EXECUTIVE SUMMARY

Title: Understanding the Importance of Distribution Channel in

Supply Chain Management (Amul Pouch Milk).

Organization: “Gujarat Co-operative Milk Marketing Federation

(GCMMF), Anand, Gujarat”.

Objective:
 Calculate the Loading and Unloading Time of the Crates from
the Truck.
 To Calculate the Kilometers from the Biosar Plant to the Drop
Point of the Distributors.
 To Analyze the Trucksheet of the Distributors and do Area
Mapping.
 To Calculate the Transportation Cost of the Distributors.
 To Calculate the Returns On Investments of the Distributors.

Research Methodology:
Research type was First Hand, Explanatory and Descriptive. The
research was done through visiting Plant of the Organisation,
Travelling along with Trucks, visiting the Distributors drop points and
personally meeting them.
All the information which has been collected is First Hand.

Data Analysis:
The data analysis has done region wise. Route mapping for every
distributor is set according to the route and timing of delivery to each
distributor. Trucksheet of each distributor was used for the purpose of
Area Mapping

Conclusion:
Amul has around 60 percent of milk market share in Nallasopara
Area.

[1]
[2]
 INTRODUCTION AND HISTORY

The brand name Amul means “AMULYA”. This word derived from the
Sanskrit word “AMULYA” which means “PRICELESS”. A quality control
expert in Anand had suggested the brand name “AMUL”.
The Kaira District Cooperative Milk Producers’ Union Limited was established
on December 14, 1946 as a response to exploitation of marginal milk producers
in the city of Anand (in Kaira district of the western state of Gujarat in India) by
traders or agents of existing dairies. Producers had to travel long distances to
deliver milk to the only dairy, the Polson Dairy in Anand – often milk went
sour, especially in the summer season, as producers had to physically carry in
individual containers.
These agents decided the prices and the off-take from the farmers by the season.
Milk is a commodity that has to be collected twice a day from each cow/buffalo.
In winter, the producer was either left with surplus unsold milk or had to sell it
at very low prices. Moreover, the government at that time had given monopoly
rights to Polson Dairy (around that time Polson was the most well known butter
brand in the country) to collect milk from Anand and supply to Bombay city in
turn (about 400 kilometers away). India ranked nowhere amongst milk
producing countries in the world in 1946.
The producers of Kaira district took advice of the nationalist leaders, Sardar
Vallabhbhai Patel (who later became the first Home Minister of free India) and
Morarji Desai (who later become the Prime Minister of India). They advised the
farmers to form a Cooperative and supply directly to the Bombay Milk Scheme
instead of selling it to Polson (who did the same but gave low prices to the
producers). Thus the Kaira District Cooperative was established to collect and
process milk in the district of Kaira. Milk collection was also decentralized as
most producers were marginal farmers who would deliver 1-2 liters of milk per
day. Village level cooperatives were established to organize the marginal milk
producers in each of these villages. The first modern dairy of the Kaira Union
was established at Anand (which popularly came to be known as AMUL dairy
after its brand name). The new plant had the capacity to pasteurize 300,000
pounds of milk per day, manufacture 10,000 pounds of butter per day, 12,500
pounds of milk powder per day and 1,200 pounds of Casein per day. Indigenous
R&D and technology development at the Cooperative had led to the successful
production of skimmed milk powder from buffalo milk – the first time on a
commercial scale anywhere in the world.

[3]
The foundations of a modern dairy industry in India had just been laid as India
had one of the largest buffalo populations in the world. We move to year 2000.
The dairy industry in India and particularly in the State of Gujarat looks very
different. India for one has emerged as the largest milk producing country in the
world. Gujarat emerges as the most successful State in terms of milk and milk
product production through its cooperative dairy movement. The Kaira District
Cooperative Milk Producers’ Union Limited, Anand becomes the focal point of
dairy development in the entire region and AMUL emerges as one of the most
recognized brands in India, ahead of many international brands.
Starting with a single shared plant at Anand and two village cooperative
societies for milk procurement, the dairy cooperative movement in State of
Gujarat had evolved into a network of million milk producers (called farmers)
who are organized in 10,411 milk collection independent cooperatives (called
Village Societies). These Village Societies (VS) supply milk to thirteen
independent dairy cooperatives (called Unions). AMUL is one such Union. Milk
and milk products from these Unions are marketed by a common marketing
organization (called Federation). Dr Verghese Kurien, former chairman of the
GCMMF, is recognised as a key person behind the success of Amul. On 10 Aug
2006 Parthi Bhatol, chairman of the Banaskantha Union, was elected chairman
of GCMMF.

[4]
Figure 1 and 2 together show the structure and the range of activities in this
extensive network.

Figure 1: Describes the hierarchical nature of the cooperative structure

[5]
Figure 2: Presents the supply chain linking farmer-suppliers of milk with the
Millions of consumers.

GCMMF has 42 regional distribution centers in India, serves over 5,00,000

retail outlets and exports to more than 15 countries. All these organizations are
independent legal entities yet loosely tied together with a common destiny.(In a
recent survey GCMMF was ranked amongst the top ten FMCG firms in the
country while AMUL was rated the second most recognized brand in India
amongst all Indian and MNC offerings). Interestingly, the Gujarat movement
spread all over India and a similar structure was replicated (all are at different
levels of achievement but their trajectory appears to be quite similar). Two
national organizations, the National Dairy Development Board (NDDB) and the
National Co-operative Dairy Federation of India (NCDFI) were established to
coordinate the dairy activities through cooperatives in all the States of the
country. The former provides financing for development while the latter
manages a national milk grid and coordinates the deficit and surplus milk and
milk powder across the states of India. In the early nineties, AMUL was asked
by the Government of Sri Lanka to establish a dairy on similar lines in Sri
Lanka. Interestingly, while Polson folded up sometimes in 1960s, the
cooperatives are

[6]
faced with new competition in liberalizing India – from MNCs who brought in
new business paradigms, new and improved product portfolio, international
network and immense financial support. The Cooperatives face new challenges
that test the robustness of their approach and their commitment to the
movement and a new style of management thinking.
Today AMUL is a symbol of many things. Of high-quality products sold at
reasonable prices. Of developing and coordinating a vast co-operative network.
Of making a strong business proposition out of serving a large number of small
and marginal suppliers. Of the triumph of indigenous technology. Of the
marketing savvy of a farmers' organization.

Indian Dairy Industry -- A Profile:

India’s dairy sector is expected to triple its production in the next 10 years in
view of expanding potential for export to Europe and the West. Moreover with
WTO regulations expected to come into force in coming years all the developed
countries which are among big exporters today would have to withdraw the
support and subsidy to their domestic milk product sector. Also India today is
the lowest cost producer of per liter of milk in the world, at 27 cents, compared
with the US’ 63 cent The urban market for milk products is expected to grow at
an accelerated pace of around 33% per annum to around Rs.83, 500 crores by
year 2012. This growth is going to come from the greater emphasis on the
processed food sector and also by increase in the conversation of milk into milk
products. By 2012, the value of Indian dairy produce is expected to be Rs 10,
00,000 million.
Co-Operative Unions:

Backward integration of the process led the cooperatives to advances in animal

husbandry and veterinary practice. The system succeeded mainly because it
provides an assured market at remunerative prices for producers' milk besides
acting as a channel to market the production enhancement package. It does not
disturb the agro-system of the farmers. It also enables the consumer an access to
high quality milk and milk products. Contrary to the traditional system, when
the profit of the business was cornered by the middlemen, the system ensured
that the profit goes to the participants for their socio-economic up liftmen and
common good. Recently the Indian cooperative movement got a much needed
facelift. With competition snapping at its heels, the sector which has been
governed by arcane laws until the recent past will see a special provision
inserted in the companies Act, 1956.

[7]
All the cooperative unions will be rechristened cooperative companies; they will
come under the purview of the registrar of companies, instead of the registrar of
cooperatives. The dairy board's programs and activities seek to strengthen the
functioning of dairy cooperatives, as producer-owned and controlled
organizations.
NDDB supports the development of dairy co-operatives by providing them
financial assistance and technical expertise, ensuring a better future for India's
farmers. Over the years, brands created by cooperatives have become
synonymous with quality and value. Brands like Amul (GCMMF), Vijaya (AP),
Verka (Punjab), Saras (Rajasthan). Nandini (Karnataka), Milma (Kerala) and
Gokul (Kolhapur) are among those that have earned customer confidence.

[8]
 13 million in India
1,22,534 Villages in India
176 District Unions in India

3.0 million in Gujarat

15,332 villages in Gujarat

13 District Unions in Gujarat

22 State Fedns. in India

GCMMF in
Gujarat

[9]
Some of the major dairy cooperative federations include

 Andhra Pradesh Dairy Development Co-operative Federation Ltd

[10]
(APDDCF)
 Bihar State Co-operative Milk Producers Federation Ltd (COMPFED)
 Gujarat co-operative Milk Marketing Federation Ltd (GCMMF)
 Haryana Dairy Development Cooperative Federation Ltd. (HDDCF)
 Himachal Pradesh State Cooperative Milk Producers Federation Ltd
(HPSCMPF)
 Karnataka Cooperative Milk Producers Federation Ltd (KMF)
 kerala State Cooperative Milk Marketing Federation Ltd (KCMMF)
 Madhya Pradesh State Cooperative Dairy Federation Ltd (MPCDF)
 Maharashtra Rajya Sahkari Maryadit Dugdh Mahasangh (Mahasangh)
 Pradeshik Cooperative Dairy Federation Ltd (UP) (PCDF)
 Punjab State Cooperative Milk Producers Federation Ltd (MILKFED)
 Rajasthan Cooperative Dairy Federation Ltd (RCDF

[11]
Amul Secret Of Success:

Amul has been able to:

Produce an appropriate blend of the policy maker’s farmer’s board of
management and the professionals: each group appreciating its role and
limitations. Bring at the command of the rural milk producers the best of the
technology and harness its fruit for betterment. Provide a support system to the
milk producers without disturbing their agro- economic systems. Plough back the
profits, by prudent use of men, material and machines, in the rural sector for the
common good and betterment of the member producers. Even though, growing
with time and on scale, it has remained with the smallest producer members. In
that sense, Amul is an example par excellence, of an intervention for rural
change. The Union looks after policy formulation, processing and marketing of
milk, provision of technical inputs to enhance milk yield of animals, the artificial
insemination service, veterinary care, better feeds and the like - all through the
village societies.
Basically the union and cooperation of people brought Amul into fame i.e.
AMUL (ANAND MILK UNION LIMITED), a name which suggest THE
TASTE OF INDIA. Amul (Anand milk union ltd.) is based on four hands, which
are coordinated with each other. The actual meaning of this symbol is co-
ordination of four hands of different people by whom this union is at the top
position in Asia.

 First hand is of farmers, without whom the organization would not

have existed.
 Second hand is of processors, who process the raw material (milk)
into finished goods.
 Third hand is of marketer, without whom the product would have not
reached the customers.
 Fourth hand is of customers, without whom the products would have
not carried on.

GCMMF Overview:

[12]
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.
Gujarat Cooperative Milk Marketing Federation Ltd (GCMMF) is the largest
organization in FMCG industry engaged in marketing of milk & milk products
under the brand names of AMUL and SAGAR with an annual turnover exceeding
Rs 9000 crores.
GCMMF is a unique organization. It's a body created by Farmers, managed by
competent professionals serving a very competitive and challenging consumer
market. It is a true testimony of synergistic national development through the
practice of modern management methods.

Vision:
GCMMF will be an outstanding marketing organization, with specialization in
marketing of food and 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 lakh 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.

[13]
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.

Organization Structure:
Organization Structure is divided into two parts:
 External Organization Structure
 Internal Organization Structure

 External Organization Structure

External Organization Structure is the organization structure that affects the
organization from the outside.

State Level Marketing

Federation. District Milk

Product Union Ltd. Village Milk

Product Union Ltd.

Villager
s

As we know, GCMMF is unit of Gujarat Milk Marketing Federation, which is

a co-operative organization. The villagers of more than 10000 villages of
Gujarat are the bases of this structure. They all make village milk producers
union, district level milk producers union and then a state level marketing
federation is established. The structure is line relationship, which provides
easy way to operation. It also provides better communication between two
stages.

 Internal Organization Structure:

[14]
The following is internal organization chart

of Amul: Organization

Structure Chart

[15]
Production Function:-

Explosion of the production technology and changes in technical field is going

to bring out revolution in the industry sector which eventually gives stand to
study and favors the come backing subject i.e. production and management.

Production and operation management is planning, organizing, staffing,

directing and controlling of all the production system those portions of
organization that convert inputs into products and services. In general
production system takes raw material, personnel, machines, buildings and other
resources and produce products and services.

The core of production system is its conversion subsystem where in workers;

raw materials are used to convert inputs into products and services. This
production department is at heart of the firm, as it is able to produce low cost
products and superior quality in timely manners.

Thus, there arises enormous need of giving due importance to this department as
a whole and a strong concrete base being foundation pillars of a manufacturing
organization, if the intention is to succeed domestically and globally.

Distribution Network:

Most producers work with marketing intermediaries to bring their products to

market. The marketing intermediaries make up a marketing channel also called
distribution channel. Distribution channels are sets of interdependent
organizations involved in the process of making a product or service available
for use or consumption.

The Head Office of GCMMF is located at Anand. The entire market is divided
in 5 zones.

The zonal offices are located at Ahmedabad, Mumbai, New Delhi, Kolkata and
Chennai. Moreover there are 49 Depots located across the country and GCMMF
caters to 13 export markets.

[16]
A zero level of channel also called a direct marketing channel consists of a
manufacturer selling directly to the final customers. A one level channel;
contains one selling intermediary such as retailer to the final customers. A two
level channel two intermediaries are typically wholesaler and retailer. A three
level channel are typically wholesaler, retailer and jobber in between.

GCMMF has an excellent distribution. It is its distribution channel, which has

made it so popular. GCMMF’s products like milk and dahi are perishable. It
becomes that much important for them to have a good distribution.

Distribution Channel
Product
s
|
Age
nts
|
Wholesal
er
|
Retail
er
|
Consum
er

[17]
We can see from above figure that GCMMF distribution channel is simple and
clear. The products change hands for three times before it reaches to the final
consumer. First of all the products are stored at the Agents end who are mere
facilitators in the network. Then the products are sold to wholesale dealers who
then sell to retailers and then the product finally reaches the consumers.

GCMMF transacts on an advance demand draft basis from its wholesale dealers
instead of the cheque system adopted by other major FMCG companies. This
practice is consistent with GCMMF's philosophy of maintaining cash
transactions throughout the supply chain and it also minimizes dumping.
Wholesale dealers carry inventory that is just adequate to take care of the transit
time from the branch warehouse to their premises. This just-in-time inventory
strategy improves dealers' return on investment (ROI). All GCMMF branches
engage in route scheduling and have dedicated vehicle operations.

Upstream Channel in which milk is procured from the farmers to

the manufacturing units.

 In the first step, the milk is taken to the VCS by the farmers on
foot or bicycles in small quantities.

 The second step involves the transportation of milk from the co-
operatives to the manufacturing units this is done in special trucks
which are equipped with tankers to carry milk.

[18]
 21

Downstream Channel, it is the distribution part of the supply chain. From the
manufacturing units to the retailers:
First leg of transport is from the manufacturing unit to the company
depots.

 Frozen food the temperature of these trucks is kept below -18˚C

 Dairy wet the temperature of these trucks is kept between 0-4˚C

Second leg is from the depot to the WD’s, this transport is carried out in
insulated 3 and 5 MT TATA 407’s here a permanent dispatch plan
(PDP) is prepared where the distributor plans out the quantity of various
products to be ordered on a particular date.

[19]
Third leg this is the flow of good from WD’s to retailers, a beat plan is
prepared and transportation is done on auto-rickshaws, rickshaws and
bicycles.

[20]
[21]
Managing Competition:

The Indian market is dominated by a large number of small local and regional
players. There are an estimated 150 manufacturers in the organized segment,
which accounts for 30-35% of sales and about 1000 units in the unorganized
segments of the market. In the organized segment the significant brands are
Kwality Walls , Vadilal, Amul, Havmor, Mother dairy and Baskins & Robbins.
GCMMF is facing very tough competition from both in and outside India. Amul
combats competition from its competitors by providing quality products at a
price which its customers value. Along with good quality products and
reasonable price the packaging is also very good.

Most of its products are available in many flavors. Excellent advertising backs its
products and helps GCMMF (AMUL) to leave its competitors a tough time. Also
Amul has come out with Amul Parlours to cater to various segments of
customers. Amul has a very strong Brand Image in the Domestic market. Many
products are exported by GCMMF.

Sales Turnover:
Sales turnover of GCMMF from 2000 to 2012:-

Sales Turnover Rs. (Million)

2000-01 22588
2001-02 23365
2002-03 27457
2003-04 28941
2004-05 29225
2005-06 37736
2006-07 42778
2007-08 52554
2008-09 67113
2009-10 80050
2010-11 90000
2011-12 11200

Areas of
Operation:

[22]
 Besides India, AMUL has entered overseas markets such as Mauritius,
UAE, USA, Bangladesh, Australia, China, Singapore, Hong Kong and a
few South African nations. Other potential markets being considered
include Sri Lanka.

Achievement & Awards:

Amul: Asia’s largest dairy co-operative was created way back in1946 to make
the milk producer self-reliant and conduct milk- business with pride. Amul has
always been the trend setter in bringing and adapting the most modern
technology to door steps to rural farmers.

Amul created history in following areas:

 First self motivated and autonomous farmers “organization comprising

of more than 5000000 marginal milk producers of Kaira District”
 Created Dairy co-operatives at village level functioning with milk
collection centers owned by them.

 Computerized milk collection system with electronic scale and

computerized accounting system.

 The first and only organization in world to get ISO 9000 standard for its
farmer’s co-operatives.

 First to produce milk from powder from surplus milk. Amul is the live
example of how cooperation amongst the poor marginal farmers can
provide means for the socio-economic development of the under
privileged marginal farmers.

[23]
Awards:
 Magsaysay award for community leadership presented in manila,
Philippines to Shri Tribhuvandas Patel, Shri D N Khurody and Shri V.
Kurien

 1965: “Padmshri” awarded was given to V. Kurien, general manager, by

the president of India.

 1987: “Best Productivity” awarded by national productivity council for

the year 1985-86 awarded to Amul dairy.

 1988: “Best Productivity” awarded for the second successive year 1986-
87 by the president of India, Mr. R. Venkatrao to kaira union.

 1993: “ICA” Memento towards genuine and self sustaining cooperative

worldwide ICA regional office for Asia and pacific, New Delhi, 1996.

 1999: G.B.Birla award. Moreover the Amul union has achieved the
prestigious ISO 9001-2000

 HACCP Certificate and effects are got to obtain ISO 14000.

 1999: Best of All" Rajiv Gandhi National Quality Award for the year.

 2003: The Gujarat Co-operative Milk Marketing Federation Ltd. has

emerged as the top scorer in the service category of the prestigious IMC
Ramakrishna Bajaj National Quality Award.

 2006-07: GCMMF has bagged award for excellent performance in

exports of dairy products from Agricultural and Processed Food Exports
Development Authority (APEDA).

 2007: Amul Pro-Biotic Ice-cream gets No. 1 Award at World Dairy

[24]
Summit.

[25]
 OBJECTIVES AND SCOPE OF THE PROJECT

Objectives of the Project

 To Calculate the Loading and Unloading Time of the Crates from the
Transporting Vehicle.
 To Calculate the Kilometers from the Biosar Plant to the Individual Drop
Points of the Distributors.
 To Calculate Returns On Investments of all the Distributors in
Nallasopara Area.
 To Analyze the Trucksheet of the Retailers and do an Area mapping
accordingly.

Scope of the Project

 It gives the Information about the Distributors Channel of the Company.
 It threw some lights on the Distributors Investments.
 Distributors act as the mediators for the Supply of the Milk Products to
the Local Area.
 It gives Information about the Time Consumed by each truck to deliver
the Products to each Different Distributor.
 It provides suggestions to the company to improve their distribution
techniques.
 It will help to calculate the time to delivery and give the distributor
proper timing to deliver the product.

[26]
 BREIF INTRODUCTION TO DISTRIBUTORS

For taking an agency of Amul an individual needs to have a basic initial

investment of Rs. 10000. This sum of amount is kept with the company as bank
Guarantee on which a Distributor earns Interests. With some additional basic
paper work an individual may gets the distributorship of Amul, once everything
is verified and trustworthy, he would start receiving the Amul products. Anyone
can become the distributor of Amul. At morning around 5.00 the distributors get
his ordered products. For receiving the order a fixed place is selected and is
called as drop point. He can then start delivery of milk and after the end of the
day, he need to accumulate all the empty crates and keep them at the same drop
point. On second day the truck driver would drop unload the ordered crates and
will load the empty crates. This process goes on and on.
Amul has three different Amul products departments and are as follows:-
 Dairy
 Ice-cream
 Dairy Products.

There are overall 17 Distributors of Amul pouch milk and are situated at
different places. In Nallasopara W. we have Following Distributors:-
 Mahalaxmi Distributors
 Bhoomi Distributors
 Ashtavinayak Distributors
 Jai Jivdani
 Datta Sai
 Siddhakala Agency

In the East region of Nallasopara we have following Distributors.

 Yash
 Deva
 2D
 Thakkar Enterprises
 Thakkar Dairy
 Riddhi Siddhi

[27]
 Central Park Dudh Vitralak Kendra
 Riddhi Raj
 Santoshi Dudh
 Mourya Milk
 Om Sai Collection.

[28]
 RESEARCH METHODOLOGY

The research was conducted from 21st May to 21st July, 2012. The research
includes meetings with the Distributors, Truck drivers, Retailers and Biosar
Plant Staff. It included Sheets provided by the Vimal Riaz (GCMMF) which has
to be answered by Distributors.
I went with the trucks to know the route and noted down the timing of reaching
to each distributor and delivering and then again leaving for another distributor.
I noted down the route which truck was following. The views of the above
parties are mentioned in the Report.
I visited Vasudhara manufacturing plant located at boisar, Mumbai. I saw the
overall process of Milk, lassee, Dahi Production. I also studied the loading of
products in refrigerated trucks and which was going to the Distributors and also
saw the unloading Process. I also calculated the time of loading and unloading
of the crates.
For Calculation of Returns on Investments, I went to all the Distributors and
asked for the required Information and calculated their Returns.

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.
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 farmers produced
 To sell liquid milk at affordable prices so as to serve a large number of
consumers.

[29]
  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 class.

It is noteworthy that from the very beginning, in the early 1950s, Amul adopted
the network as the basic model for long-term growth. Two aspects of this
network deserve special attention.
First, the network explicitly includes secondary services to the farmer-
suppliers.
Second, several of the entities in the network are organized as cooperatives
linked in a hierarchical fashion.

[30]
 DATA COLLECTION AND ANALYSIS

All data which were collected was Firsthand. For the same I visited the Biosar
Plant and travelled through the same truck which was responsible for the
delivery of Amul Products. With this trip I got an experience of the route of the
drivers and also about the time taken by them to reach the first Drop point of the
ADA.
I was responsible for the Following products:
 Amul Tazza 500X20
 Amul Tazza 1000X10
 Amul Tazza 5000X2
 Amul Gold 500X20
 Amul Gold 1000X10
 Amul Gold 5000X2

All this products starts loading after 17:45 from the Biosar plant so that can
leave the Plant for Mumbai and drop the Milk to ADA’s on Time. The Vehicles
have a Capacity of around 750 crates to 850 crates each. The Vehicles start
leaving the Plant at 19:00. The Vehicles for Nallasopara area leaves around
22:00 because the distance from the Plant to the Nallasopara is approx 80 KMs.
In Biosar Plant only Amul Tazza is produced. Amul Gold is produced at Vashi
Plant and is transported to Biosar Plant, and from Biosar plant it gets
transported to Biosar Zone. In between, drivers tend to have a small break of
around 20 minutes. Many drivers have a small meet at that place and stops for
talk and tea. The Overall Nallasopara Area comprises of 4.5 kms in all. This
includes the East and West regions. All the Crates which are placed in the
vehicles have some ice cubes in it. This helps the perishable product last longer
and increases there shelf lives. The trucks use the route of National Highway 8
for the transportation of Amul Products The truck after leaving from Plant opt
NH8 and then take a turn to Vasai Phata and through Evershine Road, they enter

[31]
into Nallasoapara. Trucks Drivers don’t come from Nallasopara Phate so as to
avoid the expenses of toll. From vasai phate they can freely enter into the city
and then they move to Nallasopara Area.

For calculating loading and unloading time of the crates I went and calculated
the time with the stop watch of my cell phone. It normally varies as the drivers
are only responsible for the same process. If the driver is strong enough to pick
the filled crates and put them to the place and it take less time. I also collected
all the required information for the process of Area Mapping. I took the
Trucksheet from every distributor and mapped them accordingly. I used google
map for this purpose.

[32]
 OBSERVATIONS AND FINDINGS

The distribution Channel of Amul is Strong in nature. I visited at the Biosar

Plant of Amul – Vasundhara Dairy. In this plant the products which are
produced are as follows:-

 Amul Tazza
 Amul Masti Dahi
 Lassee
 Flaavyo

The Production of Amul Gold is not done in Boisar plant. It is produced in

Vashi plant and then transported here. The requirement of Amul Gold is very
limited, as this milk is not used for daily purpose consumptions. It is mostly
preferred by sweet makers and a little bit is consumed in house for daily
purposes. The cost of production is more and returns are less. Hence the
decision for producing Amul Gold at one plant and then transporting it to other
plants help the company to maintain their production process effectively.
For delivering Amul Products, company has maintained a contract with some
truck owners. This truck owners / drivers are responsible for daily transport of
goods from plant to the individual drop points of the distributors. The Biosar
plants serves to the some areas in Mumbai and are as follows:-
Zone 1: Biosar to Naigoan
Biosar
Umroli
Palghar
Kelve Road
Shafale
Vaitarna
Virar
Nallasopara
Vasai
Naigoan
Zone 2: Bhayander to Mira Road

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Bhayander
Mira Road
Zone 3: Dahisar to Goregoan
Dahisar
Borivali
Kandivali
Malad
Goregoan
Zone 4: Jogeshwari to Andheri
Jogeshwari
Andheri.

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While the process of loading is on, one of the officers of Vasundhara Dairy
keeps an eye as to check the total of crates which needs to be load in the truck
and get it matched from the receipt. The truck drivers are responsible for
loading and unloading. They do it very well. It require huge amount of manual
efforts. They pick the crates and unload them. 1 crate consists of 40 pouches of
500 ml each. It requires huge muscle power as the weight is also high.
Some of the Distributor has started their business from scratch and are doing
well. Some of them have taken the agencies are not maintaining by own, they
hire some people to work for them. Some of the distributors work by their own
resources, they don’t have any one to help and this makes more profit as
compared to others.
The crates need to be returned by the distributors. The crates are kept at the drop
point of individual distributors and are taken back by the truck drivers at the
time of delivery. Some truck drivers do it on the spot after unloading the filled
crates, while some do it later when all the delivery is done.
While calculating the loading and unloading time of the crates it was found that
for a single filled crate to get unload it takes 20 minutes and the speed of that
increases with the decrease in time taken for same. The example is taken of
Ashtayinayak Agency in Nallasopara (W). The time in stop watch was 02:17
when the unloading process started and it ended at 02:40 in the night. There
were 339 crates at that day. And for unloading they took 6 minutes for 339
crates. Hence they took 1.8 seconds each for unloading the crates from their
truck to the individual drop points of the distributors. This is quite an accurate
figure as it was calculated with the help of STOPWATCH. It was found that
once the crates breaks then it stand of no use. In fact it results in spoilage of
pouch milk and results in loss. It affects the productivity of the company. The
drivers are fully responsible for it, but the loss is faced by distributors. It is the
policy of the company that once the products are delivered than it’s the
responsibility of the distributors to face the losses of damage.
In case of calculating Kilometers, I travelled through the delivery trucks and
found that the routes are standards and they are regular. With the help of
SPEEDOMETER, while leaving the Vasundhara Dairy Plant, the time was
calculated with the help of trucks speedometer and it was 57675 and while
reaching the first drop point of the ADA Datta Sai it was 57748. The overall
time taken to reach the first drop point was 2 hours and the Distance is 73
Kilometers. I came to the exact kilometers from the plant to the first drop point.
It was also calculated that the overall Nallasopara Market was only 4.5
kilometers and hence the delivery process was short. It was also observed that
around 5 trucks are responsible for delivery process in the Nallasopara Area,
which comprises of east as well as west regions. In east there are around 3
trucks and in west there are 2 trucks assigned for transportation purposes.

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For every business Returns On Investments plays a crucial role. In the business
of Distribution connection are very important. The business of Milk Distribution
yields a regular return as no credit is given, and it is never ending business. I
observed that Returns on Investments in this business are less as compared to
other businesses but are gradual. It is a onetime investment.
The Truck many times produces bad smell. This smell is because of the fallen
milk. At the time of loading, due to some of the damaged pouch, the milk fells
on the truck. These trucks are not washed regularly and hence they produce bad
smell. Though the end customer is not aware of the issue, but it is important to
check that out. It shows bad impression on the distributors. While
communicating to the drivers it was noticed that the water facility was not
provided at the plant so that the truck drivers wash their truck. It is also a duty
of the truck drivers to maintain hygiene.
Certain distributors are not literate enough to understand the billing pattern;
they need to be explained properly about what their bill is all about. They don’t
even know about crates deductions.
Certain distributors maintain milk products of others brands also. This results in
losses to Amul Company. The process goes as follows:-
The customer comes at around 3:00 in the noon time in a kirana stores / milk
shop and ask for Amul pouch milk. She gets it from the shop. Later at around
7:30 in the evening another customer enters in a shop and ash for Amul Milk.
Till this Amul milk pouch which the retailer had, has sold. The customer is
served with some other milk product but not Amul as the quantity of amul
which the retailer had was finished. The retailer was given the other brand by
same Amul distributor. In this case if the retailer didn’t had the other brand then
off course the customer would have been served by Amul and hence the sale of
Amul was done. This overall process is affecting Amul company.

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Observations in case of Distributors

All the processing and billing is done on the system called SAP. The distributors
are not satisfied with this introduction as everything is on record. Earlier no
perfect record was maintained. In SAP whole transaction between the
distributor and the Company gets processed. It include Purchase details, Issued /
received of crates, etc.
The distributors with huge volumes make more money as their fixed cost
remains same for e.g. one distributor who owns a vehicle for transport is
bearing a cost of 500 for 30 crates. This cost includes all expenses faced by
distributor for one day. If his volumes increases than his profit would also
increase and the fixed cost would remain same.
Some distributors wanted to shut their business as they were not satisfied with
the services provided by GCMMF. The main reason was other distributors in
same area and results in loss by both of the distributors. The customer enjoys
the benefit. The reason for allowing distributorship in the same area is off
course to boost up the profit.
Distributors are also facing the problem of dumping. This makes them
demotivated

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 SUGGESTIONS AND RECCOMENSATIONS

 It was observed that the distributors are facing huge losses because of
damages of the pouch milk. For this the people / drivers who are responsible
for loading and unloading process should be provided more training so as to
decrease the damages.
 The distributors are also facing the problem of dumping which make it
impossible for them to forecast and give order for the next day as they
currently have extra stock.
 Certain distributors are not literate enough to understand the billing pattern;
they need to be explained properly about everything. Their doubts need to
be cleared.
 The distributors of Amul should not be allowed to keep other milk products.
And even if they maintain the same, they should be punished.

 The exclusive distributor of Amul needs to be given more attention.

 Certain schemes needs to entertain to the milk distributors shall be given so

as to motivate them and increase our sales.

 Trucks which are used for transport of Amul Pouch Milk should be washed
regularly.

 The production of Amul Tea Top should be stopped as it is not giving proper
returns.

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 CONCLUSION

Amul means different things to different people.

To a milk producer – A life enriching experience.

To a consumer – An Assurance of having wholesome products.
To a mother – A reliable source of nourishment for her family.
To the country – Rural development and self reliance.

As we know that Amul is very big organization and market leader in dairy
products. But there are places where the Amul products are not available so
Amul can have a research on this topic and can supply products to that area.

Distribution network has been one of the major strength of Amul Company
giving a tough competition to competitors.

Supply chain management can be the back bone of a company at it carries out
the most difficult task of distributing the products to different regions and
makes them available to consumers.

AMUL, being an FMCG company, attaches a lot of significance to the

distribution aspect of its business. The distribution channel of AMUL holds a lot
of potential in affecting the demand or sales of AMUL products through
delivery on time, delivery of variety of products, the retailer friendliness of the
policies being set by the distributors and equitable distribution of products to all
the retail outlets in a particular region.

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Amul has successfully maintained very good relations with its stakeholders in
the market. Stake holders like Distributors and Customers. Even the small
Query of any distributor is solved within the time. Though the profit margin in
Amul is less compared to its competitors, the distributors are happy to distribute
Amul products.

Amul is among one of the FMCG Company in India which help the country
which is widely spread and performing for the welfare of the country.

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 BIBLIOGRAPHY

 www.amul.com
 www.wikipedia.org
 www.googlemaps.com

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