LOGISTICS OF

Presented by:-

Farhan Azmi

AMUL

Type - Cooperative

Industry -

Founded - 1946

Key people -

Revenue - INR 67.11billion (2008-2009)

Employee - Marketing arm: 735

Dairy

Dr. Verghese kurien

Milk producers: 2.8 million

KEY FACTS

AMUL means priceless in Sanskrit Amoolya

Brand name managed by an apex cooperation organization GCMMF

Worlds biggest vegetarian cheese brand

Worlds largest pouched milk brand

Largest food brand in India

Spurred the white revolution in India

Accreditation with 9001 and HACCP certification by QAS, Australia.

GCMMF: AN OVERVIEW

Members

13 district cooperative milk producers Union

No. of Producer Members

2.79

million

No. of Village Societies

13,328

Total Milk handling capacity

11.22

million liters per day

CONT

Milk collection (Total - 2008-09): 3.05 billion liters.

Milk collection (Daily Average 2008-09): 8.4 million liters

Milk Drying Capacity: 626 Mts. per day

Cattle feed manufacturing Capacity: 3500 Mts. per day

VALUE CHAIN PROCESS

AMUL PRODUCTS DIVERSIFICATION

PRODUCTS

Bread Spreads

Milk Drinks

Powder Milk

Fresh Milk

Cheese

For Cooking

Chocolate

MARKET SHARE

PRODUCT SHARE
Amul
Ice

butter - 86%

cream - 36%

Chocolate
Ghee

- 10%

- 20%

Skimmed

milk powder - 40%

PROBLEMS TO BE ADDRESSED
I.

Logistics in collection
6 million liters of milk per day
From about 10,600 separate village cooperative societies.
Approximately 2.8 million milk producing member.

II.

Logistic in coordination of
Storing the milk.
Processing the milk.
Distributing the milk.

CONT.
III.

Supplier logistics
Weighing the milk.
Determining of fat content.
Calculation of the purchase price.

EVOLUTION OF IT

The evolution of IT in AMUL was took place in the guidance of

DR.B.M Vyas.

The milk collection center at village cooperative societies, were first

automated.

Application and utilization of GIS.

Data analysis software utilization for milk production estimation and

increasing productivity.

VATS network between all the level of distribution network and

GCMMF.

IMPLEMENTATION
Amul

start implementation of ERP in phases.

Automatic

milk collection system units(AMCUS) at

village society were installed in the first phase to
automate milk production logistics.

AMCUS

facilities to capture member information, milk

fat content, volume collected, and amount payable to
each member electronically.

CONT
Indian Institute of Management Ahmedabad supplemented
Amuls IT strategy by providing an application software Dairy
Information System Kiosk(DISK) to facilitate data analysis and
decision support in improving milk collection.
The kiosk would also contain an extensive database on the
history of cattle owned by the farmers, medical history of the
cattle, reproductive cycle and history of diseases.
Farmers can have access to information related to milk
production, including best practices in breeding and rearing
cattle.
As a large amount of detailed history on milk production is
available in the database, the system can be used to forecast
milk collection and monitor the produce from individual sellers.

AUTOMATIC MILK COLLECTION SYSTEM

UNITS (AMCUS)

REAPING RETURNS
Radical changes in business processes - eliminating
middlemen .
Improved delivery mechanisms and transparency of business
operations.
Due to this process, AMUL is able to collect six million litres of
milk per day.
Huge reduction in processing time for effecting payments to the
farmers from a week to couple of minute.
Processing of 10 Million payments daily, amounting to
transactions worth USD 3.78 million in cash.

CONT..
Movement of 5000 trucks to 200 dairy processing plants twice a day
in a most optimum manner.
Practicing just in time supply chain management with six sigma
accuracy.
Online order placements of Amuls products on the web.
Distributors can place their orders on the website.
Amul exports products worth around US$ 25 million to countries in
West Asia, Africa and USA.

TOTAL QUALITY MANAGEMENT MODEL

There is improvement in quality of milk in term of acidity and sour

milk.

Sabor milk union records show 2% reduction in the amount of the

sour milk received from the union.

Improved microbiological quality of upcoming raw milk in the form of

methylene blue reduction.

This gives better shelf life to the product.

Program like Red Tag Day was launched for cleaning the milk
collection center.

AMUL PATTERN
A three tier cooperative structure:
Dairy

cooperative society at village level

Milk

union at district level

Milk

federation at state level

VILLAGE DAIRY COOPERATIVE SOCIETY

(VDCS)
Collection

of surplus milk & payment based on quality &

quantity.
Providing
Selling

support services to the members.

liquid milk for local consumers of the village.

Supplying

milk to the District Milk Union

DISTRICT COOPERATIVE MILK PRODUCERS

UNION (MILK UNION)
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.

Conducting

training on Cooperative development

CONT..

Providing management support & regular supervision to the

VDCS.

Establish Chilling Centers & Dairy Plants for processing the

milk.

Selling liquid milk & milk products within the District.

Process milk into various milk & milk products.

Decide on the prices of milk to be paid to milk producers.

GCMMFS SUPPLY CHAIN

DISTRIBUTION PROCESS
Company
Dealer Franchisee
Wholesaler
Retailer
Shopkeeper
Consumers

THE CHANNEL NETWORK

Procurement
Distribution

channel- upstream flow

channel- downstream flow

COLD STORAGE NETWORK

Chillers

in proximity of villages

Prompt

transport to district facilities for further dispatch to

consumers/ processing units.

Chilled

trucks to transport processed products

Delivery

to local chillers by insulated rail tankers and chilled trucks.

Refrigerators

and freezers with retailers and departmental stores to

retain freshness.

DISTRIBUTION

GCMMF coordinated with various unions to get a regular supply of milk

and dairy products.

The processed milk and dairy products were procured from district dairy
unions and distributed through third party distributors.

To ensure quality and timely deliveries, GCMMF and the district unions
had several mechanisms in place.

The unions monitored the supplies of milk and the distribution of finished
products.

REVERSE LOGISTICS
MILK CHURN
from dairy to VCS
POUCH MILK TRAY
from retailer to dairy
BOTTLE
from retailer to dairy
DAMAGED PRODUCTS
from customer to retailer then to dairy

LESSONS FOR MANAGING LARGE NETWORKS

Long

term perspective

Simultaneous
Network
Cost

development of markets and suppliers.

partnership Vs. ownership

leadership and value for money

Technology

and Information Sharing

DIRECT RETAILING
Amul

has recently entered into direct retailing through

"Amul Utterly Delicious" parlors created in major cities.

Amul

has plans to create a large chain of such outlets

to be managed by franchisees throughout the country.

More

than 2000 parlor with a turnover of 200 crore.

EXPANSION PLAN

Tie up with the Wal Mart

Export is in 15 countries.

Plan to open 10000 Amul parlor by the end of the 2010.

MISSION 2020
Very ambitious future plan

Turnover of 27000 crore.(three fold increase in the group turn

over.)

Milk production 33.1 million liter/day.

Milk drying capacity 200 mt/day

AMUL (RECENTLY IN NEWS)

Milk via milk train.

Tie up with Adani Logistics.

50 wagon each capacity 24k liter.

Initial transport cost was 40 crores ,reduce it to half.

THANK YOU..