amul121

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PRESENTATION ON

GUIDED BY:MANISH SIR

PRESENTED BY: AMIT SHARMAGOURAV JAIN

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Kaira District Co-ope rativ e M ilk P r odu c e rs¶ Un ion L td., An a nd.

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ANAND MIL K FEDERATION LIMITEDTHE KAIRA DISTRICT CO-OPERATIVE MILK

PRODUCERS¶ UNION LIMITED ANAND

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ROAD MAP

IntroductionHistory

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In the year 1946 the first milk union was established. This unionwas started with 250 liters of milk per day.

The union was known as KAIRA DISTRICT CO-OPERATIVEMILK PRODUCERS UNION .

This union selected the brand name AMUL in 1955.

The brand name Amul means ³AMULYA´ . This word derivedform the Sanskrit word ³AMULYA´ which means ³PRICELESS´.

The successful pattern of Amul cooperatives ,in 1965 , the primeminister of India, shri Lal Bahadur Shastri, created The NationalDairy Development Board(NDDB) .

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Plants

First plant is at ANAND , which engaged in the manufacturing of milk, butter, ghee, milk powder, flavored milk and buttermilk.

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Second plant is at MOGAR, which engaged in manufacturingchocolate, nutramul, Amul Ganthia and Amul lite.

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Third plant is at Kanjari, which produces cattle feed.

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F ourth plant is at Khatraj, which engaged in producing cheese.

Today, twelve dairies are producing different products under the brand name Amul.

Today Amul dairy is no. 1 dairy in Asia and no. 2 in the world,

which is matter of proud for Gujarat and whole India.

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GC MMFGC MMF ² ² OO VER VER V V IEWIEW

GCMMF: G ujarat Cooperative Milk MarketingFederation.

It was established in 1973.

GCMMF is India's largest food products marketing organization.

It is a state level apex body of milk cooperatives in Gujarat whichaims to provide remunerative returns to the farmers and alsoserve the interest of consumers by providing quality products

which are good value for money.

CR ISIL( credit rating information services of India limited ) , India'sleading Ratings, Research, Risk and Policy Advisory company, hasassigned its highest ratings of "AAA/Stable/P1+" to the variousbank facilities of G CMMF.

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T HE MAN WHO BEHIND T HE AMUL

Dr . VER G HESE KURIENThe fat he r of W h it e r ev olution in India

and also call e d Milkman of India .

H e was t he ch airman of t he GC MMF .

H e was also t he ch airman of NDDB .

H e was award e d by Ramon magsaysay forcommunity l e ad e rs h ip .

H e was award e d by BHA T AR PADMA SHRI,

PADMA BHUSHAN,AND PADMA VIBHUSAN .

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S ERVI C ES OFFERED BY AMUL

M e dical faciliti e s for t he cattl e of form e rC attl e f ee ding

Artificial ins e mination ( C attl e Br ee ding )

Fr ee animal v accinationForm e r e ducation programs

AMUL also pro v id e t he sc h olars h ip to c h ildr e n of m e mb e r of soci e ty .

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H UMAN RESOUR C E MANA G EMEN T

DEPAR T MEN T

Recruitment, Selection & Induction.Training & Development.Performance appraisal.Promotions & Transfers.

Wage & Salary Administration.Retirement Benefits.Employee Turnover.

Compensation.Industrial Relation.

Welfare Activities.Time Keeping Department.

Personal Records.

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A A MULMUL -- BBUSINESSUSINESS MMODELODEL

RAW MILK

DriedSkimmed Milk

Powder

Packaged Milk

Ice creamBeverages

Condensed

GheeButterCream

pasteurization

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C ON T «

E ve ry day Amul coll e cts 7 million litr e s of milkfrom 2 .6 million farm e rs (many illit e rat e ),con ve rts t he milk into brand e d, packag e dproducts, and d e li ve rs goods to o ve r 500,000r e tail outl e ts across t he country .

Its supply c h ain on e of t he most complicat e d int he world .

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Third party service providers- core is milk processing , production of dairy products

- logistics of milk collection, distribution of dairy products, sale of products through dealers and retail

stores

Umbrella brand - common brand for most product categories- Amul's sub-brands , edible oil products - Dhara, mineral water - Jal Dhara brand while fruit drinks - Safal

Developing demand - limited purchasing power, modest consumptionlevels

- a low-cost price strategy products

The distribution network - dry and cold warehouses- cash transactions throughout the supply chain- JIT improves dealers' return on investment (ROI

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Mo v ing consum e rs from loos e milk to packag e dmilk and gradually mo ve t he m up t he v alu e

ch ain (t e tra pack to b eve rag e s, all a v ailabl e und e r t he Amul brand)

A sound strat e gy lik e ly to work . Be ing ex pos e d to a brand, it is natural for acustom e r to try mor e productsImpro v ing socio- e conomic condition of t he custom e r anc h ors t he d e sir e to e n h anc e

lif e styl e

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Wid e rang e of product cat e gori e s cat e rs toconsum e rs across all mark e t s e gm e nts . Forex ampl e , Amul Kool is targ e t e d at c h ildr e n,wh il e t ee nag e rs pr e f e r Kool C afé, as it h as acool imag e ry associat e d wit h it .

S e gm e ntation is not as e asy in curd and lowfat products, du e to mi xe d audi e nc e s, v ariousculinary applications , e g . ghee , butt e r andchee se .

´In India, t he most us e d spr e ad is g hee , t he nbutt e r, c hee se , low fat butt e r, margarin e ,chee se spr e ad and mozzar e lla c hee se .

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C h anging r e tail e n v ironm e ntStriking out on its own, wit h Amul Outl e ts orparlours to d e li ve r consum e rs total brandex

pe

rie

nce

Launc he d in 2002, t he r e ar e now 400 Amulparlours across t he country, w h ich contribut e d3% to t he brand·s total turno ve r last y e ar .

Hig h profil e locations: Amul parlours ar e todaypr e se nt on campus e s of Infosys, Wipro, IIM-A,II T -B, Te mpl e s, M e tro rail and railwaystations in G ujarat .

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A mass mark e t play e r, no pr e mium off e ringsUSP ² Quality wit h affordabilityUp against nic he play e rs ² v alu e addition to custom e rsShee r siz e and scal e of op e rationN e w off e rings for he alt h conscious and v ibrant India ²

H e alt h and e n e rgy drinksStamina, a he alt h drink mad e from milk wit h add e dv itamin C against R e d Bull and G atorad e , milk b e tt e rt h an cola . Aim e d at youngst e rs, pric e d at Rs 12

Ic e -cr e amProbiotic and sugar-fr ee v ariantsC h ocolat e s

sugar-fr ee brand call e d C h oco-Mini to targ e t t he diab e tic

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G ive n t h is wid e product portfolio, Amul·sapproac h is to promot e its brands in arotational cycl e of two to t h r ee ye ars .

Afte

r ice

-cre

ams we

re

launche

d in 1996

, the

cat e gory was r e -v isit e d in 1999, in ord e r toimpro ve a v ailability of t he product and mak e itaffordabl e .

The focus s h ift e d to c hee se in 2001, AmulMasti C h aas in 2004-05 (sal e s of Masti da h igr e w by 25%), Nutramul and Kool Kaf e in200 6 and t h is y e ar t he focus is on Amul Koko

³ cold c h ocolat e drink

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Us e s a v ari e ty of m e dia to communicat e Most famous is billboard campaign

The e nd e aring polka dr e ss e d girl and pun atv arious issu e s incr e as e d brand·s fan following .

Be low-t he -lin e acti v ity h as grown too ³ suc h as t he Amul food f e sti v al, w h ich h as b ee n he ldfor t he last four y e ar b e tw ee n Octob e r andD e ce mb e r in about 50,000 r e tail outl e ts . The C he f Of India promo in v it e s h ot e l c he fs tocom e up wit h r e cip e s using as many Amulproducts as possibl e , and is conduct e d at city,

stat e and national l eve l.

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On e of t he most cons e r v ati ve FM CG e ntiti e s ³ GC MMF ³ sp e nds a m e r e 1% of its turno ve ron promotions .

GCMMF

has writt

en and r

e-writt

en rul

es of t he gam e .

Amul butt e r girl is on e of t he long e st run adcampaigns in t he country for 41 y e ars .

Int e llig e nt mark e ting of milk, ic e cr e am andbutt e r milk .

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RREASONSEASONS FORFOR SS U CC ESSU CC ESS

Robu st Supp ly Ch ai nThe vast and complex supply chain Hierarchical network of cooperatives

Stretches from small suppliers to large fragmented markets

Low Co st S trat eg yAmu l a dop ted a low- c o st p ric e strat eg y to m ak e its p r odu ctsaff o r d a b le a nd attractiv e to c on s ume rs b y gu ara n tee ing

them val ue f o r mone y

Dive rs e P r odu ct MixAmu l Bu tt e r , Milk Powde r , Ghee,Amu ls p ray , Chee s e, Cho c o lat e s ,

Sh rik h a nd, I c e cr e a m,Nu tra mu l, Milk a nd Amu lya

S tr ong D istri bu tion Ne two rkAmu l p r odu cts ar e availa b le in o ve r 500,000 r e tail ou tle ts acr o ss Ind ia th r ough its ne two rk o f o ve r 3,500 d istri bu to rs .

47 depo ts with d ry a nd c o ld w ar ehou s e s to bu ff e r in ven to ry o f theen tir e ra nge o f p r odu cts .

Te c hno log y a nd e- in itiativ e sNew p r odu cts

P r o c e ss te c hno log yComp lemen tary ass e ts to enh a n c e m ilk p r odu cti on

E-c omme rc e.

Success!!

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FF A C T S A C T S

Members: 13 district cooperative milkproducers' Union

No. of Producer Members: 2.79 million

No. of Village Societies: 13,328

Total Milk handling capacity: 11.22 million liters per day

Milk collection (Total - 2008-0 9 ):

3.05 billion liters

Milk collection (Daily Average2008-0 9 ):

8.4 million liters

Milk Drying Capacity: 626 Mts. per day

Cattle feed manufacturingCapacity:

3500 Mts. per day

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IINDUS T RY NDUS T RY A A NALYSISNALYSIS : P: P OR T EROR T ER ··SS 55FF OR C ESOR C ES

Bargaining Powerof Customers isHigh because of

Variouscompetitors

Threat of substitutes is high

because of availability of

Other products

Threat of new entrantsIs high because

There are no entrybarriers

Competitive Rivalryy is High due to

Other brands andLocal players

Bargaining Powerof Suppliers is low

because the suppliersAre rural milk

producers

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SWO T A SWO T A NALYSISNALYSIS

W eaknessesRisks of highly complex supply

chain systemStrong dependency on weak

infrastructure

Alliance with third parties who donot belong to the organized sector

OpportunitiesPenetrate international marketsDiversify product portfolio to

enter new product categories andexpand existing categories likeprocessed foods, chocolates etc

ThreatsCompetitors - Hindustan Lever,

Nestle and BritanniaStill competition from MNCs in

butterGrowing price of milk and milk

productsBan on export of milk powder

StrengthsLargest food brand in IndiaHigh Quality, Low PriceWorld's Largest Pouched Milk BrandAnnual turnover of US $1504 million

Highly Diverse Product MixRobust Distribution Network

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T HE AMUL PRODU C T S

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M ARKET PRESENCE

´ Demographics

Ag e - from 5 yrs ² 80 yrs .

S ex - No bar

Income

- low toh

igh

Occupation-Any s e ctor (not n e ce ssary)

Education- Low e r to h ig he r

´ Psychographics

P e rsonality- No discrimination .Lif e styl e - a basic normal lif e to h ig h class li v ing std

Buying Moti ve s-It is g e n e ric wit h butt e r cat e gory, r e nown e d butt e ra v ailabl e in mark e t, lo ve d by all consum e rs .

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CC US T OMERUS T OMER BB ASED ASED MM ARKE T ARKE T

SSE G MEN T A T IONE G MEN T A T ION

Kids

Women

Calorie Conscious

Health Conscious

Youth

Amul Kool Chocolate MilkNutramul Energy DrinkAmul Kool Millk ShaakeAmul Ice Creams

Amul Calci +

Utterly Delicious PizzaAmul Emmental CheeseAmul Cheese Spreadsv

Amul LiteSagar Skimmed Milk PowderAmul Lite Slim and Trim Milk

NutramulAmul Shakti Health FoodDrink

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IINDUS T RY NDUS T RY BB ASED ASED MM ARKE T ARKE T

SSE G MEN T A T IONE G MEN T A T ION

Milk

Butter/ Cheese/GheeButter/ Cheese/Ghee

Ice-cream Manufacturers

Restaurant/Food Chains

Temples

Bakery & Confectionaries

Pizza Retailers

Snacks Retailers

Coffee Shop Chains

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MM IXIX « P« P RODU C TRODU C T FORFOR EVERY EVERY ONEONE

Amul never forgot its ³primarycustomer´

- Amul collects 447,000 ltrs of milkfrom 2.12 million farmers (manyilliterate )

Product for youth- Amul launched Chocolate milk under

brandname of µAmul Kool Koko¶ targeting the

youth

Product for diabetic people- India¶s First Pro-Biotic Wellness Ice

cream & Sugar Free Delights For Diabetics

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MM IXIX « P« P RODU C TRODU C T FORFOR EVERY EVERY ONEONEProduct for the healthconscious

- Amul Launched ³low fat, lowcholesterol

bread spreads´

Product for the pricesensitive India

- Low Priced Amul Ice Creams andaffordable µsagar¶ whitener

Product for the urban class- Amul launched emmental,

gouda and pizza mozzarella cheese

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PP RODU C TRODU C T MM IXIX OFOF A A MULMUL

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A MUL - P RODU C T D IVERSIFI C A T ION

Secret Philosophy

Progressive addition of higher value products

while maintaining the desired growth in existingproducts.

Amul introduced products with consistent value

addition but never left the core philosophy of

³providing milk at a basic, affordable price´

Seeking unfamiliar products or markets inthe pursuits of growth with both dairy and non-dairy products

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A A MULMUL -- PP RODU C TRODU C T A A BANDONMEN TBANDONMEN T

10 years back, Amul took a shot at bottled waterthrough µ J aldhara ¶ which was produced by NDDB.

However the venture failed owing to less demandfor packaged water in market. The product wasabandoned.

Now Amul is all set to re-launch bottled water

³NARMADA NEER´

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TT HEHE 3 C ·3 C ·SS««

Customer

Company

Competitor

Customers extremely satisfiedMoved from loose milk topackaged milkReady to try more productsImproved socio-economicconditions

Largest milk brand in AsiaMore than 30 dairy brandsMarket leader in ghee & butterVery strong supply chainEnjoys Fine reputationQuality with Affordability

Defending against Mahananda,Vijay, Milma & other co-operativemilk brands

Aggressive moves againstBritannia, Nestle, Mother Dairyand Kwality

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A A MULMUL ² ² PP RODU C TRODU C T PP OR T FOLIOOR T FOLIO

Category Market Share Market Position

Butter, Ghee 85% 1

Milk Powder 40% 1

Cheese 50% 1

Ice-cream 24.75% 2

Sweets 50% 1

Chocolate Drink 90% 1

Chocolate 10% 3

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A A DVER T ISEMEN T SDVER T ISEMEN T S

AMUL is well known for its innovative hoardings. Find below afew :

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ADVER T ISEMEN T S

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Annu al Tu r no ve r Of Rs 4300 C r o r e (2006-07)

Rs 10,000- cr o r e m ark o ve r the ne xt th r ee ye ars .

Fou r de ca de s to be c ome R s 2,000- cr o r e en tity Bu t, the tu r no ve r doub led to o ve r Rs 4,300 cr o r e w ith in n ine ye ars fr om 1999 to 2007

Annual Turnover

4300

10000

2000

0

2000

4000

6000

8000

10000

1946 1999 2007 2008 2009 2010

Time Frame

I N R

C r o r e s

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ADVER T ISEMEN T S

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A MUL MAS C OT

The t e rm mascot ² d e fin e das a t e rm for any p e rson,animal, or obj e ct t h oug h t tobring luck [1] ² colloquially

(informally) includ e sanyt h ing us e d to r e pr e s e nta group wit h a commonpublic id e ntity, suc h as asc h ool , prof e ssional sportst e am , soci e ty , military unit ,or brand nam e .

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C OMPE T IT ORS

BrittaniaN e stl e

HLL

C adbouryMot he r Dairy

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SS T RU GG LET RU GG LE -- A A MULMUL CC HO C OLA T ESHO C OLA T ES

.

IntroductionPhase

Amul Milk,Amul Fruit andNut

LowG rowthPhase

De cli neS al es

New BrandsRejoice,Kite Bite,Nuts about youSugar FreeChoco Zoo

De cli ne

Sales

Inadequate SuccessFailed new brandsExcessive discounts10% Market shareTough competition byMarket Leaders ± Cadbury(70% ) , Nestle

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WWHA THA T MOREMORE C ANC AN A A MULMUL DODO ??To improve further Amul can try out the following ideas :

I) Amul can venture out on new products like Tonedmilk, Condensed milk that can be used for sweets, Baby foodproducts,

II ) There are certain product like Amul basundi, gulab jamoon, choclates etc which are not as popular as Amul icecream. Amul must try to understand the cause of this throughthorugh market research and work on improving theseproducts

III ) Though Amul¶s hoardings are a huge success, itcan penetrate even better in the rural areas by advertisingthrough the media viz cable channels and newspapers.Sponsoring shows in TV, sports events can be of great help .

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