A PROJECT

REPORT
ON
Amul Business and Product
Strategy
As a part fulfillment of Full time industry
integrated

MBA + Post Graduate Program

in Business Management

Submitted
to:
Submitted by
MRS. ANAMIKA CHATURVADI
ARUN KUMAR

( H.O.D. MBA DEPARTMENT )

Roll NO- 1322070006

Semester- III

DECLARATION

I Arun Kumar , student of MBA at HI-TECH

INSTITUTE OF ENGEENERING COLLAGE, hereby
declares that the project report entitled A Project
Report on Amul Business and Product
Strategy is an original document and written by
me on the basis of my winter training , has been
done with consultation with the project guide.
Feasible suggestions have been incorporated in
consultation with the project guide.

ACKNOWLEDGEMENT

This Project in itself is an acknowledge to the

inspiration, drive, technical assistance contributed
to it by many individuals. This study even internal
part of our MBA programme and to do this project in
a short period was a heavy task.

Intention,

dedication, concentration and hard work are very

much essential to complete any task.

But still it

needs lot of support, guidance assistance, cooperation of people to make it successful.

I bear to imprint of my people who have given me

their precious ideas and times to enable me to
complete the research and the project report.

want to thank them for their continuous support at

my research and writing efforts.

ARUN KUMAR

Table of content
Sr. No. Contents
Page No.

1.

Company Profile
5

2.

The brand name Amul

9

3.

List of products marketed

12

4.

Performance of Amul in last decade

16

5.
22

Plants

6.
24

Amul Preferred outlets

7.
26

Business Objective

8.
27

Business Modal

9.
31

Business Strategy

10.

Market Development Strategy

39

11.
42

Amul Best Practice

5

12.
43

Product Positioning Strategy

13.

Diversification
53

14.

Research Methodology
55

15.

Data Collection Tools

63

16.

Questionnaire
65

17.

Recommendation
67

18.

Conclusion
69

19.

Bibliography
72
6

COMPANY PROFILE
AMUL AND THE COOPERATIVE
MOVEMENT:

Amul embarked upon its illustrious journey as a beacon for the

Indian cooperative movement in 1946. Since then, it has been
undergoing a multidimensional evolution whose overarching
objective has been the same throughout: serving the farmer and
catering to consumer requirements.
A structural landmark in this evolution process was the formation
of the GCMMF in 1974, under the charismatic leadership of V
Kurien, the father of milk revolution in India, the Amul model of
cooperatives soon became an example for others to emulate. This
model showed that an integrated approach along cooperative lines
could enhance production, procurement, processing and
marketing of milk.
Throughout these last 35 years, the company has demonstratedagain and again-that Amul both represents and reconciles diverse
expectations and aspirations.
Amul has used the co-operative integrated approach to dominate
the dairy products market and is using its strong brand name to
diversify into non-dairy products, processed foods and other
products.
Indias largest cooperative society, Amul, had revenue worth USD
672 million in 2004-05.

The company is also the largest food products organization of the

country and the market leaders in whole milk, condensed milk,
milk powder, butter, cheese, ice cream, dairy whitener and
sweets.
Every day, millions of Indians wake up to the taste of Amul, the
flagship brand name of Gujarat co-operative societies in the
Indias western state of Gujarat.
It had an annual turnover of Rs 29,225 million for 2004-05.
GCMMF links about 11,000 village societies across India, a total
of 2, 41 million milk-producing families

The success of Amul has also resulted in the proliferation of

numerous Amul-like cooperatives such as Aavin, Gokul, Him,
Mahananda, Milma, Nandini, Omfed, Parag, Sanchi, Saras,
Sudha, Verka, Vijaya, Vita-all, Warana, etc., and other private
players, including Amrut Industries, J K Dairy, Heritage Foods,
Indiana Dairy, Dairy Specialties, etc. across India. In the last
three years, as many as 1,300 milk societies have been registered.
According to industry experts, the scope for growth especially in
the organized dairy industry is huge, since it accounts for less
than 15% of the total milk produced and other packaged dairy
products. Nevertheless, it cannot be certainly said whether the
other dairy societies would be able to emulate the success of
Amul.
In 1991, following de-licensing of the dairy industry, GCMMF
was faced with a question of whether it should stick to its core
business of dairy products or diversify into other products,
8

especially into processed foods such as jams, sauces and fruit

juices where it had to compete with other multinationals.
In 1996, B M Vyas, Managing Director, GCMMF, commissioned
the Indian Market Research Bureau (IMRB) to conduct a market
survey to identify the products consumers wanted from Amul.
Based on the results, Amul forayed into non-dairy business for
the first time since its inception.
It forayed into value added products like ice creams, baby foods,
curds, confectioneries, energy drinks, cheese, paneer, pizza,
condensed milk and others.
According to an analyst, a part of Amuls diversification is driven
by compulsion than anything else.

Being a cooperative, Amul was forced to buy all the milk that was
produced in Gujarat. Moreover, with milk production having
increased since the mid-1990s, GCMMF had to make use of all
the extra milk available and so the pressure to manufacture and
market more and more processed milk products arose.
He further added that only 15% of GCMMFs revenues came
from these value-added offerings as of 2004-2005. Amul also
entered various overseas markets such as Mauritius, UAE, the
US, Bangladesh, Australia, China, Singapore, hong- Kong and a
few South African countries.

Gujarat Cooperative Milk Marketing Federation

(GCMMF):
Gujarat Cooperative Milk Marketing Federation (GCMMF) is an
Indias largest food product 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.

GCMMF consists of:

10

Members:

13 district
cooperative milk
producers
Union

No. of Producer Members:

2.79 million

No. of Village Societies:

13,328

Total Milk handling capacity:

11.22 million
litres per day

Milk collection (Total - 2008-09) :

3.05 billion litres

Milk collection (Daily Average : 2008- 8.4 million litres

09)
Milk Drying Capacity:

626 Million litres

per day

Cattle feed manufacturing capacity :

3500 Million
litres per day

11

AMUL BUTTER GIRL

12

The moppet who put Amul on India's breakfast

table:
Amul products have been in use in millions of
homes since 1946. Amul Butter, Amul Milk Powder,
Amul Ghee, Amulspray, Amul Cheese, Amul
Chocolates, Amul Shrikhand, Amul Ice cream,
Nutramul, Amul Milk and Amulya have made Amul a
leading food brand in India.
50 years after it was first launched, Amul's sale
figures have jumped from 1000 tons a year in 1966
to over 25,000 tons a year in 1997. No other brand
comes even close to it. All because a thumb-sized
girl climbed on to the hoardings and put a spell on
the masses.

For 30 odd years the Utterly Butterly girl has managed to keep
her fan following intact. So much so that the ads are now ready to
enter the Guinness Book of World Records for being the longest
running campaign ever. The ultimate compliment to the butter
came when a British company launched butter and called it
Utterly Butterly.
13

The Brand Name - AMUL

AMUL means "priceless" in Sanskrit. The brand name "Amul,"
from the Sanskrit "Amoolya," was suggested by a quality control
expert in Anand. Variants, all meaning "priceless", are found in
several Indian languages.
Amul products have been in use in millions of homes since 1946.
Amul Butter, Amul Milk Powder, Amul Ghee, Amulspray, Amul
Cheese, Amul Chocolates, Amul Shrikhand, Amul Ice cream,
Nutramul, Amul Milk and Amulya have made Amul a leading
food brand in India.

Today Amul is a symbol of many things: -

Of high-quality products sold at reasonable prices.

Of the genesis of a vast co-operative network.

Of the triumph of indigenous technology.

Of the marketing savvy of a farmers organization.

14

 Of a proven model for dairy development.

MILK PROCUREMENT

Total milk procurement by Member Unions during

the year 2008-09 averaged 2.79 billion. Milk
collection (Daily Average 2008-09): 8.4 million litres,
total milk handing capacity 11.22 million per day
achieved.

DISTRIBUTION
Alignment of four Distribution Highways of fresh,
chilled, frozen and ambient products is a major
factor for the company. The company is planning to
increase our Distributor Network in smaller towns.
The fast changing market scenario resulting from
rise in household incomes leading to metamorphosis
of rural and smaller markets, significant increase of
middle class families and migration from rural areas
to smaller developing towns has resulted in the
emergence of growing markets in smaller towns all
across the country.
An addition of almost 900 distributors in small towns
was undertaken on a Time Based Military (TMT)
technique. This initiative has already started
yielding results in the form increasing availability of
15

products in smaller towns and thereby generating

additional business.

SALES
During the year, Federation's sales registered a
growth of 1.4 percent to reach Rs. 2,922.53 crores
(Rs.29.22 billion) including consignment sales of
Rs.1.53 crores (Rs.0.02 billion). Despite intense
competition, sales value of Amul Butter grew by 4.5
percent.

LIST OF PRODUCTS MARKETED

Bread Spreads:

Amul Butter
Amul Lite Low Fat Bread spread

Amul Cooking Butter

Cheese Range:

Amul Pasteurized Processed Cheddar

Cheese
Amul Processed Cheese Spread

Amul Pizza (Mozzarella) Cheese

Amul Shredded Pizza Cheese

16

Amul Emmental Cheese

Amul Gouda Cheese

Amul Malai Paneer (cottage cheese)

Utterly Delicious Pizza

Mithaee Range (Ethnic sweets):

Amul Shrikhand (Mango, Saffron, Almond

Pistachio, Cardamom)
Amul Amrakhand

Amul Mithaee Gulabjamuns

Amul Mithaee Gulabjamuns Mix

Amul Mithaee Kulfi Mix

Avsar Ladoos

UHT Milk Range:

Amul Shakti 3% fat Milk

Amul Taaza 1.5% fat Milk

Amul Gold 4.5% fat Milk

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

Amul Shakti Toned Milk

Amul Fresh Cream

Amul Snowcap Softy Mix

17

Pure Ghee:

Amul Pure Ghee

Sagar Pure Ghee

Amul Cow Ghee

Infant Milk Range:

Amul Infant Milk Formula 1 (0-6 months)

Amul Infant Milk Formula 2 (6 months
above)

Amulspray Infant Milk Food

Milk Powders:

Amul Full Cream Milk Powder

Amulya Dairy Whitener

Sagar Skimmed Milk Powder

Sagar Tea and Coffee Whitener

Sweetened Condensed Milk:

Amul Mithaimate Sweetened Condensed

Milk

Fresh Milk:
18

Amul Taaza Toned Milk 3% fat

Amul Gold Full Cream Milk 6% fat

Amul Shakti Standardised Milk 4.5% fat

Amul Slim & Trim Double Toned Milk 1.5%

fat

Amul Saathi Skimmed Milk 0% fat

Amul Cow Milk

Curd Products:

Yogi Sweetened Flavored Dahi (Dessert)

Amul Masti Dahi (fresh curd)

Amul Masti Spiced Butter Milk

Amul Lassee

Amul Ice creams:

19

Royal Treat Range (Butterscotch, Rajbhog,

Malai Kulfi)

Nut-o-Mania Range (Kaju Draksh, Kesar Pista

Royale, Fruit Bonanza, Roasted Almond)

Nature's Treat (Alphanso Mango, Fresh Litchi,

Shahi Anjir, Fresh Strawberry, Black Currant,
Santra Mantra, Fresh Pineapple)

Sundae Range (Mango, Black Currant,

Sundae Magic, Double Sundae)

Assorted Treat (Chocobar, Dollies, Frostik, Ice

Candies, Tricone, Chococrunch, Megabite,
Cassatta)

Utterly Delicious (Vanilla, Strawberry,

Chocolate, Chocochips, Cake Magic)

Amul Chocolate

Amul Milk Chocolate

Amul Fruit & Nut Chocolate

Amul Fundoo

Amul bindaas

20

Amul Almondbar

Performance of Amul in last decade:

Sales Turnover

Rs (million)

US $ (in millions)

1992-93

22192

493

1993-04

22185

493

2004-05

22588

500

2005-06

23365

500

2006-07

27457

575

2007-08

28941

616

2008-09

29225

672

2009-10

37736

850

2010-11

42778

1050

2011-12

52554

1325

2012-13

67113

1504

21

Bread Spreads
Amul Butter

Utterly Butterly Delicious

Amul Lite

Low fat, low Cholesterol Bread

Spread

Delicious Table
Margarine
The Delicious way to eat
healthy

Milk Drinks
Amul Kool Millk Shaake

Amul Kool

Amul Kool Cafe

Kool Koko

Nutramul Energy Drink

Amul Kool Chocolate

Milk

A drink for Kids - provides

energy to suit the needs of
growing Kids

Amul Kool Flavoured

Bottled Milk

22

A delight to Chocolate Lovers.

Delicious Chocolate taste

Amul Kool Flavoured

Tetra Pack

Amul Masti Spiced

Buttermilk

Amul Lassee

Amul introduces the Best Thirst

Quenching Drink

Amul Kool Thandai

Powder Milk
Amul Spray Infant Milk
Food

Amul Instant Full

Cream Milk Powder

Sagar Skimmed Milk

Powder

Sagar Tea Coffee

Whitener

Still, Mother's Milk is Best for

your baby

A dairy in your home

Which is especially useful for diet

preparations or for use by people
on low calorie and high protein
diet.

Amulya Dairy Whitener

The Richest, Purest Dairy
Whitener

Fresh Milk
Amul Fresh Milk

This is the most hygienic milk

available in the market.
Pasteurised in state-of-the-art
processing plants and pouchpacked for convenience.

23

Amul Gold Milk

Amul Taaza Double

Toned Milk

Amul Lite Slim and

Trim Milk

Amul Fresh Cream

Amul Shakti Toned

Milk

Amul Calci+

Amul Buttermilk

Cheese
Amul Pasteurised
Processed Cheese
100% Vegetarian Cheese made
from microbial rennet

Amul Emmental Cheese

The Great Swiss Cheese from Amul,
has a sweet-dry flavour and
hazelnut aroma

Gouda Cheese

24

Amul Cheese Spreads

Tasty Cheese Spreads in 3 great

flavours..

Amul Pizza Mozzarella

Cheese

Pizza cheese...makes great tasting

pizzas!

For Cooking
Amul / Sagar Pure
Ghee

Cooking Butter

Made from fresh cream.

Has typical rich aroma
and granular texture. An
ethnic product made by
dairies with decades of
experience.

Amul Malai Paneer

Ready to cook paneer to
make your favourite
recipes!

Mithai Mate

Sweetened Condensed
Milk - Free flowing and
smooth texture. White to
creamy color with a
pleasant taste.

Utterly Delicious
Pizza

Masti Dahi

Pro-biotic Dahi

Desserts
Amul Ice Creams

Amul Shrikhand

Premium Ice Cream made in

various varieties and flavours
with dry fruits and nuts.

A delicious treat, anytime.

25

Amul Mithaee Gulab

Jamuns

Amul Chocolates

Amul Basundi

Amul Yogi Yoghurt

Pure Khoya Gulab

Jamums...best served piping
hot.

The perfect gift for someone

you love.

Health Drink
Nutramul
Malted Milk Food made from
malt extract has the highest
protein content among all the
brown beverage powders sold in
India.

26

Amul Shakti Health

Food Drink

Available in Kesar-Almond and

Chocolate flavours.

Plants:
First plant is at ANAND, which engaged in the
manufacturing of milk, butter, ghee, milk powder,
flavored milk and buttermilk.

Second plant is at MOGAR, which engaged in

manufacturing chocolate, Nutramul, Amul Ganthia
and Amul lite.

27

Third plant is at Kanjari, which produces

cattelfeed.

Fourth plant is at Khatraj, which engaged in

producing cheese.

28

AMUL PREFERRED OUTLETS

29

Amul has justified its undisputed leadership in foods

business by creating 5000 Amul preferred outlets in
a record time which exclusively sell wide range of
Amul products. This has been possible due to strong
brand equity and I mmense consumer support. We
now have now ambitious plans of creating 10,000
Amul parlours by 2012.
Amul Parlours are successfully operating in more
than 1400 towns at high streets, residential areas,
Railway
Stations,
Bus
Stations,
Educational
Institutions and a whole lot of Centres of Excellence.

30

Here is a list of the few of the Amul parlours

operating across the various parts of the country
1. Indian Institute of Management, Ahmedabad
2. New Delhi Railway Station PF6/7 & PF10/11
3. National Institute of Design
4. Infosys Technologies in Bangalore, Mysore
& Pune
5. Wipro, Bangalore
6. Indian Institute of Management, Kolkata
7. Ahmedabad Airport
8. Koyambedu Bus Station, Tamilnadu
9. Savitha Dental College, Chennai
10.

IIT, Guwahati

EXPORT AND AWARDS

GCMMF is India's largest exporter of Dairy Products.
It has been accorded a "Trading House" status.
GCMMF has received the APEDA Award from
Government of India for Excellence in Dairy Product
Exports for the last 11 years.
The major export products are:
Consumer Packs

Amul Pure Ghee

Amul Butter

Amul Shrikhand

Amul Mithaee Gulabjamuns

Nutramul Brown Beverage

Amul Cheese

31

Amul Malai Paneer

Amul UHT Milk (Long Life)

Amul Gold Milk

Amul Taaza Full Cream Milk

Amul Lite Slim and Trim Milk

Amul Fresh Cream

Bulk Packs

Amul Skimmed Milk Powder

Amul Full Cream Milk Powder

Many of our products are now available in the

USA, Gulf Countries and Singapore.

AWARDS

GCMMF bags APEDA AWARD for 11th year in a

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

Ramakrishna Bajaj National Quality Award2003

Amul - The Taste Of India (Gcmmf)Receives

International Cio 100 Award For
Resourcefulness

Rajiv Gandhi National Quality Award - 1999

Business OBJECTIVES
AMULs Journey towards Excellence
The essences of AMULs efforts were as follows:
32

 It combined market and social development in an

emerging economy. It recognized the interlinkages between various environments that
governed the lives of marginal milk farmers and
the unmet needs of consumers. It also changed
the supply chain paradigm in order to reduce the
cost to the consumer while increasing the return
to the supplier.

It realized that in order to achieve their

objectives, it had to benefit a large number of
people both suppliers and consumers. While
large scale had the danger of failure due to poor
control and required more resources, it also had
the advantage of creating a momentum that
would be necessary to bring more people into the
fold and thereby help more suppliers and
consumers.

It also realized that its goal could only be

achieved in the long run and this required
developing values in people and processes that
were robust, replicable and transparent.
It also realized that the cooperative would not be
independent and viable in the face of
competition if it were not financially sound. This
implied that AMUL had to develop distinct
capabilities that would deliver competitive
advantage to its operations. This would include
long
term
cost
containment,
world-class
deployment of technological resources and R&D,
and better leveraging of scarce resources.

33

The Business Model

The objective of the network was to deliver
profitable and equitable returns to a large number
of farmers for a long period of time. This follows
rather directly from the fact that the member
farmers own essentially the network of
cooperatives. Given the weak economic status of
these members, an additional objective was to
develop the supplier over the long term through
social change. Consequently, the business model
had to include both the costs and benefits of
services that would be needed to deliver milk with
high productivity as well as to assist farmers in
improving their social environment.
The success of the network depended on high
collection rate of milk. This required increasing
membership with more VSs, raising the number of
members per VS, and improving the milk yield (i.e.,
better cattle management), constant concern about
the cost to farmers in the network and delivering
quality to customers at low prices.
The cooperative had decided as part of its value:
To charge for each service provided to the
supplier
To purchase all milk that member farmer produced
To sell liquid milk at affordable prices so as to
serve a large number of consumers
To develop and deliver services that will improve
lives of people in the network
To hire professional managers, to run the
federation and unions, whose values
included upliftment of rural poor.
34

The network explicitly includes secondary services

to the farmer-suppliers.
Several of the entities in the network are organized
as cooperatives linked in a hierarchical fashion.

35

Strengths
36

1. The company is having Indian origin thus

creating feeling of oneness in the mind of the
customers.
2. It manufactures only milk and milk products,
which is purely vegetarian thus providing
quality

confidence

in

the

minds

of

the

customers.
3. It is aiming at rural segment, which covers a
large area of loyal customers, which other
companies had failed to do.
4. People are quite confident for the quality
products provided by Amul.
5. Amul has its base in India with its butter and so
can easily promote chocolates without fearing
of loses.
6. The prices of chocolates of Nestles are
comparatively cheap as compared to other
companies.
Weaknesses
1. There are various big players in the chocolate
market,

which

acts

restricting their growth.

37

as

major

competitors

2. Lack of capital invested as compared to other

companies.
3. Improper distribution channel in India.
4. Weak distributors service channel to retailers
(in some areas).
5. Lack of availability of stock at various
locations.

Opportunities
1. There is a lot of potential for growth and
development as huge population stay in rural
market

where

other

companies

are

not

targeting.
2. The chocolate market is at growth stage with
very less competition so by introducing new
brand and intensive advertising there can be a
very good scope in future.
3. Promotions will pay good results, market is
lacking with the same.
4. A great opportunity to cash the brand name
once again by giving good

quality product.

5. Weak areas can be targeted to cover up the

entire market as per the demand.
38

Threats
1. The major threat is from other companies who
hold the majority share of consumers in Indian
market i.e. Cadburys and Nestle.
2. There exists no brand loyalty in the chocolate
market and consumers frequently shift their
brands
3. Competitor brands are offering huge profit
margin to retailers, whereas few

of them

are selling at lower retail prices.

AMULs business strategy

is driven by its

twin objectives
(i)

long-term, sustainable growth to its

member farmers, and

(ii)

Value proposition to a large customer

base by providing milk and other dairy
products a low price. Its strategy, which
evolved over time, comprises of
elements described below.

Simultaneous Development of Suppliers and

Customers:

39

From the very early stages of the formation of

AMUL, the cooperative realized that sustained
growth for the long-term was contingent on
matching supply and demand. The organization also
recognized that in view of the poor infrastructure in
India, such development could not be left to market
forces and proactive interventions were required.
The time AMUL was formed; the vast majority of
consumers had limited purchasing power and was
value conscious with very low levels of consumption
of milk and other dairy products. Thus, AMUL
adopted a low price strategy to make their products
affordable and guarantee value to the consumer.
The success of this strategy is well recognized and
remains the main plank of AMUL's strategy.
On the supply side, as mentioned earlier,
the member-suppliers were typically small
and marginal- farmers had severe liquidity
problems, were illiterate and had no prior
training in dairy farming. AMUL and other
cooperative Unions adopted a number of
strategies to develop the supply of milk and
assure steady growth.
First, for the short term, the procurement prices
were set so as to provide fair and reasonable
return.
Second, aware of the liquidity problems, cash
payments for milk supply was made with
minimum of delay.
For the long-term, the Unions followed a multipronged strategy of education and support. only
part of the surplus generated by the Unions is
paid to the members in the form of dividends. A
40

substantial part of this surplus is used for

activities that promote growth of milk supply and
improve yields. These include provision of
veterinary services, support for cold storage
facilities at the village societies etc. In parallel,
the Unions have put in place a number of
initiatives to help educate the members.
The
dual
strategy
of
simultaneous
development of the market and member
farmers has resulted in parallel growth of demand
and supply at a steady pace and in turn assured
the growth of the industry over an extended
period of time.
Cost Leadership:
AMULs objective of providing a value proposition to
a large customer base led naturally to a choice of
cost leadership position. Given the low purchasing
power of the Indian consumer and the marginal
discretionary spending power, the only viable option
for AMUL was to price its products as low as
possible. This in turn led to a focus on costs and had
significant implications for managing its operations
and supply chain practices.
Focus on Core Activities
It chose a strategy to focus on core dairy activities
and rely on third parties for other complementary
needs. This philosophy is reflected in almost all
phases of AMUL network spanning R&D, production,
collection, processing, marketing, distribution,
retailing etc.

41

For example, AMUL focused on processing of liquid

milk and conversion to variety of dairy products and
associated research and development. On the other
hand, logistics of milk collection and distribution of
products to customers was managed through third
parties.
But, it played a proactive role in making support
services available to its members wherever it
found that markets for such services were not
developed. For example, in the initial stages, its
small and marginal member farmers did not have
access to finance, veterinary service, knowledge
of basic animal husbandry etc. Thus to assure
continued growth in milk production and supply,
AMUL actively sought and worked with partners
to provide these required services.
Managing Third Party Service Providers:
Well before the ideas of core competence and the
role of third parties in managing the supply chain
were recognized and became fashionable, these
concepts were practiced by GCMMF and AMUL. From
the beginning, it was recognized that the core
activity for the Unions lay in processing of milk and
production of dairy products. Accordingly, the
Unions focused efforts on these activities and
related technology development. Marketing efforts
(including brand development) were assumed by
GCMMF. All other activities were entrusted to third
party service providers. These include logistics of
milk collection, distribution of dairy products, sale of
products through dealers and retail stores, some
veterinary services etc.
42

Financial Strategy:
AMULs financial strategy may be characterized by
two elements:
a)

Retention of surplus to fund growth and

development.
b) Limited/ no credit, i.e., all transactions are
essentially cash only.

Marketing
GCMMF is the marketing arm of the network and
manages the physical delivery and distribution of
milk and dairy products from all the Unions to
customers. GCMMF is also responsible for all
decisions related to market development and
customer management.
GCMMFs demand growth strategy
characterized by two key elements:
(i)

(ii)

may

be

Developing markets for its high value

products by graduating customer segments
from low value products, and
Maintaining a healthy level of customer base
for its base products (low value segment).
This strategy often requires GCMMF to
allocate sufficient quantity of milk supply to
low value products, thereby sacrificing
additional profits that could be generated by
converting the same to high value products.

GCMMF provides umbrella branding to all the

products of the network. For example, liquid milk as
43

well as various milk products produced by different

Unions is sold under the same brand name of AMUL.
The advertising has centered on building a common
identity (e.g., a happy & healthy cartoon AMUL
girl) and evoking national emotion (e.g., the key
advertising slogan says AMUL - The Taste of India).
Retailing of GCMMFs products takes place through
the FMCG retail network in India most of whom are
small retailers.

Operations & Supply Chain Management

The strategy, design and practices in AMULs
network are strongly driven by the objective of
establishing and operating an efficient supply chain
from milk production and procurement to product
delivery to customers. Management of this network
is built around two key elements
(a) Coordination of the diverse elements of the
network and
(b) Use of appropriate technology that includes
product, process and information technology and
managerial practices and systems.
Coordination for Competitiveness
Robust coordination is one of the key reasons for the
success of operations involving such an extensive
network of producers and distributors at GCMMF.
Some interesting mechanisms exist for coordinating
the supply chain at GCMMF. These range from
ensuring fair share allocation of benefits to various
44

stakeholders in the chain to coordinated planning of

production and distribution. More importantly, the
reason for setting up of this cooperative is not amiss
to anyone in this large network organization.
Employees, third part service providers, and
distributors are constantly reminded that they work
for the farmers and the entire network strives to
provide the best returns to the farmers, the real
owners of the cooperative. It may be remembered
that coordination mechanisms have to link the lives
and activities of 2.12 million small suppliers and 0.5
million retailers!
There appear to be two critical mechanisms of
coordination that ensure that decision making is
coherent and that the farmers gain the most from
this effort. These mechanisms are:
Inter-locking Control

Coordination
Federation

Agency:

Unique

Role

of

Inter-locking Control
Each Village Society elects a chairperson and a
secretary from amongst its member farmers of good
standing to manage the administration of the VS.
Nine of these chairpersons are elected to form the
Board of Directors of the Union. The Chairperson of
the Union Board is elected from amongst these
members. The managing director of the Union, who
is a professional manager, reports to the
chairperson and the board. All chairpersons of all
the Unions form the Board of Directors of GCMMF.
The managing director of GCMMF reports to its
Board of Directors. Each individual organization, the
Union or GCMMF, is run by professional managers
and highly trained staff.
45

Coordination
Federation

Agency:

Unique

Role

of

the

In addition to being the marketing and distribution

arm of the Unions, GCMMF plays the role of a
coordinator to the entire network within the State
coordinating procurement requirements with other
Federations (in other states), determining the best
production allocation for its product mix from
amongst
its
Unions,
managing
inter-dairy
movements, etc.

It works with two very clear objectives:

To ensure that all milk that the farmers

produce gets sold in the market either as milk
or as value added products and
To ensure that milk is made available to an
increasingly large sections of the society at
affordable prices.
In making allocations to Unions, GCMMF is
guided by two main objectives:
Maximizing the network surplus.
Maintaining equity among unions for the
surplus realized. In this regard, very often
GCMMF is willing to sacrifice realizable
surplus and allocate products to less
efficient Unions in order to achieve better
balance in surpluses accruing to the Unions.
46

Technology for Effectiveness

Technology or knowledge that was embodied in
products, processes, and practices became an
important factor in delivering effectiveness to the
network of cooperatives. One distinguishing feature
of AMUL (in comparison with other similar
cooperatives globally) is the large variety in their
product mix. AMUL dairy led the way in developing
many of these products and establishing the
processes for other member Unions.
Equally impressive are the achievements on
process technology. While several continuous
innovations to equipment and processes have
been done at AMUL, the most significant one has
been the development of processes for using
buffalo milk to produce a variety of end products.
Gujarat (and most of India) is a buffalo
predominant area. As more farmers joined the
cooperatives, the need to develop a mechanism
for storage of increasing quantities of milk
became intense. The need to store milk in powder
form increases as excess milk quantities in winter
seasons could then be used in lean summer
seasons. Demand for liquid milk was not growing
along with growth in milk production. No
technology existed worldwide to produce powder
from buffalo milk. Engineers at AMUL successfully
developed a commercially viable process for the
same first time in the history of global diary
industry. Subsequently, it also developed a
process for making baby food out of this milk
powder. It has also developed a unique process
for making good quality cheese out of buffalo
47

milk thereby converting a perceived liability into

a source of comparative advantage the task
was done through process technology research.
Most of its plants are state of art and automated.
Similar efforts in the area of embryo transfer
technology have helped create a high yield
breed of cattle in the country.
AMULs innovations in the areas of energy
conservation and recovery have also contributed
to reduction in cost of its operations. AMUL also
indigenously developed a low cost process for
providing long shelf life to many of its perishable
products.
TQM at the grassroots has been a strong
movement to develop leadership, operational and
strategic capabilities in the entire network
farmers, village cooperatives, dairy plants,
distributors and wholesalers and retailers. Key
elements of this TQM movement have been:
Friday Departmental Meetings: Each Friday,
at a prescribed time, everyone in the network
(from the farmers to the carry & forwarding
agents) joins their respective departmental
meeting to discuss quality initiatives and share
policy related information.

Training for Transformational Leadership

so that individuals are able to control their
thoughts, feelings and behavior and take more
responsibility in ones life and surrounding
environment.
48

 Application of Hoshin Kanri principles to

bring about a bottom-up setting of objectives
aligning policies for effective management of
Unions & village societies on hand with those
of channel member on the other hand.
ISO/HACCP certification was obtained for all the
Unions and each village society is in the
process of obtaining the same.

Training for farmers and their families

emphasizing the need for good health care for
not only cattle during its pregnancy and
feeding but also for expecting and feeding
mothers and the whole family. This effort has
brought about a significant social change
towards such issues in villages that have
cooperative milk societies.

Retail Census: GCMMF undertakes a census

of all retail outlets (over 500,000) to evaluate
customer perceptions and distribution efficacy
of their network. This is being done by
wholesalers in their respective territories at
their own cost. This information is used for
policy deployment exercise.
The extent of IT usage includes a B2C ordering
portal, an ERP based supply chain planning
system for the flow of material in the network, a
net based dairy kiosk at some village societies
(for dissemination of dairy related information),
49

automated milk collection stations at village

societies and a GIS based data network
connecting villages societies to markets. Milk
collection information at more than 10,000
villages is available to all dairies (or Unions) to
enable them make faster decisions in terms of
production & distribution planning, and disease
control in more than 6,700,000 animals. This is
linked with information at all 45 distribution
offices and 3900 distributors. This network is
being extended to cover all related field offices in
the network. The GCMMF cyber store delivers
AMUL products at the doorsteps of the consumers
in 125 cities across the country.

Market Penetration Strategy

This strategy involves achieving growth through
existing products in existing market. Amuls market
penetration strategy involves its expanding its
customer base in the existing market. Currently
Amul is trying to expand its customer base through
the following measures
Amul is set to build up 10,000 `Amul Parlors
across the country during the year. These stores will
sell the entire product range of Amul products, in
addition to the existing retail network for ice cream,
milk and other products.
It is trying to get more and more customers
through a more intensive distribution. It is opening
more stores at Highways, Railway stations, Airports,
Bus stations, Schools, Colleges, and Industrial
Canteens etc.
It is trying to find place in various retail outlets,
the latest story being Amul trying to acquire a shelf
50

in the yet to come Wal-Mart.

Opening small Amul-exclusive stores in each and
every neighborhood to reach to the very near of the
consumer.

Market Development Strategy

This strategy is concerned with creating business
through developing new markets with existing
products in hand. Amul is using this strategy to
capture new and unexplored sectors without
creating new products
Amul is now shifting its focus from urban to
rural markets and smaller towns. In 2005, Amul
added 900 new stores all across small towns to
increase its reach.
Amul is capturing the market of diabetic and
health conscious people through sugar free icecream, which is a variation of an existing
product.
Amul will expand its fresh milk markets to
Kanpur and Lucknow and other smaller towns
this year, thereby increasing its market base
for the existing products.
Amul is also increasing its market base for
milk through a new version the Amul Tazaa.
Tazaa is the long-life version of milk which has
a longer shelf life as compared to normal fresh
milk. This product is highly picking up in the
domestic and export market.

Product Development Strategy

Product development deals with producing new
products for the existing customer base. Amul has

51

vastly capitalized on this strategy by constantly

coming up with newer products
Amul-Cool (milk based cool drink) and AmulKool caf these are the products aimed at the
youth of the country with synonymous
marketing campaigns.
It is coming up with a chain of pizza corners.
This chain would consist of around 2000 stores
all over India.
Stamina the instant energy whey based
sport drink has been launched to provide its
customers with a totally new product.
Amul has recently launched a new variation
of ice-cream, the sundae swirl to its existing
base of ice-cream customers.
Amul-Masti, the packaged buttermilk is
aimed to be another non-carbonated cool drink
in the Amul Cool range which is not only aimed
at the youth but also at the more mature
chunk of the society.

Diversification Strategy
Diversification is a high-risk strategy as it involves
taking a step into a territory where the parameters
are unknown to the company. Amul has identified
the need to increase its presence in newer markets
and thus have come up with many new such
strategies for increasing its presence in the entire
market.
There are different types of diversification process
that any company can adopt they are as follows:
Concentric Diversification Strategy
Conglomerate Diversification Strategy
Horizontal Diversification Strategy

52

Concentric Diversification Strategy: Amul has

identified a segment for the health conscious people
and is introducing two pro-biotic ice cream ranges,
Amul Sugar free and Amul Profile and both of these
products will be available in five different flavors
this is apart from the various regular ice cream
products that it offers. They have identified the
working class women as a new segment and has
introduced frozen easy to cook stuffed parathas,
matar paneer and paneer pakoras which makes
them easy to cook quality tasty food in less time.
Conglomerate Diversification Strategy:
Amul in this concern has come up with an idea of
introducing an altogether new spots drink named
"Stamina" which will be the first sports drink by an
Indian company and it will be priced at only Rs 12
for 200ml which will be lower than its competitors
whose price ranges around 60 to 75 Rs. In this they
have also introduced the Amul Pizza in order to
enter the pizza market. They have also come up
with flavored milk and also flavored lassis to enter
newer markets.
Horizontal Diversification Strategy
In this concern Amul is to provide something new to
its older and loyal customers have come up with a
facility whereby they could order the food through
the internet and this was at a time when internet
was heard by very few in India during 1996.

AMULs Best Practices

Umbrella Brand Strategy:

53

The most successful strategy of Amul has been the

Umbrella Brand strategy. The GCMMF skillfully
avoids inter-union conflicts through this strategy by
giving every union and sub-brand the opportunity to
contribute in the developing products. Amul is the
common brand for most of the product categories
rolled out by the unions and there are also some
sub-brands of Amul which come out with variants
like Amulspray, Amulya, Amulspray and Nutramul.
Improvement Programs
Another intriguing feature about Amul is that it
constantly encourages improvement programs. For
instance, all employees of the GCMMF meet every
Friday between 10 to 11 am to discuss quality
issues at a depot, department or branch. Every
meeting has a Purpose, Agenda and Limit (PAL) and
such meetings are held in the village societies,
union and at the wholesalers level too.
Constant Innovation:
Constant innovation is another typical trait of Amul.
However, the cooperative ensures that the
sequence and product mix of high value brands is
consistent with Amuls philosophy of low pricing and
affordability. For instance, when Amul entered the
Pizza business, the price of a pizza was, at Rs 30
was much lesser than what the other players
charged.

54

Product positioning strategy

In marketing, positioning has come to mean
the process by which marketers try to create
an image or identity in the minds of their
target market for its product, brand, or
organization.
Generally, the product positioning process
involves:
Defining the market in which the product or
brand will compete (who the relevant buyers
are)

Identifying the attributes (also called

dimensions) that define the product 'space'

Collecting information from a sample of

customers about their perceptions of each
product on the relevant attributes

Determine each product's share of mind

Determine each product's current location in

the product space

55

 Determine the target market's preferred

combination of attributes (referred to as
an ideal vector)

Examine the fit between:

The position of your product

The position of the ideal vector

Position.

Indias First Pro-Biotic Wellness Ice cream &

Sugar Free Delights for Diabetics.

Low Priced Amul Ice Creams made Kwality

Walls life hell.

56

Flank Attack applied in AMUL product on Aug 25

2007

57

 Amul launches Chocolate milk under brand

name of Amul Kool Koko.
This is targeted at teenagers and youths.
Nov 11, 2007: Amul in Multinational Arena With
Snack Launch:
Munch Time.
Flavors: Masala, Mint and Tomato.
New Product Activity.
Nov 26, 2007 : Amul Launches Fresh Paneer
(Free From Any Harmful Chemicals)
Flank AttackExpanding its Cheese Segment.

58

Current market share 65%.

Product Repositioning
Re-positioning involves changing the identity of a
product, relative to the identity of competing
products, in the collective minds of the target
market.
Repositioning a company involves more than a
marketing challenge. It involves making hard
decisions about how a market is shifting and how a
firm's competitors will react. Often these decisions
must be made without the benefit of sufficient
information, simply because the definition of
"volatility" is that change becomes difficult or
impossible to predict.

59

 Amul marketed bottled water product

named JALDHARA but due to less
potential in the market it turned out to be
blunder.
Now Amul is all set to launch bottled
water NARMADA NEER.

Product Overlap

Product overlap is situation where company decides

to company decides to compete against its own
brands

60

Powdered Milk

Health and price Conscious.

SAGAR Vs Amulya.
USP: Sagar is affordable whitener for health
conscious one.
Cheese Spreads
Specific Vs General

61

Amul Processed Cheese Vs Cheese Spread

USP:
Cheese spread is highly accepted spread for regular
use.
Milk Drinks
Nutramul Energy Drink Vs Amul Kool

62

Product Design Strategy

Product design is concerned with the efficient and
effective generation and development of ideas
through a process that leads to new products.
Product designers follow various methodologies that
require a specific skill set to complete.
Initial Stage
Idea Generation can be
from imagination, observation, or research.

Need Based Generation can be from the

need to solve a problem, the need to follow the
popular trends, or the need for a product to do
a specific task.

Mid Stage

Design Solutions arise from meeting user

needs, concept development, form exploration,
63

ergonomics, prototyping, materials, and

technology.
Production involves fabrication and manufact
uring the design.

Final Stage

Marketing involves selling the product. It can

either be client based which
mean the client
buys the design and manufactures it and then
sells it to customers. Or it can be user based
where the product is sold directly to the user
by the designer.

Amul has offered a mix of both standard and

customized products.

Use of Utterly - Butterly Girl:

Using since 1967

Entered in the Guinness Book Of World
Records for being the longest running
campaign ever.

64

Product Elimination strategy

The elimination strategies used by companies to
implement the elimination decision, which includes
the following options:
(1) phase out immediately;
(2) phase out slowly;
65

(3) drop the product from the standard range and

reintroduce it as a special sell out.
The study also determined that the phase out
slowly strategy is generally preferred and that
stock on hand and replacement product
development are two of the main factors
influencing the formulation of phase out plans. A
systematized model for the implementation of the
product elimination decision based on the findings
of the study is described.
Amul eliminated JALDHARA a decade ago as
Bottled water products do not have potential
customers

Amul is all set to launch bottled water

NARMADA NEER

Diversification

66

67

Value Marketing Strategy

Providing a product that works as claimed, is

accompanied by decent service, and is delivered on
time.
Commitment to quality.
Value for money
The generation for awareness.
Fostering of Loyalty

RESEARCH METHODOLOGY
There are various types and methods of research design
but we mainly used two types of research design in this
68

report. They are exploratory research and Descriptive

research.
(a) Exploratory Research:-Exploratory research is
preliminary study of an unfamiliar problem about which
the researcher has little or no knowledge. It is similar to a
doctors initial investigation of a patient suffering from an
unfamiliar malady for getting clues for identifying it. It is
ill-structured and much less focused on pre-determined
objectives. It usually takes the form of a pilot study.
Though it is a separate type of research, it is appropriate
to consider it as the first stage of a three-stage process of
exploration, description and experimentation.
Purposes
The purpose of an exploratory study may be:
to generate new ideas or
to increase the researchers familiarity with the
problem or
to make a precise formulation of the problem or
69

 to gather information for clarifying concepts or

to determine whether it is feasible to attempt the
study.
The Steps in Exploration
Selltiz and others have suggested have suggested the
following three steps for the exploratory study:
(1) A review of pertinent literature
(2) An experience survey
(3) An analysis of insight stimulating cases.

Literature survey: A study of related and pertinent

books, articles and reports turns up a number of leads
and clues for further investigation that will advance the
research. A workable hypothesis may be formulated;
important variables may be identified.
Experience survey: Informal interviews with persons
experience in the area of study will help the researcher
in securing insight into the subject and its various facts.
70

In selecting the person for this survey, representation to

different facts of experience should be given. For
example, in an exploratory study of the problem of rural
development, it is profitable to interview researchers
familiar with rural studies, rural development
administrators, social workers, rural financial institutions
and village leaders.
This survey may yield a new hypothesis and information
on the various dimensions of the study, facilities and
cooperation available for the study, and the factors to be
controlled.
(b) Descriptive Research: Descriptive research/study
is a fact-finding investigation with adequate
interpretation. It is the simplest type of research. It is
more specific than an exploratory study, as it has
focus on particular aspects or dimensions of the
problem studied. It is designed to gather descriptive
information and provides information for formulating
more sophisticated studies. Data are collected by

71

using one or more appropriate methods: observation,

interviewing and mail questionnaire.
Objective:
A descriptive study aims at identifying the various
characteristics of a community or institution or problem
under study, but it does not deal with the testing of
proposition or hypothesis. However, it can reveal
potential relationships between variables thus setting
the stage for more elaborate investigation later.
A descriptive study also aims at a classification of
the range of elements comprising the subject matter of
study. The classification must satisfy two criteria, viz.,
(1) exhaustiveness and (2) mutual exclusiveness occurs
when each item can be unambiguously placed in only
one category in the system. Descriptive information
should also be useful for explanation, prediction and
awareness.
Usefulness

72

The descriptive studies are useful in their own way.

1. They have much to contribute to the
development of a young science, as descriptive
information can focus directly on a theoretical
point. It may be useful in verifying focal concepts
through empirical observation, The more
adequate the description, the greater is the
likelihood that the units derived from the
description will be useful in subsequent theory
building.
2. Descriptive information can highlight important
methodological aspects of data collection and
interpretation. The collection of factual data
increases our awareness of the relative accuracy of
our measuring devices. Thus, our ability to
accumulate further knowledge is significantly
broadened.
3. Descriptive information obtained in a research may be
useful for prediction about
73

areas of social life outside the boundaries of the

research.

74

SAMPLING DESIGN
A part of the population is known as a sample. The process of drawing a
sample from a larger population is called sampling. The list of sampling
units from which a sample is taken is called the sampling frame, e.g., a
map, a telephone directory, a list of industrial undertakings, a list of car
licenses etc.

Aims of Sampling: Well-selected sampling may reflect fairly accurately

the characteristics of the population. For example, with a survey of a
sample of voters, one can predict the voting intentions of millions of
voters. A specified value of the population, such as average or variance is
named as parameter; the corresponding value in the sample is termed as
statistic. The chief aim of sampling is to make an inference about an
unknown parameter from a measurable sample statistic.

The second aim of sampling is to test a statistical hypothesis relating to

population. A sample is drawn and the data collected from the sample
informants are analyzed and on the basis of the result the hypothesis may
be accepted or rejected.

75

Benefits of Sampling:
Sampling is done in a wide variety of research
settings. Listed below are a few of the benefits of
sampling:
1. Reduced cost: It is obviously less costly to
obtain data for a selected subset of a
population, rather than the entire population.
Furthermore, data collected through a
carefully selected sample are highly accurate
measures of the larger population. Public
opinion researchers can usually draw accurate
inferences for the entire population of the
United States from interviews of only 1,000
people.
2. Speed: Observations are easier to collect and
summarize with a sample than with a complete
count. This consideration may be vital if the
speed of the analysis is important, such as
through exit polls in elections.

76

3. Greater scope: Sometimes highly trained

personnel or specialized equipment limited in
availability must be used to obtain the data. A
complete census (enumeration) is not practical
or possible. Thus, surveys that rely on sampling
have greater flexibility regarding the type of
information that can be obtained.
4. Quality of a study is often better with sampling
than with a complete coverage.
5. Sampling provides much quicker results than does
a census.

SOURCES OF DATA
The sources of data may be classified into (a)
Primary sources and (b) Secondary sources.

Primary Sources

77

Primary sources are original sources from which the

researcher directly collects data that have not been
previously collected, e.g., collection of data directly
by the researcher on brand awareness, brand
preference, brand loyalty, and other aspects of
consumer behavior from a sample of consumers by
interviewing them. Primary data are first-hand
information collected through various methods such
as observation, mailing etc.
Primary sources can include

Interviews, diaries, letters, journals, speeches,

autobiographies, and witness statements

Articles containing original research, data, or

findings never before shared

Original hand-written manuscripts

Government documents and public records

Art, photographs, films, maps, fiction, and

music
78

Secondary Sources
These are sources containing data which have been
collected and compiled for another purpose. The
secondary sources consists of readily available
compendia and already compiled statistical
statements and reports whose data may be used by
researches for their studies, e.g., census reports,
annual reports and financial statements of
companies, Statistical statements, Reports of
Government Departments, Annual Reports on
currency and finance published by the Reserve Bank
of India, Statistical statements relating to
cooperatives and regional rural banks, published by
the NABARD, reports of the national sample survey
organization, reports of trade associations,
publications of international organizations such as
UNO,IMF, World Bank, ILO,WHO, etc., Trade and
Financial Journals, newspapers, etc.,
Secondary sources can include
79

Textbooks

Review articles and critical analysis essays

Biographies

Historical films, music, and art

Articles about people and events from the past

DATA COLLECTION TOOLS

The various methods of data gathering involve the use of appropriate
recording forms.
These are called tools or instruments of data collection. They consist
of Observation schedule or Observationnaire
Interview guide
Interview schedule
Rating scale
Check list
Opinionnaire
Document schedule/data sheet
80

 Schedule for institutions

Inventories
Each of the above tools is used for a specific method of data
gathering: Observation
Schedule for observation method, interview schedule and
interview guide for
Interviewing, questionnaire and optionnaire for mail survey, and
so on.

Methods of Primary Data Collection

There are various methods of data collection. A Method is different
from a Tool. While a method refers to the way or mode of gathering
data, a tool is an instrument used for the method. For example, a
schedule is used for interviewing. The important methods are:

81

(a) Observation, (b) Interviewing, (c) mail survey, (d)

experimentation, (e) Simulation, and (f) Projective technique. Each
of these methods is discussed in detail in the subsequent sections.
Observations involve gathering of data relating to the selected
research by viewing and or listening. Interviewing involves face-toface conversion between the investigator and the respondent. Mailing
is used for collecting data by getting questionnaires completed by
respondents. Experimentation involves a study of independent
variables under controlled conditions. Experiments may be conducted
in a laboratory or in a field in a natural setting. Simulation involves
creation of an artificial situation similar to the actual life situation.
Projective methods aim at drawing inferences on the characteristics of
respondents by presenting to them stimuli. Even method has its
advantages and disadvantages.

QUESTIONNAIRE
Market Survey
Name:
82

Age:
Profession:
Sex:
Q1) Which Amul Product does you like?
Cheese
Milk
Desserts
Others
Q2) How often do you visit an Amul Parlor Shop?
Almost Daily
2-3 times a week
2-3 times a month not often
Q3) How much money do you usually spend at an Amul
Parlor Shop?
25-75 Rupees
75-125 Rupees
Over 125 Rupees
Q4) How much time do you usually spend at an Amul
Parlor Shop?
Less than 1/2 hour
1/2- 1 hour
1-2 hours Over 2 hours
Q5) How you use an Amul Product?

83

 Daily
Weekly
Monthly
Q6) what is the single most important factor for you to
choose an Amul product?
Taste
Service
Experience
Value for money
Q7) Please rate the following, according to your
personal choice
1) Taste and Quality of products : (1=Bad and 5=
Fresh Milk
1
2
3
4
5
1
Cheese
1
2
3
4
5
1
Desserts
1
2
3
4
5
1
Other Drinks
1
2
3
4
5
1

Excellent)
2
3
4
2
3
4
2
3
4
2
3
4

5
5
5
5

2
2
2
2

5
5
5
5

Your comme nts:

2) Prices : (1=Cheap and 5=Expensive)

Fresh Milk
1
2
3
4
Cheese
1
2
3
4
Desserts
1
2
3
4
Other Drinks
1
2
3
4

5
5
5
5

1
1
1
1

Your comme nts:

RECOMMENDATIONS
Unavailability of Amul product is main part.
This part can be taken into consideration for
84

3
3
3
3

4
4
4
4

improving the service quality as well as

ensuring maximum availability of Amul product
at every possible location.

Right time to go for advertisement and

promotion schemes. No such major strategy is
being followed by the competitors brand right
now. The company can draw the attention of
customers and can take advantage out of it.

Only milk and ice cream products are there for

displays and advertisements in the market.
There is an absence of Amul chocolate
displays, danglers, posters, illuminated boards
etc. to focus on the Amul Chocolate.

There is a great demand from retailers side

that the company should offer greater profit
margins. As the profit margin in Amul Product
is less as compared to the competitors brand,
retailers are switching and giving their
preference to the competitors brand that is
offering maximum margins to them.

The old manufacturing date on packs is

creating the shifting of preference in
consumers choice. The consumer wants fresh
product and due to the old manufacturing
date, the consumer opts for other product
brands.

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 Relationship with retailers and company should

be kept under a close watch.
Salesmen should be given the responsibility to
handle the retailers grievances
Orders by the retailers should be executed in a
proper manner to avoid irregular availability.
Promotion activities should take into
consideration in two different ways a)
Company should associate themselves with
social events, b) Company should use
electronic as well as print media for their
advertisement.
Company should give special offers to retailers
frequently.
Company should expand their business
throughout the small towns.
Company should open exclusive Amul parlors
and outlets in big shopping Malls for promotion
in higher segment.

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 There have been a lot of complaints about

replacement policy of Amul. Amul should try to
improve its replacement policy and make it
somewhat liberal.

Conclusion
It is well recognized that markets that are
fragmented
or
producers
that
are
too small to build competitive infrastructures
or those who are unable to manage
technological changes in their operational
processes would benefit the most through a
cooperative organization..
The example of AMUL provides a number of
lessons
for
organizations
to
compete
successfully in the face of increasing
globalization and competition.
The AMUL case presents a successful model for
operating in emerging
economies
characterized by both large under-developed
suppliers and markets
with high potential.
The largest segment of the market in emerging
economies desires value for money from its
purchases.
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 Development of such markets requires careful

nurturing and a long-term approach. Initial
success in these markets is typically based on
a low price strategy (providing value for
money) supported by cost leadership.
This strategy helps to grow the market
exponentially by focusing on the largest
segment of the population, the middle and the
lower middle class.
In this context, it is important for global players
to note that the value proposition perceived by
consumers is influenced to a large extent by
the state of markets and the economy and
cultural factors.
Development
of
an
appropriate
value
proposition suitable for large mass markets in
India requires a thorough understanding of the
environment and a focus on costs.

This
in
turn,
requires
designing
the
organization structure and practices in a
manner that it delivers continued market share
through cost leadership. AMUL is a good
example of this strategy.
Amul are able to develop control processes
through better use of operational practices and
supply chain coordination are the ones that are
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able to serve large volumes and enjoy top line

growth in revenues.
Development of suppliers likewise requires
nurturing with a long-term perspective.
This was achieved by AMUL through a process
of education and social development activities
- activities that are not usually considered to
be standard business practices.
This type of out of the box vision is essential
for developing innovative mechanism in new,
unfamiliar environments where building of
relationship with consumers goes much
beyond marketing messages and useful
product offerings.
Environments with underdeveloped markets
and suppliers (as in the case of AMUL) add one
more dimension of complexity relating to the
relative pace of growth of these two areas.

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 Through its pricing strategy,

able to balance the growth
suppliers and has achieved
synchronization. Otherwise,
demand
and
supply
complementary strategies.

AMUL has been

in markets and
some degree of
gaps between
would
require

In this Project, using the example of AMUL, we

have presented a robust business model for
operating in large emerging economies
characterized by underdeveloped markets,
infrastructure and suppliers.
Cooperative
network
with
interlocking
arrangement as in GCMMF is one example of
success in managing such complex supply
chain. Of course, the long-term challenge in
such cases is to bring more members into the
network and increase their capabilities

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BIBLIOGRAPHY

Books:

Kotler Philip, Marketing Management

Kothari C.R., Marketing Research

Ramaswamy, Marketing Management

Websites:

http://www.amul.com

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http://projectstoday.com/sitemap/dairy_products_
database.asp

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