Amul Company Report

8/10/2019 Amul Company Report

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INDEX

Sr.no Contents Page no.

1. Introduction

1.1 The Birth of Amul

2. Industry Profile

2.1 Overview of Milk Industry

2.2 Dairy Enterprise Model

2.3 Competition Analysis

3. Company Profile

3.1 Anand Milk Union

3.2 GCMMF

3.3 VISION & MISSION

3.4 Organizational Structure

4. Product Profile

5. Functional department

5.1 Production and operation department


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5.2 Marketing department

5.3 Finance department

5.4 Human resource department

6. Data Analysis and Interpretation

6.1Consumer Research Data

6.2 Retailers Research Data

7. Research Methodology

7.1 Research Design

7.2 Sampling Technique

7.3 Method of Data Collection

7.4 Limitations

8. Findings

9. Suggestions & Recommendations

10. Bibliography


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EXECUTIVE SUMMARY

AMUL is a co-operative sector. It is the institution of farmers, for the farmers and from the

farmers. The Amul gives pleasure to the farmer to change the own price, which was not possible

in earlier years. This union was born on 14thDecember 1946. The union provides facilities to its

members like more return, satisfactory price, insemination, first aid, group insurance, cattle food

at confessional price etc.

I have done case analysis on HRIS of AMUL and from that I have to know how organization

operates and how the functions have been carried in the organization. From this case I have come

to know how a wide organization like AMUL manages its Human resource.

AMUL dairy has five main departments like finance, personnel, commercial, milk procurement

and production. The finance department does the clerical work and takes care of inflow and

outflows of the cash. The other work of finance department is to audit of annual work.


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INTRODUCTION

The Birth of Amul

It all began when milk became a symbol of protest.. Founded in 1946 to stop the

exploitation by middlemen, Inspired by the freedom movement


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These 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 triggered 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 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. This co-operative, the Kaira

District Co-operative Milk Producers Union Ltd. began with just two village dairy co-operative

societies and 247 liters of milk and is today better known as Amul Dairy. Amul grew from


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strength to strength thanks to the inspired leadership of Tribhuvandas Patel, the founder

Chairman and the committedprofessionalism of Dr Verghese Kurien, who was entrusted the task

of running the dairy from 1950.

The then Prime Minister of India, Lal Bahadur Shastri decided that the same approach should

become the basis of a National Dairy Development policy. He understood that the success of

Amul could be attributed to four important factors.

The farmers owned the dairy, their elected representatives managed the village societies and the

district union, they employed professionals to operate the dairy and manage its business. 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 replicating the Amul model. Dr. Kurien was chosen to head the institution as its

Chairman and asked to replicate this model throughout the country.

ROLE MODEL OF AMUL

Verghese Kurien

BORN - 26 November 1921

(Calicut, Madras Presidency, British India)

DIED - 9 September 2012 (aged 90)

(Nadiad, Gujarat, India)


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NATIONALITY - Indian

OTHER NAMES - Milkman of India

ETHNICITY - Malayali

0CCUPATION - Founder of AMULEx-Chairman GCMMF, NDDB,

Institute of Rural Management Anand

KNOWN FOR - Widely acclaimed as the Father of White Revolution in

India

RELIGION - None ( Atheism )

SPOUSE - MOLLY

CHILDREN - Nirmala Kurien

AWARDS - World Food Prize ( 1989 )

Padma Vibhushan ( 1999 )

Ramon Magsaysay Award


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INDUSTRY PROFILE

INDIA is the 2nd largest in the emerging economies in the world, with a GDP growth rate of~6.5%, 3th largest economy in the world (based on PPP) with a GDP of US $ 4.4Trillion, and

according to BRIC report published by Goldman Sachs, India will be the 2 largest economy after

China by the year 2035.

India, world's largest milk producer, accounting for more than 16% of world's total milk

production, is the world's largest consumer of dairy products. The total amount of milk produced

has tripled from 23 million tonnes back in 1973 to 95 million tonnes in 2008 and expected a

production level of 135 million tonnes by 2015. But the projected demand for milk by 2021-22

estimated at 180 million tonnes which implies that milk production will be doubled.


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Milk production is growing at 3.3% while consumption is growing at 5% leaving a gap between

demand and supply. In order to meet the rapid growing demand and to increase the milk

production, Union Government has started a central scheme National Dairy PlanPhase 1, for a

period of 2011-12 to 2016 17.This scheme will be implemented with a total investment of

about 2242 crore. This scheme main objective is to help provide rural milk producers with

greater access to the organized milk processing sector and thus to bridge the gap between the

demand and supply of milk in the country.

The share of the total milk processing capacity by private sector is 44%of total installed capacity

of 73 MLPD (Million Liters per Day) in the country. Therefore, the total share of the organized

sector, both cooperatives as well as the private sector is barely 12%. What is, therefore,

disquieting is that as much as 88% share of the total milk production is commanded by the

unorganized sector. In order to attract promote Dairy Industry and attract more investment in this

sector, government has also reduced the excise duty of 16% to Zero on Dairy processing

Machineries.

The untapped potential of the dairy sector is immense and opportunity to set up a new dairy

venture is great. And there is vast potential for the export of dairy products, as the cost of milk

production in India being the lowest.

These factors are attracting huge amount of investments in dairy processing, manufacturing dairy

processing equipment, fruit packaging equipment and equipments for biotechnology related

dairy industry.

Four dairy enterprise models

The following section presents analysis and comparisons of four dairy enterprise models in India.

Chosen for the analysis: i) a private dairy operating in Mumbai (NAGORI) ii) The Maharashtra

State Cooperative as an example of a functioning cooperative, iii) the Gujarat Cooperative Milk

Marketing Federation as an example of a strong functioning cooperative and iv) a mutually aided


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cooperative society as an alternative model. Models such as producer companies (emerging as a

new generation cooperative) are still in a developing stage.

Table 8: Model featuresPrivate

dairy

State

cooperativeGCMMF MACS

Number of farmers involved 150 000 224 000 2 700 000

Average liters milk procured per

day

700 000 322 000 60 000

Liters of milk processed at dairy

plant per day

10 200 000

As previously noted, cooperatives have been successful only in some parts of the country. This is

largely because the cooperative law falls under the state policy and is formulated differently in

different states. In states such as Gujarat, where the model succeeds, the cooperative is headed by

elected managers and managed by professionals. In many other states, civil servants manage the

cooperative, which results in a lot of government interference in the day-to-day functioning and


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leads to a lack of democracy and hence no sense of ownership or responsibility at the village

level.

Three key differences distinguish the Gujarat (GCMMF) cooperatives from the other states: i) an

oversight board elected by farmer members; ii) professionals employed by the cooperatives to

manage the cooperatives and iii) the cooperatives have autonomy and freedom in their operating

policies from interference by government and politicians.

Changing from the cooperative model to the society model has many associated bureaucratic

problems. To overcome the hassles, the concept of producer companies was introduced as a way

of transforming cooperatives to work more efficiently as representatives of farmers.

Major Competitors

Amul is a well known brand with a wide product range in FMCG giving a tough competition to

its competitors. The following are the major competitor in some of its product range.


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PORTERS FIVE FORCES MODEL

Before we actually analyze AMUL as a company, industrial analysis is primary requisite.

Therefore, I have used Porters five forces model here.

There are no entry barriers because, all we need is a bunch of high yielding milch

animals, sell the milk, get returns and expand.

Consequently there will be many brands and local players making up the competitive

rivalry.

Bargaining power of customers is high because of various competitors.

Bargaining power of suppliers is low because the suppliers are rural milk producers. Even

if the suppliers are paid rs.200 per kg fat of milk instead of say rs.245 per kg fat of milk.

Threat of substitutes is high because of availability of other products like jams, sauce etc.


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3 cs Model of Amul Company

COMPANY

CUSTOMER

COMPETITOR

COMPANY :

Largest milk brand in Asia. It is no. 1 in Asia and no. 2 in world.

More than 30 dairy brands.

Market leader in Ghee and Butter with 85% market share.

Very strong supply chain.

Enjoys fine reputation. Though the company is grown so big, it never left its key

players- the milk suppliers.

Quality with affordability.

CUSTOMER :

Are extremely satisfied.

Moved from loose milk to packaged milk. Moving consumers from loose milk to

packaged milk and then gradually moved them up the value chain i.e., the tetra

pack.

Being exposed to a brand is natural for a customer to try more products. This is

the umbrella strategy that AMUL follows.

Improved socio-eco conditions of the customers, has changed their lifestyles and

thus the scope for product innovation has increased.


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COMPETITOR:

Amul has to defend against Mahananda, Gokul, Mother dairy, Prabhat, Varna etc.

Aggressive moves against Britannia, Nestle, Mother dairy, and Kwality.

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

Its ability to collect 14 million litres of milk from 3.1 million farmers and convert

it in to Rs. 12 crores worth products and distribute them to 6 lakhs retailers is a

tough job.

Intelligent marketing.


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COMPANY PROFILE

Amul (Anand Milk Union)Formed in 1946, is a dairy cooperative movement in India. It is a brand name managed by an

apex cooperative organization, Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF),

which today is jointly owned by some 2.6 million milk producers in Gujarat, India. It is based in Anand town

of Gujarat and has been a sterling example of a co-operative organization's success in the long

term.

The Amul Pattern

It has established itself as a uniquely appropriate model for rural development. Amul has spurred the White

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

is also the world's biggest vegetarian cheese brand.

GCMMF

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

marketing organization. It is a state level apex body of milk cooperatives in Gujarat which aims to provide

remunerative returns to the farmers and also serve the interest of consumers by providing quality

products which are good value for money.

Amul's product range includes milk powders, milk, butter, ghee, cheese, curd, chocolate, ice cream, cream,

shrikh and, paneer, gulab jamuns, basundi, nutramul brand and others.

Besides India, Amul has entered overseas markets such as Mauritius, UAE, USA, Bangladesh,

Australia, China, Singapore, Hong Kong and a few South African countries. Its bid to enter

Japanese marketing 1994 had not succeeded, but now it has fresh plans of flooding the Japanese markets.

Other potential markets being considered include Sri Lanka.


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GCMMF-An overview

Year of Establishment 1973

Members 17 District Cooperative Milk Producers' Unions

No. of Producer Members 3.23 Million

No. of Village Societies 17,025

Total Milk handling capacity per day 23.2 Million litres per day

Milk Collection (Total - 2013-14) 4.79 billion litres

Milk collection (Daily Average 2013-14) 13.18 million litres

Cattle feed manufacturing Capacity 6190 Mts. per day

Sales Turnover -(2013-14) Rs. 18143 Crores (US $ 3.0 Billion)


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Vision

GCMMF will be an outstanding marketing organization, with specialization in marketing of foodand dairy products both fresh and long life with customer focus and IT integrated. The network

would consist of over 100 offices, 7500 stockiest covering at least every Taluka. Head quarter

servicing nearly 10 lakhs outlets with a turnover of Rs.10, 000 Cr and serving several co-

operatives. GCMMF shall also create markets for its products in neighboring countries.

Mission

We at GCMMF endeavor to satisfy the taste and nutritional requirements of the customer of the

world through excellence in the marketing by our committed team. Through co-operative

networking, we are committed to offering quality product that provides best value for money.

Objectives

The main objective of the Study can be listed as follows

A. Primary Objective

1. To find size of retail network of Amul Taaza and Amul Gold in specific areas of

Vashi city.

2. To find the problems faced by retailers in selling and storing.

3. To collect the information about the competitors.

4. To generate sales


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INTERNAL ORGANISATIONAL STRUCTURE

A systematic & well-defined organizational structure plays a vital role & provides

accurate information to the Top-Level Management.

An organization structure defines a clear cut line of authorites & responsibilities among

the employees of GCMMF.

The organization structure of AMUL is in well-arranged structure.

Chairman

Managing Director

General Manager

Asst. General Manager


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AMUL PLANTS

First plant is at ANAND, which engaged in the manufacturing of milk, butter, ghee, milk

powder, flavored milk & butter milk. It was established in 1973.

Second plant is at MOGAR, which engaged in manufacturing chocolates, Nutramul,

Amul Ganthia and Amul bite. This plant established in 1973. It is situated on Anand

Vadodara Highway No.8.


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Third Plant is at Kanjari, which produces cattle feed.

Old plant established in 1964 and new plant in 1980.

Fourth plant is at Khatraj, which engaged in producing cheese. It is situated between

Nadiad-Ahemdabad.


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PRODUCT PROFILE

Nutritional Information*

Amount per 200 ml

Energy, kcal 26


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Energy from Fat, kcal 9

Total Fat, g 1

Saturated fat, g 0.5

Cholesterol, mg 3

Total Carbohydrate, g 2.3

Added Sugar, g 0

Protein, g 2.1

Calcium, mg 91

Sodium, mg 30

Phosphorous, mg 79

Thiamine, mcg 25

Riboflavin, mcg 73

Niacin, mcg 61

Folic acid, mcg 4.5

Unlike carbonated soft drinks, Amul Masti Spiced Buttermilk is 100% Natural and Sucrose Free

without any color or preservative added. It is a low fat product with lower sodium salt content. It

contains protein with almost 50% lower calorie than soft drinks. The spices and condimentsadded to the product enhance its taste and flavor.

Scientific bacterial culture in Amul Buttermilk improves digestion. It is conventionally packed in

pouches and easily available at Amul Milk outlets spread all over major cities of India.

Buttermilk is traditionally known as "Chhash" (Gujarat & MP), "Mattha" (UP & Delhi), "Tak"

(Maharastra), and Ghol" (Bengal).

Product Application

Take a glass full in early morning in place of Tea; Amul buttermilk will improve the digestive

function. Replace your soup with Amul Buttermilk; it will give you dieting benefits. Take a glass


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The Amul has three plants Known as Amul 1, 2 & 3 all three plant work 24hours a day

continuously. The all manufacturing process is done automatically. The production is done in the

special machines. These machines and the technology are import-id from the TRFTA PEAK

Company. There is also facility of chilling of milk, so that the milk remains usable.

Three plant of AMUL perform different functions:

AMUL1 Presently it is use as a go down for storing raw materials.

AMUL2 In this unit, the production process of Ghee and packing's are running.

AMUL3 This unit is producing AMUL butter, spray power, and flavored milk.

Milk Collection Cycle:

The success of each and every dairy industry is the getting the milk from the farmers and making

that milk in use as soon as possible before that milk get spoiled because the milk is the perishable

product. For the smooth running the business of dairy industry the industry must concentrate on

the milk collection cycle.

Amul dairy is very conscious about the milk collection cycle because the base of the success of

the Amul is milk collection cycle.

Production capacity of Amul:

Butter 50 to 60 Tones.

Powder plant 70 tones.

Powder plant 60 tones.

Flavour milk 40000 bottles.

Amul2 Raw Reception Dock:

Reception dock is the very first department of any dairy where milk is unloaded and

simultaneously tested. Amul-2 has a well designed RMRD, situated in the west wing of dairy.


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Raw milk at Amul- 2 is received mainly through cans. There are 2 reception lines for unloading

milk cans in Amul2.

About 60 % of reception is of buffalo milk and remaining 40% is cow milk.

Butter section:

The utterly Butterly Delicious butter of the Amul is one of the most popular product of Amul

dairy along with the famous butter girl. The butter section is located in Amul-3 which

manufactures Table Butter, white butter and renduced salt butter. The section is completely

computer controlled and is equipped with most modern imported equipments. Butter section very

important as it handles fat, which is the costliest constituent. The cream obtained from processsection is fully utilized for butter making. Amul white and table Butter is exported to USA and

various Middle Eastern countries.

OPERATION:

The cream for manufacturing Butter is receiving from Amul-3 process section while

standardization of milk. In Amul -3 the milk fat will be separated at above 60

Celsius, the centrifugal separators in line with Milk pasteurizer separate this as cream. The cream

thus separated is pasteurized and then pumped to the cream buffer tanks and to cream silo. After

ageing at 8 Celsius for 24 hrs, cream is pumped to cream chilling unit in the butter section. There

the temperature of cream is adjusted to the required churning temperature of continuous Butter

Making Machine.

Packing materials used:

Delocalize market Double laminated is used for export. Tinused for 400g Army pack

Card board box- used for tertiary packing 3ply for 9.1 g weight package 5ply for normal &

export.


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Powder plant:

F-35 plant is situated in Amul -2 near to the railway siding. The plant is a single stage drying

plant having a capacity of 35 TDP. The plant is not in regular use and mainly used for the

manufacturing of cheese whey powder .

F-35 CONDENSING PLANT DETAILS:

Make : SSP ,Faridabad.

Type : Falling film vertical tube type.

No of Pre heater : 5.

No of calendria : 7.

No of vapor separators : 5.

OPERATION DETAIL:

MILK: One of the most versatile food consumed by us. All children start with mothers

milk and continue to use it in one other throughout their life. It is the secretion from the

mammary glands of a lactating mammal. The white fluid, know as milk, is made up of

milk fat and other milk solids.

MANUFACTURING PROCESS FOR MILK :

MILK PROCUREMENT: Total milk procurement by our Member Unions during the

year 2006-07 averaged 67.25lakh kilograms (6.7million kg) per day, representing a

growth of 4.5 per cent over 64.38lakh kilograms (6.4 million kg) per day achieved during

2005-06. The highest procurement as usual was recorded during January 2007 at 84.09

lakh kilograms (8.4million kg) per day. This increase in milk procurement is very

impressive, keeping in mind the massive loss suffered by our farmers due to floods

during the monsoon season, specially in Surat district


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MILK PROCESSING:

Homogenization: Milk must then be homogenized. Without homogenization, themilk fat would separate from the milk and rise to the top. Milk fat is what gives

milk its rich and creamy taste. In this process Milk is transferred to a piece of

equipment called a homogenizer. In this machine the milk fat is forced, under

high pressure through tiny holes.

Pasteurization:Pasteurization is the process that purifies milk and helps is stay

fresher, longer. Milk is pasteurized by heating it to 72C for 16 seconds then

quickly cooling it to 4C. Pasteurization is named after Louis Pasteur, the famous

Scientists.

Adding Vitamins: Before homogenization, vitamin D is added to all milk.

VitaminD combined with the calcium that naturally exists in milk help gives us

strong bones and teeth. Dairies also add Vitamin A to skim, 1% and 2% milk.

Vitamin A is good for our eyesight.

Packaging Milk: Milk is now ready to be packaged. Milk is pumped through

automatic filling machines direct into bags, cartons and jugs. The machines are

carefully sanitized and packages are filled and sealed without human hands.

During the entire time that milk is at the dairy, it is kept at 1 - 2C. This prevents

the development of extra bacteria keeps the milk fresh.

Storing: Milk is delivered to grocery stores, convenience stores and restaurants inrefrigerated trucks that keep milk cooled to 1 - 4C. The stores take their milk

and immediately place it in their refrigerated storage area. Because fresh milk is

so important to our diets, dairies, and our health.


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QUALITY MOVEMENT

Quality Policy: The motivated and devoted work-force of AMUL- are committed to

produce wholesome and safe foods of excellent quality to remain market leader through

deployment of Quality management systems, state-of-art-technology, innovation and eco-

friendly operations to achieve delightment of customers and betterment of milk

producers.

Quality of Life: Assured market for their milk and daily income round the year from

milk has improved the quality of life of farmers. The role village dairy co-operative

societies in the overall development of the villages have brought better social

infrastructures in the villages such as roads, communication system, schools, health

centers, water facilities, banks etc.

MARKETING

Concept: The marketing concept holds the key to achieving its organizational goals

consists of the company being more effective than competitors in creating, delivering and

Communicating customer value to its chosen target markets. Marketing starts with the

Determination of consumer wants and ends with the satisfaction of those wants. The

concept says that any business should be organization around the marketing function,

anticipating and stimulating and meeting customers need.

The marketing concept rests on four pillars and they are:

1. Target market.

2. Customer needs.

3. Integrated marketing.

4. Profitability.


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AMUL has also its own marketing concept. AMUL targets all type of Customers like

babies, children, young customers and old age customers etc. Amul try best for satisfying

needs by providing good quality products.

STRUCTURE OF MARKETING DEPARTMENT

4PS OF MARKETING

Product

Price

Place

Promotion


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PRODUCT

Over the years, Amul has come up with many products. There has been product line extension as

well as product category extensions. The picture below is the snapshot of various SBUs of

Amul.

Using the BCG matrix for product analysis, we can know which of these SBUs is of outmost

importance to the company or the brand Amul.


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Looking above, we may say that Amul needs to perform product innovation if it wants to convert

Amul chocolates, Masti dahi, and Amul lassi to star products. The above matrix also states that

Amul may also choose to disinvesting Nutramul and Amul Shakti.

The following table describes the market share that Amul holds for each product line.

CATEGORY MARKET SHARE MARKET POSITION

Butter 85% 1

Milk Powder 40% 1

Cheese 50% 1

Ice-cream 34.75% 2

Sweets 40% 2

Dahi 65% 1

Milk 67% 1

In ice-cream, HUL is just above the market share i.e. 29.73%, with Mother Dairy in 3rdplace

with 9.66%.

In chocolates, Cadbury has the maximum share of 70% and Nestle has 20% of the market share.

AMUL, being a co-operative union offers a variety of services to the members of village and

district level co-operate societies.

The main services offered by AMUL are

Medical facilities for the Cattle of Farmers :

AMUL provides medical facilities to cattle of farmers at a concessional rate of Rs. 50/-includesmedicines, treatment charge.

Cattle Feeding :


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AMUL provides the Dan to the cattle of member farmers. AMUL produces the by pass

protein Dan and PurkDan to the cattle of farmers at reasonable cost.

Artificial Insemination :

AMUL has established Artificial insemination center at Ode village near Anand.

Free Animal Vaccination :

Often Animals are caught up in unknown disease. To protect animals from such diseases

periodical Vaccination programme are arranged by AMUL.

Scholarships :

AMUL also provides scholarship to children of member of society.

AMUL, does all the above to ensure high yield of milk and thus ensure that there should be

continuously supply.

Amul STP is as follows

Segmentation;

Segmentation is not so easy because of mixed audience and various culinary applications.

Nevertheless, we may do segmentation based on:

Consumer type:

Kids - Amul kool, Amul chocolates, Nutramul, etc.

Womens - Amul Calci+

YouthCheese variants, utterly delicious pizza, etc.

Calorie consciousAmul lite, Amul lite slim and trim milk, etc.


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Targeting

After segmentation, one has to decide where to find market segment and what should be the size

of segment. Example, Amul has identified youth as one of his potential segment. Now it has to

decide where to find youth who will actually go get their product and the number of youth that

the company, i.e., Amul requires.

Therefore, Amul has come up with ice-cream parlours for this reason.

Positioning

A mass market player, no premium offerings.

USPQuality with affordability.

Amul as taste of India creates a value for everyone in the value chain, both customers and

farmers.

New offerings for health conscious and vibrant India in the form of Probiotic wellness Lassi, Ice-

cream, and sugar free delights for the diabetic patients and Amul kool caf for the youth of

today.

PRICE

The prices of products of Amul are also decided by the GCMMF. The GCMMF conducts the

market survey to check the validity and feasibility of prices in the market and accordingly

decides the prices of Amul products.

The price of the products of Amul are also decided by the GCMMF .The GCMMF conducts the

market survey to check the validity and feasibility of prices in the market and accordingly

decides the price of Amul products . However, the price is inclusive of several elements like:

Cost of milk.

Labour cost.

Processing cost.


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Packaging cost.

Advertising cost.

Transportation cost.

Sales promotion cost.

Taxes etc.

The GCMMF considers all this cost. Aspects and set them up in pricing

structure to decide the selling price of milk and milk products.

PLACE

Place refers to marketing activities that make products available to consumers at the right time

in a convenient location. Place refers as distribution Channels .IT is the process of moving

products from the producer the consumer.

Amul has developed federation and Amul parlors located in several parts of country. Amul

have managed to create more than 2300. Amul have identified certain potential locations such as

Railway, Airports, universities, and shopping malls. The GCMMF handles the workers relating

to Managing of stocks and distributors to in the country.

PROMOTION

One of the most conservative FMCG entitiesGCMMFspends a mere 1% of its turnover on

promotion. Amul has rewritten the rules of the game. Amul butter girl is one of the longest run

ad campaigns in the country for more then 43 years!!!

The reason Amul topical are so successful because, it doesnt plead the customer to go and buy

Amul instantly. Instead Amul captures latest news headlines and showcases them in such a way

that the moment we see it, we register it in our brains.

The basic aim here is to make butter synonymous to Amul. Next time we to buy butter, the first

brand that will come to our mind is Amul. Amul uses rotational promotional strategy to be in

touch with the customers/consumers throughout. After every 3-4 years, Amul comes up with

something new and a promotional campaign for the same is placed.


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AMUL promotional strategies are

MARKETING THE KIOSK WAY

A massive KIOSK activity was carried out across zone 3 from the period of 4weeks. The activity

includes selling and promotion of Amul Spiced Buttermilk at special offer.

The offer was buy 2 pouch of Amul Spiced Buttermilk (Rs 5/pouch) and get 1 free, Buy 5 pouchand get 2 pouches free followed by buy 7 pouch and get 3 pouches free.

The activity was carried across different distributors and retailers point. The activity resulted into

massive boost in sales in that particular region. Within the period of 15th may to 29th may

around 35 crates were sold.


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FINANCIAL DEPARTMENT

INTRODUCTION:

AMUL is Asias no. 1 and worlds second number co-operative dairy. It has large market and

dairy network in every state of India and across the India, like central Asian countries,

Bangladesh, Thailand, Indonesia, Malaysia, Singapore, etc. It was started with 250 liters of milk

and 2 societies and now, it produces 10 lakhs litters milk per day and has 1113 societies and

more than 6 lakes farmer members. It produces milk and milk products. The main motto of

AMUL is to help farmers. Farmers were the foundation stone of AMUL. The system works only

for farmers and for consumers, not for profit. The main aim of AMUL is to provide quality

products to the consumers at minimum cost. The goal of AMUL is to provide maximum profit in

terms of money to the farmers.Vision of AMUL is to provide and vanish the problems of

farmers (milk producers). The AMUL apparition was to run the organization with the co-

operation of four main parties, the farmers, the representatives, the marketers, and theconsumers.

Year Milk procured (in kgs) Sales turnover (Rs. In lack)

2000-01 277840861 50919

2001-02 258692443 46878

2002-03 257957726 48834

2003-04 255856435 54593

2004-05 276150374 60047

2005-06 297436246 70922

2006-07 324410536 81632

2007-08 401718616 107712

2008-09 468587136 137807

2009-10 498033310 169989

2010-11 515900000 211140


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OBJECTIVES

The management of finance of business / organization is to achieve financial objective they are

like :-

To ensure that the financial discipline is maintained in the divisions.

To ensure that all expenditure is incurred with due regard to principles of financial

property.

To generate cash

To know the market position

To provide a return on investment keeping

Finance department is concerned with procurement and use of funds. It main aim is to use

business funds in such a way that the earning are maximized.

FUCTIONS OF FINANCE MANAGEMENT

To give financial concurrence as per delegation of power for each proposal involving :-

Capital & Revenue expenditure

Purchase of material/ stores/ tools and other services.

Manpower requirement

Project report

Finance planning

Decision making in finance


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ROLES AND RESPONSIBILITIES OF A FINANCE MANAGER IN A

COMPANY

Senior leader of an organization are responsible for all aspects of its financial health. Managers

are charged with understanding the units financial situation and not allowing unintended deficits

to occur.

Finance managers remain accountable for the resources entrusted them, including funding,

facilities and staffing, even if they have delegated budget and accounting responsibilities to their

staff.

His roles and responsibility include making decisions related to :-

1. Working capital and cash management decision.

2. Investment decision

3. Portfolio management

4. Risk management

5. Budgeting

6. Inventory management

7. Decision making


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A finance manager also acts as a mediator, well-wisher, leader etc. finance manager also control

the cost of funds has to achieve the organizational goals. These are the certain rules and

responsibility of a good finance manager.

STRUCTURE OF FINANCE DEPARTMENT:-

FINANCE

MANAGER

TREASURERCAPITAL

EXPENDITURE

ACCOUNT

MANAGER

COST

ACCOUNT

MATERIAL

ACCOUNT


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HORIZONTAL ANALYSIS:

Gross Profit 16342.74 14314.02 2028.72 14.173

PBDIT 4327.00 3350.05 976.95 29.162

less: Depreciation 1614.63 1121.41 493.22 43.982

EBIT 2712.37 2228.64 483.73 21.705

less: Interest 1569.38 1252.58 316.8 25.292

EBT 1142.99 976.06 166.93 17.102

less: Tax Provision 212.78 255.00 -42.22 -16.557

PAT 930.21 721.06 209.15 29.006

Net Profit 926.67 735.75 190.92 25.949

Shareholders' Funds: 6826.57 5756.61 1069.96 18.587

Loan F unds: 21227.56 19111.57 2115.99 11.072

FIXED ASSETS (Net Block) 15270.87 14046.24 1224.63 8.719

Investments 1040.58 515.33 525.25 101.925

Cur rent Assets, Loan & Advances: 37290.61 40524.27 -3233.66 -7.980

Curr ent L iabilities & Provisions 27362.69 30422.64 -3059.95 -10.058

Net Current Assets 9927.92 10101.63 -173.71 -1.720

Interpretation:

Tax provision is lower by 16.56% thus improving PAT growth to 29.01% as against

PBT growth.

Investment grew by 101.92%.


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HUMAN RESOURCE MANAGEMENT

Introduction: According to SCOOT CLOTHIER AND SPRIGGEL Human resource

management as the branch of management which is responsible on a staff basis for

concentrating on those aspects of relationship of management to employees and

employees to employees and with the development of the individual and the group. The

objective is to attain maximum individual between employer and employees and effective

moulding of human resources as contrasted with physical resources.

Personal (Human resource) management plays a very important role for any organization.

The firm having all types of resources like machines, materials, money, information etc.

will not be Success in business without effective manpower. Human capital is the greatest

assets of business enterprise and manpower management is the most important and

crucial job because the managing group is the heart of the company.

Human resource department plays most important role in establishing good relation and

harmony among all.

MAJOR FUNCTION OF HUMAN RESOURCE

DEPATMENT:

1. RECRUITMENT AND SELECTION.

2. TRAINING AND DEVLOPMEN.

3. PERFORMANCE APPRAISAL.

4. SALARY AND WAGE ADMINISTION.

5. EMPLOYEE TURNOVER.

6. COMPENSATION.

7. INDUSTRIAL RELATION.

8. FACTORE ACT.


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9. INDUSTRIAL DISPUTE ACT.

10. HUMAN RESOURCE INFORMATION SYSTEM.

RECRUITMENT AND SELECTION

There are two types of Recruitment sources followed by Amul:

EXTERNAL SOURCES.

INTERNAL SOURCES.

INTERNAL SOURCES: Internal sources include personnel already on the payroll of theorganization.

1. Present Permanent Employees.

2. Employee Referrals.

3. Former Employee

EXTERNAL SOURCES: These sources lie outside the organization. In AMUL they

consider following sources of recruitment.

1. Campus Interview

2. Unsolicited Application.

3. Application Blank.

4. Placement Agencies.

RECRUTMENT POLICY OF AMUL:

Entry level qualification:

Below officers cadres:

1. S.S.C / H.S.C Attendant OperatorDairy (AOD)G Gr.Worker.

Taken as apprentice under trade apprentice Act 1961 2/3 yrs.

Apprenticeship, then based on their appraisal report, selected as temporary worker. After

total 5yrs of work, may be selected as G-Grade worker.


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2. Professional Qualification E/F Grade Worker (Boiler Attendant).

3. BA / B.COM / M.COM / M.A (general) MSW /MRM /MRS M.E_Biz of

Gujarat vidyapeeth and C Grade Worker similar NonUniversity Institutions.

3. B.Sc / M.Sc / Diploma Engineers B Grade workers. Apprenticeship Lab assistant for 1yr

3 months for B.SC & M.SC; 1yr for Diploma Eng. Then 2/3 yrs as trainee technician,

than based on appraisal Appointed as Technician B Grade.

SELECTION:

Selection procedure is concerned with securing relevant information about the applicant. The

main objective of selection process is to determine whether an applicant meets the qualification

for a specific job and choose the application that is most likely to perform well in the job.

THE SELECTION PROCESS IN AMUL IS AS UNDER

Approval from M.D

Advertisement

Collection of application

Securitize the application

Interview

Medical checkups

Selection


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After selection, the employees generally have probation period. In AMUL probation

period is different for different type of employees.

Probation period for officers is 12 months, 6 months for clerical employees and 3month

for workers.

TRAINING AND DEVELOPMENT

Training is the process where the work related knowledge, skills and attitude are given to new

employees. By which they aware the policies rules and increase technical and manual efficiency

and create of responsibility.

AMUL has accepted four methods for the training:

1. On the job method.

2. Off the job method.

3. In house training.

4. Out house training.

TRAINING PROCEDURE IN AMUL:

Identification of need of Training

Module Preparation

Selection of Employee for the Training

Training

Feedback


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PERFORMANCE APPRAISAL:

Performance appraisal is the process of evaluating the performance and qualification of

employees in terms of the requirement of the jobs for which they are employed. It is

highly useful in making decision regarding the promotion, transfer, wage and salary

administration etc.

The AMUL adopts the following appraisal system Final confirmation with the

recommendation by the divisional heads comes from the MD on annual basis. His work

is evaluated by Check list Method of Performance Appraisal. These are a various method

used to appraise the performance of an employee.

In Amul the following methods are used:

1. Self appraisal: If individuals understand the objectives they are expected to achieve the

standards by which they are to be evaluated they are to a great extent in the best position

to appraise their own performance. In this method employee himself.

2. Managers Appraisal: The general practice is superiors appraise the performance of

their subordinate. Other supervisors, who have close contact with employees work may

also appraise with a view to provide additional information.

3. Wages and Salary: It is a common method is followed for the wage and salary

administration according to Muster roll . Timekeeper sends that muster roll to the

account department for attendance of each and every employee. This will analyze and

entered in the computer. After this salary is calculated for each employee through

computer according to that they prepare salary sleep of employees.


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TOTAL QUALITY MANAGEMENT

In 1994 AMUL had embarked on the Total Quality Management and in 1999 received

the Rajiv Gandhi National Quality Award for the year 1999, Indias premier recognition

for quality. Continuing to learn their employees have consistently striven to maintain

improved product and service quality at each stage of the value chain.

More than 25000 Kaizens small improvements in work areas-were made by employees

in different areas like cost cutting, time saving and process improvement. To ensure

minimum wastage and maximum productivity and quality, house keeping initiatives have

been zealously pursued at the Federation offices, Warehouses and Distributor points.

Learning from employing Total Quality Management principles have been cascaded to

both the member dairies as well as distribution channel members. Workshops on

Statistical Quality Control have been conducted across the member dairies to achieve

total quality in the production process.

On of AMULs most remarkable achievements has been creation of more than

225Quality Circles across the length and breadth of the country. The federations

wholesale dealers meet every month in these quality circles and discuss and resolve

distribution problems and improve their distribution process.

Amul continues its commitment on improving the competency of its professional

managers through its Competency Based Training Programs which builds both generic

and functional skills through in-house, customized training programs.


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InterpretationAccording to the survey total sample size of 100 includes 43 male respondents

and 57 female respondents. This show female population plays greater role in purchase decision.

Q.2 What would you prefer?

Sr. No. PREFERENCE NO. OF RESPONDENTS

1 Homemade Buttermilk 68

2 Packaged Buttermilk 32

TOTAL 100

InterpretationAccording to the survey, consumer perception about the Buttermilk is narrow as

majority of them would prefer homemade buttermilk (68%) rather than going for packaged

buttermilk (32%).

This perception of consumer can be changed over a period of time with the help of sale

promotion activity which will make them induce TRAIL.


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Q.4Have you ever tried Amul Buttermilk (Chaas)? If yes than are you continue using it on

dayto - day basis?

Sr. No.

RESPONSE

NO. OF

RESPONDENTS

CONTINUOS

USAGE

1 Yes 81 52

2 No 19 48

TOTAL 100 100

InterpretationAccording to the survey, Majority of the population had tried Buttermilk in past

and out of the majority there are many potential prospect who are still a regular users who can

become future sales.

For this there is a need of creating more and more awareness about the Amul Buttermilk.


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Sr. No. BRANDS % OF RESPONDENTS

1 Danone 28%

2 Amul 90%

3 Gokul 24%

4 Aarey Buttermilk (Aarey

center) 48%

5 Britannia 13%

Q.5 Which of the following brands of buttermilk have you heard of? (Select all that

apply.)

Interpretation - According to the survey, the brand awareness of Amul Buttermilk is highest

among the competitors in the market. This is plus point for the brand as other brands from same

parent Co. (GCMMF) gives Amul Buttermilk more visibility and exposure.

Co. should use this opportunity by giving free samples of Amul Buttermilk (200ml) with other

products.

Q.6 Reason for discontinuing the Consumption of Amul Buttermilk

(Select all that apply)


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Sr. No. REASONS % OF RESPONDENTS

1 Taste 58%

2 Price 13%

3 Quality 64%

4 Availability 48%

5 Other reason

(please specify) 23%

Interpretation According to the survey carried on to 100 sample shows that the reason for

discontinuing the consumption of Amul Buttermilk is QUALITY and TASTE of the Product.

Most of the people didnt like the taste, with that in mind they thought the reason for bad taste is

because of poor quality of milk substance. Also the availability of the product is not there

@Distributor or Retailer point.

Co. should tackle it by improvising on the taste and quality of product. Add new flavors to the

category and make sure the delivery to the retailers/distributors point is on time and in sufficient

capacity to meet the requirements of that particular zone.

Q.8 Will you consume buttermilk in seasons other thansummer?


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Sr. No. RESPONSE NO. OF RESPONDENTS

1 YES 57

2 NO 43

TOTAL 100

Interpretation According to the survey, we come to know about the consumption pattern of

consumer. Around 59% of the sample will like to consume Buttermilk other than summer

season.

But almost half of the sample size will stick to summer as their preferable season for

consumption. The above response shows that Buttermilk as a product is seasonal in nature and

max sales will happen only in summer.

Q.9 What would you prefer?

Carbonated Soft drinks500ml for Rs 35

Sr.

No. PREFERENCE

NO. OF

RESPONDENTS

1 Carbonated Soft drinks500ml for Rs 35 21

2 Amul Buttermilk500 ml for Rs 10 79

TOTAL 100

Amul Buttermilk500 ml for Rs 10


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InterpretationAccording to the survey conveyed on sample of 100 people shows that consumer

will prefer Amul Buttermilk over Carbonated Soft drinks when given chance to choose between

two. This shows that consumer is very cautious related to the health factor.

So company can take advantage of this scenario and convey message showing benefit of

choosing Amul Buttermilk over Carbonated Soft drinks.

Q.10 If Amul Buttermilk is available in new Jeera (Cumin Seed) flavor would you like to

try it?


1 YES 81

2 NO 19

TOTAL 100

Interpretation According to the survey, it shows that people are looking forward for new

variants of Amul Buttermilk.

Co. should definitely come up with new variants and flavors.

Q.11 How much the following attributes matters you while purchasing Packet Buttermilk?

Justify your attribute by rating it.


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Q.1. Do you have cooling facility in your store?

Yes No


1 YES 68%

2 NO 29%

TOTAL 100%

InterpretationAccording to the survey around 70% of the retailers have cold facility whereas

30 % dont have any support of cold storage.

So for a Retailer to keep dairy product (such as Buttermilk) it is must to have cold storage.

So for this reason my 30% of the total population is not tapped because of absence cold storage

facility.


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Q.3 Which Brand of Buttermilk does you keeps?

Sr. No.

BRANDS

NO. OF RESPONDENTS (out of

40)

1 Danone 4

2 Amul 11

3 Gokul 8

4 Aarey Buttermilk (Aarey

center) 14

5 Britannia 1

6 Others 2

TOTAL 40

InterpretationAccording to survey most of the retailers keep Aarey Co. Buttermilk, after that

Amul ranks 2ndin the race.

When reason asked most of the retailers said they get good margin on Aarey product and they

get lowest margin on Amul products.

Also consumer are more familiar with Aarey products , most of the retailers said.

Q.4 Any problem related to the product (Amul Buttermilk)? If yes please specify.


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Sr. No.

RESPONSE

NO. OF RESPONDENTS (11 out

of 40)

1 YES 9

2 NO 2

TOTAL 11

Interpretation - Most of the retailers have problem with Amul Buttermilk, which is not good for

the brand like Amul.

The problems were as follows:-

Margin related Problems

Replacement of damaged products

Dumping of old batch production, of which the expiry date is near.

Late delivery

Q.5 Which variants of Amul Buttermilk if more economical for you? Please specify the

reason.

200ml - Pouch packSpiced Buttermilk

500ml - Pouch packPlain Buttermilk

InterpretationAccording to the survey, majority of the retailers across zone 3 prefer keeping

200mlSpiced buttermilk as compared to 500ml - plain buttermilk.

Reason given:-


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200mlSpiced Buttermilk

Size of the product It is easy to hold and store, save space.

Margin The margin on this product is 0.50 paise/pouch and which

sells out very fast.

Which is good as compared to 500 ml pack which has 0.85

paise/pouch margin?

Easy to Display It is easy to display the product as a sample.

Most frequently asked This variant of Amul Buttermilk is most frequently asked

by the customer as it is ready to serve drink.

RESEARCH METHODOLOGY

Research methodology is the way to systematically solve the problem. In it we study the various

steps that are generally adopted by a researcher in studying his research problem along with thelogic behind them. Thus, When we talk about research methodology we not only talk of the

research methods but also consider the logic behind the methods we used in the context of our

research study and explain why we are using a particular method or technique and why we are

not using others so that research results are capable of being evaluated either by the researcher

himself or by others.

RESEARCH DESIGN

A sample size of 100 consumers and 40 retailers was taken into consideration..

The survey was conducted in the area MumbaiZone 3 (includes Vile parle to Mahim)


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Sampling techniques

A quota sampling technique was adopted because the sample audience was made out of potential

purchasers of the product. The sample was carefully drafted. A lot of care was taken when

designing the questionnaire and also when collecting information

Primary data

The primary data consists of information obtained from the retailers, distributors and through

consumer interaction.

Secondary data

The secondary data is obtained from the information already published in research articles ,

books and newspaper. The websites like Amul.Com ,Scribd. Com , Wikipedia , PTI , etc were

also useful.

Methods of Data Collection

The source of the data collected for the research is both primary data and secondary data

Primary Data

By Observation Method

By Personal Interviews: The data was also collected by pitching consumers at retailers and

distributors place across Zone 3. Each consumer was asked questions with the help of tool

(questioner). Though the Questioner was close-ended but it made consumers think for a while

when responding.

When it comes to retailers the data was collected by visiting the Retail outlets across Zone 3 by

seeing the displayed Amul products in that stores.


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The data was collected on the following parametrs:

Price (Margins).

Visibility.

Shelf Life.

Discounts Offered.

Limitations

The research was carried out for 2 months which proved to the insufficient to tap the accuracy of

the study.

Time factor has been a very big limitation in the research survey like this

Restriction w.r.t location on study. We cannot expand our research to other geographical

location.


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SWOT Analysis

STRENGTH :

Largest food brand in India and Asia.

High quality, low price.

Most well known brand in terms of milk and fresh product division.

WEAKNESS:

Strong dependency on weak infrastructure.

Complex supply chain.

Short life of product.

Alliance with third party.


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OPPORTUNITIES :

Penetrate on international market.

People in India mainly trust AMUL for their good and better quality this creates a

good brand image and goodwill into the minds of the peoples.

Use internet to sell its product.

Diversify product portfolio to enter new product categories.

THREATS :

Various competitors such as; Gokul, Mahanada, Mother dairy, Prabhat etc. Gokul

milk is nowadays the main threat to AMUL milk.

Competition from MNCs in butter.

Ban on export of milk powder.

Price rise of milk.


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MCKINSEYS 7S FRAMEWORK

The figure on the previous page illustrates the multiplicity interconnection between the elements

that define the organizations ability to change. The theory helped the managers to think about

how companies could be improved. It says that it is not just a matter of devising a new strategy

and following it through nor is it matter to setting up new system & letting them generate

improvements. The 7s model is an anthropological way to understand the culture. The model

shows that corporate success requires the development of both hard Ss (Strategy, System, &

Structure) and soft Ss (Skill, Staff, Shared value, & Style of leadership).

It helps the leader as a

1. Mental model to understand culture

2. Guide for change in management strategy

3. Tool to design initiative holistically

4. Reminder of hard & soft assets to integrate align & measure.


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The 7ss are

a) StructureStrategyThe route that the organization has chosen for its future

growth, a plan an organization formulates to gain sustainable competing

advantages.

b) System- The formal & informal procedure including Innovation system, Quality

control system, management information system, capital acceleration system, that

govern everyday activities.

c) Style- The leadership approach of the top management and the organizations

overall approach. Also the way in which the organizations employees present

themselves to the outside world, to supplier & customer.d) StaffThe organizations human resources refers to how people are developed,

trained, socialized, integrated, motivated & how their carrier are managed.

e) Skill- what the company does best, the distinctive capabilities & competencies

that reside in the organization.

f) Shared value- originally called super ordinate goals, the guiding concept, &

principles of the organizations value & aspiration often unwritten that go beyond

the conventional statement of the corporate objectives, the fundamental ideas

around which a business built; the things that influence group to work together for

a common aim.


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FINDINGS

1.With respect to the above study and the findings thereby, the product (Amul Buttermilk) is

working on regional pattern i.e. Amul Buttermilk Sales is highest in Vile Parle and Sanatacruz

where as in Mahim it is very low.

2. The awareness of the product is very low amongst consumers.

3. Amul Buttermilk as a Product is somewhat seasonal in nature. In summers the sales are at

peak.

4. There were about 4 out of 10 local unorganized Buttermilk sellers who were selling buttermilk

in plain glass bottle with no brand name.

5. Study shows that Aarey Buttermilk is the biggest competitor for Amul Buttermilk, where as

Danone is also few steps behind in the race and Gokul has gained competitive position as well.

6. According to the survey it is founded that, Aarey Co. pays highest markup.

7. According to Survey, Aarey co. has best after sales service (like return of defective pouch,

customer grievances) followed by Amul and Gokul.

8. Majority of the dealers are not satisfied with the profit margin of Amul.

9. Sales promotion scheme had boosted the sales of Amul Buttermilk in certain region.


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SUGGESTIONS & RECOMANDETION

Company should improve its sales and distribution in order to tackle the problem related to latedelivery.

Company should distribute free samples more often for making brand popular among people.

Company should introduce new variants and flavors.

Distributors and Retailers desire more advertisement to be done through local newspaper and

cable TV ads. To make consumers aware about the product.

Company should increase the margins of retailers.

Company should target middle class or semi-middle class customers. Also target according to

the cultural group.


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BIBLOGRAPHY

www.Amul.com/home/product/63chbjduij/jv

www.mma.com/ysis

www.Notca.com/researchdata/ydncid/$hd/km

www.economictimes.com/archives/13/sjdjdamul?
http://www.amul.com/home/product/63chbjduij/jvhttp://www.amul.com/home/product/63chbjduij/jvhttp://www.mma.com/ysishttp://www.mma.com/ysishttp://www.notca.com/researchdata/ydncid/$hd/kmhttp://www.notca.com/researchdata/ydncid/$hd/kmhttp://www.economictimes.com/archives/13/sjdjdamulhttp://www.economictimes.com/archives/13/sjdjdamulhttp://www.notca.com/researchdata/ydncid/$hd/kmhttp://www.mma.com/ysishttp://www.amul.com/home/product/63chbjduij/jv

Amul Company Report

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