Visakhapatnam - 530045 Summer Internship Project Report Distribution System of Amul Products through Pharmacies in Hyderabad

Submitted By

LINGAM KRISHNA RAVITEJA MBA (IB) (2012-14) (1226112129)

In Partial Fulfillment of Requirement for the Award of the Degree of Master of Business Administration (International Business)

Under the Guidance of

Faculty Guide
Dr. V. L. Rao GITAM Chair Professor of International Trade and Finance GSIB

Industry Guide
Mr. S.V. R Chary Branch Manger Amul, Hyderabad

DECLARATION
I here by solemnly declare that the project entitled Distribution System of Amul Products through Pharmacies at Hyderabad submitted by me to GITAM School of International Business, GITAM University is a genuine and bona fide work done by me and is not submitted to any other University or published any time before .The project work is in partial fulfillment of the requirement for award of Master of Business Administration .

Place : Visakhapatnam Date

LINGAM KRISHNA RAVITEJA

ACKNOWLEDGEMENT

I would like to our heartfelt gratitude and thanks to Prof V L Rao for his guidance and support throughout this project. I am thankful to my Institute for providing me with proper resources and fostering this project work.

I convey my sincere thanks to Mr S.V. R Chary Branch Manager for granting me an opportunity to work with an esteemed organization. He has been benevolent enough to lend help and spare his valuable time throughout this project. He has been immensely contributive with his ideas, constructive criticism and motivation which were the guiding light during the entire tenure of this project.

I also extend my heartiest thanks to the Manager and other employees of GCMMF for their support and guidance.

CONTENTS
Page No Executive Summary 1 Chapter 1- Introduction 1.1 Objectives 1.2 Research Methodology 2 Chapter 2- The Dairy Industry in India Production policy Regulation of milk and milk products in India Trade Policy 3 Chapter 3- Company profiles Amul Pattern Three-Tier Amul Model Business Philosophy of Gcmmf 4 Chapter 4- Amul marketing and Distribution Strategies Pricing Strategies Marketing Strategies Market Segmentation Distribution Channel 5 6 Chapter 5- Analysis APPENDIX I- Questionnaire 37-44 45-46 18-36 11-17 3-10 1-2

EXECUTIVE SUMMARY

The project makes an attempt to identify the distribution system of Amul products through pharmacies in Hyderabad and also to identify the different system followed by various corporate and also the potential market for distribution for their products and also the key areas to be focused in the distribution. DISTRIBUTION The distribution system which followed by the Amul was perfect while comparing to the profit margin of Amul compared to the competitor Nestle was not so more. The distributer for the Amul products were selected by the company were as for the Nestle they have many distributer the company do not select the distributors they will give the dealership based on the credit system them maintain with the company. The sale of Amul and its competitor Nestle are same but the profit margin earned by the pharmacist on nestle is more when compared to that of Amul. The profit margin is not as much that it can be recognized on a single carton box but only if they buy 4 -5 carton boxes at the same time. The 250 ml and 5 lit milk pouch are not available to the retailers for selling. Retailers were selling different brands. Because they were able to receive more margin from on popularized brand that they could not from well known brands. All retailers get Amul products from company selected distributors. All retailers were familiar with sales promotion activities undertaken by Amul. But more of the activities were not communicated by distributors. So it shows that distributors are taking the advantage of such activities. Some questions were asked with view to convert retailers into distributors, but due to low margin they denied that. The awareness for the AMUL pro is not so more in the market

AMUL SPRAY Competitors Amul Spray have two main Competitors they are Farex and Nestle the main competitor for the Amul is Nestle because the sale for the Farex has come down because the Physicians said that Farex do not have more lactose so the sale has come down. Amul has a very high market which equally to its competitor Nestle. In the past day Amul Spray is available in only in departmental stores but now it has targeted to sell through Pharmacies as its competitor Nestle is selling through Pharmacies as the Amul Spray is prescribed by most of the Doctors now-a-days. As the Nestle is available in seven flavors but the Amul Spray is available in only one flavor. Amul remains the most affordable of baby food brands at Rs 250-270 for a one-kg pack and Rs 130-35 for 500gms. The only lever available to push the product in a category as Amul Spray via retail channels., coming second after Nestle, which has a share of close to 80 per cent. Nestles brands in India include Nestum, Nan, Lactogen, Nestogen and Cerelac. Amul Spray on the other hand, has a share above five per cent, according to industry estimates. But the demand for the product is more. Local manufacturing would also help the company bring down price points, since products are priced anywhere between Rs 200 and Rs 300 for a 500-gram tin, Kucz had said. Competitors such as Nestle are a bit more aggressive in their pricing thanks to local manufacturing capabilities. For instance, a 350-gram pack of Cerelac costs between Rs 140 and Rs 150, depending on the flavor (there are at least six to seven flavors in the marketplace). A 350-gram pack of Lactogen starts from Rs 200, while Nan costs as much as Rs 340-345 for a 450-gram pack.

Amul Pro Amul Pro is not so well know to the customers so the product was not so much salable in Hyderabad and the advertisement strategy was not up to the mark and the schemes were not up to the mark compared to the competitors products. Offers for the product was not available to Amul pro when compared to the other products in the market but the price of the product was less when compared to that of the other products but it could not go into the market because of lack of awareness. The malt beverages market with a size of 30000 crores, where GSKCH has most of the market share with 70% where as the market for the Amul Pro is less than 1%. The market leaders in this segment are horlicks followed by bournvita. The company must give more awareness for Amul pro in the market .The company must also see the margin which it is giving for the Pharmacies and retail outlets .The company must also focus on the price compared with its competitor.

CERTIFICATE
This is to certify that the report entitled Distribution System of Amul Products through Pharmacies at Hyderabad submitted by Lingam Krishna RaviTeja enrolment no 1226112129 in partial fulfillment of requirement for the award of degree of Master of Business Administration in International Business in an original work and carried out under my supervision.

Faculty Guide

Dr. V L Rao GITAM Chair Professor of International Trade and Finance GSIB