BUSINESS HISTORY PROJECT TITLE- AMUL
BUSINESS HISTORY PROJECT
1946- The success continues…
PREPARED BY: SECTION-H STUDENTS:
N. Saibaba Krati Mangal Manoj Kumar
TABLE OF CONTENTS
1 OBJECTIVE OF THE RESEARCH 5
2. THE BEGINNING: STORY OF AMUL
a.Introduction b.The Amul Model 6
3. FOUNDERS OF AMUL 8
4. GROWTH OF AMUL
GCMMF- An Overview
Addition of Products
Suppliers and Workforce 9
5. DAIRY INDUSTRY AND AMUL
Marketing Strategies 14
6. COPING WITH CHANGES 21
7. CSR Activities BY AMUL 25
8. MAJOR EVENTS & TIMELINE 29
9. FUTURE PLANS 30
10. CONCLUSION 31 11.
This work would not have been possible without the support of the Professor Kala Chenji. We are especially indebted to Prof. Kala Chenji, who have been supportive of our career goals and who worked actively to provide us with the protected academic time to pursue those goals. We are grateful to all of those with whom we have had the pleasure to work during this and other related projects. Each of the members of my team has provided us extensive personal and professional guidance and taught us a great deal about both historic research and life in general.
The report is a short overview of Amul growing in the field of Dairy Industry and gradually expanding since its inception in the year 1946. Sardar Patel, Tribhuvandas Patel and Dr.Verghese Kurien being the faces of Amul particularly assumed to be responsible for the scalable growth that Amul has today in India as well as globally.Furthermore, the report includes growth and stages of growth right from supplier, purchaser, employee base and all other possible walks. The addition of products category is also showcasted. Change being the law of nature, with improvements in technology and entry of competitors in the market, it is obvious that the same system can’t work for continued success and the same happened with Amul as of which we have also included how instances changed and what all was done to adopt to change. Amul had its strong foundation laid on the basis of CSR activities that it used to perform. The same has been covered in report. Finally, the major events that affected both positively as well as negatively are taken up in the major events and closing part covers future plans of the company where major role is scaling of the market.
Objective to the research
To know awareness of people towards amul products
To know the preference of amul products with respect to other brands
To know the factors which affects consumer’s buying behaviour
Swot analysis of amul
Change in business strategy according to the time
Ideas about increase the sale of amul
To study various factors such as quality, price, easy available etc. is influencing lot and influences positively.
2.THE BEGINNING: Story of Amul1
The white revolution was spearheaded by Tribhuvandas Patel under the guidance of Sardar Patel and Dr.Verghese Kurien. As a result, Kaira District Milk Union Limited was born in 1946. Tribhuvan das became the founding chairman of the organization which he led till his last day of his life.
He hired Dr. Kurien three years after the white revolution. He convinced Dr.Kurien to stay and help with the mission rest was history in the dairying industry.
Amul spurred India’s White Revolution, which made the country the world’s largest producer of milk and milk products. In the process Amul became the largest food brand in India and has ventured into markets overseas.
Amul products are now available in more than 60 countries in the world. The seeds of this unusual saga were sown more than 65 years back in Anand, a small town in the state of Gujarat in Western India.
The exploitative trade practices followed by the local trade cartel kicked off the cooperative movement. Angered by unfair and manipulative practices followed by the trade, the farmers of the district approached the great Indian patriot Sardar Vallabhbhai Patel for a solution.
He advised them to get rid of middlemen and to form their own co-operative, which would have procurement, processing and marketing under their control. In 1946, the farmers of this area went on a milk strike refusing to be cowed down by the cartel. Under the inspiration of Sardar Patel, and the guidance of leaders like Morarji Desai and Tribhuvandas Patel, they formed their own cooperative in 1946.
The Amul Model
The Amul Model of dairy development is a three-tiered structure with the dairy cooperative societies at the village level, district level & state level as shown in the figure below.
Fig.: 1a Amul Adaptation Model
http://www.amul.com/m/about-usThe Amul model has helped India to emerge as the largest milk producer in the world.
3.FOUNDERS OF AMUL
The co-operative – The Kaira District Co-operative Milk Producers Union Ltd. began with two villages dairy co-operative societies and 247 litres of milk and is today widely better known as Amul Dairy.
Amul grew from strength to strength under the visual guidance of inspired leadership of Tribhuvandas Patel, the founder Chairman and the committed professionalism of Dr. Verghese Kurien,who was entrusted the task of running the dairy since 1950.
The then Prime Minister of India, Shri. Lal Bahadur Shastri decided that the same approach should become the basis of a National Dairy Development policy. Most importantly, the co- operatives were sensitive to the needs of farmers and responsive to their demands.
At his instance in 1965 the National Dairy Development Board was set up with the basic objective of dualize the Amul model. Dr. Kurien was chosen to head the institution as its Chairman and asked to grow this model throughout the country.
Fig.:2aTribhuvandas Patel – FATHER OF WHITE REVOLUTION2
Source : https://en.wikipedia.org/wiki/Tribhuvandas_Kishibhai_Patel
Fig.:2bDr.Verghese Kurien – FOUNDER CHAIRMAN 3
Source : https://timesofindia.indiatimes.com/india/Father-of-white-revolution-Dr-Verghese-
4.GROWTH OF AMUL
GCMMF – An Overview
Addition of Products
Suppliers & Workforce
No. of Producer Members No. of Village Societies
Total Milk handling capacity per day Milk Collection (Total – 2016-17)
Milk collection (Daily Average 2016-17) Cattlefeed manufacturing Capacity
Sales Turnover -(2017-18)
3.6 Million 18,554
32 Million litres per day
7.7 billion litres
20.4 million litres 9200 Mts. per day
Rs. 29225 Crores (US $ 4.5 Billion)
GCMMF – An Overview1 :
Major Terms associated with growth of the company as of 2015-16: CAGR: 21%
Products Group Turnover under Amul Umbrella: 29225 Cr INR
Newly Added Products26
Cities with New & Upcoming Plants: (As Under)
S.No. City Plant
1. Palanpur Milk Powder
2. Rohtak Dairy Plant
3. Faridabad Dairy Plant
4. Lucknow Dairy Plant
5. Kolkata Dairy Plant
6. Kanpur Dairy Plant
7. Surendranagar Dairy Plant
8. Kutch Dairy Plant
9. Varanasi Dairy Plant
10. Amreli Dairy Plant
11. Gandhinagar Butter Plant
12. Palanpur Mega Cheese Plant
Fig.: 3.2(a) Sales Turnover of Last 11 Years4
A steady growth is noted with the timeline of sales in previous 10 years.
2005-06 to 2006-07 had a minor increase in sales with a value of 504 crores.
Roughly thereafter for 2007-08 as compared to previous year, there was an increase of 473 crores with an overall increase compared to previous year of 977 crores and that of 2005-06 of 1481 crores.
2008-09, 2008-09, 2009-10 saw a steady increase in sales in range of 800 cr – 1400 cr.
Notable increase in sales can be seen in 2013-14 which can be assumed to be a Best Performer of 11 years timeline.
CURRENT STATUS OF THE INDUSTRY
As per the current stats, Amul reported its increased turnover of 18% at Rs.2,70,85 for the last fiscal on an across-the-board. Gujarat Co-operative Milk Marketing Federation (GCMMF), had posted a turnover of Rs.22,972 crore. In last 7 years, turnover of GCMMF has increased by about 3.5 times. The 18 member Unions of GCMMF with farmer member strength of more than 36 lakhs across 18,700 villages of Gujarat are procuring on an average 177 Lakhs litres of milk per day.
GCMMF ranks among the top 13 dairy companies in world in terms of milk processing as per International Farm Comparison Network (IFCN).
The member unions of GCMMF have opened more than 13 lakh new bank accounts for milk producer members and also their almost entire payment is done through bank accounts. Now, milk payments are cashless and directly transferred into their bank accounts
Because of better milk procurement prices paid by member unions of GCMMF, milk procurement by member unions has increased by 91% during last six years.
Pouch milk, which is the highest turnover product, shown volume growth in double digits while products like butter, ghee, ice cream, UHT milk, flavoured milk, paneer and fresh cream have also showed a very good significance growth.
It crossed Rs. 27,000 crores sales turnover with 18% growth. GCMMF has planned to achieve sales turnover of Rs. 50,000 crores by 2020-21. In order to reach interior markets, GCMMF has started fourteen new branches in India during last four years. GCMMF has been achieving a compound annual growth rate (CAGR) of more than 20 % for the last 5 years due to higher milk procurement, continuous expansion in terms of adding new markets, new products launch and adding new milk processing capacities across India, etc. Amul plans to step up its milk processing capacity to 380 lakh litres per day, from the current 300 lakh litres, in the next three years.5 GCMMF have started creating their own milk processing plants in states of Haryana, Uttar Pradesh, Maharashtra, Madhya Pradesh, West Bengal and Rajasthan. Milk procurement has witnessed a phenomenal increase of 96%.
During the last three years. During this period, it has set up several new dairy plants including new dairy factories at Faridabad, Rohtak, Lucknow, Kanpur, Amreli and Kutch. Its new Cheese factory at Palanpur in Gujarat’s Bansakantha district was inaugurated, by our Hon Prime Minister, Shri Narendra Modi,in December 2016. This has led to a three-fold increase in our Cheese manufacturing capacity.The processing capacity of our AmulFed dairy at Gandhinagar is being enhanced from 35 lakh litres per day to 50 lakh litres per day.
NEW PRODUCTS IN THE MARKET
Amul landed up with several new products and in which they are very successful and striving hard to achieve more. Few of the new are mentioned below.
Smoothies ; Shakers
Fig.: 3.3a Amul Product Lines
With 3+ added product lines, Amul added up more than 100 products to its bag.
With addition of 100+ products, Amul added up a new customer base of more than 100k+.
SUPPLIER, EMPLOYEES, RETAILERS AND DEALERS
Its daily milk procurement is approx 18 million lit per day from 18,549 village milk cooperative societies, 18 member unions covering 33 districts, and 3.6 million milk producer members. Till now, there are total 750 employees of Marketing Arm ; 3.6 million milk producer members7.
Amul success has not only been emulated in India but serves as a model to the rest of the World. It is exclusive marketing organisation of ‘Amul’ and ‘Sagar’ branded products.
It operates through 56 Sales Offices and has a dealer network of 10,000 dealers and 10 lakh retailers, which is one of the largest such networks in India. Its product range comprises milk, milk powder, health beverages, ghee, butter, cheese, Pizza cheese,Ice-cream, Paneer, chocolates, and traditional Indian sweets, etc. GCMMF is the largest dairy producer in india
In 2013-14, GCMMF took giant strides in expanding its presence in International markets also. Amul’s presence on Global Dairy Trade (GDT) platform in which only the top six dairy players across the world sell their products and it has earned respect and recognition across the world.
It has enhanced the distribution footprint by adding 15 new Branch Offices in recent years and expanding its network of distributors, super-stockists and substockists to reach millions of retail shops across the country.They have added another 1,250 distributors during the year and also further strengthened its rural reach with 181 Superstockists covering 3,600 interior markets.
EFFECT ON THE INCOME OF FARMERS
It has successfully quadrupled the income of its dairy farmers in last seven years, demonstrating the efficacy of Amul model in exceeding our national goal of doubling farmer?s income in six years. During the last seven years, Amul?s milk procurement prices to its farmer-members more than doubled from Rs. 24.30 per litre for buffalo milk (Rs. 337 per kg fat) in 2009-10 to Rs. 49 per litre (Rs. 680 per kg fat) in 2016-17. Since the cooperative?s total milk procurement also doubled during this period, from 90.9 lakh litres per day to 176.5 lakh litres per day, this effectively increased the income of its dairy farmers, four-fold in the last seven years.
DAIRY INDUSTRY AND AMUL
Turnover of GCMMF has increased by 187% during last six years; registered a provisional turnover of Rs. 27,085 crores for the financial year 2016-17 which ended on 31st March 2017. This is 18% higher than last financial year’s sales turnover of Rs 22972 crores.
Amul plans to enhance its milk processing capacity from the current level of 28.1 mlpd to 38 mlpd in the next five years. Patel also claimed in New Zealand farmers were getting around Rs 51.5 per liter of milk during 2013-14 which was reduced to Rs 21.7 per liter during 2015- 16.
On the other hand, farmers of Gujarat are getting 8-10% higher price of milk every year. In order to meet milk and milk product demand in major metros of India, the member unions of GCMMF have started creating their own milk processing plants in states of Haryana, Uttar Pradesh, Maharashtra, Madhya Pradesh, West Bengal and Rajasthan. The Member Unions of GCMMF have also started milk procurement from other states.
MAJOR COMPETITORS OF AMUL
Britannia posted a turnover of Rs 7,175.99 crore for 2014-15, while Nestle clocked a turnover of Rs 8,175.31 crore. ITC and HUL’s food businesses posted turnovers of Rs 6,411 crore and Rs 5,522 crore respectively last fiscal year.
COMPETITOR ANALYSIS- 2015-2016
Fig: 5a-Competitive Analysis of 2017-2018
Fig: 5b-Major Competitors of Amul
MARKETING STRATEGIES OF AMUL:
Very high market share in ice cream – Amul has the topmost market share in ice cream segment which further helps it push other products into the market.
Excellent brand equity – Amul is a beloved brand over the years and the contribution of
“Amul Girl” and her outdoor ads should specifically be mentioned here.
Excellent quality management – Although it has such a wide and large distribution network, hardly any quality complaints come for Amul.
Strong distribution network – This is one company which is strong in urban as well as rural distribution. One can find its presence even in small towns and villages.
Good product portfolio – Amul had a deep product portfolio when compared to any other FMCG company. It has many different variety of milk & milk based food items like cheese, butter, milk, buttermilk, lassi and many others. In ice creams too, Amul has a large variety of flavours
Strong Supply chain – Vendors love Amul and is widely known for the “White Revolution”
Rural presence – Strong rural presence of Amul is its plus point. It is mentioned here separately because this rural presence gives Amul a strong competitive advantage.
Marketing Strategy- Successful advertising and marketing campaigns has enhanced the brand presence.
Perishability- Pasteurization has overcome this weakness partially. UHT gives milk longlife. Still perishability is there at the milk vendor’s end. This does result in loss of someproduction. But Amul Dairy is taking steps to store milk at the vendors end. Surely, manynew processes will follow to improve milk quality and extend its shelf life.
Cost of Operations – Amul’s operation is huge. And so is the cost. Moreover, the sector is such that maintaining margins becomes difficult day by day. Thus, to face international players, Amul needs to maintain the operations in the same manner it is carrying out today. It is not a weakness but rather a constant challenge for Amul. In fact, during summers, the brand faces severe shortage of supply.
Chocolates – Amul’s expansion to chocolate has failed and hardly any product of Amul chocolates is selling in the market. Amul needs further products to expand its product line and increase bottomline.
“Failure is never final, and success never ending”. Dr Kurein bears out this statement perfectly. He entered this industry when there were only threats. He met failure head-on, and now he clearly is an example of never ending processes.
Export – Amul can export its product to other countries thereby increasing its turnover and margins exponentially.
Concentrate more on chocolate market – Amul has a no advertisement policy which creates a problem for its foray into additional products. Amul should in fact have concentrate more on increasing its product line through chocolates or other such products.
Increasing competition in Ice cream segment – Many players, local and international, are entering the ice cream market thereby taking away share of wallet from Amul. Kwality walls, Naturals, London Dairy, Havmor, Arun ice cream, Vadilal, Ramani,Mother Dairy etc. are some of the few brands who are directly in competition with Amul.
International brands-Strong competition from International ; domestic players in the ice cream segment means limited market share. Strong competition from international players can reduce the market share of Amul.
Economic Condition of India- Economic slowdown and inflation can affect business.
PORTER’S 5-FORCE MODEL
The success of the national and local competitor?s brands includes effectives distribution system, advertising, good pricing policy etc.
The factors ascribed by porter are as follows:
Threats of new entrants
Bargaining power of suppliers
Bargaining power of buyers
Rivalry among competitors
Threats from substitutes
BARGAINING POWER OF CONSUMERS
THREAT OF SUBSTITUTES
BARGAINING POWER OF SUPPLIERS
Fig: 62a- Porter’s 5-Force model
Threats of new entrants
Economies of Scale: GCMMF enjoys economies of scale, which is difficult to match byany other competitor. It is because of his reasons that no regional competitor has grownto a national level.
Cost and Resources advantages: Amul dairy is co-operative society. That means
“cooperation among competitive is the fundamental principle. Amul dairy is managed the norms of GCMMF and market the products under the brand name “Amul” which has very good reputation at domestic and international level. Here the raw material procurement is very difficult for the new entrants. Consequently capital requirement is also high. Still new entrants are moderate.
Brand preferences and consumer loyalty: There is an immense level of Brand preference of Amul in the mind of the people. The level of preference specifically in the liquid in the milk sector is that would go to other retailer if the retailer does not have milk.
Access to distribution channels: The distribution channel of GCMMF is a very planned and perfect one. For any new entrant to enter it would be a very difficult task. For GCMMF the result is years of hard work and its investment in its employees as well as at different levels in the distribution network.
Capital Requirements: The total investments required in the industry is huge and is a decision worth considering even for MNC’s . The investments decision cover the
processing costs as well as marketing costs. To compete with the brand Amul in India isdifficult as Amul is synonymous to Quality.
Bargaining power of supplier
The objective of Amul dairy is not profiting. As it is a part of cooperative society, it runsfor the benefit of farmers those are suppliers of milk and users of milk products. According the concept of the cooperative society supplier has bargaining power to have good return on his or her supply. However, supplier has limited rights to bargain with the cooperative society because it is made and run for the sake of mass and not for individual benefit. But it is made sure that the supplier gets his fair share of return.
There is appropriate bargaining power of the supplier. In olden days there were not any kind of cooperative societies as the farmer was exploited. But, nowadays the farmer’s
rights are protected under the cooperative rules and regulation, which ultimately results in moderate power of bargaining from the supplier.
Bargaining power of buyers
Cost of switching to competitor brands: The switching of brand is seen very much in products such as ice cream, curd, milk powders, milk additives etc. but it can be seen comparatively less in liquid milk category. Even if the buyers shift to the other brands of milk, the value that they get is less than they would get from consuming Amul.
Large no. of buyers: Milk is a necessity product and hence is a mass product. It has considerable share of the rupee spent by any Indian. Moreover the buyers are spread evenly over the country and do not have any bargaining power.
Rivalry among competitors
Demand for the product: The demand of the products of GCMMF is increasing at a very healthy rate. To stand against the rivalry GCMMF is coming with a wide range of products.
Nature of competitors: In different business category GCMMF faces competition from different players. In the milk power category it faces competition from Cadbury &Nestle, in the chocolate category also it faces competition from Cadbury & Nestle.
Mergers and acquisition: As such in the industry there are no mergers or acquisitions. However if any MNC wishes to enter through this route then the competition might be severe.
Threats of Substitute
Availability of attractive priced substitutes: Different substitutes are available for different category of products. There is ample availability of low priced substitutes from local vendors retailers. This is a front where GCMMF is still finding hard to combat.
Satisfaction level of substitutes: Customers do consider these products as equal on quality if not better then products of GCMMF. Hence the rate of customers switching to the substitutes is very high. Moreover the buyers also can switch to the customers easily without any hurdles.
Not immediate substitutes: Distant substitutes are present in many of the categories of business of GCMMF. For example in the Masti Buttermilk category it faces competitioncold drinks and ice Cream.
These 5 force interact among themselves at different degrees over a period of time. Moreover it will getintense or loosen up depending upon there of competitors, buyers, suppliers etc.
6. Coping with the changes
Since the turn of 19th century, Cooperatives have existed as dominant forms of organization in the dairy industry around the world. Sometimes they have played the role of developing infant industry while at other times they have been used to strengthen weak production bases in an environment where market failures tend to be higher for marginal producers. In some other cases, a network of small producers have organized themselves to better market their products. Management of these cooperatives have also led to some interesting managerial insights for managers in emerging as well as developed economies.
Large emerging economies, e.g., India and China, have complexities that range from development of markets (where the largest segment of population is the one which has low purchasing power) to integration of low cost suppliers who are predominantly very small. For firms that aspire to conduct substantial business in such markets, such complexities have to be recognized and then overcome.
The Kaira District Milk Cooperative Union or AMUL in India is an example of how to develop a network of firms in order to overcome the complexities of a large yet fragmented market like those in emerging economies by creating value for suppliers as well as the customers. AMUL has led the milk dairy revolution in India that has now emerged as one of the largest milk producers in the world. AMUL is an Indian dairy cooperative founded in 1947—eight months before India’s independence from British rule—and owned by over three million farmers in the state of Gujarat. It is India’s largest food product marketing organization, selling 46 products, including pouched milk, cheese, butter, ice cream, and infant food through a million retailers across the country, and is the market leader in almost all the categories in which it operates. AMUL is well known among Indian consumers for offering high-quality products at reasonable prices, and runs a highly popular advertising campaign that spoofs current events. It offers its farmers 80% of the consumer’s dollar for milk, compared with 35%–40% typical in some Western markets. AMUL’s cooperative dairy model has been replicated across several Indian states, thereby helping increase the incomes of 80–100 million farmer families across the country. However, despite its success, AMUL is beginning to come under increasing pressure. Multinationals like Nestlé and Unilever are increasing their presence in India and competing fiercely with AMUL in value-added products like yogurt. The entry of large multi-brand retailers like Wal-Mart in the Indian market threatens to squeeze AMUL’s margins and undermine its low-cost distribution network. India’s large young rural population is shying away from dairy farming in favour of urban jobs, leaving questions about future procurement.
Measures to overcome challenges
Increasing the import duty applicable to milk powder and butter oil to prevent subsidized import
Currently, the world trade is highly distorted. Most of the advanced dairying countries subsidise whole or a major portion of their domestic milk production. They also impose several restrictions to stop import of dairy products. Many of these countries offer high support price to stimulate milk production. Through various policies and facilities they frequently subsidise exports.
However, in India, the milk producers do not get any such support. They only want their government to protect them from the distorted world trade of subsidized commodities to flood their market. Each year, the Director General of Foreign Trade (DGFT) issues notification for Tariff Rate Quota (TRQ) for import of Milk Powder including Skimmed and Whole Milk powder, Milk food for babies etc. at a concessional duty of 15 per cent. It is felt that this concessional duty of 15 per cent to import milk powders should be raised to 60 per cent to protect the milk producers from unfair world competition.
Amending policy regulations on Import of milk products
Under the liberalized import regime, the Government has allowed import of food products in consumer packs also. Often these imported products do not meet the Indian standards of quality and packaging, which is applicable to the domestic manufactures. There is a tendency that developed countries dump products of inferior quality to India. It is therefore necessary that the Government enforce the regulation on imports that are violating the laws of the land to protect the interest of the consumers. Additionally, due considerations on sanitary and phyto-sanitary measures should be given while approving import of milk and milk products.
Introducing integrated food laws
Presently, manufacture and supply of milk and milk products are governed by a plethora of food laws such as the Prevention of Food Adulteration Act,1954; the Standard Weights and Measures (Packaged Commodities) Act, 1976; the Industrial Development and Regulation Act, 1951, the Agricultural Produce (Grading and Marking) Act, 1937 as amended in 1986 (AGMARK); the Milk and Milk Product Order, 1992; the Infant Milk Substitutes, Feeding Bottles and Infant Foods (Regulation of Production, Supply and Distribution) Act, 1992; the Insecticides Act, 1968; the Consumer Protection Act, 1986 (COPRA); the Water (Prevention and Control of Pollution) Act, 1974 and the Air (Prevention and Control of Pollution) Act, 1981; the Bureau of Indian Standards (BIS) Moreover, implementation of these laws comes under the control of a host of ministries including Ministry of Agriculture, Ministry of Food Processing, Ministry of Consumers Affairs, Ministry of Health, Ministry of Company Affairs, Ministry of Law etc. Each one of these ministries has their own departments and systems of administrations requiring numerous clearances and inspections invariably leading
Any other incidental or consequential matter as deemed necessary. Recognition of cooperatives as a distinct sector of economy
In line with the National Policy on Cooperatives, cooperatives are required to be recognized as a distinct economic sector and integral component of the socio-economic system deserving special status from our Government. The cooperatives have the potential, if governed properly, to solve many of our problems especially in rural areas. Hence, the Governments policy initiatives for cooperatives are extremely important. Since the dairy cooperatives are limited resource farmers organizations and poor in capital formation, they are vulnerable to open and unfair competition requiring the Governments policy support to protect them from unfair and unequal competition whether they are from outside or inside.
Creating obligation for private trade including multi-national companies operating in dairy business
During the past decades the dairy cooperatives have invested substantially in developing their individual milk sheds, educating member farmers, etc. Thus, it would be unfair for the Government to allow private and multinational companies to set up dairy business in milk sheds already developed by the dairy cooperatives. Companies would be allowed to reap benefits for which they did not make any prior investment and so, it would be invariably at the cost of the cooperatives. Further, cooperatives, by law, are required to contribute a portion of their business surplus towards education fund maintained by the National Cooperative Union of India, New Delhi. On the other hand, private trade does not have any such obligation, they would continue in business as long as it is profitable. They would not have any sincere intention to invest in developing their milk sheds or to create infrastructure facilities in their individual area of operation. Therefore, it is proposed that the Government should come out with some policy directives by which private trade and multinational companies would be required to invest a portion of their business surplus in developing their milk shed or upgrading genetic resources of milch animals or fodder availability etc. in their area of operation. This would go a long way in developing the dairy industry of the country as a whole.
Abolishing deputation of Government employees in dairy cooperatives
Past experiences reveal that competent and committed professionals working for cooperatives for reasonably long period of time, in most cases, holds the key to the success of cooperatives. It is no wonder that the best performing dairy cooperatives today are headed by professionals and not by government officers posted on deputation. Therefore the Government needs to discontinue the practice of deputing government officers to head the dairy cooperatives.
Achievements of the Dairy Cooperatives in India
The dairy cooperative network is owned by nearly 12 million farmer members.
These producers are grouped in nearly 1,08,574 village-level dairy cooperative societies.
The societies are grouped in 170 district-level unions spanning 338 districts.
The unions make up 22 state-level marketing federations.
Average daily cooperative milk marketing stood at 14.87 million litres; annual growth has averaged about 4.2 per cent compounded over the last five years.
Dairy cooperatives now market milk in about 200 class I cities including metros and some 550 smaller towns.
During the last decade, the daily milk supply has increased from 17.5 to 52 litres per 1,000 urban consumers.
Bulk vending saves money and conserves the environment.
Milk travels as far as 2,200 kilometres to areas of shortage, carried by rail and road milk tankers.
India produces 95 per cent of its own dairy equipment, saving valuable foreign exchange.
The annual value of India’s milk production amounts to about Rs.880 billion.
Dairy cooperatives generate employment opportunities for about 12 million farm families.
Amul CSR activities
Amul Dairy has propelled a novel plan for add up to country sanitation and set an objective for itself whereby not a solitary drain maker will take care of nature’s bring in the open. The Dairy with the help of District Rural Development Agency (DRDA) will give intrigue free credits to its drain makers in Anand and Kheda locale to set up “pucca” latrine pieces, which won’t just enable ladies to drain makers stay away from humiliation yet will likewise guarantee cleanliness.
‘In five years, dairy wishes to accomplish the objective of giving 100 for every penny can offices in all towns where Amul has a drain society. The mission is not just about bringing a social change by soaking up great propensities among drain makers yet in addition focused towards empowering clean practices in the drain inventory network.
Amul has arranged a model minimal effort latrine hinder that costs Rs. 11,500 per unit. While DRDA will bolster this activity through endowment going amongst Rs.4500 and Rs.4600 for BPL/APL families, Amul will give its individuals an intrigue free credit worth Rs.4300 returnable in four years. A part can pay up this advance by getting Rs.100 every month deducted from his/her bill.
To energize exceptional offspring of agriculturists in seeking after higher investigations Amul presented scholarship plots in 1992. The youngsters are given scholarships for pressing together Diploma, Graduation, Post-Graduation and Doctorate. Consistently the remarkable youngsters are recognized from the towns and scholarships are given to satisfy their fantasy of accomplishing scholastic greatness. This exertion has propelled extraordinarily kids to exceed expectations in their investigations and spread instruction in rustic zones.
Amul Scholar Felicitation Programme
Yearly Amul congratulate exceptional offspring of representatives who have secured most noteworthy checks in tenth, twelfth norms and Gold Medallist in graduation. Amul Scholars’ Felicitation Program was started in 2004 and has encouraged numerous remarkable understudies of Amul family.
Amul Vidya Shree & Vidya Bhushan
Amul’s vision is to see an informed, gifted and solid youth in a created India without bounds and subsequently contribute towards country building. We at Amul trust that the sound training of its childhood is the establishment of each state. Consequently, it is the most essential constituent for a creating country like our own. Towards this rationality, Amul Vidyashree and Vidyabhushan Awards have been initiated to perceive the brightness of the understudies crosswise over India and the nature of instruction and direction granted by the schools they contemplate in. The commencement of these honours goes back to 2004-05.
The Awards perceive the scholarly brightness of Class tenth and twelfth best legitimacy rankers crosswise over India and the nature of instruction and direction granted by the schools they examine in and subsequently energize the soul of edification among the present youth. In the main year of the Award Foundation, Amul regarded 500 understudies in Gujarat and different parts of India. In the second year, it recognized further 2267 understudies crosswise over schools in India. Advancing (2006-07) Amul founded Amul Vidya Bhushan” honours to perceive the toppers of Stud twelfth examination too. It is India’s first of its kind honour that perceives and rewards splendid personalities
of India. By winning this honour, the understudy gets perceived, as well as help the schools to upgrade their picture as an institute that gives quality instruction, worth imitating by others.
Amul with red cross
Amul in relationship with the Indian Red Cross Society intend to move, energize and start compassionate administrations to limit, lighten and avoid human enduring consistently to contribute for “Humankind to Peace”. Towards this goal Amul started blood gift battle since 1987. Blood gift camps are sorted out frequently in rustic ranges through Village Dairy Co-Agent Societies. Thus, camps are sorted out in Amul Dairy Campus wherein workers and their relatives participate in giving blood. Also, Amul arranges gift of blood on crisis. Amul has made a pattern in giving blood to the general public.
Milk Producer individuals from Gujarat Dairy Cooperatives-also called AMUL have been commending the country’s Independence Day in a novel way by planting lakhs of saplings crosswise over Gujarat and have taken up an eager intend to spare the earth by planting trees, influencing India to green and along these lines lessening the impacts of a worldwide temperature alteration. The milk makers of Gujarat Dairy Cooperatives are leading mass tree estate drive each year on Independence Day for most recent nine years. In most recent ten years (2007 to 2016) the milk makers have planted around 619.7 lakhs trees). The most striking component of these whole projects was that it has been started by milk maker individuals from the dairy cooperatives. The one of a kind reality about the program was that the milk maker individuals took up the promise to ensure tree saplings till it survives and develops into tree.
Throughout the years, because of serious farming and dairying different common assets are getting expended at speedier pace in Gujarat province of India. The state level zenith collection of dairy agriculturists in Gujarat gave a genuine idea toward this path and found an original thought for offering back to nature. The thought was “one part one tree” manor on our 60th Independence Day – 15th August 2007.To put this thought in to the training an outline group constituting of delegates of part unions were shaped. The group acknowledged the thought by heart and instantly chose to spread it among rancher individuals from town dairy agreeable social orders. At that point the thought was conveyed to rancher individuals and they all invited it and energetically consented to execute the thought.
For smooth usage of the thought, the plan group chalked out the guide for different exercises. Execution groups were framed at locale union level to give last shape and put the arrangement in real life. Town level organizers were recognized and they were prepared to streamline movement of tree estate. Different mindfulness materials were readied. Through different correspondence media rancher individuals were made mindful of advantages of tree manor and tree estate action plan.
CSR ACTIVITIES TOWARDS ITS EMPLOYEES
Corporate social obligation (CSR) has been characterized as the dedication of business to add to feasible financial advancement working with representatives, their families, the neighborhood group, and society everywhere to enhance their personal satisfaction, in ways that are both useful for business and useful for improvement.
To meet with the CSR, it is normal that a business in its whole obtainment generation preparing advertising chain should concentrate on human advancement including the maker, the specialist, the provider, the shopper, the common society, and nature.
Surely, an exceptionally extreme undertaking. Most organizations would absolutely wallow in not having the capacity to accomplish no less than one or a significant number of those desires. Be that as it may, AMUL has demonstrated the way.
CSR-touchy Organizational Structure
AMUL is a three-level co-agent association. The primary level is the co-agent society at the village, of which; drain makers are deliberate individuals, dealing with the co-agent through a fairly chose 9- part overseeing panel, and working together by obtaining milk from individuals and pitching it to the region level co-agent. There are more than 11,000 co-agents in towns of Gujarat.
The second level is the region co-agent that procedures drain into drain items, showcases locally and pitches surplus to the state co-agent for national and universal promoting. There are 12 area co-agents each being overseen by a 15-part board chose by the school involving the assigned delegates or directors of the town co-agents.
Third level is the state level co-agent – the Gujarat Co-agent Milk Marketing Federation (GCMMF) in charge of national and worldwide promoting of drain and drain items created and sold to it. The GCMMF is overseen by the board justly chose by and from among the executives of the locale co- agents.
The whole three-level structure with the GCMMF at its peak, is a one of a kind establishment since it envelops the whole chain from creation of crude material to achieving the shopper with the finished result. Each capacity includes human mediation: 23.60 lakh essential drain makers; 35,000 provincial laborers in more than 11,400 town social orders; 12,000 specialists in 15 dairy plants; 750 advertising experts; 10,500 business people in dissemination organize and 600,000 salesmen in retail arrange. Accumulation of human capital is sine qua non for the improvement and development of any undertaking or economy. The GCMMF is touchy towards CSR. It trusts that innovation and capital are replicable information sources however not the human capital. Since men are the reason for accomplishing the CSR, the GCMMF lays emphasis on their advancement into equipped, affable, valid, solid, responsive communicators and entertainers.
CSR-touchy Business Philosophy
The initial move towards releasing the CSR is the business rationality of the GCMMF. It is two- overlap: one, to serve the premiums of drain makers and second, to give quality items to customers as incentive for cash. Development of an authoritative framework has guaranteed that the corporate social obligation towards the essential drain makers, town and the biological adjust is satisfied. The drain makers are paid for their drain as per advertise powers and acknowledgment of significant worth for their create. Constantly the value paid to the part makers in Gujarat is higher by 15 for every penny than the national normal.
CSR-introduction To Distributors and Retailers
The GCMMF has distinguished the merchants and retailers are its critical connection in its seller inventory network. Through studies the GCMMF found that 90% of the wholesalers don’t get any chance of introduction to most recent administration rehearses. The GCMMF understood that it was a corporate social duty to reinforce the centre business procedures of its wholesalers in order to keep them in standard business and rival those with formal preparing in administration. The GCMMF has created and prepared every one of its wholesalers through Value-Mission-Strategy Workshops, capability building, Amul Yatra, Amul Quality Circle gatherings, computerisation, and electronic trade exercises.
Competency Building Module of the GCMMF is intended to imbue proficient offering aptitudes by making the merchants and their sales people mindful of most recent deals administration apparatuses and systems; improve their insight into items; situating and division procedures for different items. Under Amul Yatra the wholesalers and their sales people are gone up against a visit to Anand. Amid this visit they are demonstrated dairy plants, their upkeep, universal measures of cleanliness and quality; the practices received for clean drain creation, or more all the agreeable logic. Through coordinated chat with the agriculturists, the wholesalers and sales people acknowledge AMUL is a substantial business of little ranchers. The visit leaves an everlasting impact on their brains that by offering AMUL items, they are releasing a social duty towards countless agriculturists whose occupation relies on their expertise and trustworthiness. They feel pleased that they are members being developed of rustic culture and along these lines in country building.
Income Of GCMMF
Supporting its essential individuals – the drain makers – is the principal mission of the GCMMF. Release of this obligation is reflected in the way in which the GCMMF conducts its business and offers its profit. The drain from the town co-agents is acquired at an interval cost. In order to expand the profit of the drain makers the GCMMF changes the item profile amid the monetary and coordinates its deals and showcasing exercises towards those items that would acquire most extreme returns. Genuine! Each business association takes after a similar standard. Yet, the GCMMF tails it with the focal enthusiasm of the makers. Amid the financial, as the GCMMF finds that from its profit it is conceivable to pay more to the makers for drain, the last cost is proclaimed higher than the between time cost being paid. Before the GCMMF shuts its money related records the co-agents are paid value contrast, the sum between the break cost and the last cost. Subsequently benefit of the GCMMF is low. The net benefit (PADT) of the GCMMF amid 2003-04 was Rs 7.31 crore against a turnover of Rs 2,947 crore, a pitiful 0.25%. Farther of the net benefit of Rs 7.31 crore, Rs 4 crore was given as offer profit to the co-agents. To satisfy its corporate social duty towards its drain makers and co-agents the GCMMF deals with razor thin benefits and maintenance of assets.
CSR-situated To Staff
The GCMMF contracts and prepares individuals to exploit over its rivals. It has created in-house modules for preparing and ability working to enhance and up review of their insight; relational abilities to comprehend the client, be receptive to client prerequisites, and impart plainly for investigating of issues. They are required to be gracious, well disposed, deferential, and obliging to the client. To enhance the validity and reliability of the chiefs it is essential they perform reliably and precisely every time and consistently. The structure of compensation and perquisites is out and out various. The above all else the staff must land fulfilment from the position they. They are perceived fortheircommitmentCSR-AMULWAY
MAJOR EVENTS AND TIMELINE
1946 December Under guidance of Morarji Desai and Sardar Patel, Foundation Stone was led as Anand Milk Union Limited (AMUL)
1950 Appointment of Dr.Verghese Kurien to Run the Dairy as Executive Head.
1965 March NDDB was setup to replicate Amul Model in entire nation for “OPERATION FLOOD” or “WHITE REVOLUTION”
1973 June Dr.Verghese Kurien appointed as Chairman of GCMMFL
2009 March Foundation Stone of Paneer Plant laid
2009 Dec National Energy conversation award from Ministry of Power
2010 Oct Inauguration of Cheese Whey Drying Plant
2011 March Foundation Stone of Greenfield Dairy Plant
2012 June Mobile Milk Testing Lab
2012 Nov Foundation Stone of New Cattle Feed Plant
2013 Sept Unveiling of Bust and Memorial of Dr.Verghses Kurien on his first Death Anniversary
2013 Dec Receives CII National Food Safety Award
2016 November Receives APEDA Export Award
2016 July Receives Golden Peacock Eco-Innovation Award
2016 October Inauguration of Milk evapouration plant
Amul plans to enhance its milk processing capacity from the current level of 300 lakh litres per day to 380 lakh litres per day in the next three years.
GCMMF aims to achieve a business turnover of Rs. 50,000 crore and become the largest FMCG organization in India by 2020-21. In the long-term, Amul claims to establish itself as the largest dairy organization in the world, rising up from its current ranking of thirteenth largest dairy organization to number one.
Automated Milk Collection Systems installed at village dairy cooperative societies have now been linked through common online software applications. This helps to further enhance transparency among producer members using digital technology.
Enhancing of milk powder manufacturing capacity with a new factory of 150 MT per day production capacity coming up at Gandhinagar, along with another new milk powder plant at Himmatnagar. It is also putting into effect significant capacity expansions for Chocolates and Paneer.
It has grown from a turnover of Rs.8,000 crore to 23,000 crore just about six years. The target of taking this to Rs.30,000 crore by 2017-18, which means 25% growth in two years, seems achievable.
Using information technology, its common distributor management software application seamlessly integrates all its distributors into their business, enabling them to track and thereby enhance shop-wise sales, across the country. This year, they leveraged heavily on their technological capabilities and data analytics to enhance communication with its channel partners and expand its distribution reach. Product innovation has always been part of their DNA and has inspired them to launch more than 50 new products in the market during the last three years.
Recalling history to unite and inspire people
While forming the co-operative society the major challenges faced by sardar vallabhai Patel was to unite people. Their they asked people that how you fought Britishers for the freedom of life, similarly now you have to tackle this middle man and situation of poverty by uniting and facing together. Hence this lead to a moment also known as WHITE REVOLUTION.
After that also it has continued inspiring people like the Amul and it was also adopted by various other co-operatives such as saris in Rajasthan, Nandini in South
Value for many, value for money the company philosophy is to enhance the economic state of rural population which consists of majority share of the country, keeping in mind to provide the products to the consumers which justify its cost
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