand in its list of Top 1000 Brands of Asia for the third consecutive year. Amul is also ranked as No.1 dairy brand, ahead of leading food and dairy brands of the Asia region like Dutch Lady, Dumex, Magnolia etc. It has overall ranked Amul as the 89th Best Brand in its ranking of Top 1000 brands of Asia based on a consumer survey conducted in Australia, China, India, Japan, Korea, Hong Kong, Malaysia, Singapore, Taiwan and Thailand. Amul's has featured in the list of top 100 brands of Asia consistently for last 3 years. There is no other "Indian" brand in the list of Top 1000 brands ahead of Amul (#89). The other Indian brands ranked as per the survey are Kingfisher (# 116), Big Bazaar (#184), ICICI Bank (# 215), State Bank of India (#216) and Airtel (# 221) to name a few. Asia's Top 1000 brand listing is based on a proprietary survey by the Campaign Magazine. Leading Research Agency TNS interviewed people 3322 consumers aged 15-64 years old across the 10 countries. Two questions were asked to determine the best brands in each of the 14 major product/service categories. The questions were pertaining to the best and second best brand that would come to the respondent's mind for a particular product/service category. The definition of best was one the respondent would trust the most or the one that had the best reputation in the product/service category. The survey reaffirms the faith Indian customers have in the Amul brand and also the fact that a brand created by India can feature among the top brands globally. This survey has been published in "Campaign" issue of July 2011.
Amul Ventures into Quick Service Restaurant Segment with Caf Amul
After touching a figure of 6,000 parlours across India, Amul, Asia's largest milk and milk products brand owned and marketed by the Gujarat Co-operative Milk Marketing Federation (GCMMF), is now venturing in quick service restaurants called Caf Amul. Tasting success with the two Amul Cafes at Ahmedabad, GCMMF has opened two more Cafs in Ahmedabad & Bangalore on October 6th, 2011."Venturing into value-added Retailing was a natural extension to us. We started with our Retailing Franchisee concept "Amul preferred Outlets" for selling our entire range of packed products. We next went for "Scooping Parlours" to sell value added Ice-creams. Our entry into Quick Service Restaurant is a natural fit with our business as Amul products go with all dishes one can think of. Our leadership in food business would get reinforced further with our Cafes." said R S Sodhi, Managing Director, GCMMF, during the inaugural function.
GCMMF receives Srishti's G-Cube Award - 2010 White revolution turns a shade greener by plantation of 235 lakhs trees by
GCMMF (Amul). Four years ago, the 17 Milk Unions affiliated with Gujarat Cooperative Milk Marketing Federation (GCMMF) decided to launch a mass tree plantation programme involving each and every member milk producer. In last four years, milk producers of Amul have planted around 235 lakhs tree saplings in Gujarat.
This initiative of farmers has been recognised nationally and internationally. GCMMF (Amul), has won Srishti's G-Cube (G3-Good Green Governance) Award 2010 in "Service Category" for fourth consecutive times. This "Amul Green" movement has also been awarded by International Dairy Federation for best environment initiative in the "sustainability category". Entire programme is initiated & executed by 30 lakh milk producer farmer members of the dairy cooperatives in 15,000 villages of the state. Each member takes oath to plant saplings and ensure that it grows in to a tree. Milk producers of Gujarat is not only producing milk, but by this green initiative, they are demonstrating their concern & commitment for betterment of environment. GCMMF Celebrates Women's Day On 8th March, 2011, the International Womens Day, GCMMF celebrated it with its women employees at Head Office, Anand. The women employees were given bouquet with Best wishes for their enthusiastic spirit be with them always.
Mission 2020
VADODARA: Gujarat Co-operative Milk Marketing Federation (GCMMF), the apex marketing body of Gujarat's dairy co-operatives that markets the Amul brand, will be pumping in Rs 2,600 crore as part of its mission 2020. The co-operative aims to become a Rs 27,000 crore group in 2020 from present Rs 10,000 crore. A major part of this investment will go in ramping up infrastructure and capacities of the 13 district dairy unions. At the same time, Amul also wants to scale up the number of Amul parlours from present 4,000 to 10,000 by end of 2010.
The bigger plan is to set up satellite dairies in all major metros of the country. Its member unions will set up three new milk processing dairy plants at Delhi, Mumbai and Kanpur, with an estimated investment of Rs 50 crore each. While Asia's largest dairy Mehsana District Co-operative Milk Producers Union Limited (MDCMPUL), popularly known as Dudhsagar Dairy, will expand capacity of Manesar plant through which it presently supplies milk in Delhi market, the Sabarkantha District Cooperative Milk Producers Union Limited, popularly known as Sabar Dairy, will set up a new plant to cater to Delhi market. At the same time, the Kaira District Co-operative Milk Producers Union Limited (KDCMPUL), popularly known as Amul Dairy, is setting up a plant at Mumbai whereas Gujarat's second largest dairy, the Banaskantha District CoCollege of Business Administration Lingaraj College
operative Milk Producers Union Limited (BDCMPUL) popularly Banas Dairy is setting up a plant at Kanpur. "Delhi has turned into our biggest market where we supply around 13 lakh litres per day (LLPD), including ten LLPD from Mehsana Dairy and another three LLPD from Sabar Dairy. While Mehsana Dairy is expanding capacity of Manesar plant from three LLPD to ten LLPD, Sabar Dairy is setting up a new plant that will process six LLPD," says GCMMF's managing director B M Vyas. The battle between GCMMF and the National Dairy Development Board (NDDB) to capture the Delhi market is getting intense since quite some time now. NDDB's Mother Dairy is the market leader in Delhi with sales over 25 LLPD, including 15 LLPD sales that it does through packaged milk and another ten LLPD through milk vending machines which sell lose milk. GCMMF, which had entered the Delhi market five years back, is hoping to overtake Mother Dairy's packaged milk market in a span of two years. In Mumbai, GCMMF's member unions presently supply nearly 6.5 LLPD, but Amul Dairy will be setting up a processing plant with four LLPD capacity in the initial phase. Stateowned Mahananda Dairy is presently is one of the biggest suppliers in Mumbai. "There is huge demand of milk in Mumbai and space for all the players," says KDCMPUL's chairman Ramsinh Parmar, adding that the new plant in Mumbai will help scale up Amul's milk supply to ten LLPD in Mumbai. Amul Dairy already processes nearly 3.5 lakh LLPD milk at two rented facilities in Kolkata where it produces ice-cream and curd apart from milk. With population-sizes like that of Ahmedabad, Lucknow and Kanpur are emerging as important milk markets, BDCMPUL will be setting up a liquid milk and fresh products manufacturing plant at Kanpur through which supply to Amul milk will be increased to four LLPD from present two LLPD.
Corporate Social Responsibility (csr), The Amul Way

Corporate social responsibility (CSR) has been defined as the commitment of business to contribute to sustainable economic development working with employees, their families, the local community, and society at large to improve their quality of life, in ways that are both good for business and good for development. To meet with the CSR it is expected that a business in its entire procurement-productionprocessing-marketing chain should focus on human development involving the producer, the worker, the supplier, the consumer, the civil society, and the environment. Indeed, a very tough task. Most businesses would certainly flounder in not being able to achieve at least one or many of those expectations. But AMUL has shown the way. CSR-sensitive Organisational Structure AMUL is a three tier co-operative organisation. The first tier is the co-operative society at the village,of which; milk producers are voluntary members, managing the co-operative through a democratically elected 9-member managing committee, and doing business by... purchasing milk from members and selling it to the district level co-operative. There are more than 11,000 co-operatives in villages of Gujarat. The second tier is the district co-operative that processes milk into milk products, markets locally and sells surplus to the state co-operative for national and international marketing.
There are 12 district co-operatives each being managed by a 15-member board elected by the college comprising the nominated representatives or chairmen of the village co-operatives. Third tier is the state level co-operative - the Gujarat Co-operative Milk Marketing Federation (GCMMF) responsible for national and international marketing of milk and milk products produced and sold to it. The GCMMF is managed by the board democratically elected by and from amongst the chairmen of the district co-operatives. The entire three-tier structure with the GCMMF at its apex, is a unique institution because it encompasses the entire chain from production of raw material to reaching... the consumer with the end product. Every function involves human intervention: 23.60 lakh primary milk producers; 35,000 rural workmen in more than 11,400 village societies; 12,000 workers in 15 dairy pla-nts; 750 marketing professionals; 10,500 salesmen in distribution network and 600,000 sal-esmen in retail network. Accu-mulation of human capital is sine qua non for the development and growth of any enterprise or economy. The GCMMF is sensitive towards CSR. It believes that technology and capital are replicable inputs but not the human capital. Since men are the basis for achieving the CSR, the GCMMF lays emp-hasis on their development into competent, courteous, credible, reliable, responsive communicators and performers. CSR-sensitive Business Philosophy The first step towards discharging the CSR is the business philosophy of the GCMMF. It is two-fold: one, to serve the interests of milk producers and second, to provide quality products to consumers as value for money. Evolution of an organisational... system has ensured that the corporate social responsibility towards the primary milk producers, village and the ecological balance is fulfilled. The milk producers are paid for their milk in accordance with market forces and realisation of value for their produce. Invariably the price paid to the member-producers in Gujarat is higher by 15 per cent than the national average. CSR-orientation To Distributors & Retailers The GCMMF has identified the distributors and retailers are its important link in its vendor supply chain. Through surveys the GCMMF found that 90% of the distributors do not get any opportunity of exposure to latest management practices. The GCMMF realised that it was a corporate social responsibility to strengthen the core business processes of its distributors so as to keep them in mainstream business and compete with those with formal training in management. The GCMMF has developed and trained all its distributors through ValueMission-Strategy Workshops, competence building, Amul Yatra, Amul Quality Circle meetings, computerisation, and electronic commerce activities. Competency Building Module of the GCMMF is meant to infuse professional selling skills by making the distributors and their salesmen aware of latest sales management tools and techniques; enhance their knowledge of products; positioning and segmentation strategies for various products. Under Amul Yatra the distributors and their salesmen are taken on a visit to Anand. During this visit they are shown dairy plants, their upkeep, international standards of hygiene and quality; the practices adopted for clean milk production, and above all the cooperative philosophy. Through one to one talk with the farmers, the distributors and salesmen realise AMUL is a large business of small farmers. The visit leaves an everlasting
impression on their minds that by selling AMUL products, they are discharging a social responsibility towards a large number of poor farmers whose livelihood depends upon their skill and integrityThey feel proud that they are participants in development of rural society and thus in nation building. Earnings Of GCMMF Nurturing its primary members - the milk producers - is the first mission of the GCMMF. Discharge of this responsibility is reflected in the manner in which the GCMMF conducts its business and shares its earnings. The milk from the village co-operatives is purchased at an interim price. So as to maximise the earnings of the milk producers the GCMMF changes the product profile during the fiscal and directs its sales and marketing activities towards those products that would bring in maximum returns. True! Every business organisation follows the same principle. But the GCMMF follows it with the central interest of the producers. During the fiscal, as the GCMMF finds that from its earnings it is possible to pay more to the producers for milk, the final price is declared higher than the interim price being paid. Before the GCMMF closes its financial accounts the co-operatives are paid price difference, the amount between the interim price and the final price. Thus profit of the GCMMF is very low. The net profit (PADT) of the GCMMF during 2003-04 was Rs 7.31 Crore against a turnover of Rs 2,947 Crore, a meagre 0.25%. Further out of the net profit of Rs 7.31 Crore, Rs 4 Crore was given as share dividend to the co-operatives. To fulfil its corporate social responsibility towards its milk producers and co-operatives the GCMMF works on razor thin profits and retention of funds. CSR-oriented To Staff The GCMMF hires and trains people to take advantage over its competitors. It has developed in-house modules for training and competence building to improve and upgrade of their knowledge; communication skills to understand the customer, be responsive to customer requirements, and communicate clearly for trouble Shooting of problems. They are expected to be courteous, friendly, respectful, and considerate to the customer. To improve the credibility and trustworthiness of the managers it is important they perform consistently and accurately every time and at all times. The structure of salary and perquisites is altogether different. The first and foremost the staff must get satisfaction from the job they. They are recognised for their contribution (Climate Survey) CSR-AMUL WAY
History
It was formally registered on December 14, 1946.
In 1929 Peston Edul Polson established polson dairy at Anand. In 1944 Bombay Municipal Corporation Milk Supply was inaugurated. Monopoly rights were given to polson for producing milk from kaira. Farmers were cheated by the middlemen. Tribhuvandas patel a young farmer thought of bringing farmers together. Hence farmers approached sardar Vallabhai patel under the leadership of tribhuvandas patel. Moraraji desai organised the farmers and formed cooperative society. KDCMPUL was formed to collect and process the milk which marked the beginning of. Gujarat cooperation milk marketing federation was formed and given the brand name. Under the leadership of tribhuvandas patel and with the help of dr. verghese kurien, started expanding rapidly.
THE SAGA
How did the brand become what it is? To, answer that s birth is indelibly linked to the freedom movement in India. It was Sardar Vallabhbhai Patel who said that if the farmers of India are to get economic freedom then they must get out of the clutches of the middlemen. It was Sardars vision to organise farmers, to have them gain control over production, procurement and marketing by entrusting the task of managing these to qualified professionals, thereby eliminating the middle men, the bane in farmers prosperity. This was the origin of the Anand pattern of cooperatives. The colonial government refused to deal with the cooperative. The farmers called a milk strike. After fifteen days the government capitulated. This was the beginning of Kaira District Cooperative Milk Producers Union Ltd., Anand, registered on 14 December 1946.
In 1973, in order to market their products more effectively and economically, they formed the Gujarat Cooperative Milk Marketing Federation Limited (GCMMF Ltd.). GCMMF became the sole marketer of the original range of products including milk powder and butter. That range has since grown to include ice cream, ghee, cheese, chocolates, shrikhand, paneer, and so on. These products have made a leading food brand in Indi
AWARDS RECEIVED
Magasasy
Padmashri
Padma Bhushan
Padma Vibhushan
World food prize

Amul The Taste of India: College of Business Administration Lingaraj College

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Amul The Taste of India: College of Business Administration Lingaraj College

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Amul THE TASTE OF INDIA

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

The amul saga

College of Business Administration Lingaraj College

How did the

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

Emerging Dairy Markets

Food service institutional market: It is growing at double the rate of consumer

Defense market: An important growing market for quality products at reasonable

Parlour market: The increasing away-from-home consumption trend opens new

College of Business Administration Lingaraj College

quality control expert in Anand. It is a brand name managed by an apex cooperative

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

The birth of and development of IndIas diary cooperative movement

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

PHASE III (1985-1996)

Emphasis on Research & Development in animal health & nutrition and to

College of Business Administration Lingaraj College

Gujarat Cooperative milk Marketing Federation Ltd

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

the three tIer model

Village Dairy Cooperative Society (VDCS)

College of Business Administration Lingaraj College

dIstrIct cooperatIve mIlk producers unIon (mIlk unIon)

The main functions of the Milk Union are as follows:

State Cooperative Milk Federation (Federation)

College of Business Administration Lingaraj College

Decide on the prices of milk & milk products.

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

pouch butter milk

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

College of Business Administration Lingaraj College

Cooperative development programme Action @amul

College of Business Administration Lingaraj College