Amul final

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Transcript of Amul final

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TABLE OF CONTENTS

     

Sr. No.

Topic Pg. No.

1 INTRODUCTION 2

2 AMUL: AN INTRODUCTION 4

3 SITUATION ANALYSIS 6

4 STRATEGIC ANALYSIS 10

5 AMUL SCOOPING PARLORS 18

6 A QUESTIONNARE: REVIEW OF ICE-CREAM PARLORS

20

7 BIBLIOGRAPHY 23

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1. INTRODUCTION

Retail Sector is the most booming sector in the Indian economy. Some of the

biggest players of the world are going to enter the industry soon. It is on the threshold of

bringing the next big revolution after the IT sector. Although organized retail market is

not so strong as of now, it is expected to grow manifolds by the year 2010. The sector

contributes 10% of the GDP, and is estimated to show 20% annual growth rate by the end

of the decade as against the current growth rate of 8.5%. A CRISIL report says that the

Indian retail market is the most fragmented in the world and that only 2% of the entire

retailing business is in the organized sector. This suggests that the potential for growth is

immense. There are about 300 new malls, 1500 supermarkets and 325 departmental

stores currently being built in the cities across India.

The retail sector would generate employment for more than 2.5 million people by the

year 2010, predicts an analysis.

Some of the players present in the industry:

Archies, Bata India Ltd, Big Bazaar, Crossword, Ebony Retail Holdings Ltd., Fabmall,

Food Bazaar, Globus Stores Pvt. Ltd., Health and Glow, Liberty Shoes Ltd., MTR Foods

Ltd., Music World Entertainment Ltd., Pantaloon Retail India Ltd., Shoppers Stop, Style

SPA Furniture Ltd, Subhiksha, Titan Industries, Lifestyle, etc.

New entrants entering the market soon will be Reliance Retail Ltd, Wal-Mart Stores,

Carrefour, Tesco, Boots Group, etc.

Evolution of the Sector

1. Weekly Markets, Village and Rural Melas

Source of entertainment

Rural and historic reach

2. Convenience stores, Mom-and-pop / Kirana shops

Neighborhood stores/convenience

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3. Traditional and pervasive reach Government supported

Availability/low costs/distribution

4. Exclusive Brand outlets,

Hypermarkets, Supermarkets, Department stores and Shopping malls

Shopping experience/ efficiency

Modern formats/ international

5. Modern Format retailers

Supermarkets

Hypermarkets

Department Stores

Specialty Chains

Company Owned Company Operated

6. Traditional Format Retailers

Kiranas: Traditional Mom and Pop Stores

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2. AMUL: AN INTRODUCTION

WHERE AMUL STANDS IN MARKET?

Amul, the most famous Indian brand of milk and milk-based products, owned by Gujarat

Co-operative Milk Marketing Federation (GCMMF), which achieved an annual turnover

of Rs 6,711 crore in 2008-09, has now become the largest retailer of processed food

products in the country.

While, Amul products are currently available to consumers across India through a

network of more than two million retail outlets, Amul has also begun to expand its

network of its exclusive retail outlets popularly known as Amul parlours (”Amul Utterly

Delicious”). The concept of exclusive retail parlors developed in 2002 has now gained

momentum with the approvals number crossing 4500 outlets. These parlors, located in

various towns and cities across the country, are mostly owned by franchisees, though

some of them are still operated by the company.

The large part of the credit for creation of over 2,000 parlors during the current year has

been given by the company to its channel partners (wholesale distributors) who embraced

the concept by not only by starting their own parlors, but also motivated franchises to set

up new parlors, that apart from generating business are also creating employment.

Apart from garnering sales turnover of over Rs. 200 crore during the current year,

the parlors have also become an effective platform for introducing all the innovative

products of the company.

Amul has also opened food stalls across major railway stations of the country to cater to

the demand for quality food of travellers and commuters across the country. While 50

such parlors/stalls have already been set up, 300 more stalls/parlors are being set up in

the coming year with the support from IRCTC.

Amul has also begun setting up ice-cream scooping parlors.These have turned out to

be another blockbuster for the company. Plans are afoot to set up 200 such parlors during

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the year. Taking cue from the success of parlors and commitment of its sales team and

channel partners Amul is planning to take the total tally of Amul parlors to 10,000 by

adding 6000 parlors during the current financial year (2009-10).

ISSUES

• Create awareness about Amul retail parlors

• Need to attract more people for franchising.

• Awareness in minds of customers that such scooping parlors exist

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3. SITUATION ANALYSIS

SWOT

PORTERS

BCG ANALYSIS

SWOT ANALYSIS:

STRENGTHS

Wide range of products

Affordable price

Effective ad campaign

Distribution network

Diversification

Brand image

WEAKNESSESS AND THREATS

Every entity in the world will have its weaknesses and will face some or the other

threat. The Following are the weaknesses and threats associated with Amul brand:

Less control over milch yield

Cannot accommodate transport delays (perishables)

Dependence on poor infrastructure for supply (roads, electricity etc)

Increasing population , increasing requirement

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Adulteration

Saturation point not far away

OPPORTUNITY

Export segment good market

Expansion in retailing

Packaged sweets market

Sports drink new market

E-competency for scm

PORTER’S FIVE FORCE:

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

requisite. We have used Porter’s 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 milk suppliers are paid Rs. 200 per kg fat of milk instead of

say Rs. 245 per kg fat of milk, they would want to bargain much on this.

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

sauce etc.

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BCG MATRIX:

Looking at the matrix above, we may say that Amul needs to perform product innovation

if it wants to convert Amul chocolates, masti dahi , Amul mithai mate, Amul lassi to star

products. The above matrix also indicates that, Amul may also choose to disinvest in

NutrAmul and Amul shakti.

WHERE ARE WE NOW?

Amul has good brand image. Most SBU’s are doing well. Currently majority of retailing

done thru retailers. For the farmers Amul acts as a stem of support .For customers Amul

adds value for their money. Largest milk brand in asia. Marketing more than 30

different brands of dairy products like cheese, ice-cream, condensed milk, ready- to-eat

pizza, beverages etc. Amul is the market leader in ghee and butter.Amul kool and kool

café doing well.

Current tie-up for retailing

Reliance fresh

Big bazzar

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WHERE WE WANT TO BE?

To reach out its customer more directly & let them have the total brand experience.

OBJECTIVES

Increase the market share of ice creams.

Overall expansion of the market.

Increase the no of franchisee.

Open ten thousands retail outlets by the end of this year.

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4. STRATEGIC ANALYSIS

AMUL STP ANALYSIS

SEGMENTATION

Consumer type:

For kids- Amul kool, Amul chocolates, nutrAmul, etc

For women-Amul calci +

For youth-utterly delicious pizza, cheese variants etc

For the calorie conciuos-Amul lite, Amul lite slim trim milk etc

For health conscious-nutrAmul, Amul shakti etc.

Industry type:

Milk- ice cream manufacturer, restaurants, coffee shops etc

Butter/cheese/ghee-bakery, pizza retailers, snack retailers

TARGETING

• Identified youth as potential segment

• Decide where to find youth as one of the potential segemnt who wil actually go

and get the product

• Require parlors for the same

POSITIONING

• A mass market player, no premium offerings

• Usp – Quality With Affordability

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• “Amul” as “Taste of India” - creating 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

• Ice-cream, sugar free delights - diabetic patients Amul kool - the youth of today.

PROMOTIONAL ACTIVITIES

A successful product or service means nothing unless the benefit of such a service can be

communicated clearly to the target market. An organisations promotional strategy can

consist of:

Advertising: Is any non personal paid form of communication using any form of mass

media?

Public relations: Involves developing positive relationships with the organisation media

public. The art of good public relations is not only to obtain favorable publicity within

the media, but it is also involves being able to handle successfully negative attention.

Sales promotion: Commonly used to obtain an increase in sales short term. Could

involve using money off coupons or special offers.

Promotion BudgetCOST SHEET

** SCHEDULE ‘A’

PARTICULARS Rate Total CostMascot (Mooh) 100/day 10,000Television Advertisements 90,000Radio Jingles 6,045.45Banners and Hoardings 58,000Print Advertisements (Newspapers) 60,000Print Advertisements(Magazines) 45,500World Cup Promotional Activity -NilPayment to brand ambassador 3,50,000

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Fig: Above A Pull Strategy (Left) Push Strategy (Right).

Communication by the manufacturer is not only directed towards consumers to create

demand.

A push strategy is where the manufacturer concentrates some of their marketing effort on

promoting their product to retailers to convince them to stock the product. A combination

of promotional mix strategies are used at this stage aimed at the retailer including

personal selling, and direct mail. The product is pushed onto the retailer, hence the name.

A pull strategy is based around the manufacturer promoting their product amongst the

target market to create demand. Consumers pull the product through the distribution

channel forcing the wholesaler and retailer to stock it, hence the name pull strategy.

Organisations tend to use both push and pull strategies to create demand from retailers

and consumers.

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ADVERTISING:-

An Amul butter ad on Pakistan's Kargil War fiasco. The image shows the "Amul baby" in

between George Fernandes and Vajpayee.

Its advertising has also started using tongue-in-cheek sketches starring the Amul baby

commenting jovially on the latest news or current events. The pun in her words has been

popular.

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

Guinness records for being the longest running ad campaign ever. Sylvester daCunha,

was the managing director of the advertising agency, ASP, that created the campaign in

1967 whose charm has endured fickle public opinion, gimmickry and all else.

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BANNERS:-

Amul "Utterly Delicious" Parlours

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Amul has recently entered into direct retailing through "Amul Utterly Delicious" parlours

created in major cities Ahmedabad, Bangalore, Baroda, Delhi, Mumbai, Hyderabad and

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

franchisees throughout the country. We have created Amul Parlours at some prominent

locations in the country, which are run by the company or its wholesale dealers:

1. Delhi Metro Rail Corporation

2. The Somnath Temple

3. National Institute of Design

4. Infosys Technologies in Bangalore, Mysore & Pune

5. Wipro campus in Bangalore

6. L.J. College, Ahmedabad

7. Ahmedabad Airport

8. Surat Municipal Corporation

9. Delhi Police

10. Gujarat State Raod Transport Corporation

11. Jubilee Mission Medical College, Trichur, Kerala

12. Sanjay Gandhi Hospital Parlour, Amethi

13. Indian Institute of Management, Kolkata

14. Cafe Amul, MDG, Gandhinagar

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"Amul Utterly Delicious" parlours are an excellent business opportunity for investors,

shopkeepers and organizations. In order to come closer to the customer, we have decided

to create a model for retail outlets, which would be known as "Amul Preferred

Outlets"(APO).

1. The criteria for selection of APOs would be -

a. Visibility - How prominent is the location of your shop?

b. Shop area: 100 - 300 sq. ft.

c. Good Business potential

d. Exclusive Amul outlet - no other products

e. Willingness to sell the entire range of Amul Products

f. Creditworthiness and past business experience

2. On your inquiry - our Field force would visit your site. He/She would fill the APO

proposal form with your passport size photograph. You would require:

i. Shops and Establishment license

ii. Layout of the shop and frontage - The layout of the shop designed by a

local architect/local contractor.

iii. 2 Passport size photographs

Renovation Work of the Shop to give it a standard look – Would be done to meet the

design and specifications at your cost. The cost of renovation of a typical shop would

normally be between Rs. 60,000 to Rs. 1 lac.

Branding- The APOs would be branded as "Amul Utterly Delicious". The cost of the

signage fabrication and installation would be borne by GCMMF office operating in your

region.

Equipment- You would require the following equipment:

d. 1or 2 deep freezers can be purchased through Hamara Apna Deep Freezer

Scheme

e. 1 Refrigerator through Hamara Apna Refrigerator Scheme

f. 1 pizza oven

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g. 1 Chest Milk Cooler for Pouch Milk

Security Deposit- You would be required to furnish an interest free refundable security

deposit of Rs. 25,000 to us. An amount of Rs. 5000/- would be deducted towards

refurbishing the signage, in the event of closure of APO before 3-year of operation.

Supplies- The delivery of products would be done through our wholesale dealers. We

feel that the shop has good potential, and needs support in the initial days, we can offer

additional margins up to maximum of 1% on dairy products and 2% on Ice cream. The

additional margin shall be target based and shall be given in kind. The support at best

would be given only for the first year of business.

Agreement- An agreement bringing us together would be signed.

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5. AMUL SCOOPING PARLORS

Requirements of franchisee

Brand Elements of the Scooping Parlour

Franchisee requires around 300 Sq. Ft. space at a premium location.

Air-conditioned parlour with toughened glass installation at the entrance

Wall claddings with Green Lam Laminates of fiesta colour (Saffron Hue)

Signature A made from stainless steel at the entrance

Neon sign with Amul in acrylic letters as per standard specifications

Interiors with vinyl posters & price list

POS with retailing software

Investment Required

An owned or a leased air-conditioned shop of 300 sq.ft. at a prominent location

Refundable Brand Deposit Rs. 100,000/-

Renovation & interiors Rs. 75,000/-

Equipment Rs. 150,000/-

Working Capital Rs. 25,000/-

Total Rs. 350,000/- *

* Approximate Figures

Equipments Required

Equipments Cost in Rs.

Scooping Cabinet with SS bowls 30,000

Waffle Cone Machine 13,000

Mixer/Grinder 3,000

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Cone Holder/Toppings Tray for placing Sauces, Nuts etc. 1,000

Visi-Coolers 28,000

Deep-Freezers - 2 Nos. 50,000

POS Machine 25,000

Total Cost 150,000

ROI - Indicative Statement

Total in Rs.

Sales (Value per month) 150,000

Gross Margins Earned 75,000

Less: Electricity 5,000

Less: Rentals 20,000

Less: Manpower 10,000

Net Profit per month 40,000

Operation

The franchisees shall be supplied with pre-packed Amul Ice-Creams/Amul products in

different varieties and volumes as per their requirement through authorized wholesale

distributors. The franchisees shall purchase necessary toppings, sauces and consumables

from approved vendors/brands. The products to be sold from these parlours would be as

per the recipes and prices approved by Amul.

Agreement

An agreement would be executed between the franchisee and GCMMF Ltd. as per the

standard draft finalized by GCMMF Ltd.

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6. REVIEW OF ICE-CREAM

PARLORS

AMUL PARLOR AT KALYAN

1. How do you feel being associated with such a large brand name?

Ans: It makes the business easy when you have a tie up such a great brand, because

people already know what you have to offer them. No doubt there is a big responsibility

to carry the image but still it really makes way easy.

2. What are the prospects of Amul retail as a business?

Ans: It is having good prospects because because people are well versed with the brand

and they are assured about the quality. So there is a good scope for the product.

3. Do you provide any internal promotional offers?

Ans: Initially when we opened the shop we have to do some promotions but now we do it

occasionally when we see some reduction in sales or when we have some good schemes

or offers with us.

4. Has Amul given any specific strategies for promotions?

Ans: As such they do not give any such strategies, they just help in setting up the outlet.

5. When did u start with your business?

Ans: I started my business six months back.

6. What are the customer’s perceptions about?

Ans: They have a perception of low price and good quality as Amul always try to bring

the same.

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7. When do you expect to achieve the BEP?

Ans: It will take 1,5 or 2 yrs for us to achieve our bep because the profit margin is low.

8. What is the lead time for the reorder of ice creams?

Ans: One day is the lead time because the demand is more and the distributor is nearby

so it is feasible for us.

9. How far is the distributer from your outlet?

Ans: It is not very far by it is in kalyan.

PARLOR AT MALAD

1. How do you feel being associated with such a large brand name?

Ans: By attaching with the Amul, we are feeling great competitive advantage in the

market. And as it is a most trust worthy & popular brand so obviously people are looking

forward to the brand name. We are happy to be with this business.

2. What are the prospects of Amul retail as a business?

Ans: As being in the Dairy Product in the urban area… the people totally depends on the

packed milk and packed products. So there is demand in the nearby area. And there is no

such local shop to sell the milk products, so there is good market for the Amul.

3. Do you provide any internal promotional offers?

Ans: Not so. But when people come to buy the milk we are just offer or create awareness

about the new Amul products. We also put some posters of the Ice cream and some times

in the festival we offer some discounts to our products like Shrikhand, Amrakhand etc.

4. Has Amul given any specific strategies for promotions?

Ans: He doesn’t know more about this but he said, they are using simple adds on all

types of media, which gives simple, fresh and innovative clean, emotion-based ads not

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using hi-tech special effects, and aimed at maintaining the perfect balance between the

traditional and the modern...

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5. When did u start with your business?

Ans: Started in the 2003.

6. What are the customer’s perceptions about?

Ans: As a well popular brand, there is no doubt about this brand. Very trusted and have

faith about this brand.

7. When do you expect to achieve the BEP?

Ans: He has started his business in the 2003, he has received his capital invested.

8. What is the lead time for the reorder of ice creams?

Ans: when you order the ice cream today, you will get it within 2 days.

9. How far is the distributer from your outlet?

Ans: For ice cream distributors we have in Borivali named Laxmi Agencies, for milk in

the western line distributors available in Andheri & Jogeshwari, but for them they order

from the Surya Narayan Milk Agencies, Malad (E).

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7. BIBLIOGRAPHY

www.amul.com

www.amul.tv.com

www.wikipedia.com

www.icmr.com

www.businessline.com

www.rediffnews.com

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