SUMMER TRAINING REPORT

On

Market study for insights for Parag’s product cheese in Modern

Trade
Parag Milk foods

Submitted in partial fulfillment of the requirements of

Post Graduate Diploma in Management (PGDM)

By

Sakshi Arora

Batch – 2017-2019

Roll No. - 16

Bharatiya Vidya Bhavan’s

Usha & Lakshmi Mittal Institute of Management

Copernicus Lane, Kasturba Gandhi Marg

New Delhi - 110001

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I hereby declare that the Project work titled – Market study for insights for Parag’s product cheese

in Modern Trade submitted by me for the Summer Internship during the Post Graduate Diploma in

Management to Bharatiya Vidya Bhavan’s Usha & Lakshmi Mittal Institute of Management

(BULMIM) is my own original work and has not been submitted earlier either to BULMIM or to any

other Institution for the fulfillment of the requirement for any course of study. I also declare that no

chapter of this manuscript in whole or in part is lifted and incorporated in this report from any

earlier / other work done by me or others.

Signature of Faculty Mentor: ________ Signature of Company Mentor: ___________

Name of Faculty Mentor: __________ Name of Company Mentor: ______________

Designation: _____________________ Designation: _________________________

Date: Date:

Place: Place:

Signature of Student: _____________

Name of Student: ________________

Batch:__________________________

Date:
Place:

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 ACKNOWLEDGEMENT

I would like to express gratitude to the ones who have been an immense support throughout my Summer
Internship Program me. Firstly, I would like to thank Mr. Vinay Gupta (Parag Milk Foods) for his
immense and kind support, I would also like to thank Mr. Sanjay Kumar Verma (Parag Milk Foods)
for his sincere support throughout the Summer Internship Support.

I would like to express my heartfelt gratitude to my faculty mentor Dr Swati Singh of Bhartiya Vidya
Bhawna’s Usha and Lakshmi Mittal Institute of Management for being a friendly support throughout
the project and also providing his wise guidance in the conduct of this project.

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 CONTENTS

 Executive Summary
 Objectives
 Introduction
 Company Profile
 Literature Review
 Working Methodology
 Analysis
 Recommendations
 Limitations
 Learning
 Appendices

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 LIST OF TABLES AND CONTENTS

SERIAL NO. TOPICS PAGE NO.

1 Executive Summary

2 Objectives

3 Introduction -

1.1 Introduction of Parag Milk Foods

1.2 Brands of Parag Milk Foods
1.3 Company Vision
1.4 Company Mission

4 Company Profile –

2.1 Functioning of the company

2.2 CSR activities
2.3 Company Statistics

5 Literature Review

6 Working Methodology

7 Analysis –

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8 Recommendations

9 Limitations

10 Learning

11 Appendices

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 EXECUTIVE SUMMARY

The project was taken into consideration for the promotion and marketing of the Go cheese in the modern
trade business and a comparison of the present business performed by other companies like: Amul,
Dairycraft, mother dairy cheese, Britannia cheese etc.

The main task assigned to us by our company mentors was to make the products available in each and
every hyper store like Big Bazar, Spencer’s, Reliance fresh.

The main aim of the summer training was to first analyze the market situation, focus on the need of the
consumers what they actually want, lacking in the competitors product so that the same thing didn’t
happen in our produce.

Along with the whole promotion and marketing of the product we get the details on the current users and
non-users with the sample size of 120 outlets wanted to know the feedback which we are getting for our
product.

Conclusion:

I have studied and analyzed the dairy based food product of cheese and curd business of PARAG on
different aspects of the users from Big Bazar, Spencers, Reliance fresh.

The 53 days of summer internship with PARAG actually helped me to learn many things that would really
be helpful in my life for future growth.

This project shows me the way to work in the market. How to communicate with different types of
people. How to convince one for better job, learn how to sell product, how things work in FMCG with
perishable nature of these product one need an excellent distribution network and carefully select user as
food business changes day to day and users may increase or decrease upon conditions.

According to me the growth of any product whether it could be food based or any other depends upon
how we do proper branding of the product and also the promotions which plays a very vital role in
attracting customers.

The main aim should be to attract costumer and to retain them so that the loyalty remains in future as
well. Besides this quality in the dominating aspect which influences consumer to purchase Go cheese, but
prompt availability of other brands and aggressive promotional activities by others influences the
consumer towards them and also leads to increase sales.

Ultimately I must say that I am privileged to work with the company like PARAG for Go cheese and& get
such a real time exposure of FMCG company.

Training Module:

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Training provided to us was a one day classroom training in which we were briefed about companies
profile and plan for future. Another day training was provided in which we get to know about the products
we have to pitch in the market and how to go and communicate with people outside.

Product brochures & booklets for company profile were given to us to give further information to the
clients.

We were taught on how to interact with the clients that includes : appointments, presentation about
company product, follow up and feedback, closing a deal.

OBJECTIVES

OBJECTIVES

1. To know the potential strength of Go cheese and Go fresh cream in modern trade.
2. To get the data on market share of Go products and other brands.
3. To create brand awareness of Go products among the modern trade.
4. To apply the theoretical knowledge in practical work during training.

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 5. To understand the new market trends and new opportunities in FMCG.
6. To know the drawbacks in Go products visibility and distribution to the users.

CHAPTER -1

INTRODUCTION

1.1 Introduction of Parag Milk Foods Pvt. Ltd.:’

Parag Milk Foods Pvt. Ltd., was established in 1992, is one of the India’s largest Private dairy
products manufacturers, having own manufacturing facility with cutting age technology. Our plants
are strategically located in Manchar, Maharashtra and Palamner, Andhra Pradesh. The company also
has its own dairy farm called Bhagyalaxmi, where it hosts 3,000 specially bred Holstein Freisensa
cows and equipped with one of India’s first Rotary Parlors, which has mechanized the whole milking
process and in turn ensured high quality and hygiene. Under the brand “Gowardhan”, it offers
traditional products like Ghee, Dahi, Paneer etc. whereas under the brand name “Go” it offers new
generation products like Cheese, UHT milk, Yogurt etc. The company believes in quality and values
its consumers, and thus its offerings to the consumers are best in quality.

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In 1992, Parag Milk Foods Pvt. Ltd. was founded by Mr. Devendra Shah at Manchar (in the milk belt
of Maharashtra). In earlier co-operative times, there were milk holidays and the farmers had to dump
their milk into garbage as co-operatives didn’t take milk from them on holidays.

Mr. Shah tapped this opportunity and started processing milk collected from farmers during holidays
and thus was born Parag Milk Foods Pvt Ltd.

From 1992 to 1998, we were primarily into collection and processing of milk. After that, we started
manufacturing dairy products such as Ghee and Milk Powders. Simultaneously, we were exporting
these dairy commodities too

In 2008, we established one of India’s largest cheese plants and started manufacturing value added
milk products. We also own one of the largest and modern dairy farms in India with rotary milk
parlour. Today, we are the youngest, strongest and one of the largest private dairy players in India.

Mr. Devendra Shah, Chairman & Managing Director, Parag Milk Foods, India’s largest private
dairy and manufacturers of the Gowardhan and Go range of milk and milk products. He also holds
reputed positions in various ventures like Director - Bhimashankar Sahakari Sakhar Karkhana,
Paragon, Secretary of National center for Rural Development. He also promotes India’s largest cow
farm called Bhagyalaxmi Dairy farm. Mr. Shah was born on September 21, 1964 in Pune. He received
a Bachelor of Commerce degree from Pune University. After graduating in commerce, Mr. Shah
dabbled in other businesses like clothes retailing but it was not until 1989 that he found his true
calling - the dairy business. The big break for Mr. Shah came in 1991 when Finance Minister Dr.
Manmohan Singh in his budget speech announced de-licensing that included the dairy sector as well.
This paved the way for private players to procure milk from farmers. He launched Parag Milk Foods
in 1992, and being a capital-intensive business he invested Rs 10mn. The money was raised from a
combination of accruals from Mr. Shah’s earlier ventures and borrowings from a local co-operative
bank. He is actively involved in agricultural activities and elevation of farming community. For his
good work, Maharashtra Government had honored him with Maharashtra Udyog Bhushan award.

The products like Ghee, Milk Powders, Dahi, and Gulab Jamun Mix etc are marketed under
the brand name “Gowardhan”, which connects us with the Indian tradition.

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On the other hand, modern products like Yogurt, Cheese, UHT Milk, etc are sold under the
brand name “Go”, which connects us with youth.

We are making our own path and we are not trying to compete with anyone in the market. We
are providing best quality and innovative products to our valuable consumers. Consumers’
response for our products is phenomenal.
That is why, being the youngest in the dairy industry, we have gained importance over a span
of just four years. Competition is rising, but the market is growing at a much faster rate. So,
we are less worried about competition and more focused towards giving quality offering to
our consumers. We hold 1% market share in dairy products but we have a higher market
share in value-added milk products.

The size of the Indian dairy industry is approximately US$70bn. The Indian Dairy Industry has
been growing @ 5% per annum.
The average per capita consumption of dairy products in India is around 300 gm compared to
the global average of 700 gm per day.

We have two plants; one in Man char, Pune (Maharashtra) and another is in Palamner, Chittur
(Andra Pradesh). Both of them are fully automated.
The capacity of both the plants is 20 lakh litres of milk per day.
The Manchar plant is Asia’s largest cheese plant, with the capacity of manufacturing 40 MT
per day.
We will establish two more plants – one in North and one in East in the coming years. The
investment will be around Rs 3bn.

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At Parag, each day is filled with providing new inspiration to consumers, to create fresh trends in dairy
consumption. Each of our brands Gowardhan, Go, Topp Up and Pride of Cows, play a central role in
people's lives – they awake to them and consume them all day long. Each with their own unique taste and
place in life. We are passionate about making milk moments a source of delight and inspiration.

From new ways to delight children, to healthier ways to spread goodness and cheer in families, from
delicious ways to entertain friends, to providing the quickest ways in which a mother can provide taste
and nutrition.

From making ghee which is as close to home made ghee, the first packaged shredded cheeses designed
for convenience and the first cheese in a squeeze tube to delight children, to cream cheeses in many exotic
flavors to make entertaining exciting, the first natural fruits based yogurts, or making fresh Paneer with
extended shelf life for convinience and India’s freshest, highly nourishing farm to home milk. Parag has
led successful dairy farming in India.

1.2 BRANDS OF PARAG MILK FOODS

THE BRANDS

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 

Competing in the Market with Strong Brands

GO PRODUCTS
GO CHEESE PRODUCTS:

Go Cheese Slices:

Go cheese has high calcium content. The high quality cheese is made using UHT technology,
which ensures a longer shelf life.

Go Sandwich Cheese Slices:

These are orange colored cheese slices of Go so that to give an orange color texture to your food.

Go Cheddar Cheese:

Made from mild cheddar cheese, traditionally aged over six months. It has a creamy texture and
a clean cheddar flavor that gives great taste to food.

Go Pizza Cheese:

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It is a blend of mild cheddar and traditionally made mozzarella cheese with superior melting and
a stingy texture. It has a perfect mix of texture and taste for making delicious pizzas at home.

Go Mozzarella Pizza Topping:

Soft and stringy, Go block, dice & shredded mozzarella is a cheese with a firm close texture that
lends itself to many dishes.

Go Creamy Cheese Spread:

It is available in three delicious flavor- Mexican Twist, Tomato salsa, & black pepper.

A smooth spreadable texture and versatility in cooking is what makes Go creamy cheese spread a
must have item in all household.

Go Processed Cheese:

This cheese is mild in flavor, with a medium firm consistency and made from blends of cheddar
cheese. A versatile cheese can be added to a casserole or grate over a salad.

Go Cheese Wedges:

It has a delicious, mild creamy taste. It comes in a portable form that’s perfect for the lunch box
or as an on the go snack.

GO FRESH CREAM:

It is an all purpose cream, made with quality fresh milk. It makes everyone’s favorite Indian
curries and a range of desserts tastier and creamier.

GO PRODUCTS
GO CHEESE PRODUCTS:

Go Cheese Slices:

Go cheese has high calcium content. The high quality cheese is made using UHT technology,
which ensures a longer shelf life.

Go Sandwich Cheese Slices:

These are orange colored cheese slices of Go so that to give an orange color texture to your food.

Go Cheddar Cheese:

Made from mild cheddar cheese, traditionally aged over six months. It has a creamy texture and
a clean cheddar flavor that gives great taste to food.

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Go Pizza Cheese:

It is a blend of mild cheddar and traditionally made mozzarella cheese with superior melting and
a stingy texture. It has a perfect mix of texture and taste for making delicious pizzas at home.

Go Mozzarella Pizza Topping:

Soft and stringy, Go block, dice & shredded mozzarella is a cheese with a firm close texture that
lends itself to many dishes.

Go Creamy Cheese Spread:

It is available in three delicious flavor- Mexican Twist, Tomato salsa, & black pepper.

A smooth spreadable texture and versatility in cooking is what makes Go creamy cheese spread a
must have item in all household.

Go Processed Cheese:

This cheese is mild in flavor, with a medium firm consistency and made from blends of cheddar
cheese. A versatile cheese can be added to a casserole or grate over a salad.

Go Cheese Wedges:

It has a delicious, mild creamy taste. It comes in a portable form that’s perfect for the lunch box
or as an on the go snack.

GO FRESH CREAM:

It is an all purpose cream, made with quality fresh milk. It makes everyone’s favorite Indian
curries and a range of desserts tastier and creamier.

Our products play a central role in people’s lives, they awake to them and consume them all day long. We

believe in making dairy moments enjoyable, inspiring and nutritious!

As we strive to offer healthier & nutritious dairy alternatives to people, we keep taste and flavour in mind.

Our wide range of products are designed to make moments both delicious and healthy.

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INDUSTRY PROFILE

Cheese Industry:

The cheese industry is the complex, global collective of diverse businesses that together supply
much of the food energy consumed by the world population. Only subsistence farmers, those
who survive on what they grow can be considered outside of the scope of the modern food
industry.

The Food Industry includes:

Regulation: local, regional, national and international rules and regulations for food production
and sale, including food quality and food safety.

Education: Milking of cows, fodder to cattle, vaccination priority.

Research &Development: Food technology, testing and research on the food nutrition.

Financial Services: Insurance, credit via banks, IPO rising.

Manufacturing : Farm machinery and supplies, construction of sheds ,etc.

Agriculture Rising of crops and livestock.

Food Processing : Preparation of fresh products for market.

Marketing : Promotion of generic products (e.g. milk board), new products, public opinion
through advertising, packaging, public relations.

Wholesale &Distribution : Cold storage, Warehousing, transportation, logistics.

Retail : Supermarket chains and independent food stores, direct to consumer, restaurant, and food
services.

Advantage:

India is one of the largest food producer country. India has diverse agro-climatic conditions and
has a large and diverse raw material base suitable for food processing companies.

Investment requirement of around US$ 15 billion exists in the food processing sector. India is
looking for investment in infrastructure, packaging and marketing. India has huge scientific and
research talent pool. Well developed infrastructure and distribution network, rapid urbanization,
increased literacy, changing lifestyle, increased number of women in workforce, rising per capita
income, leading to rapid growth and new opportunities in food and beverages sector, 30 percent

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of household expenditure by Indians is on food items. Under the food industry, dairy products
are very important part of food processing. Dairy processing is acting good role in India.

Dairy Processing :

India ranks first in the world in terms of milk production. Indian production stands at 91 million
tones, growing at a CAGR of 4 percent. This is primarily due to the initiative taken by the
operation flood programmers in organizing milk producers into co operatives,
buildinginfrastructure for milk procurement, processing and marketing and providing financial ,
technical and management inputs by the ministry of agriculture and ministry of food processing
industries to tureen the dairy sector into viable self sustaining organized sector. About 35% of
milk produced in India is processed. The organized sector ( Large scale Dairy Plants) processes
about 13 million tons annually. While the unorganized sector processes about 22 million tons per
annum. In the organized sector, there are 676 dairy plants in the cooperative, private and
government Sector registered with the government of India and the state government.

Indian dairy industries have shown an unprecedented growth in milk production from about 51.4
million tons in 1990 to about 115 million tons in 2010-11. India has emerged as a largest milk
producer in the world, but could only expect to reach about 160 million tons by 2020. The
overall growth rate of the dairy industry in India is around 4%, which is almost 3 times the
average growth rate of the dairy industry in the world. The milk production grew by 3 million
MT per annum from 1992-2007 and now we need it to grow at 5 million MT per annum in next
fifteen so as to meet the ambitious target of around 183 million MT in 2022.

The ministry of food processing industries is promoting organized dairy processing sector to
accomplish upcoming demands of processed dairy products and helping to identify various areas
of research for future product development and quality improvement to revamp the Indian dairy
export by way of providing financial assistance to the dairy processing units. 32 units have been
sanctioned financial assistance ( Rs 591 laths ) under the plan scheme of the ministry during the
year 2006-07.

India has a unique pattern of production , processing and marketing / consumption of milk ,
which is not comparable with any large milk producing country. Approximately 70 million rural
household (primarily, small and marginal farmers and landless laborers) in the country are
engaged in milk production. Over 11million farmers are organized into about 0.1 million village
dairy co operative societies (DCS) (about 110 farmers per DCS). The cumulative milk handled
by DCS across the country is about 30 million kg of milk per day. These cooperatives form part
of a national milk grid which links the milk producers throughout India with consumers in more
than 700 towns and cities bridging the gaps on account of seasonal and regional variations in the
availability of milk.

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Major Indian Players and Overseas in the Cheese Industry:

1. Amul cheese.
2. Dairy craft cheese.
3. Chaudhary cheese.
4. Flanders cheese.

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Certification :

We are an ISO 9000 certified company , committed to international standards of product quality.
Our product portfolio includes skim milk powder, whole milk powder , ghee , processed cheese ,
butter , dacha, proprietary foods like dairy whitener and gulaabjamun mixed powder under the
brand names of “ Gowardhan” and “ GO” , all made from 100% fresh cow milk.

Exports :

Gowardhan exports milk powder , butter and butter oil , anhydrous mik fats and ghee to 27
countries in the middle east , south east Asia and Africa. We are soon going to include cheese in
the product mix. Some of our significant customers include Yakult for our skimmed milk
powder and BEL, morocco (world famous manufacturer of cheese) .

Institutional Sales :

Gowardhan is a one stopped, efficient and reliable supplier to reputed hotels , restaurants,
institutions and caterers. The wide ranges of products we supply include cheese , butter, ghee and
milk powder. Each of these products comes with the Gowardhan assurance of purity and quality.
We have a national tie up with companies like Baskin robins, Barista, Café Coffee Day etc.

We have also expanded our retail presence significantly: Gowardhan and Go brands are now
available at large retailers and modern retail outlets , reaching out to more and more customers
with the promise of our healthy and active life.

Infrastructure and Technology :

Our commitment to quality and innovation has resulted in huge investment in infrastructure and
technology. Our integrated dairy and cow farm at Manchar , is rapidly scaling to cater to the ever
expanding circle of customers in India , who seek all natural, wholesome and delicious dairy
products.

Dairy Plant, Manchar, Pane(Maharashtra) :

The extensive range of our products is processed at this ultra modern dairy. Our dairy plant is
fully automated of international standards and equipped with the best European technology.
Right from reception of milk to the finished product , we maintain strict no human contact
through the entire manufacturing process. Our plant churns out 2000000 liters of milk per day,

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has an output capacity up to 10 MT of butter , 25 MT of ghee and 10 MT of dahi (yoghurt) and
65 MT of milk powder.

The GowardhanDifference :

Gowardhan manufactures dairy products that are not just 100% natural , but also lighter and
reach in calcium. That’s because the milk , procured from its own cow farm – the largest in asia –
is 100% natural cow’s milk. What’s more , the use of latest European technology in our
manufacturing units ensures superior quality and freshness of our products, giving them the
unique Gowardhan taste and flavor.

Go Cheese :

Asia’s largest cheese plant with an installed capacity of 40 MT per day, where every product is
made under stringent quality norms. We can boast of having the largest international quality
cheese range with the promise of great taste. Go is also the largest supplier of cheese to not only
hotels , restaurants, pizza chain and so on, but street food stalls as well in India .

How Milk is Produced:

At a dairy farm in Manchar on the outskirts of pane, a four hour drive from Mumbai, about 2500
cows await their turn to be milked. They wait like shoppers in the billing queue of a supermarket,
quite an orderly. One by one, the cows step onto 20 feet rotating circular platform and rubber
hoses are attached to their udders. Once milked, the cow themselves kick away the hoses.
“Minimal human effort, maximum milk produce,” gushes Defender Shah. Chairman, Parag Milk
Foods Ltd. who started its operation in Manchar in 1993.

The country has spent over Rs. 40 crore on its rotary milking parlor, the first in India. The 3000+
Holstein cows, purchased at Rs. 40000 apiece, are treated with a special diet of calcium rich feed
and mellifluous bhajans in their sheds. “The music increases their milk produce,” claims Shah,
citing that each cow produces 25 liters of milk a day. “It’s total cow comfort technology. These
are the standards we need to adopt if we need to compete with international players in products
like cheese,” he adds. And cheese is where Shah’s immediate ambitions lie.

With a turnover of about 2000 crore, PARAG milk foods has been selling milk and ghee in Pune
and Mumbai since the mid 90’s. But from the last few years, the company’s focus has shifted to
products like cheese and cream. It has invested Rs. 110 crore to build what it claims it Asia’s
largest cheese plant (with a capacity to process 40 tons of raw cheddar daily). “Cheese from this
plant is right now being sold in South Korea. Within a few months of our launch, we have
cornered a 30 % market share of cheese sales at modern retail outlets in Mumbai. Our
competitors are the crafts and laughing cows of the world. With our superior product quality, we
are not even competing with the Indian dairy players.”

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Some 450 km away, lounging in the Spartan office in Anand in Gujrat, the mica of the Indian
cooperative movement, B.M. Vyas would be tempted to disagree with Shah’s claims. After all as
MD of India’s largest and only billion dollar cooperative dairy player, The Gujrat Cooperative
Milk Marketing Federation (GCMMF), Vyas has seen competitors make more audacious claims
in his 16 year tenure as MD. GCMMF sounds like a mouthful, but the brand name under which
the cooperative sells its products Amul is perhaps the most recognized and revered dairy brand
across the country. This despite the fact that, PARAG Milk Foods’ state of the art dairy farm,
Amul’s milk is collected by dairy farmers every morning largely by hand. “The fact that 2.7
million farmers wake up early each morning to milk their cows and then give it to us is our
biggest strength”. He is no stranger to pretenders challenging Amul’s dominance. “Amul has
seen competition in the past. It really does not worry us” by PARAG.

Taking on competitors in a category or two at the same time is something Amul has done before.
But the threat today is different, and huge. That’s because never before has Amul been buffeted
by as much competition as it is today, across every category it operates in – right from pouched
milk and butter to cheese and ice creams. Other than HUL and Nestle, multinational giants like
krafts (which acquired Cadbury globally, thereby getting a passage into India) and group Danone
are beginning to flex their muscule. “we hope to bring some of our big brands like kraft cheese
and Oreo cookies to India. With Cadbury’s distribution strengths, we can push some of these
brands in India,” Sanjay Khosla, president (developing markets), Kraft. Group Danone is looking
at tapping into the small, but fast growing flavored milk market. It’s currently testing chocolate-
flavored fortified milk in Hyderabad.

Regional players, too, are upping the tempo. Other than PARAG, there’s Amrita Group in
Kolkata, which plans to launch value added milk products. Says Harish Bagla. MD, Amrita
Group: “we are coming up with various value added products like flavored milk, dahi, lassi,
cheese, butter, paneer, and ice cream.” Bagla’s also exploring tie-ups with international
companies. Finally don’t forget Johnnies come lately like Zydus wellness—which has carved a
need for itself in butter alternatives—that are opening up new markets.

The biggest threat to Amul, though, could well come from its one time friend but now a bitter
rival, Mother Dairy, a subsidiary of the National Dairy Development Board (NDDB). In mid-
February, Amul made a bold claim when it declares itself as the No.1 player in the branded
packaged milk segment, with sales of 1.45 million liters daily, in the Delhi market, a traditional
stronghold of mother dairy. Within a day, the New Delhi headquarters Mother Dairy shot back.
“Mother Dairy sells approx. 29 lakh litres of milk per day in Delhi-NCR, which is about twice as
much as that of the nearest competitor.” Says Paul Thachil, CEO (Dairy & Foods), Mother Dairy
fruit and vegetable. By the truth PARAG Go cheese has major production and sales in cheese
industry with an output of 450 tons per month which is increasing day by day.

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“in the recent times PARAG Go cheese also received an order from Russia to supply initial 900
tones of cheese which PARAG has tied itself in fulfillment and the rest of the players are out
from the market in fulfilling the standards and requirement of cheese”.

Reasons for brand fairing

Both Gowardhan and Go have a strong footing in the consumer’s mind. We have done dipsticks
and analysis with consumers and we are pretty well. If I was to look at the spread of the brands
across the country, then Go will be the front facing growth driver. Bulk of my investments in
terms of creating a brand for the organization will be spent on Go.

Today, Gowardhan will be twice the size of Go in value terms and in terms of revenue-
Gowardhan accounts for 70 percent of the pie.

Marketing strategy of PARAG for the promotion of dairy tourism

We organize one day picnics for school children where they can come to the plant and see the
process of milking, tour the cheese plant and interact with the animals on the farm and so on. The
image of the Indian dairy industry in the world is very vague. Hence, we want to showcase to the
world our state of the art dairy equipment and machinery. Secondly, once people come and see
your plant, the consumer becomes ‘yours for life’. So there is a clear marketing intent behind
this.

Various verticals of distribution/sales general trade, modern trade & institutional in Parag

In the consumer business, we distribute through general trade and modern trade. Under
institutional sales, we supply to Dominos, KFC, and Pizza Hut and so on. Then there is a Horace
(Hotels, Restaurants, and Catering) segment, where PARAG caters to hoteliers and other
restaurants.

Lastly we export to 27 countries in a trading model, but in future we want to get into serious
consumer brand building. We primarily export powders and ghee now. We will get into pander,
dahi and yoghurt in countries with a large Indian dispora.

30-35 percent of our revenue comes from general trade while 15 percent id from modern trade,
the balance is from institutional sales. Bulk of the institutional business is for cheese.

(Also liquid milk is distributed locally; typically 300 kilometers around the plant location)

The creative and media agencies on board

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Our media buying agency is Madison while Scion in Bangalore is our brand consultant and
creative agency. They have been with us since 2008 and have helped us create consumer brands
that you can see today.

In 2014, all our product categories will have new communications. Our marketing budget is four
to five percent of the top line. Our next year marketing budget is Rs 75 to 80 crore.

The current product and brand portfolio under PARAG and contribute maximum to
revenues

PARAG started as a milk company. Ghee was the first product that we went into the consumer
segment with. Our real transition into consumer goods started in 2009 and we have evolved
greatly.

The portfolio today is broadly divided into liquid milk which contributes around 20% to our top
line. We supply milk in key cities of Maharashtra and South India. The next big category is
cheese that contributes 25% to 30% to revenues. The third segment is SMP (skimmed milk
powder) that accounts for 20%. The fourth category is the new product lines (UHT and tetra
pack), which account for 7% to 8% of revenue. Lastly we have a ‘Fresh’ division comprising of
dahi(curd), yoghurt, paneer (cottage cheese), cream which accounts for 15% to 18%.

We primarily have two brands- Gowardhan and Go. If I was to give a personality to the two
brands, I would say Gowardhan is a traditional Indian housewife brand. The products are
actually ingredients that go into preparations in the kitchen. Gowardhan is our parent brand that
has been in existence for 18 years, while Go was incepted in 2008. Go is a young, dynamic
brand. It is targeted towards youthful, young urban consumers. These are the two brands that are
known to consumers pan India. There is ‘Pride of cows’ which is more specific to Pune and
Mumbai, and is a farm to home business model. And last year we launched ‘Topp Up’ (RTD
flavored milk beverages) in selected markets.

The growth driver for Parag in “Go Cheese”

We love cheese and it’s our stated intent to be called ‘The Cheese People’. Having said the, as
we move forward, if our mix today is 70-30, then it is going to change where Go will contribute
most to the revenues in future. Cheese will remain the growth driver, we have done wonders with
cheese. So the focus is going to be more on the umbrella branding on Go.

The new product lines that are currently at 7-8% in the next two years will grow to 20%. They
are under the Go brand.

Over the past two years, PARAG has been adding more products to its portfolio. Is it because of
the growing competition from regional, national and international players?

23
The fact is India is a growing economy. The demographics of the country are very young and
hence there will be competition from MNC’s. the onslaught is given. In the next three to four
years, all the big players from Europe will be in the Indian market; DANONE is their currently.
Innovation is not the result of the competition. PARAG is a category leader and being so, it is the
onus of the leader to drive the categories.

For example, for the category of cheese- all Indian penetration is 9%. If I was to do an urban-
rural divide then urban is close to 20%, and further segregate into metro and non metro, it is only
35%(in metros). So there is phenomenal opportunity for growth. Over the next 20 years, I see
cheese as one of the biggest categories that will change the dynamics of the dairy industry.

The biggest challenge in this category is how I get my distribution enhanced. So it is requires a
huge investment in cold storage facilities in the supply chain. There is a huge capital expenditure
required for putting up world class plants. Fortunately, we did it five years ago when our sales
were not even 3 tons a day (it is more than 30 tons a day currently).

So someone has to take the initiative and whoever does it will get the first mover advantage.
Secondly, these innovations are also a result of consumer insights that we get when we interact
with them. I strongly believe that whenever you are working a market it is always important that
apart from a retailer you also speak to the consumers. It is only from consumer insights that you
get your triggers. Research is conducted at an organized level but that is more from the point of
understanding the pulse of your brand, the categories. But, to get real insights, I encourage
people to talk to consumers directly and understand their needs.

In India, markets while see as a stronghold for the brand

The way dairy companies evolve is that they become strong in the place they are located in. we
are a home grown, Maharashtra company with the plant located near Pune, so our strength is the
west- Maharashtra, Gujrat. The second plant came up in Andhra Pradesh and this caters to the
entire country, so in a sense we are strengthening our distribution across the country. Ideally, I
would want PARAG to be present in all the villages that have a population of 1000 plus, but that
is not possible. But we are trying to get our distribution strong.

We plan to go big in the south as the plant is located in Andhra Pradesh and we will have an
advantage of doing a lot in the ‘Fresh’ categories.

The Marketing Mix generally like for the brands

We are primarily a TV led brand and that’s required to be present in the minds of the consumers.
But the challenge is that if I do a TVC on cheese and I am not present all over the country, a lot
of wastage will happen on TV. So there has to be a focus on print as well.

24
Currently, our marketing mix is 70-80% skewed towards TV and around 15% accounts for press.
The balance is on social media and point of purchase. We plan to invest a lot in point of sales as
well.

There is a lot of innovation happening at point of sales in terms of visibility, the manner in which
you talk to consumers and so on. Moving forward, I have an equal split between addressing the
consumer at home and the shopper located at the point of purchase. And overwriting this is the
internet- one cannot ignore digital today. I would admit that we have been slow in getting on to
digital but we have serious plans for the future.

PARAG also does a lot of consumer sampling. Being in the food industry, if your consumer
tastes your product once, he is yours for life. We do this at modern trade and places of
congregation in key towns.

Revenue:

PARAG Milk Foods Ltd., which launched its new corporate identity, said it is eyeing Rs.2400
crore turnover during the financial year 2015-16 on the back of expansion and growing markets,
both domestic and international.

“We have undertaken many expansions during the last few years. We have introduced and
established four brands- Gowardhan, Go, Pride of Cows, Top Up a new brand for beverages.
Looking at the growth we are expecting our revenue more than the previous figures in 2017-18,”
PARAG Milk Foods” chairman Devendra Shah.

The company in the first quarter of FY17 consolidated net profit rises 82.9% yoy which in
figures will be Rs. 428.2 crore, registering 3.4% yoy increase. Looking at the full year numbers
we see that revenue jumped by 5% to reach Rs. 1730.7 crore.

25
1.3 COMPANY’S VISION

We strive to optimize the potential of milk across a host of exciting dairy products to fill each day with
imaginative and healthy options for our consumers. We believe that milk in all its wonderful forms is one
of nature’s most nutritious foods and anyone who consumes milk products daily, benefits from vital
nutrients that the body needs. Fulfilling dietary nutritional requirements is a source of great joy and
creativity for us.

A bigger company also has larger responsibilities. While India is the largest producer of milk in the world,
and the commodity has become an important source of income for 70m rural households, the output per
animal is dismal. A key area of focus for us is to help farmers and milk producers to boost animal
productivity. The enhanced participation and involvement of the private sector is key to further
agricultural marketing practices and to make milk and its derivatives more accessible and affordable to
India. In this regard, we deploy state- of- the- art technology to enhance productivity.

We also seek to drive innovation in milk and milk products through our well-diversified portfolio of
brands that deliver dairy products to international standards of quality. To add value to people’s lives
every day. We at Parag live and breathe our corporate slogan of ’Ideas for a new day’

26
1.4 COMPANY’S MISSION

The Consumers
Should be able to trust our brands. This is why food quality is a fundamental requirement for Parag. We
make every effort to ensure that our processes are safe, and that high quality standards are maintained
throughout the supply chain.

Dairy innovation
Focus on dairy innovation, enables us to produce an array of products that make milk moments nutritious,
healthy, and enjoyable and we market them under well targeted portfolio of brands.

Partnership with the dairy farmers

We are working with dairy farmers to enrich their lives, and set new standards for sustainable dairy
production. We want to use our resources in a sustainable manner. By having a long term environmental
strategy we can help make this happen.

Good citizenship
We want to influence the development of society and set an example through our best practices. To make
quality milk and world class dairy products accessible to the masses. As a large private sector dairy
player, we have the opportunity to do so.

Building long-term relationship with local

communities
We strive to uphold respectful and constructive community relations, and contribute to the development
of communities by building long-term relationships with people, businesses and organisations.

27
 CHAPTER – 2

COMPANY PROFILE

2.1 FUNCTIONING OF PARAG MILK FOODS

Parag Milk Foods Limited is engaged in manufacturing and processing of milk and milk products. The
Company offers a range of products, which include cheese, ghee, whey proteins, paneer, curd, yoghurt,
milk products, liquid milk, milk-based beverages and milk powders. The Company's brands include
Gowardhan, under which traditional dairy products, such as ghee, are marketed; Go, under which western
lifestyle dairy products, such as cheese, are marketed; Pride of Cows, under which premium milk is sold,
and Topp Up, under which flavored milk is marketed. The Company has an aggregate milk processing
capacity of approximately two million liters per day. The Company has a product basket comprising over
150 stock keeping units (SKUs). Its manufacturing facilities are located in Manchar (Pune district) and
Palamaner (Chittoor district).

Parag Milk Foods Pvt. Ltd. also engages in the business of exporting, manufacturing, wholesaling and
retailing milk products and other dairy products. These include cheese, ghee and butter, dahi and chass.
Incorporated in the year 1992, the company is located in Pune.

2.2 CSR

The Ministry of Corporate Affairs introduced the new concept of Corporate Social Responsibility
(“CSR”) in the Companies Act, 2013 (“Act”) with a view to bring back the true meaning of the vedic
philosophy of “SARVA LOKA HITAM” i.e. ‘‘the well-being of all stakeholders”, Thus it has regained
importance in the current business environment. The concept has evolved over the years and now used as
strategy and a business opportunity to earn stakeholder goodwill.

The need for Corporate Social Responsibility has gained prominence from all avenues. The corporate
must understand that the Government cannot alone uplift the society as a whole and thus corporate must
extend their hands for this noble cause.

Parag Milk Foods Limited always believed in and worked towards “inclusive growth’- improving the
quality of life of the people we touch and in the communities where we operate , your Company
understands its moral, social and business responsibility to protect, preserve & nurture human values and
also to promote socio-economic welfare. Parag Milk Foods Limited believes in sharing the profits not

28
 only with its members but also with the society around it. The Company through its CSR initiatives will
continue to enhance value and promote social sustainability, sustainable development of the environment
and social welfare of the people and society at large, more specifically for the deprived and
underprivileged persons.

The main objective of this policy is active involvement in the social and economic development of the
society, in which we operate, share profits with the society through responsible business practices as well
as good governance and bring positive changes to the lives of mankind.

The Policy has been formulated by the CSR Committee and approved by the Board of Directors of the
Company in compliance of Section 135 of the

Companies Act, 2013 read with rules made thereunder. The Policy shall apply to all CSR activities
undertaken by the Company in India as per Schedule VII of the Act.

Currently, the following activities are permissible under the CSR Activities

 Eradicating hunger, poverty and malnutrition, promoting health care including preventive health
care and sanitation including contribution to the Swach Bharat Kosh set-up by the Central Government
for the promotion of sanitation and making available safe drinking water;

 Promoting education, including special education and employment enhancing vocation skills
especially among children, women, elderly, and the differently abled and livelihood enhancement
projects;

 Promoting gender equality, empowering women, setting up homes and hostels for women and
orphans; setting up old age homes, day care centre’s and such other facilities for senior citizens and
measures for reducing inequalities faced by socially and economically backward groups;

 Ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal
welfare, agro forestry, conservation of natural resources and maintaining quality of soil, air and water;

 contribution to the Clean Ganga Fund set-up by the Central Government for rejuvenation of river
Ganga;

 Protection of national heritage, art and culture including restoration of buildings and sites of
historical importance and works of art; setting up public libraries; promotion and development of
traditional arts and handicrafts;

29
 Measures for the benefit of armed forces veterans, war widows and their dependents;

 Training to promote rural sports, nationally recognised sports, paralympic sports and Olympic
sports;

 Contribution to the Prime Minister's National Relief Fund or any other fund set up by the Central
Government for socio-economic development and relief and welfare of the Scheduled Castes, the
Scheduled Tribes, other backward classes, minorities and women;

 Contributions or funds provided to technology incubators located within academic institutions

which are approved by the Central Government;

 Rural development projects.

 Slum area development.

 Any other Projects / activities the Government may include from time to time to the Schedule VII
of the Companies Act, 2013 or allow through clarifications/ Circulars.

 Any ancillary or incidental activities required to be performed to undertake any of the projects
mentioned above subject to the prior approval of the CSR Committee.

CONTRIBUTION TOWARDS THE CSR ACTIVITIES

The Board of the Company shall ensure that the Company allocates and spends, in every financial year, at
least two per cent of the average net profits of the Company made during the three immediately preceding
financial years, calculated in accordance with section 198 of the Act, in pursuance of the Policy.

Any surplus arising out of the contribution made for CSR Activities shall not form part of the business
profit of the Company and shall be used for CSR only.

If the Company fails to spend such amount the Board shall, in its report specify the reasons for not
spending the amount.

The CSR activities undertaken in India only shall amount to CSR Expenditure.

CSR Expenditure shall include all expenditure including contribution to corpus for CSR activities
approved by the Board on the recommendation of the CSR Committee but does not include any
expenditure on an item not in

30
conformity or not in line with activities which fall within the purview of Schedule VII of the Act.

2.3 \COMPANY STATISTICS

Yearly Results of Parag Milk Foods ------------------- in Rs. Cr. -------------------

Mar '17 Mar '16 Mar '15 Mar '14 Mar '13

1,701.0
Net Sales/Income from operations 1,622.95 1,420.20 1,079.22 922.65
9
Other Operating Income -- -- -- -- --
1,701.0
Total Income From Operations 1,622.95 1,420.20 1,079.22 922.65
9
EXPENDITURE
1,335.3
Consumption of Raw Materials 1,104.10 1,081.08 823.40 687.58
9
Purchase of Traded Goods 73.44 131.75 39.24 64.27 8.02
Increase/Decrease in Stocks -155.12 -62.17 -21.70 -50.45 3.09
Power & Fuel -- -- -- -- --
Employees Cost 77.98 66.03 53.91 43.28 35.22
Depreciation 47.26 31.73 25.42 24.89 23.93
Excise Duty -- -- -- -- --
Admin. And Selling Expenses -- -- -- -- --
R & D Expenses -- -- -- -- --
Provisions And Contingencies -- -- -- -- --
Exp. Capitalised -- -- -- -- --
Other Expenses 268.30 234.83 161.41 115.75 105.07
P/L Before Other Inc. , Int., Excpt. Items &
53.84 116.70 80.85 58.08 59.74
Tax
Other Income 6.72 1.43 1.01 1.04 1.87
P/L Before Int., Excpt. Items & Tax 60.56 118.13 81.85 59.11 61.60
Interest 32.81 48.18 47.90 40.38 39.28
P/L Before Exceptional Items & Tax 27.76 69.95 33.95 18.73 22.32
Exceptional Items -19.38 -- -- -- --

31
P/L Before Tax 8.37 69.95 33.95 18.73 22.32
Tax -1.65 17.44 3.76 -0.50 -0.10
P/L After Tax from Ordinary Activities 10.02 52.51 30.19 19.24 22.43
Prior Year Adjustments -- -- 0.14 -- -0.21
Extra Ordinary Items -- -- -- -- --
Net Profit/(Loss) For the Period 10.02 52.51 30.33 19.24 22.22
Equity Share Capital 84.12 70.42 15.97 15.97 15.97
Reserves Excluding Revaluation Reserves 582.00 307.27 117.84 87.51 68.27
Equity Dividend Rate (%) 5.00 -- -- -- --
EPS Before Extra Ordinary
Basic EPS 1.22 8.01 5.22 3.31 3.82
Diluted EPS 1.22 8.01 4.45 2.82 3.26
EPS After Extra Ordinary
Basic EPS 1.22 8.01 5.22 3.31 3.82
Diluted EPS 1.22 8.01 4.45 2.82 3.26
Public Share Holding
No Of Shares (Crores) -- -- -- -- --
Share Holding (%) -- -- -- -- --
Promoters and Promoter Group Shareholding
a) Pledged/Encumbered
- Number of shares (Crores) -- -- -- -- --
- Per. of shares (as a % of the total sh. of
-- -- -- -- --
prom. and promoter group)
- Per. of shares (as a % of the total Share
-- -- -- -- --
Cap. of the company)
b) Non-encumbered
- Number of shares (Crores) -- -- -- -- --
- Per. of shares (as a % of the total sh. of
-- -- -- -- --
prom. and promoter group)
- Per. of shares (as a % of the total Share
-- -- -- -- --
Cap. of the company)
Notes

Source : Dion Global Solutions Limited

216.35 -9.70 (-4.29%)BSE : Jun 16, 16:00

Open 228.10 Vol 60813
High 228.10 52 Week 356.70
Low 215.00 52 Week 203.00

Prev. Close 226.05

Bid Offer
Price 217.30 217.90

32
 Quantity 5.00 5.00

216.15 -10.90 (-4.80%)NSE : Jun 16, 15:52

Open 227.95 Vol 401025
High 228.10 52 Week 357.00
Low 212.65 52 Week 202.00
Prev. Close 227.05

 Simple Moving Averages

Days BSE NSE
30 239.28 240.14
50 241.72 242.29
150 248.99 249.41
200 265.60 265.93

33
 LITERATURE REVIEW

In early 2008, a few months before the global economy went into a tailspin. Devendra Shah, the pudgy
boss of PARAG Milk Foods Ltd., took his boldest bet ever. In those days, India, which produces 127
million litres of milk a day, converted just 40 tons of that yearly flood into cheese, according to industry
estimates. Most of it was made by Amul and sold to retail customers.

Shah, who has set up his dairy 16 years ago in 1992 in Manchar, an hour’s drive from Pune, believed that
india was on the cusp of a huge jump in cheese consumption. Now, this was before Indians had begun
devouring Pizzas faster than companies could serve them. Dominos had only 62 stores in India, a fraction
of the 667 it has today. Other pizza chains, where they existed, were relatively smaller.

But Shah could not have known about the explosion ahead or the risks. If he had gone about analyzing
this opportunity in a conventional way—looking at the amount that would have to be invested, the return
on that investment and so on—he would probably have decided it wasn’t worth the risk. But he did what a
classic entrepreneur would—he deleted the excel sheets and took a gut call. “I realized it was or never,”
he says. He decided that there was an untapped opportunity in processed cheese and that PARAG Milk
foods would ride the coming wave. And Shah didn’t want to set up a small plant. He toured Europe for
the best technology and by the end of the year he’d signed on for a 40 tonne cheese plant.

Overnight, PARAG milk foods has doubles India’s cheese making capacity.

Cheese consumption has zoomed over the years and PARAG has a lock on institutional clients such as
Dominos, Pizza Hut and Papa John’s. the company’s revenue has grown at a fast clip of between 20-30%
in the last five years. It closed last fiscal with a top line of Rs. 950 crore, most of it on the back of value
added products like cheese, UHT milk and ghee.

PARAG’s success has not gone unnoticed by private equity investors, hungry to be part of a growing,
healthy, profitable business opportunity. Since 2008, the company has raised two rounds of capital from
Motilal Oswal Private equity and IDFC alternatives. In September 2012, Motilal Oswal, which put in Rs.

34
60 crore in 2008, diluted half of its 20% stake in favour of IDFC. (IDFC put in Rs. 155 crore for a 22%
stake). Motilal made a 3x return.

Flashback:

A generation ago, shah’s family moved to manchar, a small town 50 km north to Pune. They came from
Gujrat as cloth traders and, for two decades, continued with the traditional business. In the 1980’s Shah’s
father realized that farmers in the area had very poor yields from potato, their main crop. He began
trading in seeds from Shimla, which produced potatoes with less moisture content. Yield’s went up and
Shah’s family was now looked at with respect within the community.

By the late 1980’s, the family had ventured into cold storages to enable local farmers to get better and
stedier prices for their produce. While the Shah’s were now established and well known, they spotted
another opportunity—in the dairy business. This was a time when milk production in the country had
zoomed and the farmers of Manchar had few takers for their milk, with supply in the region outstripping
demand.

The Secret Sauce:

Fast forward to febraury 2012, Girish Nadkarni of IDFC alternatives was late in hearing about the
business PARAG had built. No matter, he still scheduled a meeting with the company and was pleasantly
surprised with what he saw—a well run company that was scaling up rapidly. He was hooked, but
realized he had competition.

Edelweiss was already shopping around for good investments, and had signed seven term sheets with
PARAG. Acoording to Vikas Khemani, president at Edelweiss Securities, the trm sheets didn’t work out,
as potential investors, including some large global names, wanted exclusively.

Meanwhile, Nadkarni continued his research and got another crack at doing a deal in September. First off,
Nadkarni realized that one of the reasons why foreign investors had been wary of investing was the
company’s inability to monitor and track milk. But Nadkarni knew that was impossible in India. He
visited the company’s milk collection centres and saw first hand how unlikely it was for an Indian farmer
to supply bad milk. ‘you supply it once and you will be ostracized within the community” he says. He
also got to experience the brand equity the company had built. People would walk 10 km to come to the
nearest PARAG milk collection centre.

But what of the company’s future prospects? India has seen several dairy companies languish in the 500-
600 crore range after showing initial promise. Even those which had broken the scale barrier, like heritage
(turnover of around 1609 crore) and Hatsun (Rs.2165 crore), have remained regional players who have
not grown outside southern india.

What makes PARAG different is, simply, this. Unlike other dairy companies, which see 25-30% of their
top line coming from value added products, PARAG generates 75% of revenue from cheese, flavored
yoghurt and ghee, all of which are value added products.

35
What difference does the value addition make to the margins? Let’s take cheese as an illustration.
Producing a kg of cheese requires 12 litres of milk. This is milk that has high fat and SNF (solid non-fat)
content. After removing the fat and SNF, it costs the company Rs190 for 12 litres. Cheese is sold at
Rs.230 a litre, ex-factory, which results in a 14% margin. The fat and SNF content can be used to make
whey proteins, another revenue stream. In contrast, a litre of milk has a margin of 10%, according to
Nadkarni of IDFC alternatives.

PARAG enjoys better margins than companies like Britannia and Danone as, unlike them, it did not
outsource any part of its supply chain. Let’s take a look at the comparative profitability. PARAG made
Rs100 crore on a top line of Rs.950 crore, while Hatsun made Rs44 crore on a top line of Rs.2165 crore.
“All its products are UHT-complaint,” according to Rakesh Sony of Motilal Oswal Private Equity. UHT-
complaint means that even cheese doesn’t need a cold chain to be transported, saving the company
money.

In addition to focusing on value added products, PARAG had worked hard at building a brand,
Gowardhan. PARAG hired Mahesh Israni as chief marketing officer from HUL and his efforts are
showing. Since Israni’s arrival, packaging of Gowardhan products changed from the earstwhile staid and
boring to stand-out and eye-ball catching. The Uniliver DNA in Israni gave him the confidence to invest
Rs.30 crore on advertisement last year. A projected doubling of the media budget this year should help get
better rates on television and print.

While Israni makes the product look slick and shiny, it is another key hire, BM Vyas who is responsible
for the reliability of the product. The story of how Shah brought him to the company is instructive. Soon
after Vyas left Amul after a four decade stint there, Shah drove to Anand in Gujrat and urged him to join
the company. Vyas was hesitant, and it took a month of persuasion and guarantees of a free hand in
building the company and professionalizing it—to get him on board. “I had seen how they operated at
Amul. He had a strong will and got the job done,” says Shah.

Vyas seen PARAG becoming a FMCG player from being a commodity company, something that would
increase size and profitability immensely. “PARAG has more than 3000 crore sales in 2016”, he says. For
now, Vyas is working on increasing distribution and has managed to take PARAG’s direct reach to
125000 outlets across the country. To meet the growing demand , PARAG has already added a second
dairy at Palamaner in Andhra Pradesh. It is exploring the possibility of setting up one in the ease of the
country.

36
RESEARCH METHODOLOGY

Research Methodology is a way to systematically solve the problem. In it we study the various
steps that are generally adopted by a researcher in studying his research problem along with the
logic behind them. Thus, when we talk about research methodology we not only talk of the
research methods but also consider the logic behind the methods we used in the context of our
research study and explain why we are using a particular method or technique and why we are
not using others so that research results are capable of being evaluated either by the researcher
himself or by others.

Research Objective:

 To know the potential strength of Go cheese and Go fresh cream in modern trade.
 To get the data on market share of Go products and other brands.
 To create brand awareness of Go products among the modern trade.
 To apply the theoretical knowledge in practical work during training.
 To understand the new market trends and new opportunities in FMCG.
 To know the drawbacks in Go products visibility and distribution to the users.

Research Design:

 A sample size of 120 restaurants/hotels/cafeterias/caterers was taken.

 The survey was conducted in the area of Faridabad and Ghaziabad.

Sampling Technique:

A “Probability sampling technique” was adopted because the sample audience was made out to
be potential purchasers of the product. The sample was carefully drafted. A lot of care was taken
when collecting then information. A no. of users was samples to know the user view and prospect
where we can bring new business.

37
 METHODS OF DATA COLLECTION

The source of the data collected for the research can be primary data or secondary data or both.

Primary data: The Primary Data consists of information obtained from the restaurants owners, caterers,
and hoteliers.

Secondary data: the secondary data is obtained from the information already published in newspaper
articles, blogs and books. The websites like: Paragmilkfoods.com, Economic Times, and Business Today
etc.

*(during the complete internship period, the method used for the collection of data is primary data).

PRIMARY DATA

By Observation Method:

This data was collected by visiting the Hotels, Restaurants, Cafes, Caterers in Faridabad and Ghaziabad
by searching on websites through Google, by taking help of applications like zomato and as a walk-in
search.

The data was collected on the following parameters:

 Quality
 Price
 Shelf Life.

By Personal Interviews:

The data was collected by visiting each and every outletwhere food service is especially Italian multi-
cuisine are available and also check the availability of PARAG products. The information was taken by
talking to the purchase managers of store, chefs or the owner of the outlet. The objective of this was to
know the preference of the user. To know the problems regarding the delivery, the problems between
distributors and user requirements. The questions were open ended as well as close ended.

38
 WORKING MEHTHADOLOGY

The research been conducted by me was a Primary Research , where I did not make use of any
references or sites to attain insights , instead I was given 2 questionnaires which I had to get
filled from various consumers using different brands of cheese and also from various outlets
(big bazar reliance more ) where Go Cheese was consumed.

Out of the 2 questionnaires –

1. Retailer survey
2. Consumer survey

In retailer survey there were various parameters that I had to note about the outlet , I
had to make a note of the type of outlet (big bazar reliance more etc) , further make a
note the various brands cheese in their outelet . . Further I also to ask which brand
product has max sale in their outlet and flavours preferred by consumers in spread and
slice.and retailers feel about profit margin being provided by the organization. Are the
retailers satisfied with current margins and services. And problems they find in Go
cheese product.

In consumer survey the various parameters I had to note about the consumers were
about what is frequency of buying cheese products, which brand do they prefer to buy
and what are factors that influence them while buying it.Which type of cheese do they
prefer to buy ?How long have they been using present brand of cheese and which
flavour do they

39
 ANALYSIS

 In overall market research it was found that Amul has a major share in the Dairy products that
need to be captured by Go cheese as well. It can be captured only through proper marketing
where the products need to be familiar to all cheese and curd users with timely delivery and
timely feedback.
 Dairy Craft, Britannia cheese and mother dairy cheese are among a few less common brands
among users but they offer quality cheese at low prices, and many users are less interested in Go
cheese because of the price factor which they find higher if they use the same and could bring the
costing higher for their business.
 Go cheese presence is best seen in West India (Maharashtra) region where the major sales of
cheese is there than the Northern region where users are still unknown of the brand and on an
introduction they mix the name with the U.P Cooperative Dairy ‘Parag’ than the PARAG from
Maharashtra.
 Promotion through marketing where the new TV ads should be offered by the company to bring
boost to the sales. An awareness program on cheese and crud must be taken on to the hospitals
and health centers.

Costumer Brand Usage as per Primary Data Collection

BRAND No. of respondent Persentage

AMUL CHEESE 54 55%
PARAG CHEESE 15 15%
CHAUHDARY CHEESE 20 20%
DAIRYCRAFT CHEESE 10 10%

40
TOTAL 99 100

1. Brand Preference

BRAND PREFFERED
60%
50%
40%
30%
20% BRAND PREFFERED
10%
0%
e e se se
ees ees ee ee
Ch Ch yC
h C h
ul Go a r aft
Am dh ycr
au ir
Ch Da

Interpretation: 56%clients from Amul Cheese, 20%Chaudhary Cheese, 14.5%Go Cheese, 10%
Dairy craft Cheese

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 Brand Awareness No of Awareness Percentage

Word of mouth 40 40%

Newspapers 15 15%

Hoardings/banners 20 20%

Television 25 25%

Total 100 100%

2. Consumer Brand Awareness

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 BRAND AWARENESS
45%
40%
35%
30%
25%
20%
15% BRAND AWARENESS
10%
5%
0%
th

n
r

rs
pe

io
ne
ou

pa

is
an
M

l ev
ws

/B
of

Te
Ne

gs
d
or

n
di
W

ar
Ho

Interpretation: It was observed during survey that different person aware about Go Cheese brand
by 40%Word of mouth, 25%Television, 20 %Hoarding/Banners, 15 %Newspaper

No. of respondent Percentage

Respondent
YES 60 60%

NO 40 40%

Total 100 100%

3. Consumers Preference to buy New Product

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 Do You Buy New Product
70%

60%

50%

40% Do You Buy New Product

30%

20%

10%

0%
Yes No
Interpretation:
Only 60% YES tells that knows about the Go brand

Only 40% NO tells that doesn’t know the Go brand

Reason Percentage
Quality 60%
Brand 20%
Price 20%
Promotional 0

4. Factors to consider- while buying Cheese

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 Factors to look while purchasing
70%

60%

50%
Factors to look while
40% purchasing
30%

20%

10%

0%
Quality Brand Price Promotional Offer

Interpretation: It was observed during survey that different factors to look while
purchasing 60% of Quality, 20% of Brand, 20% of price and 0% of promotional offer

Respondent No. of respondent percentage

YES 24 25%

NO 75 75%

Total 99 100

5. Go cheese or Go cream Users

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 Go cheese or cream users
80%
70%
60%
50%
Go cheese or cream users
40%
30%
20%
10%
0%
Yes No

Interpretation: consumer are not use Go cheese 75%, consumer are use GO cheese 25%

S. no Opinion Percentage
1 Yes 70%
2 No 30%

6. Go Cheese knowledge

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 Have you heard of Go Cheese
80%
70%
60%
50% Have you heard of Go
Cheese
40%
30%
20%
10%
0%
Yes No

Interpretation: In this graph shows that consumer known about the Go 70% yes, 30% No

7 Revenue growth of go cheese over last few years

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8.Competitor market share

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 RECOMMENDATIONS

 Amul has a very big market. People in every location are very much familier with the name and
trusts the brand blindly. This is basically all because the quality and advertisement campaigns of
Amul. The quality of Go cheese is very good than Amul, but still the company is lacking because
of advertisements. Therefore, Go should advertise more.
 Digitalization is the new trend, Go should advertise its products on digital platforms like social
media sites etc.
 Non Availability of all the products- Go has its industries in Maharashtra and Andhra Pradesh
because of which there is non availability of every product in northern regions. As sometimes
people want to deal with the company who can provide them with all the dairy products of their
use so that it becomes easy for them to purchase from a single buyer.
 When it comes for Go cheese, mostly people give negative feedback of the product. According to
them, ‘the cream is very less thick than Amul, so they prefer Amul cream’. The company should
think on that seriously, otherwise it will lose its customers.
 The lot of products not comes same all the time. Some people I encounter with have complains
regarding poor quality of products of cheese as well sometimes and to some other time the quality
is very good. So, there is an inconsistency in the quality. Therefore, the company should focus on
regular quality check.

LIMITATIONS

 The research was carried out for 55 days which proved to be the insufficient time to tap the
accuracy of the study s I have to cover two big stores of two different areas.
 Go cheese brand presence is somehow restricted to Maharashtra only. Here also the market is
quite good but it takes time to expand.
 Rigidness of operatives in food business who sometimes unable to disclosed their details to the
research.
 Non consumers not entertain us on hearing the Go cheese prices as cheese products were little
expensive and not in their affordability.
 Some people in the market do not even want to understand the difference these products have
from other brands.

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 LEARNINGS

 Firstly, I got a chance to learn about a big FMCG company and from what strategies and
marketing schemes it became capable to make itself a big name.
 Through the visits to various outlets like Big bazaar, spencer’s, more, reliance fresh etc. I got a
chance to learn to tap different type of people with different ways.
 Understanding Buying Behavior of Cheese customers Delhi their patterns of buying.
 Market Analysis of the other competitors and their share including their pricing for industrial
 Client Relations with existing and convincing ability to new customers for making them our loyal
customers for future.
 I have learnt different types of purchase order ie Automatic and Manual
 I learnt about shelf life of Go products.
 Understanding there is huge link between food bazar team and modern team in terms of demand
and supply
 Understanding why parag’s products are better than its competitors.
 Learning about expire of Go cheese and products from competitors

REFERENCES

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 The basic information about the company profile was searched and taken from the corporate
website of “Gowardhanindia” & “Paragmilkfoods”.
 Product range was taken from the website of Go Cheese.
 Literature Review information through Business Times article.
 The Hindu business line article April 09, 2018
 Forbes India magazine article Dec 18, 2017.
 Campaign India Jan 04, 2017.
 Economic Times 17 April, 2018
 Times of India 22 April, 2018.

LEARNINGS

 Firstly, I got a chance to learn about a big FMCG company and from what strategies and
marketing schemes it became capable to make itself a big name.
 Through the visits to various outlets like Big bazaar, spancers, more, reliance fresh etc. I got a
chance to learn to tap different type of people with different ways.
 Understanding Buying Behavior of Cheese customers OF central delhi areas, specially their
patterns of buying.
 Market Analysis of the other competitors and their share including their pricing for industrial
users.
 Client Relations with existing and convincing ability to new customers for making them our loyal
customers for future.

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 QUESTIONNARE FOR CONSUMERS
Name of the Respondent:

Gender: Male / Female:

Staying: single / with family.

Occupation : a. Employment b. Business c. Professional d. Student e. Housemaker f. Any other.

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1: Do you consume milk & milk products? Yes/No

2: What is your frequency of buying cheese products?

 Daily
 Once in 2-3 days
 Once in 4-6 days
 Once in a weak
 Once a month

3: Are you aware of the difference cheese brand available in the market? A. Yes b. No

If yes, the brands you are aware of:

a) Go cheese b) Amul c) Mother dairy d) Britannia

4.Which brand do you prefer to buy and what influence you while buying?

Brand /factor: price taste brand availability variety

Amul

Go cheese

Britannia

Mother dairy

Other

5.What factors influence you to by this brand?

a)Quality

b)Easy availability

c)Price

d)Dealer relationship

e)Attractive packing

f)Regular supply

6.Which type of cheese do you prefer to buy and why?

Type/factors: price taste brand availability usage

Mozzarella

Processed

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Pizza cheese

Spread

Slices

7.How long have been using the present brand of cheese?

a)one year b)two year c)three years d)four years and above

8.Which flavour of do you prefer in spread and slice and why?

Spread : four pepper

Olives and herbs plain,

Smoked paprika,

Jalapeno,

Garlic

Slice : plain

Mild chedder

Monetary jack

Gouda

Parmesan

Emmental

Colby

9.Have you tried go cheese products if yes then what?

Slice /mozzarella / spread /others

10.How do find Go cheese products?

Excellent – Good – Average – Poor – Very poor

11.If you are not using Go cheese brand, then specify the reason

a)Do not like taste

b)It is not fresh

c)Don’t like the brand

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d)Highly priced.

e)Poor packaging.

APPENDECISE

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