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Transcript of GCMMF_Internship Project Report_Anshul Mittal_IMNU
Summer Internship
Summer Internship Report
Summer Internship
Summer Internship Report
Gujarat Cooperative Milk Marketing Federation Limited
Plot 5-6, Near Roshanji Ki Bari, Sector 12, Savina, Udaipur
Submitted in partial fulfillment for the award of the degree of Master of
Business Administration
Submitted to: Submitted by:
Dr. Shahir Bhatt Anshul Mittal
1st July, 2016 151215
MBA (FT)
Institute of Management, Nirma University
Summer Internship
Acknowledgements
Every work accomplished is a result of efforts of several hands which contribute to its successful
fulfillment and this work is no different. I got this rare opportunity to express gratitude only
because I came across some wonderful people who helped me in accomplishing this project.
I would like to take this opportunity to acknowledge Gujarat Cooperative Milk Marketing
Federation (GCMMF) Limited for giving me this opportunity to be a part of India’s leading brand
Amul. I am extremely grateful to the federation for conferring me with a golden chance to
contribute my skills for the growth of such an esteemed organization. I would always remain
indebted to the thirty six lakh families of farmers who are the real contributors towards satisfaction
of the need of the consumers for milk and milk products.
I would like to thank GCMMF Ltd. Udaipur Branch for providing me the useful resources for
completing the work. I am thankful to the Branch Manager Mr. Santosh Kumar for helping me all
throughout my journey of eight weeks by resolving my most petite queries without which I could
not have gained enough learning. I am also thankful to Mr. Sandeep Kumawat, Territory Sales
Incharge for helping me in resolving specific issues arising in the market without which sales could
not have been accomplished.
I am grateful to the distributors of Amul in Udaipur City, Mangla Trading Company and
Harekrishna Marketing and their salesmen Mr. Gopal and Mr. Shankar for providing me with
enough resources for sales and marketing and presenting before me the true picture of market of
Amul in Udaipur.
I would like to acknowledge Mr. Ajit Jain of Padma Traders, the distributor for institutional market
of Amul in Udaipur city for providing me a glimpse of the business market of hotels of Udaipur. I
am thankful to Mr. Jain for providing me enough resources which I could utilize in order to
promote Amul in Udaipur.
Summer Internship
I am thankful to Dr. Shahir Bhatt, my institution mentor, for guiding me all throughout the period
of summer internship without which I would not have achieved the required excellence as per the
industry norms.
I am thankful to Prof. Sapna Parashar and Prof. Indranil Banerjee for their constant support and
coordinating with me for the process of summer internship with GCMMF Ltd.
I would like to acknowledge the large number of retailers and hotel managers who entrusted me
as a representative of this reverend organization and provided me the useful information for
accomplishing this work.
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Executive Summary
The report aims at presenting the results of projects accomplished at Gujarat Cooperative Milk
Marketing Federation Limted, Udaipur Branch. The First Project aimed at increasing the retail
penetration of Amul Buttermilk and Amul Lassi. The Second Project aimed at assessing the market
potential and promoting Amul Liquid Creamer at Star Hotels of Udaipur.
The two projects dealt with two different markets. Buttermilk and Lassi are products of the
consumer market while Liquid Creamer is a product of the market of premier Hotels. Both the
kinds of market require different style of dealing and understanding the customer demands.
The summer internship involved lots of experiential learning from understanding the structure of
the Fast Moving Consumer Goods industry to managing sales in the same. It involved considerable
amount of negotiation and convincing skills.
The results of the projects were quite satisfying for the Udaipur branch.
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Contents
S. No. Title Page No.
1 Orgnaisation Profile 1
1.1 History of Organisation 1
1.2 Top Management 10
1.3 Size of the Organisation 12
1.4 Vision and Mission 14
1.5 7-S Framework 15
1.6 Competitive Position in the industry 19
1.7 Future Strategy of the company 21
2 Project Work 22
2.1 Context of the Organisation 22
2.2 Project 1 22
2.3 Project 2 37
2.4 Ethnographic study 45
3 Learnings from the case 47
3.1 Applications of concepts learned at NIM 47
3.2 New concepts, techniques, knowledge learned 48
3.3 Augmentation of skills 49
3.4 Direction of career path 49
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List of figures
S. No. Title Page No.
1 Farmers collecting milk at Anand 1
2 Farmers at Anand 1
3 Shri Tribhuvandas K Patel 2
4 Symbol of KDCMPUL 3
5 The first office of the KDCMPUL 3
6 Dr. Verghese Kurien 4
7 The Amul Girl 6
8 Shree Lal Bahadur Shastri at Anand Dairy in 1964 6
9 Symbol of the Operation Flood 7
10 GCMMF Limited symbol 8
11 The logo of Amul 8
12 Organisation Structure of Amul cooperative 15
13 Organisation Structure at GCMMF Ltd. 16
14 Porter’s Five Forces Model for understanding competitive position 20
15 Display of Amul Buttermilk and Amul Lassi 29
16 Amul Liquid Creamer 37
17 Porter’s model over Amul Liquid Creamer 45
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List of Tables
S.No. Title Page No.
1 Amul Dairy Management Team 10
2 Amul Dairy Organisation Size 12
3 Retail Market Visits and Follow up records 31
4 Hotel Visits 37
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ORGANIZATION PROFILE
History of Organization
History of KDCMPUL
In 1942-43, Britishers settled in Bombay fell sick. After a
report, it was found that the quality of milk was not good.
The government of Bombay was forced to intervene. They
were looking for good quality of milk and milk products
supply from nearby areas. In 1926, Pestonjee Edulji had set
up a large factory nearby Anand district where butter was
being manufactured. Fig. 1: Farmers collecting milk at Anand
The butter manufactured at Pestonjee’s plant was sold under a Western sounding brand name
“Polson” which had already become a household name in butter. The farmers of Kaira district of
Anand started producing milk in larger quantities for Polson Limited. Around the year 1945,
Polson Limited was contacted by the British Government of Bombay if Pestonjee could supply
milk 427 km from Anand to Bombay. Pestonjee pasteurized milk at his cream manufacturing
facility and supplied milk by packing them in gunny bags with chilled water inside. The milk after
reaching Bombay was in fairly good condition. This was the start of Bombay Milk Scheme (BMS).
Hence, Bombay became a market for milk producers in Kaira district of Anand in Gujarat.
Polson asked for an agreement with the British Government that no one else
in the area should be allowed to obtain milk from the farmers of Anand.
Farmers of all the villages of Anand should sell the milk only to Polson. In
other words, Polson got a direct license to monopolize the supply of milk.
The prices of milk was never fixed. Polson obtained milk at very low prices
from the farmers. They were being exploited for selling milk.
Fig.2: Farmers at Anand
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Farmers united themselves and met Sardar Vallabhbhai Patel. Sardar Patel suggested them to form
milk cooperatives. Sardar Patel assigned the task of formation of
cooperatives to Mr. Morarji Desai. Morarjibhai appointed
Tribhuvandas Patel, a farmer of the area as the head of the union of
farmers. Tribhuvandas had a very good reputation among the farmers
as he was a freedom fighter and had come out of jail then. Although,
Tribhuvandas was reluctant in adopting this role, but seeing his
previous work Morarjibhai considered him as perfectly fit for taking
up the role to unite the farmers. Under his leadership, cooperatives
started forming in the villages of Anand. These cooperatives together
collected the milk and collectively sold to Polson. Fig.3: Shri Tribhuvandas K Patel
Polson tried all the filthy tricks - like discovering flies in the milk- to break the cooperative
structure. The farmers were exploited even more. At this stage, they again met Sardar Patel. Sardar
Patel asked them to remove Polson. Sardar Patel asked them if they were ready to fight the
government. Such an action would directly result in some losses to farmers as they would not be
able to sell milk. But if they were ready to bear the losses, Sardar Patel could lead them. The
farmers agreed.
In January 1946, Morarjibhai met the farmers under a banyan tree in Chaklashi village, ten
kilometers from Anand. Thereby, two points were proposed. One, no milk will be sold to Polson.
Two, cooperatives will be formed at village level which will be together responsible for milk
procurement, processing and marketing. The union of cooperatives will have its own pasteurizing
plant.
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These demands were rejected by Government of
Bombay. The farmers went on fifteen day strike.
Milk was poured on the streets and not a drop was
given to Polson. Villagers were adamant on their
demands. As a result, BMS collapsed and
Polson’s milk collection came to a halt. In 1946,
the farmers under the leadership of Tribhuvandas
Patel registered Kaira District Cooperative Milk
Producers Union Limited (KDCMPUL).
Fig.4: Symbol of KDCMPUL
There was an old plant of research creamery in Anand which belonged to National Dairy Research
Insititute (NDRI). This was not operational after First World War. The Union demanded if they
could be given the plant. The demand was not approved. However, they were given the permission
to use the plant for a yearly rental charges of Rs.9000.
Fig.5: The first office of the KDCMPUL
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Entry of Dr. Kurien
Dr. Verghese Kurien, a person who had then completed dairy engineering from Michigan State
University as a part of some government scholarship programme was sent to Anand as part of the
contract to work. He was assigned the task of manufacturing milk
powder out of buffalo milk from a government creamery. The work
was not at all exciting. This was the first time that Dr. Kurien got to
know about village cooperative from Tribuvandas Patel working at
the government research creamery just their next door. Dr. Kurien
would go and help these farmers in repairing the old machines on
which they were working in the creamery located just nearby to
where he was working. Dr. Kurien had been helping Tribhuvandas in
repairing the machines and somehow get their work done. Fig.6: Dr. Verghese Kurien
One day, Dr. Kurien said that repairing these machines would not help their union in the long run.
He suggested that they should purchase a plate pasteurizer. Tribhuvandas took some money on
loan from his brother-in-law and asked Dr. Kurien to order a plate pasteurizer next time he visits
Mumbai. Soon, the cooperative got a new plate pasteurizer. Dr. Kurien who had already sent his
resignation from his job finally got a reply of the acceptance of his resignation. When he was about
to leave Anand, he was approached by Tribhuvandas if he could stay back and further help the
cooperative with the operations of new machines. Dr. Kurien agreed to stay for two months for a
salary of Rs.600 per month. Later Dr. Kurien found himself so involved with the farmers that he
decided to stay there forever and help them. He formally joined KDCMPUL as General Manager
in 1950.
Soon, the milk production increased from 200 litres in 1948 to 20000 litres in 1952. Pasteurized
milk was being supplied from Anand to Bombay Milk Scheme through trains. Later, they faced an
unprecedented problem. The buffaloes give more milk in winter than summer. As a result, they
would get surplus milk in winter. Dr. Kurien thought of manufacturing milk powder out of it. He
was sent to New Zealand for a research fellow during 1952-53. When he returned, he started
thinking upon purchasing a new dairy plant for manufacturing milk powder out of buffalo milk.
Milk powder had never been prepared from buffalo milk and hence there were lots of people in
politics who were criticizing the idea. Also, it required huge set up cost.
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In 1956, UNICEF representative Mr. Davis was in India. He suggested that UNICEF could assist
them in setting up the new plant if they could distribute milk to children and expectant mothers
completely free valued at one-and-half times the plant cost, to be repaid over a period of five years.
Dr. Kurien agreed. Also, he, along with his friend Mr. Dalaya demonstrated milk powder
production from buffalo milk in Bombay. As a result, he won trust of everyone and got the
assistance of UNICEF in setting up the plant. After some serious negotiation, the plant they got
was the Niro Plant manufactured by Larson and Toubro.
Creation of Amul
During this time, Dr. Kurien’s wife’s brother-in-law, Mr. K.M. Philip, an entrepreneur himself,
suggested Dr. Kurien that he should start focusing upon nitty-gritties of marketing. Dr. Kurien
realized that they were able to sell milk and milk products only because there existed a market in
Bombay. Hence, he realized the importance of marketing. He studied marketing and started
discussing with people in the field. He then decided that they should have a brand name for their
products. During a brainstorming session, a chemist in their lab suggested a name, ‘Amul’. It had
come from the Sanskrit word, ‘Amulya’, meaning priceless. Dr. Kurien liked it as it was short,
easy to spell, pronounce and remember. Also, it could be thought of as an acronym for Anand Milk
Union Limted. Also, it was easier on tongue than Kaira District Cooperative Milk Producers Union
Limtied. All agreed to the brand name Amul. In 1957, the cooperative registered the brand name
Amul.
Later, Polson dairy which had started facing losses approached a few ministers for solution. Dr.
Kurien came out with a solution to divide Anand district into two regions, one from where Amul
dairy could obtain the milk and other from where Polson could purchase. Dr. Kurien carefully
planned the division in a manner that the villages which produced more milk came under the ambit
of Amul. Gradually, Polson lost its share and Amul started becoming a household name for milk
and butter. Amul also started baby food after some time.
Creation of Amul Girl – Utterly Butterly Delicious
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In 1966, Amul account was given to Advertising and Sales Promotion (ASP)
Company, Bombay. ASP was asked to dislodge Polson from their premier
brand position from Bombay. Eustace Fernandes then, created the famous
character of endearing and mischievous Amul girl. The team of Usha
Kartak, K. Kurien and Sylvester DaCunha gave the tagline of ‘Utterly,
Butterly Delicious’ - which broke all records of longest running ad
campaigns in the Indian advertising history.
Fig.7: The Amul Girl
Creation of GCMMF and Operation Flood
Fig.8: Shree Lal Bahadur Shastri at Anand Dairy in 1964
In 1964, the then Prime Minister of India, Shri Lal Bahadur Shastri was invited to Anand for
inaugurating a plant at Kanjari, few kilometres from Anand. Shastriji visited Anand. He carefully
observed everything and appreciated the work of cooperatives and Dr. Kurien. He asked Dr.
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Kurien to start working for the entire nation. Shastriji wanted Dr. Kurien to set up Anand model
in the entire nation.
Dr. Kurien accepted the idea and on his suggestion, National Dairy Development Board (NDDB)
was set up in 1965 at Anand to take up the project of creating several Amuls in entire nation. A
board member argued that creating more Amuls would mean creating competition for themselves.
But Shastriji was correct on his point that just one Amul would not be able to meet the demand of
milk and milk products of the entire nation. Moreover, several Amuls would be a structure as
strong as clenched fist which would be difficult to break.
Dr. Kurien began drafting the document for operation flood with his old friend at dairy H.M.
Dalaya and a professor Michael Halse. The proposal was finalized on 31st October, 1968 and
approved by the government. They called it ‘Operation Flood’ which was later called as the
‘Billion Litre Idea’. They received funds from World Bank to carry out Operation Flood.
Operation flood was to be carried out in three phases. In the first
phase, they received skimmed powder milk and butter oil from
European Economic Community (EEC) as gifts through the World
Food Programme. They could, thereby, finance the First Phase by
selling these products. Also, they linked the eighteen of India’s
premier milk sheds with the markets of Delhi, Bombay, Calcutta and
Madras. The phase spanned through 1970s and took around ten years.
Fig.9: Symbol of the Operation Flood
The second phase lasted from 1981 to 1985. It was implemented from the seed capital raised from
the sale of EEC gifts and World Bank loan of Rs.200 crore. During this time, the number of milk
sheds increased from 18 to 136. In total, 43,000 village cooperatives were formed covering 4.25
million milk producers and more than 290 urban markets were established.
The third phase of Operation Flood lasted from 1985 to 1996. It increased the number of
cooperatives from 42,000 to 72,000. During this phase, the veterinary facilities were extended.
More emphasis was laid on research in dairy and animals.
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During the period of Operation Flood, more and more village cooperatives were developing. These
cooperatives gradually entered into competition with one another. This could mean that the
cooperative structure could do more harm than good to the farmers by not generating sufficient
price for their milk production. A large cooperative was formed at Mehsana, which directly
competed with the Anand cooperative. As a result, in 1969, Dr. Kurien signed an agreement with
the Mehsana Dairy under which the Mehsana Dairy would produce butter and milk powder and
the products would be distributed under the brand name of
Amul. The same structure could be applied at state level to
avoid competition among the cooperatives. Hence, in 1973,
Gujarat Cooperative Milk Marketing Federation (GCMMF)
Limited was formed. Dr. Kurien became the Chairman and
Managing Director of the Federation and resigned as General
Manager of Amul. Since then, GCMMF is the apex body which
purchases milk and milk products from the 17 district level
cooperatives in Gujarat and involves into their marketing and
distribution. Fig.10: GCMMF Limited
Amul-The Taste of India
In 1994, as Amul was making more and more products, there appeared a strong need for creating
a brand new logo which could depict the taste and diverse nature of the country. The Amul girl
covered only Amul butter. It took several sittings with Dr.
Kurien for advertising agencies to before reaching down to any
conclusion. Finally, Shri Kanon Krishna of Advertising and
Sales Promotion Company, Mumbai suggested the tagline
“The Taste of India”. Dr. Kurien readily approved it and it
became the new tagline of the leading brand. Fig.11: The logo of Amul
History of Udaipur Branch
Udaipur branch started in the year 1999. Prior to the Udaipur branch there was only Jaipur branch
in Rajasthan. Udaipur branch is given the North-West and South-West region of Rajasthan under
its ambit for sales management. Later, Jodhpur branch was carved out of the Udaipur branch.
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Since 2011, Udaipur branch has seen tremendous growth. In the fiscal year 2013-14, Udaipur
branch doubled its sales as compared to the fiscal year 2011-12 and became the largest growing
branch in terms of annual turnover. It was conferred with the prestigious Certificate of Leadership
by GCMMF Limited.
The secret of Udaipur branch lies in the fact of starting new distributor in nearby town called
Mavli. This kind of horizontal expansion in width has helped them increase the sales manifold.
This is because earlier the supply to the Mavli region was done by distributors located in Udaipur
which could not understand the demand pattern of a town located more than 50 kms from the city.
Also, creating a new distributor helped in satisfying the sudden erratic patterns of demands which
may rise during the festivals and fall suddenly in winters.
Another strategy which was adopted by Udaipur branch was to start the supply of Amul beverages
at tourist spots. Udaipur is tourist hub and attract large number of peoples from all over the world.
Hence, it was indeed a masterstroke which helped in boosting the sales of Amul.
The current Branch Manager of Udaipur branch is Mr. Santosh Kumar.
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Top Management
Amul Dairy Management Team
Management Team Dr. K. Rathnam - Managing Director
Dr. H. K. Desai - General Manager (Production)
Shri Amit M. Vyas - General Manager (Projects and Engineerng)
Shri J. K. Joshi - Deputy General Manager (HR)
Production Team Kamlesh Chauhan -CEO(CFO)
Sanjeev Mehta
Ashvin Prajapati
Kalpesh Kachchiya
Quality
Assurance/Technical
Team
Sandip Sankpal
Dr. Pragnesh Patel
Sales and Marketing
Team
Dr.Gopal Shukla
Dr.Rajendra Umale
Vipul Parmar
Mohd. Salman I Dadabhai
Sanyam Pandya
Nileshbhai Panjabi
Dharmendrasinh Mahida
Kinnar Patel
Kiransinh Soda Parmar
Jatin Patel
Nilesh Patel
Mrs. Komal Patel
Bharat Bharvad
Table 1: Amul Dairy Management Team
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GCMMF Ltd Management Team
The Chairman of GCMMF is elected by voting in which the chairmans of all the 17 district
cooperatives take part. Currently Mr. Jethabhai Patel of Sabarkantha Dairy is the Chairman of
GCMMF. The Managing Director is Mr. R.S. Sodhi. Mr. Sodhi was re-elected as MD in
September 2015. He holds an experience of more than 34 years in Amul and has done a
tremendous job in the marketing area for GCMMF. He did MBA from Institute of Rural
Management, Anand and thereafter he worked as Senior Sales Manager at Amul. He had also
worked with Dr. Kurien.
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Size of the Organization
GCMMF, is India's largest food product marketing organization. Its annual turnover (2014-15) is
US$ 3.4 billion. It collects milk from different cooperatives of Gujarat, processes it and markets
the finished milk and milk product. The daily milk procurement by GCMMF is approximately
14.85 million litre per day from 18,536 village milk cooperative societies, 17 member unions
covering 31 districts, and 3.37 million milk producer members, i.e., around 36 lakh families of
farmers.
Table 2: Amul Organisational Size
Cooperatives under GCMMF
1. Kaira District Cooperative Milk Producers' Union Ltd., Anand
2. Mehsana District Cooperative Milk Producers' Union Ltd, Mehsana
3. Sabarkantha District Cooperative Milk Producers' Union Ltd., Himatnagar
4. Banaskantha District Cooperative Milk Producers' Union Ltd., Palanpur
Members 17 District Cooperative Milk Producers' Unions
No. of Producer Members 3.37 Million
No. of Village Societies 18,536
Total Milk handling capacity per day 24 Million litres per day
Milk Collection (Total - 2014-15) 5.42 billion litres
Milk collection (Daily Average 2014-15) 14.85 million litres
Cattlefeed manufacturing Capacity 6340 Mts. per day
Sales Turnover -(2014-15) Rs. 20733 Crores (US $ 3.4 Billion)
Geographical Spread India, USA, Gulf nations, Singapore, China, Japan,
Australia, Philippines.
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5. Surat District Cooperative Milk Producers' Union Ltd., Surat
6. Baroda District Cooperative Milk Producers' Union Ltd., Vadodara
7. Panchmahal District Cooperative Milk Producers' Union Ltd., Godhra
8. Valsad District Cooperative Milk Producers' Union Ltd., Valsad
9. Bharuch District Cooperative Milk Producers' Union Ltd., Bharuch
10.Ahmedabad District Cooperative Milk Producers' Union Ltd.,Ahmedabad
11. Rajkot District Cooperative Milk Producers' Union Ltd., Rajkot
12. Gandhinagar District Cooperative Milk Producers'Union Ltd., Gandhinagar
13. Surendranagar District Cooperative Milk Producers' Union Ltd., Surendranagar
14. Amreli District Cooperative Milk Producers Union Ltd., Amreli
15. Bhavnagar District Cooperative Milk Producers Union Ltd., Bhavnagar
16. Kutch District Cooperative Milk Producers' Union Ltd., Anjar
17. Junagadh District Cooperative Milk Producers' Union Limited,Junagadh
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Vision of Amul
When Dr. Kurien had set up Aml dairy, its vision was, “To provide the best prices to the farmers
for their produce and provide high quality products at best prices to end consumer.” Since then,
Amul has worked keeping the same vision in mind.
Mission of Amul
We at GCMMF endeavor to satisfy the taste and nutritional requirements of the consumers of the
world through excellence in marketing by our committed team. Through co-operative networking,
we are committed to offer quality for products that provide best value for money.
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7-S Framework
Structure:
Fig.12: Organisation Structure of Amul cooperative
Milk
Federation
at State Level
Milk Federation at District Level
Village level Cooperative Structure
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Fig.13: Organisation Structure at GCMMF Ltd.
Strategy:
GCMMF Ltd. works procuring milk collectively from all the cooperatives of Gujarat, thus
avoiding any internal competition among the cooperatives and help farmers get the best price for
milk supply.
It has state-of-the art processing and packaging plants for producing and packing the final milk
product. Economies of scale have been achieved which help in reducing the costs and thus
providing the consumers best prices.
MD
GM
AGM (Finance)
AGM (Marketing)
Zonal Manager
Branch Manager
Territory Sales
Incharge
AGM (Production)
AGM (Sales)
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It works with the concept of Umbrella branding. All the products are marketed under the single
brand name. This helps in earning brand perception in consumer’s mind whenever it wishes to
launch any new product. Also, it focuses more on advertising of the brand “Amul”. This helps in
marketing all the products under the name of Amul.
It enters into alliances with large retail chains, hotel brands etc. for better sales.
Systems
Amul implements effective Distribution Management System which helps it in effectively
managing all the operations like, finance, sales and marketing.
Staff:
GCMMF Ltd employs a dedicated sales force which is committed to the end results. They believe
in better care for the employee and provide awards into several categories for good work. The
Udaipur branch received two awards for doubling the revenue in two years.
Skills:
Amul’s brand building skills is unmatched. GCMMF’s core skill is its underlying sales and
distribution team. They manage their sales effectively. To complement to the same, they have very
well established network of milk suppliers from whom they obtain milk at appropriate time and
manage their inventory very well.
Style:
The leadership style of managers at Amul has always been transformational in nature right from
the time of Dr. Kurien. Smaller tasks are given. Strong communication is focused. Mangers
motivate the employees continuously for achieving goals.
Shared values:
Amul has always believed in the power of farmers. Dr. Kurien believed that if the farmers are
given the power to take decisions they will contribute to the nation’s growth. Amul has always
believed in the power of people of India. Dr. Kurien said that there is huge untapped potential in
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the people of India. This potential can be utilized. Still believing in this value, Amul deliver the
major power of decision making in the hands of farmers in Gujarat. They share the value of
delivering maximum benefits in the hands of the farmers. They focus more on the cooperative
culture rather than the corporate culture.
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Competitive position of GCMMF Ltd.
The organization stands at number 10 in terms of annual turnover in the FMCG industry. The chief
competitor of Amul in the industry include Nestle at the national level besides several local players
in different states like Saras in Rajasthan, Nandini in Karnataka etc. Nestle is a leading
multinational company which deals into several products categories in the food and beverage
segment of the FMCG besides milk and milk products. Mother Dairy is yet another dairy following
a pattern similar to Amul and has a good market penetration in ice-creams.
Amul has around 90% market share in butter, 63% in cheese and around 40% in organiseed milk
distribution segment.
Amul has seen tremendous growth of 187% in last six years. In the fiscal year 2015-16, it registered
growth of 11% over the previous year and touched Rs.23000 crore of turnover annually. Britannia,
Nestle, ITC (food business) and HUL (food business) posted an annual turnover of Rs.7175.99
crore, Rs.8175.31 crore, Rs.6411 crore, and Rs.5522 crore respectively.
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Fig.14: Porter’s Five Forces Model for understanding competitive position
Bargaining power of Suppliers
GCMMF holds a very good relationship with the suppliers of milk, that is, the farmers of Gujarat. It procures all the milk from them. No one else is allowed to procure milk from them. Also, the suppliers are given very good price for their produce.
Bargaining Power of Customers
The consumers have a very good brand perception of Amul. They are ready to buy
Amul at whatever prices. However, aligning with its vision of providing high quality products to consumers at best prices, Amul keeps the prices of the
products low. Consumers get more options in ice-creams, however, Amul is the only
brand providing pure milk ice-cream and it advertises it effectively.
Threat of substitution
The dairy industry is seeing a continuous growth and any substitution is unlikely for milk and milk products. The unorganised
milk distribution has also started providing milk based products. They provide more personalised services to the consumers. Also, milk based beverages face threat
from cold drinks and juices.
Threat of New Entrants
There are speculations that Patanjali Ayurved Limited might enter into Dairy
segment as it has already rolled out ghee. The new entrants would face difficulty to enter as Amul has a good brand perception
among consumers, economies of scale, efficient network of established
distributors and good relation with suppliers. Also, installation cost of plants
is very high.
Industrial Rivalry
Amul is the market leader in butter, cheese and organised
milk distribution. The competitors have far less market share. Amul has
economy of scale in production which helps it in
winning over its competitor by lowering the prices.
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Future strategy and plan of the company
Amul has plan to invest Rs.600-800 crore every year to make a total of Rs.3000 crore investment
to increase its milk processing capacity by 2020. This is being done in order to increase the milk
processing capacity. At present, the company has a capacity of 2.8 crore litres of milk processing
every day. This will expand to 3.2 crore litres per day by March 2017. The organization wishes to
enter in Bihar, Jharkhand, Kerala, Odisha and certain parts of North-East India including
Guwahati. Amul is the official sponsor of Indian team for Rio Olympics.
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PROJECT WORK
Context of the Organisation
I was supposed to work with the distributors of Amul in Udaipur region, find out issues coming
up in sales of Amul products and increase sales of Amul.
Project 1
Objective:
Assessing the market potential and increasing the retail penetration of Amul Buttermilk and Amul
Lassi in Udaipur city.
Motivation behind the project:
GCMMF wishes to capture the market of beverages through its high quality and low-priced Amul
buttermilk and Amul Lassi. In summer, the demand of these products rises. As a result, there is
good chance of capturing the retail market for the same. Hence, the project was undertaken.
Project introduction:
In summer, the demand of cold beverages increases. Hence, I was supposed the push the sales of
Amul Buttermilk and Amul Lassi by increasing the retail penetration. I was supposed to work with
two distributors, Mangla Trading Company and Harekrishna Marketing which are distributors of
Amul dry products in Udaipur city region.
Approach of work:
I was supposed to make market visits and understand the structure of FMCG sales. I was required
to note down the areas where there is high demand for beverages and promote Amul Buttermilk
and Amul Lassi. I needed to find out the problems occurring in the sales of Amul products and
resolve the same.
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Market visit
I have visited large number of retailers on my 17 market visits with salesmen of Mangla Trading
Company and Harekrishna Marketing. The salespersons would take orders from retailers for Amul
Products while I would discuss with them about sale of various Amul products with special focus
on Buttermilk, i.e., Amul Masti Masala Buttermilk and Amul Lassi.
Our promotion against various points kept by retailers
1. Improper display of Amul items at the retail outlet: I visited various outlets and found
that except a few retail outlets and Amul Preferred Outlets, most of the outlets do not
display the Amul products properly on their retail outlet. All retail shops keep Amul
products in refrigerators provided by Pepsi or Coca-Cola or their own personal refrigerator.
There are just a few retailers who complain that they are threatened by Pepsi or Coke for
keeping products of other companies. As a result, they keep Amul products behind other
products of Pepsi or Coke. Hence, Amul products are not visible and face problem of slow
sales. Many retailers say that they do not have much space in their refrigerators. But still,
this is an issue which can be solved. We suggest them to keep a few pieces outside as Amul
products with Tetra-pack do not require refrigeration and have longer shelf life. They can
keep their remaining products elsewhere in the refrigerators behind other products. We
suggest them the best display for all the Amul products such that they are clearly visible to
the customer.
2. Location of shop: Amul beverages are chiefly consumed by students and youth. There are
certain shops which are located in residential areas. These retailers are not interested in
keeping 200ml packs of Amul beverages. But this is a misconception. We promote 1 litre
packets of Amul beverages along with small packs under the brand name of Amul and its
very fast sales in summer season. This way we try to convince them.
3. Low margin: Retailers feel that Amul doesn’t have much margin on any of its product.
Also, given the fact that Amul works on Best-cost-strategy producing best quality at low
prices, the margin in the entire value chain is very low. Hence, new retailers feel afraid in
keeping Amul products. For such retailers, we promote the quality of Amul products and
its brand name. We ask them to start by keeping 5-6 pieces of each of the Amul beverages
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which make a total bill of around 200 Rs. at the retail shop. This small amount of
investment risk is taken by the retail shop only to later realize that Amul product do not
stand for many days in their shelf and are sold faster than other FMCG products. Once they
start keeping, they continue.
4. Competition from locally prepared Lassi and Buttermilk: Many retailers say that
consumers demand the Lassi and buttermilk prepared locally which is thicker in texture
and tastes better. In order to solve this issue, we promote the flavour in Amul Lassi which
is Rose and commonly loved by consumers as they use similar Rose flavor of ‘Roohafza’
at their homes for flavoured milk. The local Lassi doesn’t have any specific flavour. Also,
the shelf life of tetra-packets of Amul Buttermilk and Amul Lassi are 6 months and 4
months as compared to 2 days of locally prepared beverages. One point which forces us
into serious discussion with the retailer is that margin of locally produced beverage is more
than 5Rs. on a 200ml pack. But again, it is the brand name of Amul which we strongly
project which can help in higher sale in terms of volume to overcome the low value.
5. Space within the refrigerator: A retailer makes a simple excuse of lesser space within his
refrigerator. But then, we educate him that Amul products can be kept outside the fridge
for display. He requires to keep only a few inside the refrigerator for few consumers. Rest
can be kept outside. Most retailers do not arrange items within their refrigerator and hence
face space shortage issue, which is not an issue at all.
Achievements:
Following is the updated list of retail outlets which we have added. There are a few which have
newly started keeping Amul products while there are others who have been keeping Amul products
for long but did not keep Amul Buttermilk and Amul Lassi.
1. Almdar Provision Store: This is a big Departmental Store in a posh area of the city. It
registers huge sales of all the Amul products except Lassi. The store doesn’t keep Amul
Lassi. I pushed Amul Lassi and the shopkeeper ordered a complete case/carton/carat for
the same.
2. National Book and General Store: The store keeps products from two different
industries: Education and FMCG. It is general store cum book store. The store is located 2
kms from a tourist spot though not exactly on a tourist place. The area doesn’t have a very
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large population in the surrounding vicinity of 200 m2. It is located on a road where
consumers do not stop much but the road is very busy. Considering all the factors, I found
the place good to pitch for Buttermilk and Lassi. Hence, an order for the same was given
by the shopkeeper. The shop increased its order for Buttermilk and Lassi next time.
3. New Jodhpur dairy: It ordered several Amul products except Lassi. It did not keep Lassi
earlier. But after we pitched for AmulLassi in the right manner, he has given the order.
4. Bansal Store: It is a small general Store having a good perception of Amul brand. The
store usually orders Amul Butter and Amul Cheese. This time we asked for Buttermilk and
Lassi. It agreed to start with 5 pieces each.
5. Agrawal Store: It is also a small general store in the same locality as the previous store
registering small sales. It also started with 5 pieces of Lassi.
6. Saraswati Store: It is a newly opened store at Pichola. We asked for Amul orders including
Lassi and Buttermilk. It ordered.
7. Lavina Ice Cream: It is also a new ice-cream parlour and cold house. It agreed for keeping
Amul products. The shop is located inside a Colony.
8. Charlie Bakery: This is bakery shop regularly orders Amul Chocolates and Amul Butter.
This time we pushed for Amul Lassi. He started with keeping 5 pieces each.
9. Shyam Store: It also started with keeping 5 piece each.
10. Lakshmi Dairy: It is a complete Dairy products shop. Hence, we promoted Amul
Buttermilk over here. It agreed to keep 10 pieces.
11. Maifair shop: It usually keeps lots of Amul products. I promoted buttermilk and Lassi on
my previous visit. It did not order then. On my visit on 2nd May, it ordered, 1 carat/case of
Buttermilk and 10 pieces of Lassi of 250ml.
12. Indore Mishthaan: It doesn’t keep any Amul product except Amul Ghee from some other
trader. We promoted Buttermilk over here. It agreed to keep 1 packet.
13. Hari Om Krishna and General Store: It started with 10 pieces of Buttermilk.
14. Shree RasDhara: It is a new retail shop added on the route. It ordered 1 pack of each
Buttermilk, Lassi 200 ml, Lassi 250 ml.
15. Mateshwari Provision Store: It agreed to keep 5 pieces of Buttermilk along with other
Amul products which it had been buying.
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16. Jitesh General Store: I could sell 6 pieces of buttermilk to this small retail shop owner in
Sector 4.
17. VikasKirana Store: 1 case of Buttermilk and 1 case of Lassi of Rs.15 was sold to this
outlet. It is also a small retail shop.
18. National Mishthaan Bhandar: It is a sweets shop in Sector 4. After excessive pitching
and promotion, it ordered 1 carton of Buttermilk.
19. Celebration Bakery: This is a large bakery in Sector 4. Since bakeries are good places for
keeping beverages. We promoted Amul buttermilk and achieved success in terms of 12
pieces of buttermilk.
20. Mukesh General Store: It ordered 6 pieces of buttermilk and 6 pieces of lassi of Rs.15
21. Shree Ratlam Namkeen Bhandar: I could sell 1 case of buttermilk and 12 pieces of Lassi
of Rs.15.
22. Ramji Sweets: It ordered 10 pieces of buttermilk.
23. Mahaveer Departmental Store: The shop is in a good residential area of Sector 4. The
shop is large in terms of number of products in its store but it doesn’t register very high
sales. We asked him, if he could start with bare minimum of 6 pieces of buttermilk and he
agreed. He has been keeping other products of Amul but from now on, he will keep Amul
Buttermilk as well.
24. City Corner: This shop is also located in a residential area. They willingly asked if we can
provide them a few pieces instead of entire case/carton, they can start keeping Lassi. We
could hence obtain an order of 10 pieces of Amul Lassi of 200ml.
25. Jhameshwar: Here, we could sell 1 case/carat of lassi of 200ml and 15 pieces of
buttermilk.
26. Lucky General Store: This is a retail store which is located in such a residential area
where he could sell only butter and that too only on Sundays. The retailer has a very good
image of Amul products in mind and had a good display even on a small store. He wished
to expand his sales and hence we convinced him to keep Amul Buttermilk. He has ordered
6 pieces initially. In the previous week, he had ordered Amul Kool for the first time, now
he ordered buttermilk and wishes to order Lassi next week.
27. Laxmi Dudh Dairy: This is a new shop. It ordered for 1 case/carton of Buttermilk and 1
case of Lassi of 200ml.
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28. Jilani General Store: This is a very small retail store in terms of area of outlet but registers
good sale of Amul products despite keeping many other products. The shop has a very
good display as it displayed all its beverage products right in front on the desk on which he
deals with the customers. He started keeping 10 pieces of Lassi of 200ml.
29. Patel Kirana Store: This is a store which had a good brand perception of Amul. Hence, it
agreed to keep 15 pieces of Amul Buttermilk and Amul Lassi of 200 ml.
30. Radha Krishna Kirana: It ordered 6 pieces of buttermilk.
31. Bhagya Laxmi Bakery: It started with 6 pieces of buttermilk.
32. Shivam Store: This is a very small outlet in form of a retail counter on the NH-8 few
metres away from Pratapnagar Chouraha. It is located close to the service lane and attracts
consumers from surrounding residential areas, villagers from nearby villages, students etc.
This shop keeps Frooti. From now on, it has started keeping Amul Buttermilk. It initially
ordered 10 pieces of Amul Buttermilk on our promotion.
33. Raj provision: This is a store just near to the Shivam Store. It is also a small shop with no
space inside the refrigerator or anywhere to keep Amul products. The retailer is interested
in keeping Amul products as he has got enough experience of selling Amul products in
Vape, Gujarat. Hence, we got the right person who could sell any kind of Amul product.
To start with, we promoted buttermilk, as it is small in its shape and occupies less space.
The retailer agreed to keep these many pieces and hence will sell this much.
34. Ramanand Dairy: Like other dairy shops, here also, the shopkeeper seemed interested in
Buttermilk and Lassi. We could convince him for 1 carat/case each of Lassi of 200 ml and
Masti spiced Buttermilk, apart from Amul Kool.
35. Ramdata Dudh Dairy: Here we started Amul beverages with 12 pieces each of
Buttermilk, Kool and Lassi.
36. Nirankar Mobile Store: This is Mobile Recharge Shop. The shopkeeper intends to expand
business to start keeping beverages. He had earlier kept Amul products in some other city.
He also owns an Amul Refrigerator which he had bought earlier at his previous shop. The
shop is located just outside the Pacific College where lot of Gujarati students study. The
shop appears to be best place for expanding the Amul market. Hence, we could sell 12
pieces each of Kool, Buttermilk and Lassi to begin with the Amul products at this new
shop.
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37. Choudhary General Store: This small shop is located in Madri Industrial Area where
there are more people from villages and are employed as daily wage labourer. The
shopkeeper was of the view that such customers might not buy the Amul products as such
beverages would be premium for him. But the cold drink bottles kept at his shop prompted
us to push for Amul as it is made from milk and is cheaper and healthier. Hence, we
promoted with the brand name of Amul as villagers are more aware about Amul than
anyone else. Also, Buttermilk is a product which is liked by villagers. They enjoy it more
than any other beverage. Further, Amul has got a better brand name than any other
company operating in India. We could start with 10 pieces of Amul Buttermilk at this shop.
We also put a dangler of Amul Spiced Buttermilk at the shop for motivating the retailer
and advertising for the customer.
38. Hanumant Kirana Store: This is the only large retail store in the Madri Industrial Area
having a store occupying two shops. We convinced him to start Amul Buttermilk as he is
keeping several Amul products in dry portfolio. The shopkeeper started with 10 pieces.
39. Jai Bhawani: This is a small tea stall and milk counter, having a ‘Amul’ brand name
painted on its store. He orders Amul Buttermilk in pouch from some other distributor. But
doesn’t keep Masti Buttermilk in tetra-pack. Therefore, we promoted the shelf-life of the
tetra-pack and hence, we could sell 10 pieces of Masti buttermilk of 200 ml.
40. Jaishree Bhojnalay: This is a tea-stall and a breakfast centre: The owner was interested
in keeping Amul products. He directly ordered 2 cases/carats of Amul Buttermilk.
41. Menaria Store: This is a small restaurant. It usually orders Amul Lassi from some other
distributor in glasses which have shelf-life of only a few days. Therefore, we promoted the
tetra-packs of Lassi and Buttermilk having shelf-life of 4 and 6 months. He ordered 1 carat
of each buttermilk and lassi of 200 ml and 2 carats of Kool mix flavour along with Amul
Bindass wafer chocolates.
42. Gunjan Kirana Store: This is the sole retail outlet in the IT park region of the Madri
Industrial Area. The shopkeeper has been ordering Amul Buttermilk in pouch from some
other distributor since long. Therefore, we promoted Amul Masti Spiced Buttermilk tetra-
packs and could sell 1 carat of the same.
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Displays at retail stores:
I visited several stores and talked about display of Amul products. Some of the products had a very
good display which can be seen below:
1. This is an example of a beautiful display. It shows
that Amul beverages can be displayed right on the
corner of the main counter where the shopkeeper
deals. It helps in informing the consumer that Amul
beverages are available at the shop. The display
doesn’t even hide the main dry products which are
placed within the cabinet. Hence, it clearly shows
almost all the products which the retailer has for
selling including Amul.
2. This is yet another beautiful way of
informing the consumer that Amul products
are available at the shop. The shopkeeper has
stuck a piece of paper on which it is written
that Amul milk and curd are available at the
shop. Amul doesn’t provide refrigerator so
these refrigerators which are owned
personally by the shopkeeper are used for
storing Amul products. On such
refrigerators, paper can be stuck.
3. Decorating one or two pieces in the Cadbury
refrigerator is an example of good display
which the retailers can use. In this way,
while the consumer wishes to buy
chocolates, he comes across Amul
beverages. This also helps in attracting
children towards the favourite brand Amul.
Fig.15: Display of Amul Buttermilk and Amul Lassi
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Danglers for display:
Besides the work regarding promotion of Amul beverages, I also performed the work of displaying
the danglers of Amul. These danglers are provided by GCMMF for displaying at the retail counter.
I along with Mr. Shankar roamed in the market and took up the initiative of displaying the danglers
at the retail outlets. This helped learn about a very important aspect of advertising in a retail store.
Follow-up visits:
I carried out several follow-up visits in order to ensure that the retailers where I started Amul
beverages have got their supply and whether there is any repeat order. The summary about the
same is presented below:
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S. No. Shop Name Area Initial Order Repeat order/ Last order
quantity
1 Almdar Provision Store Fatehpura 1 case Lassi Initial supply not given as shop
was closed on supply time
2 National Book and
General Store
Chetak Circle, Near
Lav Kush stadium
5 piece buttermilk
and lassi
12 pieces of Buttermilk and Lassi
3 New Jodhpur Dairy Bhopalpura 5 piece buttermilk 1 case Buttermilk
4 Bansal Store Agrasen Nagar 5 piece buttermilk 12 pieces twice
5 Agrawal Store Agrasen Nagar 5 piece buttermilk No repeat order
6 Saraswati Store Pichola 5 piece Buttermilk 12 piece repeat order.
7 Lavina ice-cream Inside Kalaji-
Goraji, jagdish
Mandir colony
1 case
buttermilk/lassi
1 case each
8 Charlie Bakery Gulab Bagh road,
towards Surajpole
5 pieces lassi 2 cases sold
9 Shyam Store Gulab Bagh road,
towards Surajpole
5 piece
Buttermilk/lassi
10 piece Buttermilk/Lassi
10 Lakshmi Dairy Panchwati 10 piece buttermilk 1 case Buttermilk
11 MayFair Panchwati 1 case buttermilk,
10 piece lassi
1 Case each
12 Indore Mishthaan
Bhandar
Panchwati 1 case Buttermilk 3 cases Amul Kool, 1 case Lassi,
2 cases Buttermilk
13 Hari Om Krishna General
store
Fatehpura 10 pieces
Buttermilk
10 pieces each
14 Shree Ras Dhara Fatehpura 1 case each of
Buttermilk, Lassi
200 ml, Lassi 250
ml
First supply not given. New shop
added.
15 Mateshwari Provision
Store
Fatehpura 5 pieces of
Buttermilk
12 pieces of buttermilk
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16 Jitesh General Store Sector 4 6 piece Buttermilk 6 piece order repeated every
week
17 Vikas Kirana Store Sector 4 1 case each
buttermilk/lassi
No repeat order thereafter
18 Celebration Bakery Sector 4 12 piece buttermilk 12 piece thereafter every week
19 National Mishthan
Bhandar
Sector 4 1 case buttermilk Initial order not accepted
20 Mukesh General Store Sector 4 6 pieces buttermilk No repeat order
21 Shree Ratlam Namkeen
Bhandar
1 case buttermilk,
12 pieces of Lassi of
200 ml
1 case each week thereafter
22 Ramji Sweets University Road 10 piece Buttermilk 10 piece repeat order
23 Lucky General Store Savina 6 piece Buttermilk 6 piece Buttermilk once
24 Laxmi Dudh Dairy Savina 1 case of Buttermilk
and 2 case lassi
Supply not given
25 Jilani Kirana Store Savina 10 piece of
Buttermilk, Lassi
No repeat order thereafter
26 Patel Kirana Store Savina 15 piece
Buttermilk/Lassi
No repeat order
27 Radha Krishan Kirana Savina 6 piece Buttermilk 1 case repeated next
28 Bhagya Laxmi Bakery Sector 11 6 piece buttermilk Repeated thereafter. Regular
supply
29 Jai Jhameshwar Store Sector 11 15 piece buttermilk,
Lassi (200 ml) 15
piece
1 case of lassi ordered next time
30 Mahaveer Departmental 6 piece buttermilk 6 piece buttermilk thereafter
31 City Corner Sector 4 10 piece Lassi
(200ml).
10 piece order repeated
32 Shivam Store Pratap Nagar 10 piece Buttermilk 10 piece order repeated next.
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Increase in retail penetration:
Udaipur city has a total of 700 retail outlets in the market. I started sales of Amul Buttermilk and
Amul Lassi at 42 new retail outlets. As a result, the increase in retail penetration of Amul
Buttermilk and Amul Lassi can be calculated as:
(42/700) * 100 = 6
Hence, the retail penetration could be increased by 6% in 4 weeks’ time.
33 Raj Provision Pratap Nagar 12 piece Buttermilk No repeat
34 Ramanand Dairy Pratap Nagar 1 case Buttermilk, 1
case Lassi (200ml)
No repeat
35 Ramdata Dudh Dairy Pratap Nagar 12 piece Buttermilk,
Lassi (200 ml)
12 piece of buttermilk repeated
36 Nirankar Mobile Pratap Nagar 12 piece Buttermilk,
12 piece Lassi (200,
250 ml)
No repeat order
37 Hanumant Kirana Madri Industrial
Area
12 piece Buttermilk Next Order will be given later.
38 Choudhary Store Madri Industrial
Area
10 piece Buttermilk Initial order not accepted
39 Jaishree Bhojnalay Madri Industrial
Area
2 cases Buttermilk Next Order will be given later.
40 Jai Bhawani Madri Industrial
Area
10 piece Buttermilk Next Order will be given later.
41 Menaria Store Madri Industrial
Area
1 case Buttermilk, 1
case Lassi (200 ml),
1 case Kool
Next Order will be given later.
42 Gunjan Kirana Store Madri Industrial
Area
1 case Buttermilk
ordered
Next Order will be given later.
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Key Learning:
I learned the following things through my market visits:
1. Structure of FMCG sales: In the industry of Fast Moving Consumer Goods (FMCG), the
products are transported from the plant of manufacturing to the district level depot from
where they are sent to the various distributors and then to the retail outlets.
2. Assessing Market potential: The correct potential of the market is required to be assessed
for your product. Earlier I did the mistake of underestimating the potential of the market.
The supply of Amul Buttermilk and Amul Lassi at almost all the shops, created a
misconception as if my target products have already reached their target customers. But
then, there were certain shops which were still left to be covered. These were shops which
were less motivated in keeping Amul because it doesn’t provide refrigerator. Then there
were others who were selling Frooti from their juice shops but not Amul. Hence, these
shops were required to be targeted and convinced for keeping Amul buttermilk. I assessed
the market based on several other beverages which shopkeeper were selling like Frooti.
3. Understanding Retail Penetration: By asking more and more retailers to keep Amul
products and convincing them to sell Amul Buttermilk and Amul Lassi, I could understand
how retail penetration is done in the FMCG industry.
4. New market creation: FMCG industry is highly competitive. Every company competes
to enter a new market. But the one entering first in any new market sets the standard and
enjoys the benefit of capturing market share. While selling the Amul products, I suggested
a totally new market area inside Madri Industrial Area where my competitors were either
quite dormant or had not entered.
5. Market Segmentation: At the bottom level sales, you require to segment your market
correctly especially on geographical grounds. I learned how the areas were divided which
could save the cost on transportation and labour while not leaving any retailer untouched
on the route. The routes have to be optimized keeping profit maximization as the goal.
6. Right promotion as per the customer: Promotion and sales pitch cannot be generalized
across different segments of customers. The pitch has to be modified based on the type of
customers. For example, if it is an area where end consumers are villagers, the retailer or
customer has to be convinced keeping the needs of villagers and demand of the small retail
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shop owner in mind. On the other hand, if the shopkeeper is a big retail store right in the
heart of the city, the pitch has to be modified accordingly.
7. Understanding the competition: Amul Buttermilk and Amul Lassi faces stiff competition
from locally prepared lassi and chach at retail stores and sweets shop. The profit margin
for these locally prepared beverages are as high as 60-70% as compared to Amul’s 10%
margin. But Amul products have a greater shelf life, better quality and brand perception.
8. Targeting the right customer: The customer to be targeted must be properly understood.
There were instances when we targeted customers who were not even having refrigerators
simply because they were having a very good perception of Amul brand. But we failed to
realize that even if the retailer was having a good brand perception of Amul, he could not
keep a majority of Amul products which require refrigeration.
9. Understanding the needs of the customers: There were some retailers who had been
selling Amul for long incurring good sales while there were others who we had newly
started. Both of these kinds of retailers required support of Amul for advertisement. Hence,
it was our duty to present danglers and posters to them which they could hand on their
shops and inform the audience about the availability of Amul products with them.
10. Understanding the genuine demands of the customers: There were a few retail shops
which were asking for demands which could not be fulfilled under any condition. Some
were asking for replacement of expired products while there were others who wanted more
margin than any other beverage in the industry. Amidst all these demands, I learned that
an organization must not forget its vision for which it is working. When Amul was
established by Dr. Kurien, it aimed at providing the right value to the farmers for their milk
supply and provide high quality products at affordable prices to the end consumers.
Increasing margin further would mean making products expensive for the end consumer
which could not be done.
11. Customer retention: This is one of the very important point which needs to be taken care
of especially when the industry and market in which you are working is highly competitive.
For this, it is extremely essential to earn the trust of the customer. Honesty is the biggest
strength of the marketer which he can use as the Ace of Spades to win the customer loyalty
and retention. For example, the Menaria Store was giving order of so many Amul products
which I knew he won’t be able to sell given the target audience for the products and the
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consumers living in his surrounding. Therefore, we reduced his order of 4 Amul Kool case
to 2 so that he could sell easily. Otherwise, later he won’t have given order for any more
Amul products as he wouldn’t have been able to sell those extra 2 cases. We compromised
our short-term sales for a long time customer retention and sales for long time in future.
12. Display in a Retail outlet: In Retail Marketing, the display of products in the retail store
matters a lot to the way a customer observes and perceives the product. Every company
fights for the front row display of its products at the retail store. Every company wants that
his products appear before other products to the customer. For this purpose, it is the job of
the marketer that he ensures that the products are very well displayed at the shop such that
the customer can easily see them. While working on this project, I asked retailers to keep
a few pieces of Amul Buttermilk and Amul Lassi right in front on the counter so that
customers can know about the availability of the products. Moreover, it helps in spreading
awareness about the product.
13. Display advertising in a retail store: During my work with Harekrishna Marketing
distributors, I also took up the task of displaying danglers in a retail outlet. This helped me
learning about the consumer perception and best location suitable for display ads.
14. Negotiation skill: I negotiated with the retailers to start selling Amul products even though
it had lesser margin than its competitors and Amul doesn’t provide refrigerator like other
companies.
15. Convincing skill: This is one skill I learned during the course of four weeks of the project.
I understood how to convince the customers and sell the product.
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Project 2
Objective: Promoting Amul Liquid Creamer through
sampling at Star Hotels.
Motivation behind the project:
Amul wishes to capture the market of premium Hotels in the
segment of products supplied in the rooms. Creamer is a
product developed especially for keeping in rooms for
preparing tea/coffee.
Work Approach:
I was supposed to work with Padma Traders which is the
distributor for Amul Products in Hotels of Udaipur. I was
required to talk to purchase manager of the hotel and
promote Amul Creamer. Fig.16: Amul Liquid Creamer
Hotel visits:
I visited star hotels where Padma Traders are supplying Amul products. The summary of the same
is presented below:
Hotel Area No. of
Sample
given
Date
of
visit
Current
Product
Remarks Follow up
Vishnupriya
Hotel
Gulab
Bagh
Road
0 30th
May,
2016
Nestle
Everyday
Meeting to be done on 1st
June.
The concerned
person did not meet
even after several
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No meeting could be
done later even after
several follow-up visits
and phone calls as the
concerned person has
been on leave.
follow up in the
hotel.
Gold Leaf Sarvaritu
Villas,
Udaipur
2 30th
May,
2016
Nestle
Everyday
MD was impressed with
the characteristics of
product like easy to
open, easy to use, easy to
mix at the same price. He
promised to purchase the
same next time
whenever he will order.
They will order once
the previous stock
gets over.
Le Roi Udaipur
City
Station
4 31st
May,
2016
Nestle
Everyday
Meeting required to be
done 1st June, 2016.
The required person did
not give proper reply in 3
follow-up visits. Phone
number switched off.
The store manager
did not receive any
feedback from
management.
Paras Mahal Paras
Tiraha
4 31st
May,
2016
Nestle
Everyday
The purchase manager
will give the feedback
directly to distributor
after consultation with
the hotel staff.
House keeping is
not interested in
this product.
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Rajputana
Resorts
Sector 13 4 31st
May,
2016
Nestle
Everyday
The purchase manager
will give the feedback
the next day after
consultation with the
chef.
They are satisfied
with powdered milk.
They get supply
from Vijaylaxmi
Inder
Residency
Sector 14 4 31st
May,
2016
Nestle
Everyday
The purchase manager
will give the feedback
the next day after
consultation with the
chef.
Old pieces still
kept. It will order
whenever feel
like.
Amantra
Comfort Hotel
Saheliyon
ki Bari
Marg
4 1st
June
Nestle
Everyday
The chef and MD liked
the product but found it
bit costlier than existing
product. Follow up
required after 4 days.
They currently get at
Rs.1.58 per piece.
Old pieces still
kept. It will order
whenever feel
like.
Hotel Archi Sukharia
Circle
3 1st
June
Nestle
Everyday
Follow up required after
4 days.
Talked to
General manager
Yogesh
Nagarchi. He
found the
product good. He
will order next
time.
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Bhairav Garh
Resorts
200 feet
road, from
Sukher
Road
1 2nd
June
Nestle
Everyday
Follow up required after
4 days. The Executive
House Keeper wanted to
fix a meeting with Amul
managers regarding
deals for their total 10
properties. They are also
interested in deal for
Amul Ice-cream as they
are currently purchasing
Havmor.
The Housekeeping
Executive has
already talked to the
General Manager
regarding the
product but the
General Manager
hasn’t replied yet.
Hotel Horizon Sukhadia
Circle
Road,
Panchwati
3 2nd
June
Nestle
Everyday
The Manager requires a
quotation to be mailed.
The distributor
requires to mail the
quotation.
Hotel
Ambience
Near
Shobaghp
ura Circle
1 2nd
June
Amul
Millk
Powder.
A satisfied person with
the Amul Brand. They
are not interested in
replacing one Amul
product with another.
Not interested
Royal Inn 100 feet
road
3 2nd
June
Nestle
Everyday
Follow up required after
3 days.
Manager is not in
town for few
days.
Valley View NH-8,
behind
Transport
nagar
3 3rd
June
Nestle
Everyday
Follow up required after
2 days.
Response from
management hasn’t
arrived to store.
Therefore, they
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The Distributor Eagle
Enterprises is not
providing the required
quantities of Amul
Butter for last 4 months.
The distributor promotes
D’Lecta cheese and
butter when asked for
supply of Amul.
require a week’s
time more.
The Fern Sector 4 3 3rd
June
They are
not using
anything
now.
Hotel is
under
constructi
on.
The purchase executive
is not satisfied with the
packaging. He is
concerned about absence
of FSSAI mark and
expiry date on single
piece of cup. Follow-up
required after Monday
The Purchase
Manager is not
very interested
because of the
packaging issue.
He will talk with
the management
regarding the
same.
The Oriental
Palace
Subhash
Nagar
3 3rd
June
Sachet
milk
The MD and Purchase
manager are not
interested in expensive
products
Not interested in
expensive
product.
The Taj Lake
Palace
Lake
Pichola
3 6th
June
D’Lecta
creamer
The purchase manager
wants an introductory
mail about the product.
D’Lecta is cheaper than
Amul
The introductory
mail still requires to
be sent.
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HRH Group
of hotels
Near City
Palace
3 6th
June
Provides
ready-
made
coffee/tea
in rooms.
Follow-up required after
3 days.
Mr. Bhatt is on leave
till 17th June. A
follow-up would be
required after that.
The Leela
Palace,
Udaipur
Lake
Pichola
6 7th
June,
2016
D’Lecta
and
Cremica
powder
The purchase office
people will directly talk
to the distributor if they
are satisfied with the
product. They had earlier
got the product once but
rejected.
Product still to be
checked.
The Amet
Havel
Ambrai
ghat, Lake
Pichola
2 7th
June,
2016
Nestle The front office person
did not seem much
interested.
They found the
product
expensive.
Lakepichola Lake
Pichola
2 7th
June,
2016
Nestle
Everyday
The owner of the Hotel
has a very good brand
perception of Amul. He
will order the product on
1st July as currently they
are not having enough
occupancy.
The person will
order from 1st
July.
Udai Kothi Hanuman
ghat, Lake
pichola
3 7th
June,
2016
Neslte The owner and MD is
not much aware about
the products they
currently use but they
Not interested.
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will talk to the distributor
if at all they are satisfied.
They will see
only after 1st
August.
Amargarh
Resorts
Balicha,
Ahmedaba
d
Highway
3 8th
June
Nestle 3 samples provided. They will talk to
Padma Traders
Paras Hill
Resorts (Club
Mahindra)
Balicha,
Ahmedaba
d
Highway
4 8th
June
Amul
powder
Creamer
They are getting current
product at Rs.0.82 per
piece. They have already
got the samples but the
feedback from
housekeeping was that
Liquid Creamer is
expensive. Also, more
pieces are consumed per
cup of tea.
They would talk
to GCMMF
directly. They
want GCMMF to
contact Mr. Sai
Shankar,
Corporate
Purchase
Manager, Club
Mahindra
Competitive analysis using Porter’s model
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Fig.17: Porter’s model over Amul Liquid Creamer
Key learnings:
1. Negotiation skills: The best skill I developed with my interaction with the Hotel Managers
is to negotiate. All that a customer expects is best quality at best prices. Amul has been
known for this. I negotiated with them for the best offer.
2. Promotion through sampling: I learned the ability to promote the product by providing
samples for the same. It is an important method of promotion for the same.
3. Sales management in a B2B segment: The product is meant for the hotel businesses.
Hence, I got an opportunity to understand the structure of sales management in a B2B
segment.
Bargaining power of suppliers
Amul has a well established network of suppliers and this is not a
problem with it.
Bargaining Power of customers
They get Nestle Everyday, a solid whitener at a cheaper rate of Rs.1.8
per piece. However, D'Lecta is expensive than Amul.
Threat of new entrants
There are several international brands looking for opportunity to
enter India. Also, there are several solid creamers trying to enter
premium hotels.
Threat of substitutes
Facility for preparation of tea and coffee in rooms is being replaced by
prepared tea/coffee served on order. Solid creamers are also entering market
of liquid.
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Ethnographic study
Company image from inside:
The organization has a very good image among the employees. The Udaipur branch has a mix of
committed youth and experienced managers. The organization has a very good track record of
employee retention. This itself shows that it has a very goof image from inside.
Self-image of Employees:
Employees have a good perception of GCMMF Ltd. and the managers have a referent power over
the employees. The employees are committed to work not only for themselves but for the greater
good of farmers and nation as a whole.
Employee satisfaction:
Employees are satisfied at GCMMF Ltd. Udaipur branch. They are awarded for achieving greater
sales. Moreover, there are regular meetings where top management seeks to meet the employees
and sales incharges and attempts to solve their queries. Although, last few days of of a month
involve a bit hectic schedule as sales accounts are closed.
Work culture:
The orgaisation works by the idea of mutual cooperation. Employees seek to complement each
other for skills. They work by helping each other in achieving sales. The core focus at Udaipur
branch is to increase distribution and achieve greater retail penetration. Employees work by
helping each other to achieve organizational goals.
Sources of conflict:
There are no sources of conflict as such in the Udaipur branch among the employees. However,
the retailers and distributors have always had a conflict with the organization for increasing the
margin but Amul provides the margin of around 10%-15% on every SKU to retailer and a margin
of 4-5% to distributors which is almost similar to other FMCG brands.
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Sources for opportunities of company:
The dairy industry of India is expected to cross $140 billion by 2020 and Amul has an immense
potential to serve the same.
Issues for future competition:
There are several players about to enter the dairy market like Patanjali Ayurved Limited. But in
near future of five years, Amul’s immense market share cannot be compromised as Amul has a
very high share of market. (as discussed in Porter’s model).
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LEARNING FROM SUMMER TRAINING
Applications of concepts learnt at NIM
Project specific learnings are mentioned earlier with the project work.
1. Consumer’s cognition, attitude and belief:
Consumers perceived that ‘pan shop’ has several items like ‘supari’ which can be used as
mouth freshener. Catering to this belief of consumers, we targeted Amul Buttermilk
towards the ‘pan shops’ and convinces them to start selling Buttermilk as there is highly
likely chance that consumers get attracted towards buttermilk as mouth freshener.
2. Underestimating the potential of the market:
In FMCG sales, we often commit mistake of underestimating the market potential. It is
always suggested to measure the demand for competitor’s product if you feel you have
achieved enough sales and it cannot be increased further.
3. Project Management:
I was supposed to complete each project in a time of 4 weeks from the day of
commencement. The target was virtually to increase the retail penetration as much as I
could and achieve the promotion of Amul Creamer. I worked rigorously and visited more
than 450 retailers in 4 weeks. I even paid more than one visit and results were quite
satisfying for the GCMMF Ltd. Udaipur branch. I could achieve 6% increment in retail
penetration in 4 weeks for Amul Buttermilk and Amul Lassi that too in a market which
was already performing very well in beverage segment.
4. Sales management process application:
I could apply the process of sales management which involves lead generation, qualifying
leads, demonstrating values, guiding prospect understanding and delivery and support, in
two different types of market, consumer and business market.
5. Understanding the difference between serving business and consumer
market:
The consumer market sales can be achieved by better promotion strategies and delivering
best quality at affordable prices. But business market involves more of personalized selling.
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New knowledge, tools, techniques and skills learned
1. Understanding Retail Penetration:
Retail penetration is an important concept in Marketing Management and finds its
application in the FMCG industry. It means the number of retailers keeping the product. I
could increase the retail penetration of Amul Buttermilk and Amul Lassi by 6% in 4 weeks’
time.
2. Understanding structure of distribution of FMCG industry:
FMCG industry works on the basis of an efficient network of distribution. The channel
management is an important task. I could understand the complete structure of how the
FMCG channel of distribution is managed.
3. Promotion strategy:
I learned how small danglers can work wonders for promoting the brand. Consumers are
attracted towards the shops having the danglers hanging outside. The location and position
of dangler also plays an important role.
4. Understanding Market Potential Assessment:
Market Potential refers to the total estimated size of market in terms of population or
market share which the brand can serve. It helps in knowing the right size of the target
market. When the product or segment of products category is having full demand, like the
beverages of Amul, a good way to further estimate the demand is to look for the
competitors’ products which the consumers wish to buy. In order to assess the market
potential of Amul Buttermilk, I was guided by Organisation Mentor to assess the market
and retail penetration of Parle Agro’s Frooti and its SKU of Rs.10. Although buttermilk is
catering to the consumer demand of milk based beverage which is different from Frooti
but still in order to stimulate more demand for higher quality beverage, I assessed the
market potential of Frooti.
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Augmentation of soft skills
I could enhance my communication skills, negotiation skills and convincing skills. Both the
projects involved more and more discussions. It helped me in enhancing these skills. I also
improved upon my skill of creativity. Every different customer would come with different
perception about the products. In order to communicate them the right message tailor-made for
their demand, I required to be bit creative by bringing out something new every time out of the
box.
Direction for career path
During my engineering, whenever I would make any project, I would always take deeper interest
into the final part of presentation and report writing besides the technical details. I always used to
find the utility of whatever software I used to make. This made me more interested into marketing
and sales profile and hence I decided to pursue career in the same.
Gradually, I started taking interest into the FMCG sales as it involves greater challenges in
satisfying the needs of customer for his daily requirement. To further add to the challenges, there
are large number of competitors. Hence, I wished to confront this challenge. This compelled me
to opt for summer internship into India’s leading FMCG brand Amul.
Internship at GCMMF Limited has taught me the deep nitty-gritties of FMCG sales. I could find
lots of issues arising in sales to end consumer and various challenges involved in managing the
distribution channel. Amul has taught me an important message of not to under estimate the
potential of the market.
