Presented By:

Akash Jain
Roll No. 06
 Indian Dairy Industry

India is worlds largest producer of dairy products by volume.

It is accounting more than 9.5% of worlds total milk

production.

Also India is worlds largest consumer of dairy products,

consuming almost all of its own milk production.

Indian dairy industry is different from other dairy producing

countries as India places its emphasis on both cattle and
2
buffalo milk.
Introduction to AMUL
Amul means
Priceless
Managed by GCMMF

Exists since 1946

Indias largest Food

brand
Worlds Largest
Pouched milk brand
 GUJARAT COOPERATIVE MILK MARKETING
FEDERATION (GCMMF)
India's largest food product marketing organisation
with annual turnover (2015-16)US$ 3.5 billion
India's largest exporter of Dairy Products
Products are available in USA, Gulf Countries,
Singapore, Philippines, Japan, China and Australia.
It operates through 56 Sales Offices and has a
dealer network of 10000 dealers and 10 lakh
retailers, one of the largest such networks in India.
Growth
Registered a quantum growth of 187 per cent in the last
six years
Cumulative average growth rate (CAGR) of 19.2 per cent
Last three years, Amul achieved a growth of 67 per cent
A turnover of Rs 22,972 crore during the year 2015-16
The group turnover of GCMMF and its constituent member
unions, representing the figure of all products sold under
the Amul brand, was Rs 33,000 crore or $5 billion.
Amul Products Diversification

Dairy
Cheese Products
Bread Spreads Non-Dairy
Milk Drinks & Desserts
Instant Food
Fresh Milk
Snacks
Veg. Oils

8
 PRODUCTS
Bread Spreads

Milk Drinks

Powder Milk

Fresh Milk

Cheese

For Cooking
9
Chocolate
MARKET SHARE

10
AMUL Model

11
12
13
Supply Chain
Management

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 Products are
transported
Pasteurized to the
milk is various
transported wholesale
to the and retail
Chilled milk is stores
regional milk
transported
federation
from the VCC
factories
to the ditrict
where dairy
union where
Dairy products are
the milk is
farmers get pasteurized manufacture
milk to the d and
VCC where branded
milk is
cooled
using
16
 Logistics Process
I. Logistics in collection

16 million liters of milk per day

From about 18,485 separate village cooperative societies.
Approximately 3.6 million milk producing member.

II. Logistics in coordination of

Storing the milk.

Processing the milk. 17

Distributing the milk.

 Cont
III. Supplier logistics

Weighing the milk.

Determining of fat content.
Calculation of the purchase price.

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 THE CHANNEL NETWORK

Procurement channel- upstream flow

Distribution channel- downstream flow

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 Procurement

Activities at the village level comprised developing and servicing the

VCSs.

Milk collection, procuring milk, and transporting it to the chilling and

processing units twice a day.

The VCSs provide the farmers with good quality animal feed, fodder,
and other services like veterinary first aid.

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 PROCUREMENT CHANNEL
(UPSTREAM)
On an average around thousand farmers come to sell milk at their local co-
operative milk collection center.

Each farmer has been given a plastic card for identification.

At the milk collection counter, the farmer drops the card into a box and the
identification number is transmitted to a personal computer attached to the
machine.

The milk is then weighed and the fat content of the milk is measured by an
electronic fat testing machine.
 Cont
Both these details are recorded in the PC. The computer then calculates the
amount due to farmer on the basis of the fat content.

The value of the milk is then printed out on a slip and handed over to farmer
who collects the payment at adjacent window.

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 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.
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 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. 24
 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

 Direct retailing

Amul has 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 Rs. 200 crores.

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 EVOLUTION of IT
Started fifty years back by AMUL by eliminating the middlemen and
bringing the producers closer to the consumers.
Amul has start implementation of ERP in phases.
The project was named as Enterprise wise integrated application system [EIAS]
Automatic milk collection system units(AMCUS) at village society were installed in the first
phase to automate milk production logistics
AMCUS has facilities to capture member information, milk fat content, volume collected,
and amount payable to each member electronically
Data analysis software utilization for milk production estimation and increasing
27
productivity
 Benefits of IT
Processing of 10 Million payments daily, amounting to transactions worth USD 3.78
million in cash.

Radical changes in business processes - eliminating middlemen.

Improved delivery mechanisms and transparency of business operations.

Huge reduction in processing time for effecting payments to the farmers from a week to
couple of minute.
 Cont
Movement of 5000 trucks to 200 dairy processing plants twice a day in a most
optimum manner.

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.

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 Quality Management
Have a commitment to achieve quality in basically six priority areas
Cleanliness of the dairy cooperative societies,

Planning and Budgeting of the Dairy Society,

Artificial Insemination Service,

Quality Testing and Milk measurement at Dairy co-operative Societies and

Management Practices

Self-leadership Development
 Contd..
TQM movement has also been extended to the wholesale dealers by
organizing workshops for them

Movement also involves the process of policy deployment known as

Hoshin Kanri.

This involves strategy formulation and implementation, involving every

member of the value chain.
SWOT ANALYSIS

S W O T
Strengths
Largest food brand in
India
Vast resources
High Quality, Low
Price Advanced
Technical
World's Largest Equipment
manpower
Pouched Milk Brand
capacity
Highly Diverse Increasing
Product Mix purchase power

Robust Distribution
Network

S
Enhanced Milk
Production capacity
Weaknesses Risks of highly
complex supply
chain system Perishability of
products
Strong
dependency on Erratic power
weak supply
infrastructure
Lack of proper
Alliance with 3rd Infrastructure;
parties who do warehousing,
not belong to the Trained
organized sector manpower

Indian Roads
specially for
logistics facility

W
 Increase the
Opportunities Penetration in
international
markets

Diversify product Presence only in

portfolio to enter Vegetation Food
new product Market, can launch
categories and range of non-veg
expand existing items
categories like
processed foods,
chocolates etc

innovations in
product
development,
packaging and

O presentation

IT support
Threats Milk vendors,
the un-
organized sector
Milk
Threat of adulteration
Competitors
Low profit
Still margin to
competition Retailer, risk of
from MNCs in switching brand
butter

Growing price
of milk and milk
products

Ban on export

T of milk powder
 PORTERS 5 FORCES
Competitive Rivalry - HIGH Bargaining Power of Suppliers -
New brands are coming up each day and the Bargaining LOW
Power of
major factor on which they play in this Suppliers Farmers, rural households and
industry is prices LOW small cooperatives sell at the
going market rate.
The big giants and the
Threat of Substitutes - LOW government control the sector
Essential item for and regulate prices
beverages like tea, coffee
Traditional consumption Threat of Competitive Threat of
New
habits make milk a favorite Substitutes Rivalry Entrants
Threat of New Entrants -
There is no other offering LOW HIGH
HIGH HIGH
that can substitute milk. Not many entry barriers
Many local players have
come up with their own
Bargaining Power of Consumers - LOW
local brands
The prices of packaged and branded
New company just has
milk and milk products is fixed Bargaining to follow the defined
Bargain with the local milk vendors in Power of
Consumers
standards and it can
unorganized sector and local shops
LOW
come up with its
selling milk products
offerings in this sector
 References
http://www.ijser.org/researchpaper/A-CASE-STUDY-OF-AMUL-COOPERATIVE-IN-I
NDIA-IN-RELATION-TO-ORGANIZATIONAL-DESIGN-AND-OPERATIONAL-EFFICIENCY.pdf
http://
economictimes.indiatimes.com/industry/cons-products/food/amul-clocks-quantum
-leap-of-187-in-6-years/articleshow/52802217.cms
https://www.trendingtopmost.com/worlds-popular-list-top-10/2017-2018-2019-2020
-2021/world/largest-milk-producing-countries-world
/
http://www.amul.com/m/about-us
http://www.amul.com/m/gcmmf
http://www.amuldairy.com/index.php/cd-programmes/quality-movement
http://
economictimes.indiatimes.com/industry/cons-products/food/amazon-to-sell-amul
-products-in-us/articleshow/55602997.cms
THANK YOU