EXECUTIVE SUMMARY

In today’s competitive world while entering in the market it is very necessary to

have good knowledge of the potential of a particular market. The growth of a

company is invariably determined not just by its strategy, but on how it

responds to the challenges it encounters. Over the decades AMUL has

successfully countered several challenges that have come its way with

innovative responses and continuous improvement, which have enabled it to

remain stable and even convert some of these challenges into opportunities. It

is the culture of endurance that has accorded AMUL the insight and focus to

deal with the current economic environment. Drawing from its inner strength

and beliefs, AMUL responded by launching several initiatives across all its

operations in various geographies that are helping the group achieve growth

even in current times. It is also this very strategic culture that will propel AMUL

to continue on its growth trajectory in years to come.

The report provides a comprehensive insight into the company and also about

the company’s SWOT analysis. This report mainly studies in detail the various

product mix strategies of the company and also focuses on the segmentation of

both company based and industry based and helps in analysing the company’s

competitive advantage and the reason behind its success.

1.INTRODUCTION

1.1 About the company:Amul (Anand Milk Union Limited), formed in 1946, is a dairy cooperative movement

in India. It is a brand name managed by an apex cooperative organisation, Gujarat

Co-operative Milk Marketing Federation Ltd. (GCMMF), which today is jointly

owned by some 2.9 million milk producers in Gujarat, India. It is based in Anand

town of Gujarat and has been a sterling example of a co-operative organization's

success in the long term. Dr Verghese Kurien is recognised as the man behind the

success of Amul. The Amul Pattern has established itself as a uniquely appropriate

model for rural development. Amul has spurred the White Revolution of India,

which has made India the largest producer of milk and milk products in the world. It

is also the world's biggest vegetarian cheese brand.

AMUL means "priceless" in Sanskrit. The brand name "Amul," from the Sanskrit

"Amoolya," was suggested by a quality control expert in Anand. Variants, all

meaning "priceless", are found in several Indian languages. Amul products have

been in use in millions of homes since 1946. Amul Butter, Amul Milk Powder, Amul

Ghee, Amulspray, Amul Cheese, Amul Chocolates, Amul Shrikhand, Amul Ice cream,

Nutramul, Amul Milk and Amulya have made Amul a leading food brand in India.

Today Amul is a symbol of many things. They are:

High-quality products sold at reasonable prices.

The genesis of a vast co-operative network.

The triumph of indigenous technology.

The marketing savvy of a farmers' organisation.

Proven model for dairy development.

Amul has justified its undisputed leadership in foods business by creating 5000

Amul preferred outlets in a record time which exclusively sell wide range of Amul

products. This has been possible due to strong brand equity and immense

consumer support. Amul Parlours are successfully operating in more than 1400

towns at high streets, residential areas, Railway Stations, Bus Stations, Educational

Institutions and a whole lot of Centres of Excellence.

1.2 Gujarat Cooperative Milk Marketing Federation:

Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's largest food

products marketing organisation. It is a state level apex body of milk cooperatives in

Gujarat which aims to provide remunerative returns to the farmers and also serve

the interest of consumers by providing quality products which are good value for

money.

GCMMF is India's largest exporter of Dairy Products. It has been accorded a

"Trading House" status. GCMMF has received the APEDA Award from Government

of India for Excellence in Dairy Product Exports for the last 11 years.

CRISIL, India's leading Ratings, Research, Risk and Policy Advisory company, has

assigned its highest ratings of "AAA/Stable/P1+" to the various bank facilities of

GCMMF.

Facts:

Members: 13 district cooperative milk

producers' Union

No. of Producer Members: 2.9 million

No. of Village Societies: 15,322

Total Milk handling capacity: 13.07 million litres per day

Milk collection (Total - 2009-10): 3.32 billion litres

Milk collection (Daily Average 2009-10): 9.10 million litres

Milk Drying Capacity: 647 Mts. per day

Cattlefeed manufacturing Capacity: 3740 Mts per day

1.3 Awards:

GCMMF bags APEDA AWARD for 11th year in a row

Amul Pro-Biotic Ice-cream Gets No. 1 Award At World Dairy Summit

Ramkrishna Bajaj National Quality Award-2003

Amul - The Taste Of India (Gcmmf)Receives International Cio 100 Award For

Resourcefulness

Rajiv Gandhi National Quality Award - 1999

1.4 Achievements:Amul created history in following areas:

First self motivated and autonomous farmers “organization comprising of more

than 5000000 marginal milk producers of Kaira District”.

Created Dairy co-operatives at village level functioning with milk collection

centres owned by them.

Computerized milk collection system with electronic scale and computerized

accounting system.

The first and only organization in world to get ISO 9000 standard for its farmers

co-operatives.

First to produce milk from powder from surplus milk.

Amul is the live example of how co-operation amongst the poor marginal farmers

can provide means for the socio-economic development of the under privileged

marginal farmers.

2.AMUL BUSINESS MODEL

2.1 Objective: Deliver profitable and equitable returns to a large number of farmers for a long

period of time

2.2 Additional objective: Develop the supplier over the long term through social change.

3.SWOT ANALYSIS

3.1 Strengths:

Demand profile: Absolutely optimistic. Milk being a necessity product, the

demand will stay and the sales at GCMMF are bound to increase over a period

of time.

Margins: Quite reasonable, even on packed liquid milk. The margins are enough

to limit the entry of potential entrants.

RAW

MIL

K

Drie

dSk

imm

ed M

ilk P

owde

r

Pack

aged

Milk

Ice c

ream

Beve

rage

s

Cond

ense

d

Ghee

Butte

rCr

eam

pasteu

riza tion

Flexibility of product mix: Tremendous. With balancing equipment, GCMMF has

kept adding a wide array of products to its product line.

Availability of raw material: Abundant. Presently, more than 80 per cent of milk

produced is flowing into the unorganized sector, which requires proper

channelization. Amul & GCMMF have leveraged this and has got itself a strong

base of suppliers who provide them milk throughout the year. Large number of

dairy plants in public and cooperative sectors besides several others coming up

in the private sector would result in competition. Because of this the end

consumer would benefit and a good product mix would emerge.

Technical manpower: Professionally trained, technical human resource pool,

built over last 30 years is the strength that GCMMF has. The employees of

GCCMF are highly recognized in the industry and have earned name for

themselves as well as the federation.

Enhanced Milk Production: Increase in the milk production with consequently

increased availability of milk processing has led to increase in consumption and

faster access to the consumers through effective distribution. The technology is

brought from Denmark and the production of milk has benefited from that.

Transportation: The transportation facilities and the easy availability of the

special trucks have provided a boost. Cold refrigerated trucks are there in place

and the warehouses also have the cold storage facilities that facilitate the

transportation.

Vast resources: Country has vast natural resources which offer immense

potential growth and development for dairying. Moreover the financial

resources available with the federation are immense and the reputation is such

that in case of any further requirements, it can approach any institution and

raise any form of capital.

Increasing purchase power and changing tastes of the consumers: The

purchasing power of the residents is increasing. As a result a lot of products are

being consumed. Moreover, the consuming habits are changing. As a result, the

demand for products such as butter and cheese is increasing at a very rapid

rate.

3.2 Weaknesses:

Perishability: Pasteurization has overcome this weakness partially. UHT gives

milk long life. Still perishability is there at the milk vendors end. This does result

in loss of some production. But Amul Dairy is taking steps to store milk at the

vendors end. Surely, many new processes will follow to improve milk quality

and extend its shelf life.

Lack of control over yield: Theoretically, there is little control over milk yield. A

lot depends upon the monsoon in the country. This is because of the quality of

cattle feed that would be available will not have the required nutritional

content. Steps are taken to provide awareness regarding these and the

penetration of quality feed is being increased. Moreover, increased awareness

of developments like embryo transplant, artificial insemination and properly

managed animal husbandry practices, coupled with higher income to rural milk

producers should automatically lead to improvement in milk yields.

Logistics of procurement: Woes of bad roads and inadequate transportation

facility make milk procurement problematic. All these factors lead to

perishability of the procured milk. But with the overall economic improvement

in India, these problems would also get solved.

Erratic power supply: The erratic power supply would cause harm in the

processing of milk.

Underdeveloped systems: There still exist underdeveloped raw milk collection

systems in some parts of the country. However steps are being taken such as

setting up of cold storage points at key collection centers to combat the

situation.

Lack of proper implementation: Dairy development programmes have not been

fully implemented as per the needs of the region in different agro-climatic

zones.

Infrastructure: The infrastructure that is available is not up to the current world

standards. Also lack of infrastructure for offering dairy business management

programmes to the trained personnel is creating a hindrance.

3.3 Opportunities:

"Failure is never final, and success never ending”. Dr Kurien bears out this

statement perfectly. He entered the industry when there were only threats. He met

failure head-on, and now he clearly is an example of ‘never ending success’! If dairy

entrepreneurs are looking for opportunities in India, the following areas must be

tapped:

Competition: With so many newcomers entering this industry, competition is

becoming tougher day by day. But then competition has to be faced as a ground

reality. The market is large enough for many to carve out their niche. Moreover

due to competition, there is a chance to better serve the market with innovative

products.

Value addition: There is a phenomenal scope for innovations in product

development, packaging and presentation. Given below are potential areas of

value addition:

o Steps should be taken to introduce value-added products like khoa,

flavored milk, dairy sweets, etc. This will lead to a greater presence and

flexibility in the market place along with opportunities in the field of brand

building.

o Addition of cultured products like yoghurt and cheese lend further strength

- both in terms of utilization of resources and presence in the market place.

o Yet another aspect can be the addition of infant foods, geriatric foods and

nutritional.

Export potential: Efforts to exploit export potential are already on. Amul is

exporting to Bangladesh, Sri Lanka, Nigeria, and the Middle East. Following the

new GATT treaty, opportunities will increase tremendously for the export of

agri-products in general and dairy products in particular. There is a strong basis

of cost efficiency, which GCMMF can leverage in the world market.

Markets: The market for the traditional as wells as processed dairy products is

expanding both at the domestic and international front.

IT support: Software is now available for project formulation for dairy

enterprise. It has also computerized its production processes. Mother Dairy was

the first fully computerized dairy in India. In its Anand plant all products are

processed computerized, which does not have any hand touch during any stage

of process.

3.4 Threats:

Milk vendors, the un-organized sector: Today milk vendors are occupying the

pride of place in the industry. Organized dissemination of information about the

harm that they are doing to producers and consumers should see a steady

decline in their importance.

Infestation: There are increasing incidents of chemical contaminants as well as

residual antibiotics in milk.

Quality: The quality of the milk is found to be poor as compared to the

international standards. One of the reasons for these according to the EU and

America is the method of milching the milk. In these nations the milk is hands by

the farmers owning the cattle do milched with the help of machines, while in

India.

Exploitation: The liberalization of the Dairy Industry is likely to be exploited by

the multinationals. They will be interested manufacturing the milk products,

which yield high profits. It will create milk shortage in the country adversely

affecting the consumers.

Subsidy by Western Nations: There have been incidences wherein the Western

nations subsidizing the dairy products by a few means like transportation.

Because of such reasons the final price of the product goes below the prices

prevailing in the Indian Market. Hence it proves a threat to GCMMF’s and other

Indian dairy products.

Creation of Non Tariff Barriers by Developed Nations: The Developed Nations

have created Non Tariff Barriers related to Quality of the milk specifically. They

want that the milk be processed with potable Air and Water. They also want

that the milching of cattle be done with the help of machines. However this type

if system is yet to evolve in India. Because of these reasons they are reducing

the market potential of Indian made products, where GCMMF holds a lions

share.

The study of this SWOT analysis shows that the ‘strengths’ and ‘opportunities’ far

outweigh ‘weaknesses’ and ‘threats’. Strengths and opportunities are fundamental

and weaknesses and threats are transitory. Any investment idea can do well only

when you have three essential ingredients: entrepreneurship (the ability to take

risks), innovative approach (in product lines and marketing) and values (of

quality/ethics).

4.COMPETITION

Amul has a competitive sustainable advantage. This lies in the procurement part. Its

ability to collect 7 million liters of milk from 2.6 million farmers and convert it into

Rs. 6 crore worth products and distribute them to 5 lakhs retailers is a tough job.

The competitors:The various competitors of Amul product –wise is given as under:

5.AMUL SALES TURNOVER

Sales Turnover Rs (million) US $ (in million)

1994-95 11140 355

1995-96 13790 400

1996-97 15540 450

1997-98 18840 455

1998-99 22192 493

1999-00 22185 493

2000-01 22588 500

2001-02 23365 500

2002-03 27457 575

2003-04 28941 616

2004-05 29225 672

2005-06 37736 850

2006-07 42778 1050

2007-08 52554 1325

2008-09 67113 1504

2009-10 80053 1700

6.MARKETING MIX

6.1 PRODUCT:

Breadspreads:

Amul Butter

Amul Lite Low Fat Breadspread

Amul Cooking Butter

Cheese Range:

Amul Pasteurized Processed Cheddar Cheese

Amul Processed Cheese Spread

Amul Pizza (Mozarella) Cheese

Amul Shredded Pizza Cheese

Amul Emmental Cheese

Amul Gouda Cheese

Amul Malai Paneer (cottage cheese)

Utterly Delicious Pizza

Mithaee Range (Ethnic sweets):

Amul Shrikhand (Mango, Saffron, Almond Pistachio, Cardamom)

Amul Amrakhand

Amul Mithaee Gulabjamuns

Amul Mithaee Gulabjamun Mix

Amul Mithaee Kulfi Mix

Avsar Ladoos

UHT Milk Range:

Amul Shakti 3% fat Milk

Amul Taaza 1.5% fat Milk

Amul Gold 4.5% fat Milk

Amul Lite Slim-n-Trim Milk 0% fat milk

Amul Shakti Toned Milk

Amul Fresh Cream

Amul Snowcap Softy Mix

Pure Ghee:

Amul Pure Ghee

Sagar Pure Ghee

Amul Cow Ghee

Infant Milk Range:

Amul Infant Milk Formula 1 (0-6 months)

Amul Infant Milk Formula 2 ( 6 months above)

Amulspray Infant Milk Food

Milk Powders:

Amul Full Cream Milk Powder

Amulya Dairy Whitener

Sagar Skimmed Milk Powder

Sagar Tea and Coffee Whitener

Sweetened Condensed Milk:

Amul Mithaimate Sweetened Condensed Milk

Fresh Milk:

Amul Taaza Toned Milk 3% fat

Amul Gold Full Cream Milk 6% fat

Amul Shakti Standardised Milk 4.5% fat

Amul Slim & Trim Double Toned Milk 1.5% fat

Amul Saathi Skimmed Milk 0% fat

Amul Cow Milk

Curd Products:

Yogi Sweetened Flavoured Dahi (Dessert)

Amul Masti Dahi (fresh curd)

Amul Masti Spiced Butter Milk

Amul Lassee

Amul Icecreams:

Royal Treat Range (Butterscotch, Rajbhog, Malai Kulfi)

Nut-o-Mania Range (Kaju Draksh, Kesar Pista Royale, Fruit Bonanza, Roasted

Almond)

Nature's Treat (Alphanso Mango, Fresh Litchi, Shahi Anjir, Fresh Strawberry,

Black Currant, Santra Mantra, Fresh Pineapple)

Sundae Range (Mango, Black Currant, Sundae Magic, Double Sundae)

Assorted Treat (Chocobar, Dollies, Frostik, Ice Candies, Tricone, Chococrunch,

Megabite, Cassatta)

Utterly Delicious (Vanila, Strawberry, Chocolate, Chocochips, Cake Magic)

Chocolate & Confectionery:

Amul Milk Chocolate

Amul Fruit & Nut Chocolate

Brown Beverage:

Nutramul Malted Milk Food

Milk Drink:

Amul Kool Flavoured Milk (Mango, Strawberry, Saffron, Cardamom, Rose,

Chocolate)

Amul Kool Cafe

Amul Kool Koko

Amul Kool Millk Shaake (Mango, Strawberry, Badam, Banana)

Health Beverage:

Amul Shakti White Milk Food

6.1.1 The different product for different people:

Customer Based Market Segmentation

Kids

Women

Calorie Conscious

Health Conscious

Youth

Amul Kool Chocolate MilkNutramul Energy DrinkAmul Kool Millk Shaake

Amul Calci +

Utterly Delicious PizzaAmul CheeseAmul Cheese Spread

Amul LiteSagar Skimmed Milk PowderAmul Lite Slim and Trim MilkNutramulAmul Shakti Health Food Drink

Industry Based Market Segmentation

Milk

Butter/Cheese/Ghee

Ice-cream Manufacturers

Restaurant/Food Chains

Temples

Bakery & Confectionaries

Pizza Retailers

Snacks Retailers

Coffee Shop Chains

Amul never forgot its “primary customer”

Amul collects 447,000 ltrs of milk from 2.12 million farmers (many illiterate)

Product for youth

Amul launched Chocolate milk under brand name of ‘Amul Kool Koko’ targeting the

youth.

Product for diabetic people

India’s First Pro-Biotic Wellness Ice cream & Sugar Free Delights For Diabetics

Product for the health conscious

Amul Launched “low fat, low cholesterol bread spreads”

Product for the price sensitive India

Low Priced Amul Ice Creams and affordable ‘sagar’ whitener

Product for the urban class

Amul launched emmental, gouda and pizza mozzarella cheese

6.1.2 Amul product mix:

Amul Product Portfolio

Amul mainly produces dairy product which falls under nondurable goods category but

also produces durable goods

Examples

Durable Goods:-Milk Powders, Ready to Serve Soups

Non Durable Goods: - Fresh Milk, Cheese Range & Ice creams

Dairy Non -diary

Fresh Milk

Veg. Oils

Snacks

Instant FoodCheese products

Milk Drinks & Desserts

Bread Spreads

Bread Spreads Cheese Desserts

Butter Shredded Pizza Cheese. AMUL Shrikhand Mango,

Saffron, Almond Pistachio,

Cardamom)

Low Fat Bread Spread. Emmental Cheese. AMUL Amrakhand.

Cooking Butter. Gouda Cheese. AMUL Mithaee

Gulabjamuns.

Malai Paneer (cottage

cheese) Frozen and Tinned.

AMUL Mithaee

Gulabjamuns Mix.

Utterly Delicious Pizza. AMUL Mithaee Kulfi Mix.

Cooking Health Drink

Amul/SagarPureGhee Nutramul

AmulMalaiPaneer AmulShaktiHealthFoodDrink

MithaiMate

Pro biotic‐ Dahi

MastiDahi

UtterlyDeliciousPizzaProduct Mix- Width

Prod

uct M

ix L

engt

h

Milk Drinks Powder Milk Fresh Milk

Amul Kool Milk Shake Amul Spray Infant Milk food Amul Fresh Milk

Amul Kool Amul Instant Full Cream milk Amul Gold Milk

Amul Kool Cafe Sagar Skimmed Milk Powder Amul Taaza

Double TonedMilk

Kool Koko Sagar Tea Coffee Whitener Amul Lite Slimand

Trim Milk

Nutramul Energy

Drink

AmulyaDairyWhitener AmulFreshCream

Amul Kool Flavoured

Bottled Milk

AmulShaktiToned

Milk

Amul Kool Flavoured

TetraPack

AmulCalci+

Amul Masti Spiced

Buttermilk

Amul Buttermilk

AmulLassee

AmulKoolThandai

Prod

uct M

ix L

engt

hProduct Mix- Width

Prod

uct M

ix L

engt

h

Product-Width

The width of a product mix refers to the total number of items in the mix.

Example: The total number of items is 8. (Bread spreads, cheese, desert, cooking, health drink,

milk drinks, powder milk & fresh milk

Product-length

The length of a product mix refers to the total number of items in the mix.

Example:

The total Length of Amul’s Product mix is 42

The Total width of Amul’s Product mix is 8 ( No of lines)

Hence the average product length is ( Total Length / Number of lines) = 44/8 is less than 6

Product Depth

The depth of a product mix refers to how many variants are offered of each product in the line

Amul’s Product Depth

Name of product Variants PriceAmul Butter 100g Pack Rs. 25

Amul Butter 500g Pack Rs. 122

Delicious Table Margarine 100g Pack Rs. 13

Delicious Table Margarine 500g Pack Rs. 60

Amul Lite lowfat Breadspread 200g Tub Rs. 32

Name of Product Variants Price

Amul Cheese 400g Tin (EOE) Rs. 117

Amul Cheese Slices 200g Pack Rs. 77

Amul Cheese Chiplets 200g Pack Rs. 66

Amul Cheese 1kg Block Rs. 233

Amul Cheese Spread 200g Tub Rs. 50

Amul Pizza Cheese 200g Pack Rs. 55

Amul Emmental

Cheese

400g Pack Rs. 160

Amul Gouda Cheese 250 g Rs. 115

Amul Gouda Cheese 1 kg Rs. 440

Amul Malai Paneer 200g Dice Pack Rs. 36

Amul/Sagar Pure

Ghee

1 Litre Tin Rs. 265

Amul/Sagar Pure

Ghee

500ml Pouch Rs. 125

Amul/Sagar Pure

Ghee

2 Litre Tin Rs. 495

Amul/Sagar Pure

Ghee

5 Litre Tin Rs. 1,225

Amul Pure Ghee 1 Ltr Refill Rs. 260

Amul/Sagar Pure

Ghee

1 Ltr Pouch Rs. 242

Amul Shrikhand 500g cup

Elaichi

Rs. 53

Amul Shrikhand 500g cup

Mango

Rs. 55

Amul Shrikhand 500g cup Kesar Rs. 66

Name of Product Variants Price

Amul Shrikhand 500 g Badam

Pista

Rs. 61

Amul Mithaee Gulabjamun 1kg Tin Rs. 115

Amul Mithaee Gulabjamun 500g Tin Rs. 64

Nutramul 500g Refill Rs. 110

Amul Chocolates 35g Milk Rs. 15

Amul Chocolates 35g Fruit & Nut Rs. 16

Amul Almondbar 35g Rs. 15

Amul Chocozoo 232g Tin Rs. 125

Amul Chocozoo Tub 500 g Rs. 180

Amul Taaza Double Toned Milk 1 Litre Tetra Rs. 35

Amul Taaza Double Toned Milk 200 ml Tetra Rs. 9

Amul Tazza Toned Milk - Nothern

Eastern States

1 Litre Tetra Rs. 38

Amul Gold Milk 1 Litre Tetra Rs. 39

Amul Lite Skimmed Milk 1 Litre Tetra Rs. 40

Amul CALCI + high calcium milk 1 Litre Brik Rs. 42

Mithaimate sweetened Condensed Milk 400g Can Rs. 58

1 Lit Tetra Brik Rs. 113Name of Product Variants Price

Amulspray IMF 500 g Pouch Rs. 110

Amulspray IMF 500g Refill Rs. 111

Amulspray IMF 500g Tin Rs. 115

Amulspray IMF 1 kg Pouch Rs. 202

Amulspray IMF 1 kg Tin Rs. 222

Sagar Skimmed Milk Powder 500g Pouch Rs. 110

Amulya Dairy Whitener 500g Pouch Rs. 113

Amulya Dairy Whitener 500g Refill Rs. 114

Amulya Dairy Whitener 1 kg Pouch Rs. 227

Amul Shakti Health Food Drink

(Kesar Almond)

500g Refill Rs. 115

Amul Kool (Kesar, Elaichi, Rose) 200ml Bottle Rs. 12

Amul Kool (Kesar, Elaichi, chocolate) 200ml Tetra Rs. 12

Amul Kool Kesar 250 ml can Rs. 25

Amul Kool Cafe 200 ml Glass Bottle Rs. 15

Amul Kool Cafe 250 ml Can Rs. 22

Amul Kool Cafe 200 ml Tetra Brik Rs. 15

Amul Kool Koko 250 ml Can Rs. 22

Amul Kool Millk Shake (Mango,

Strawberry & Badam)

220 ml Can Rs. 22

Amul Kool Millk Shake (Mango,

Strawberry)

180 ml Tetra Pack Rs. 15

Amul Fresh Cream 200 ml Tetra Brik Rs. 30

Amul Fresh Cream

Amul Masti Spiced Butter milk 200ml Tetra Brik Rs. 10

Amul Masti Spiced Butter milk 1 Litre Tetra Brick Rs. 35

Amul Lassee(Rose) 200 ml Tetra Brick Rs. 12

Amul Basundi l Ltr Tetra Brick Rs. 103

Amul Mithai mate 400 g EOE can Rs. 58

Line stretching

Every company’s product line covers a certain part of the total possible range. Line

stretching occurs when a company lengthens its product line beyond its current range. The

company can stretch its line down market, up-market or both ways.

Example: Amul is now aggressively adopting the down market stretch by introducing

(CHHOTA AMUL Priced at Rs. 5 to take advantage of the Bottom of the Pyramid i.e. to

individual of low income group.)

Amul has been introducing products with consistent value addition but never left the core

philosophy of “Providing milk at a basic, affordable price”

6.2 PRICE

Survival.

Capture market share.

To provide service to all income group

Amul butter:

100gm– Rs.18

Competitor: Mother Diary 100gm- Rs.19

Amul cheese:

200gm– Rs.55

Competitor: Britannia cheese–200gm– Rs.70

Amul Ghee:

1Lit.– Rs.190

Competitor: Gits. 1Lit.-Rs.210

Amul Kool Milkshake

200ml– Rs.15

Competitor Nestle Milk Shake –200ml–Rs.20

6.3 PROMOTION Advertising philosophy "to be simple, fresh and innovative".

The clean, emotion-based ads.

Amul ads-creative, apt forth current situation.

The Amul ads are one of the longest running ads based on a theme, now vying for the

Guinness records

1% of its turnover on promotions.

Not spending more than Rs 2crore on Amul butter.

Billboard campaign

First billboard came up in 1967

For the first one year the ads made statements of some kind

Later many topical adds came into existence

When Mumbai first saw the beginning of the Hare Rama Hare Krishna movement

Amul came up with a clincher—‘Hurry Amul, Hurry Hurry India’

Promotion by events

Amul Chef of the Year, 2009 contest: in this, the participants are required to use as

many Amul products as possible.

Amul Maharani Contest, 2008-09: in this, the participants are required to fill up

questionnaires and then there is a lucky draw.

Amul Food Festival Contest

Winners of Slogan likho Disney land dekho contest

Winners of" Amulya Fly to Bangkok Contest

Sponsoring amul star voice of india

Amul publishes some books periodically. Basically they are related to Amul or dairy

industry

Amul also gives away academic excellence awards for school children every year. They

are called Vidya Shree – for 10th std and Vidya Bhushan – for 12th std students.

6.4 PLACE

Amul-Place

Channels

Coverage

Assortments

Locations

Inventory

Transport

Its supply chain one of the most complicated in the world.

Amul has plans to create a large chain of such outlets to be managed by franchisees

throughout the country

Channel

Online (Internet):

- Amul cyber store

- Ice-cream cyber store

Direct retailing through "Amul Utterly Delicious" parlours

- Major cities Ahmadabad, Bangalore, Baroda, Delhi, Mumbai, Hyderabad and Surat.

- Presently 1,500 parlours and plan to open 10,000 of them by 2012

Retailers

- Currently online are Chennai and Calcutta

- Chennai, Kolkata, Nasik, Jalgaon, Aurangabad, Delhi, Raipur, Jodhpur, Udaipur, Pune,

Siliguri/Durg, Kota.

Wholesalers

- Producer Cooperatives: This type of distribution organization is formed by agricultural

producers for selling their produce in the local market.

- Network of over 3,500 distributors

Coverage

India:

- Covering 13,000 villages benefiting 2.7 million farmers

- Collection 447,000 liters of milk/day from 2.12 million farmers.

- Delivery of goods to over 500,000 retail outlets across the country

- Members: 13 district cooperative milk producers 'Union

- No. of Producer Members: 2.7 million

- No. of Village Societies: 13,141

International Markets: Available in over 40 countries.

Locations

The major markets are the US, WestIndies, countries in Africa, the Gulfregion, Singapore,

the Philippines, Thailand, Japan and China. Some Amul Parlours in the country run by the

company or its wholesale dealers:

- Delhi Metro Rail Corporation

- The Somnath Temple

- National Institute of Design

- Infosys Technologies in Bangalore, Mysore & Pune

- Wipro campus in Bangalore

- L.J. College, Ahmedabad

- Ahmedabad Airport

- Surat Municipal Corporation

- Gujarat State Raod Transport Corporation

- Jubilee Mission Medical College, Trichur,Kerala

- Sanjay Gandhi Hospital Parlour, Amethi

- Indian Institute of Management, Kolkata

- Café Amul, MDG, Gandhinagar

Inventory

- 47 depots with dry and cold ware houses of entire range of products.

- Total Milk handling capacity: 10.21 million liters per day

- Milk collection (Total-2007-08): 2.69 billion liters

- Milk collection (DailyAverage2007-08): 7.4 million liters

- Milk Drying Capacity: 626Mts. Per day

- Cattle feed manufacturing Capacity: 3090 Mts per day

Transport

- Transport cans

- Engages in route scheduling

- Has dedicated vehicle operations.

Assortment

Amul’s dominance: Products like cheese, butter, liquid milk and yogurt sectors

Amul’s success today is partly because of its strong supply chain design.

Below is the schematic diagram of Amul’s supply chain.

With products being highly perishable, the supply chain ought to have to maintain correct

temperature, humidity etc and the chain should move fast. To reach out its consumers more

directly and let them the total brand experience, Amul has come up with Amul parlours.

These are called “Utterly delicious parlours”. They have come up in major cities like

Ahmadabad, Bangalore, Baroda, Delhi, Mumbai, Hyderabad and Surat already, and many

more starting up real soon. Till date there are about 400 Amul parlours across the country.

These parlours are set at prominent locations such as campuses of Infosys, Wipro, IIM-A, IIT-

B, temples, Metros etc.

7.RECOMMENDATIONS

1. Amul has a relatively good distribution network, but still company is not able to fulfill the

demand of outlet in the peak season when demand is very high. Here company should

consider on the supply of product in the peak season.

2. Supply should be regular to all the outlets including those that lie in the pocket roads

and not just in the outlets which lie on the easily accessible routes.

3. Since the penetration of Amul products in eateries is the worst among all the channels,

the company ought to adopt strategy like supplying free menu cards, which has the

company logo printed on them, this will not only increase the penetration of the product

in the outlets, but also improve the market sales.

4. The company should also ask its distributors to supply its products on a bill to bill based

credit system with at least all the reliable retailers, so that the product penetration in

the outlets increases in terms of percentage of units stocked at a time in the outlet, this

would also look appealing to the customer who would instead like to pick up the product

at first glance.

5. Credit is the 2nd biggest factor that influences the penetration of the product into the

retail outlet. So company should give the credit to all outlets.

6. Given the fact that margin offered to the retailer is not similar in the case of the

competitor‟s product. For this fact, the company should give good margin to the

retailers than the competitors.

7. Due to the lack of awareness of milk product in cochin, the company should be

advertised of the product by print and electronic media specially in local channel and

newspapers.

8. Discount is also an important factor of stocking decision for retailers. So, company

should give discount to all retailers for influencing the stocking.

9. Company should also give the replacement offer to those outlet which is running with

small business.

10. Only fresh product should be supply in the outlet.

11. Amul should take proper steps to improve service because although being in the top slot

in butter and cheese supplies it does not get the sales in chocolates.

12. The company should use brand ambassadors to attract all age groups.

13. Amul should give local advertisements apart from the advertisements given at the

national level. Local advertisements must mention the exclusive Amul shops of the city.

8. CONCLUSION

Amul is a well known brand and a market leader in dairy products. It has maximum market

share in milk, butter and cheese which are its core products. Amul is a cooperative

organisation but chocolate making is a profitable industry. So Amul must concentrate on

profit making through the chocolate industry. With the help of research the company can

find out its weak points in chocolate product and can increase its market share by rectifying

its mistakes.

Amul must come up with new promotional activities so that people become aware of

Amul chocolates.

Quality is the dominating factor which influences consumers to buy Amul products but

prompt availability of other chocolate brands and aggressive promotional activities

attracts customers towards them and also increases their sales.

People are mostly satisfied with the overall quality of Amul chocolates, but for the

existence in the local market it must use aggressive selling techniques.