SUMMER INTERNSHIP PROJECT

Mother Dairy Fruit and Vegetable Pvt. Ltd. – An Organizational study

with specific reference to Accounts Department

Submitted by

AFREEN SIDDIQUI

Bachelor of Commerce (Honors)

Class of 2022

Under the Supervision of

Mr. Rakesh
Chauhan Unit
Finance Head
Mother Dairy Fruits & Vegetables Pvt. Ltd

In Partial Fulfilment of the Requirements for the

Degree of
Bachelor of Commerce (Honors)

AMITY COLLEGE OF COMMERCE AND FINANCE

AMITY UNIVERSITY UTTAR PRADESH
SECTOR 125, NOIDA - 201303, UTTAR PRADESH, INDIA
 ACKNOWLEDGEMENT

It was a great learning experience for me to work on my project for six weeks in such a charged
and highly motivated organization. As a student of Amity College of Commerce and Finance, I
got an opportunity for doing my summer internship in MOTHER DAIRY FRUITS AND
VEGETABLES PRIVATE LIMITED.

First of all, I wish to express my profound gratitude and sincere thanks to Mr. Neeraj Aggarwal,
General Manager (Finance), who allowed me to do my Summer Internship in Mother Dairy Fruit
and Vegetable Pvt. Ltd., Patparganj, New Delhi.

I owe my wholehearted thanks and appreciation to Mr. Rakesh Chauhan, Unit Finance Head for
his support and guidance as my Industry Guide and for providing platform to interact with all the
staff members of the Unit I would also like to thank Mr. Ashwini Kumar Wadhwa, Sr.
Executive, Finance who was always there to help and guide me & provided me with the data
required for the analysis. I would also like to thank Mr. Vinay Agarwal, Senior Manager, Mr.
Shakti Chand, Assistant Manager Finance & Mr. Anil Kumar Dhyani, Accounts Officer for
helping & guiding me in my analysis. Thanks to all the staff members of Finance, HR and
Procurement Department for their valuable support and helping me out during my visits to field
areas. Working with them was an extremely knowledgeable and enriching experience for me.

Also, I would like to express my deepest gratitude to my faculty guide Dr. Adarsh Arora for his
guidance, cooperation and encouragement which helped in completion of the report and Dr.
Sujata Khandai, Director, Amity College of Commerce and Finance for giving this project. I
am wholeheartedly thankful to both for giving me their valuable time and attention and for
providing me a systematic way for completing my project on time.

Last but not the least, I extend my heartfelt thanks to my family and well-wishers who provided
me their helping hands for the completion of the internship.
 ABSTRACT

An organization entails a group of people who work together with the intention of achieving a common
goal through specialization and division of labour. This requires Co-ordination at all levels to smooth
functioning. An organizational study is an effective tool conducted to gain an insight on the pillars of the
organization. The main purpose of doing the organization study is to study the various departments of the
organization and understand their basic functions, their purpose, achievements, competitors and the
mission and vision of the company and their progress towards that.

As a part of three-year B. Com Honors program at the end of 2 nd semester, we had to undertake summer
internship (as a part of NTCC program) in an organization, in order to understand the its structure, their
functions and corporate culture. This was a great opportunity to get the first hand information and
understand the functioning of the various departments.

Through this project report entitled “Mother Dairy Fruit and Vegetable Pvt. Ltd. – An Organizational
study with specific reference to Accounts Department ” , we will be able to analyze the overall
functioning of the firm. Mother Dairy is known to be one of the leading brand name under FMCG sector.
Built on the cooperative milk model that revolutionized the Indian dairy industry while transforming
the lives of milk producers in distant rural areas, Mother Dairy bases a major portion of its daily milk
production from dairy cooperatives and village level organizations, ensuring the freshest products while
empowering those who produce them. High quality and reliable products along with a robust network
of local level milk booths and larger retail channels have ensured that Mother Dairy has become a
household name in the branded milk segment.

The prepared report consists of five Chapters that outlines the history, genesis, activities, and
achievements of Mother Dairy Fruit and Vegetables Pvt. Ltd Patparganj, Delhi. This information can help
in better understanding the firm, its policies and strategies. The study gives hints on how effectively an
organization can design its functional areas like production, marketing, finance, HR practices, operations
and supply chain management and how they can be constructed to improve organizational effectiveness.

Training under Organization’s Accounts Department also gave me an opportunity to enhance my

necessary knowledge and skill in line with the field of accounting and finance. This enabled me to
generate practical skills from the respondents in the various directorate and department of organization
and in getting a fundamental overview of some of the core activities performed in the respective
department which is further elaborated in subsequent chapter.

The key learnings from this valuable opportunity also aimed at providing:

 Exposure to real life organisational and environmental situations

 Provided invaluable knowledge and developing a network which will be useful in enhancing the
career prospects.
 Applying book learnt concepts in real-life situations.
 Grooming my intellectual, interpersonal, and leadership qualities.
 TABLE OF CONTENTS

S.NO. DESCRIPTION
1. CHAPTER -1 INTRODUCTION OF THE COMPANY

2. CHAPTER – 2 ORGANISATION STRUCTURE

3. CHAPTER 3 –

(PART -A) FUNCTIONAL DEPARTMENTS

(PART -B) FUNCTIONAL ANALYSIS – ACCOUNTS DEPARTMENT

4. CHAPTER – 4 COMPANY ANALYSIS

1. PRODUCT MIX
2. SWOT ANALYSIS
3. BCG MATRIX
4. PESTLE ANALYSIS
5. MARKETING MIX STRATEGY

4. CHAPTER – 5 CONCLUSION

5. REFERENCES
 CHAPTER -01
INTRODUCTION OF THE COMPANY

Introduction
In India, the dairy sector plays an important role in the country’s socio-economic development
and constitutes an important segment of the rural economy. Dairy industry provides livelihood to
millions of homes in village, assuring supply of quality of milk and milk products to both urban
and rural areas. With view to keeping pace with the country’s increasing demand of milk and
milk products, the industry has been growing rapidly. The dairy sector in the India has shown
remarkable development in the past decades and India has now become one of the largest
producers of milk and value-added milk products thus becoming ‘The Oyster’ of the global
dairy industry.
This all began back in 1965, with the formation of National Dairy Development Board (NDDB)
that aimed at promoting, planning and organizing dairy development through cooperatives.
NDDB's programmes and activities seek to strengthen farmer owned institutions and support
national policies that are favorable to the growth of such institutions.
One such great initiatives was Operation Flood (1970) which is considered to be the world’s
largest dairy development programme. The success of the programme, led to NDDB evolving
similar programmes for other commodities. As a result, various joint ventures, dairy
cooperatives and subsidiaries came up and significantly contributed in making India a self-
sufficient in milk production globally.
Mother Dairy is one such commercial operations, set up in 1974 under the Operation Flood
Programme, a wholly owned subsidy of NDDB. Over the years, Mother Dairy has contributed
significantly in achieving this objective through a series of innovations and programmes. Today,
Mother Dairy Fruit & Vegetable Pvt Ltd manufactures, markets & sells milk and milk products
and has a diversified portfolio with products in edible oils, fruits & vegetables, processed food
etc. to meet the daily requirements of every household.

A. Objective of the Study

The internship report was made after having internship with Mother Dairy Fruit& Vegetable Pvt
Ltd. from 30/05/2022 to 10/07/2022. The objective of the study broadly covers the following:
1) Gain early understanding and appreciation of the practical life real-life situation
challenges associated with application of the theoretical knowledge acquired.

2) Develop expected professional self-awareness, internalization of career job requirements

and experience.
 3) Develop and acquire critical skills needed to proactively observe and analyse
problems/challenges encountered while executing career duties and responsibilities at
work.

4) Student gain knowledge about practical aspects of functioning of an organization with a

special emphasis on finance/ accounting management.

5) Student knowledge about performing specific tasks and develop problem identification
and problem solving skills in finance management /accounting.

PROFILE OF THE COMPANY

A. Brief Narrative About Mother Dairy Fruit & Vegetable Pvt. Ltd.

Mother Dairy Fruit & Vegetable Pvt. Ltd. in Patparganj, Delhi. is a leading dairy player which
manufactures, markets & sells milk and milk products including cultured products, ice creams,
paneer, ghee, etc. under the ‘Mother Dairy’ brand.
The Company also has a diversified portfolio under the ‘Dhara’ brand for edible oils and fresh
fruits & vegetables, frozen vegetables & snacks, unpolished pulses, pulps & concentrates, etc.
under the ‘Safal’ brand. Mother Dairy through its brands has a national footprint across all
major cities in India, offering a delectable range of products to its consumers.

 General Details of the Company

Company Name : Mother Dairy Fruit & Vegetable Pvt. Ltd.

Date of Incorporation: 24 Mar, 2000

Industry : Manufacturing (Food products and beverages)

Parent organization : National Dairy Development Board

Corporate Office : A-3, NDDB House, Sector-1, Noida,

Uttar Pradesh-201 301 (India)

Website :
Following are the key details of Mother Dairy Fruit & Vegetable Pvt. Ltd.:

Company Category: Company Limited by Shares

Company Sub- Category: Non- Government Company

Class of Company: Unlisted Private Company

Authorized Capital: ₹ 897 Cr (approx.)

Paid up Capital: ₹ 250 Cr. (approx.)

Operating Revenue: Over INR 10,000-11,000 Cr. for the financial

year ending on 31 March, 2021.

Historical Overview
About NDDB
The National Dairy Development Board (NDDB) was created in promote, finance and support
producer-owned and controlled organizations. NDDB’s efforts are co-operative principles and
the Anand Pattern of Co-operation.
The NDDB was created in 1965, fulfilling the desire of the Prime Minister of India – the late Lal
Bahadur Shastri – to extend the success of the Kaira Co-operative Milk Producers union (Amul)
to other parts of India. Dr. Amrita Patel served as the Chairman of NDDB and Dr. Verghese
Kurien was the founder Chairman.
An instrument for the development of India’s rural transforming dairying into an instrument for
the development of India’s rural people. Prior to NDDB, the milk market was vastly governed by
local private dairy and these dairies were neither producing milk nor they were animal breeders
and hence law of demand and supply was unheard by those whose intentions were purely to
make more money from both the sides – that is from producers of milk (farmers) and consumers
at large. Establishment of NDDB broke that spell and traders were side lined in due course.
NDDB began its operations with the mission of making dairying a vehicle to a better future for
millions of grassroots milk producers. The mission achieved thrust and direction with the
launching of “Operation Flood”.
 About Operation Flood
India's Operation flood was the world's biggest dairy development program which gave a major
thrust to the milk production of the nation. It aimed at helping the dairy industry sustain itself
economically while providing employment to poor farmers.
Dr. Verghese Kurien was the architect of Operation Flood which was launched in 1970 by
India's National Dairy Development Board (NDDB).
Operation Flood was launched to help farmers direct their own development. It placed the
control of the resources they create in their own hands. The White Revolution brought in by the
program was achieved not merely by mass production, but by production by the masses. It was
launched to help farmers direct their own development. It placed the control of the resources they
create in their own hands. This brought in by the program was achieved not merely by mass
production, but by production by the masses.
As the program came into force, India escalated from 50th position to the peak in terms of milk
production in just a couple of decades.

 How operation flood created the 'flood' of milk

Operation Flood worked in three phases which ensured the following:

 It created a national milk grid linking producers throughout India with consumers in over 700
towns and cities
 It reduced the seasonal and regional price variations
 It ensured that the producer gets a major share of the price consumers pay, by cutting
out middlemen
 The bedrock of the program was village milk producers' co-operatives, which procure milk and
provide inputs and services.
 Three Phases of White Revolution

 Phase 1: Started in July 1970, phase 1 of White Revolution (Operation Flood) carried the
objective of setting up dairy cooperatives in 18 milk sheds in 10 states, and to connect them
with four best metropolitan markets. The phase ended in 1981 and India had 13,000 village
dairy cooperatives covering 15,000 farmers.

 Phase 2: Built on the designs of phase 1, the second phase of the operation assisted Dairy
Development Programmes in Karnataka, Rajasthan and Madhya Pradesh. By the end of this phase
in 1985, India had 136 milk sheds, village dairy cooperatives reached 34,500 with 36 lakh
members.

 Phase 3: The final phase of the programme, emphasized to improve the productivity and
efficiency of the dairy sectors for long-term sustainability. By the time phase 3 ended in 1996,
there were 73,300 dairy cooperatives and over 9.4 million farmer members.

From the outset, Operation Flood was conceived and implemented as much more than a dairy
programme. Rather, dairying was seen as an instrument of development, generating employment
and regular incomes for millions of rural people.
Mother Dairy was created under the Operation Flood Initiative, the world’s largest program for
dairy development, aimed at making India a milk-sufficient nation. Since its origins during the
country’s White Revolution, the brand has grown from strength to strength, diversifying from its
flagship dairy products to include fruits and vegetables.
 CHAPTER –2
ORGANISATION STRUCTURE

MOTHER DAIRY

ABOUT

· "Mother Dairy" is the single largest brand of milk in India as well as in Asia, marketing about
4.45 million litres of milk per day. Mother Dairy commands 62% market share in the
organized sector in and around Delhi, primarily because of consistent quality and service –
whatever be the crisis - floods, transport, strike, curfew etc. Mother Dairy Fruits & Vegetables
Pvt. Ltd, Patparganj, Delhi, is presently manufacturing & selling around 8.5 lakh litres of
toned milk through bulk vending shops.

· Built on the cooperative milk model that revolutionised the Indian dairy industry while
transforming the lives of milk producers in distant rural areas, the company bases a major
portion of its daily milk production from dairy cooperatives and village level organisations,
ensuring the freshest products while empowering those who produce them.

· The company is a highly trusted house hold name for its wide range of milk products including
cultured products like Milk, Flavoured Milk, Ice-Cream, Dahi, Lassi, Table Butter, Dairy
Whitener, Ghee etc. Mother dairy has taken up the concept of Total Productive Maintenance
(TPM) wholeheartedly.

VISION AND MISSION

• "Provide quality food and beverages to consumer at

affordable prices while ensuring fair returns to
VISION the producers."

• Mother Dairy's heritage is intrinsically linked to

the cooperative movement of India. With
determination & pride we will continue to serve
MISSION our farmers, rural India & our consumers. Our
values reflect who we are and what we firmly
believe in.
Mother Dairy Core Values:
Let us have a look at certain important aspects of Mother Dairy.

FOCUS ON CUSTOMER

EXCELLENCE INNOVATION

Mother dairy's Core Values are aimed at developing a customer-focused, high-performance

organization, which creates value for all its stakeholders.

a) Focus on customers-

At Mother dairy we believe that customer focus is very important. We give importance to deliver
both value & quality to the customer.

b) Excellence-

Mother dairy will strive for excellence in whatever we do. We will take the right path to do
whatever we do and excel in the same.

c) Innovation-

We will constantly innovate and strive to better our processes, products, services and
management practices.
» Quality Standards:

 At Mother Dairy, processing of milk is controlled by process automation whereby state-

of-the-art microprocessor technology is adopted to integrate and completely automate all
functions of the milk processing areas to ensure high product quality/ reliability and
safety.
 Mother Dairy is an IS/ ISO-9002, IS-15000 HACCP and IS-14001 EMS certified
organization. Moreover, its Quality Assurance Laboratory is certified by National
Accreditation Board for Testing and Calibration Laboratory (NABL)-Department of
Science and Technology, Government of India.

» Strategy:

 Identify and address quality related problems at every stage from the producer at the
village cooperative, to the dairy plant and the process of final delivery to the consumer.

 Facilitate improvement of hygiene, sanitation, food safety and operating efficiency in the
dairy plants and sensitize dairy personnel to product quality aspects as per international
standards

» Action Plan:

 Phytosanitary, bacteriological and organoleptic quality at all stages.

 Development of a comprehensive database on raw milk quality at every stage from

producer to consumer.

 Identification of key intervention technologies for each stage.

 Orientation of Union technical inputs and other support services to emphasize compliance
to national and international quality standards.

 Encouragement of quality incentives supported by educational programmes for Dairy

Cooperative Society staff, transporters and farmer producers.

 Establishment of village-level chilling as first stage in cold chain reaching to the plant
and on to the consume Establishment of village-level chilling as first stage in cold chain
reaching to the plant and on to the consumer.
Objectives and Business Philosophy of Mother Dairy

 The main stakeholder of Mother Dairy was the farmer member for whose welfare it existed.
Unlike other organizations, their objective is not to maximize the profit. They are more
interested in giving the best price for the farmers for their milk than in making a large profit.
Thus they look at the price given to their suppliers as not a cost but as an objective.

 Mother Dairy had, as its main objective, “carrying out activities for the economic
development of agriculturists by efficiently organizing marketing of milk and dairy produce,
agricultural produce in raw and/or processed form and other allied produce”.

This was to be done through:

· Common branding

· Centralized marketing

Centralized quality control

Centralized purchases

Pooling of milk efficiently

 Mother Dairy had declared, as its business philosophy, the following:
ensure that milk producers and farmers regularly and continually receive market prices by
offering quality milk, milk products and other food products to consumers at competitive prices
and; uphold institutional structures that empower milk producers and farmers through processes
that are equitable.

 An enviable network secures milk supplies

Mother Dairy today is the second largest player in the Indian Dairy market second only to Gujarat Co-
operative Milk Marketing Federation Ltd. (GCMMF) which retails the Amul brand. Mother Dairy sells
about 3.2 million litres of milk every day, of which ~80% is sold in Delhi, where it has 66% market share
in the branded milk segment. Mother Dairy's success has been an outcome of its unrelenting focus on
quality, innovative distribution models and a deep understanding of local consumer preferences which has
enabled the company to grow despite stiff competition from local and international peers.

Mother dairy has been able to efficiently capitalize on the strong three tier milk grid that NDDB has
managed to build over the years. While earlier it was difficult for small farmers owning 2-3 buffaloes to
sell their milk directly to end users, the efficient 3 tier milk grid system has successfully managed to
connect the small farmer to the urban milk consumer.

Moreover, the farmer gets immediately paid for the milk delivered, thus reducing his dependence on
credit. With a strong focus on farmer welfare and the strong equity among milk producers, the company
has successfully managed to establish supply side security. Mother Dairy's strong supply side will remain
a key competitive advantage for the long term given that building such a large supply chain is a long
drawn process.
  Strong processing capabilities & robust supply chain

Milk is a highly perishable commodity and the process from procurement to consumption is extremely
critical. Over the years, Mother Dairy has been successful in developing a lean and optimal supply chain
model which has enabled them to deliver quality products to its consumers at affordable prices. In its
dairy business, the company has the unique distinction of operating a mini reverse supply chain where a
portion

of milk which is delivered to milk booths daily is brought back to the processing plant to check for
contamination in the intermediate supply chain.

In its fruits & vegetable business, it procures fresh produce from 16 states and delivers them straight to its
outlets thus eliminating middlemen and benefiting both farmers and consumers. All these processes have
yielded results and Mother Dairy has successfully positioned itself as a high quality brand in the minds of
the consumer.

Another success factor for a company largely operating in a low involvement product category is a strong
distribution network since the consumers do not make extra efforts to buy the product. With 175,000
outlets vending its edible oil Dhara,15000 stores selling Mother Dairy ice creams countrywide, 29,000
retail points vending its dairy products and 350 odd SAFAL stores selling fruits & vegetables, Mother
Dairy has already established a strong retail footprint across segments to satisfy the rising consumer
demand.

 Deep understanding of local customer preferences

The Indian consumer preferences are complex in nature. While the consumer expects the product to be of
international standards, the preference for local flavors is entrenched in Indian taste buds. Mother Dairy
has successfully managed to design its products to suit the taste buds of the Indian consumers. In the ice
cream category, it innovated by offering Indian sweet delicacies like Thandai and Shahi Meva in Ice
cream flavors. These flavors have been instant hit with consumers and enabled Mother Dairy to make
strong inroads in the ice cream category. In the dairy category, localized products like 'Misthi
Dahi'(Sweetened Curd) and 'Tadka Chach' (Butter Milk) have performed extremely well and a host of low
fat products focused on the health conscious Indian consumer have found strong traction.

Constant product innovation keeping in mind the evolving tastes and preferences of the Indian consumer
have contributed immensely to the success of Mother Dairy.
 ORGANISATION STRUCTURE OF THE COMPANY

BOARD OF DIRECTORS

CHIEF
EXECUTIVE
DEPUTY MANAGING DIRECTOR (DMD)
CHIEF OPERATING OFFICER

Procurement Department
Production Department
Ice Cream Production Sales & Marketing Dispatch
Department
and Logistics Departm
Department Research and Development

Human Resource Department

Finance Department

Product Manufacture Accounts Department Field Sales Force

Product Assembly Taxation Department E- Commerce & Direct Sales

Quality Control Customer Service

STAFF MEMBERS
 PRESENT LEADERSHIP

 Managing Director- Mr. Manish Bandlish

 Dy. Managing Director- Dr. Omveer Singh
 Deputy Manager – Mr. Neeraj Sexana
 CHRO – Mr. Pradyumna Pandey
 CFO- Sanjay Kumar Gupta
 CXO- Annie Mathew (IT)
 COO- Mr. Manish Goyal
 General Manager (Finance) – Mr. Neeraj Aggarwal
 Unit Finance Head- Mr. Rakesh Chauhan
 Assistant Manager Finance – Mr. Shakti Chand
 Accounts Officer- Mr. Anil Dhyani
 Sr. Executive Purchase- Mr. Jatin Garg
 HR Manager- Mr. Janmayjey Sayamal
 Sr. Manager Ice- Cream Manufacturing Head – Ms. Dipanjali Palit
 Assistant Manager Stores- Shri J.S Rajput

Ethical Principles-

Transperancy

ETHICAL PS
Respect Loyalty
RINCIPLE

Integrity
 Transparency
Transparency is an important part of the culture. The employees, shareholders, clients,
customers and vendors are given only true information about the company and the business.
In return company expect the same transparency from our people & associates.

 Loyalty
Mother Dairy has earned the trust of thousands its clients and millions of its customers
across the globe. The company has established loyal and enduring relationships with the
clients, employees, shareholders, suppliers and stakeholders.

 Integrity
Mother Dairy will not engage in unethical, illegal or unfair business practices - and the
company expect the partners to observe the same high standards of ethics that have been the
hallmark of the company. Wherever the company do business, it will not tolerate business
practices that are not based on the core principles of trust, integrity and fairness.

 Respect
Mother Dairy offers equal opportunities for all employees regardless of their race,
national origin, creed, political beliefs, personal opinions, gender, lifestyle choices or age. As
respect is an inalienable part of the commitment to improve the quality of daily life for those
we serve, Mother dairy is strongly committed to creating a work environment based on
mutual respect for all individuals and building a culture that appreciates and values the
experience and skills of our people.

ORGANISATIONAL CULTURE AT MOTHER DAIRY

(a) The company constantly inspires the employees to explore and find out their true
potential.
(b) Employees are motivated to new thinking and fresh ideas which will foster
their performance.
(c) Open Door Policy is encouraged.
(d) The company believe in the power of collaboration in order to deliver excellent
business results.
(e) The company not merely focuses on the organizational goals, but also by the national
growth.
 i. Task Orientation: Mother Dairy is an ISO 9001:2008 (QMS), ISO 22000:2005 (FSMS) and
ISO 14001:2004 (EMS) certified organization. Quality of milk is of paramount importance
for the company and hence it has invested extensively in installing hi tech automated
machines to ensure high product quality/reliability and safety.
Also the company follows a proper hierarchy from top to bottom or vice versa for reporting of
any work and the final reporting is at the centralised point i.e. head office NOIDA. As mother
dairy is a widely accepted brand for its products on daily basis so it maintains consistency in
output for e.g. daily production of BVM milk 30lakh litres.

ii. People Orientation: The people of mother dairy are self-motivated and ready to give their
best to whatever is assigned to them either as a team or as an individual. People in the
organization are attuned to the expectations and interactions of subordinates. People at top
management involved in every aspect of the work in the organization and offer ideas, advice,
and support to subordinates.
Welfare measures have been taken care of like staff quarters have been provided, medical facilities, travel
allowance to employees and also cab facility for official purpose.

iii. Team Orientation: As per the project requirement of the company the project team is made and
their roles or work responsibility is clearly defined to them, taking an example of current project
of mother dairy plant that is to set up in BHIWANDI the project team of 7-8 members from a
particular department are made with their tasks assigned. The suggestions for any improvement
or any better idea are freely welcomed here.

iv. System/Rule Orientation: A proper manual of written rules is provided to all the departments
separately for any quick reference or to avoid any type of conflict in work place. Not only the
written rules but also SOP (standard operating procedures for each and every work is
mentioned in the manual.

v. Competition Orientation: As per the changing needs and requirements the company has freely
accepted the change in various segments like use of best imported machinery so as to reduce
cost and waste, using SAP software to increase the efficiency of their work etc.
Mother Dairy is the only brand that produces a unique product TADKA CHACH keeping in mind the
taste of people and also MISTI DOHI.

The company follows a culture to reward their outstanding employees at the end of the financial year
according to the performance the employee on certain standards in terms of either promotion or monetary.

It not only focuses on result orientation but also on process, example for this is during the production of
ice cream there was the breakdown so to keep the production go on the production was then transferred to
the next machinery which was kept as a back for any such situation.

vi. Openness Orientation: The people are free to communicate to any of the person may it
horizontal or vertical no such boundation is there on the employees. As the company is a
private
limited company so it is not mandatory for it to show the documents publically so they are not
available easily on website.

It has been a constant endeavor at Mother Dairy to stay connected with its stakeholders. The corporate tag
line of the latest brand campaign - Happy Food Happy People - captures the essence of what the
Company stands for. Mother Dairy is committed to bring happiness to every individual with its range
offering pure, hygienic and adulteration-free high-quality products which has been the strength,
differentiator and heritage of the brand over years.

In their effort to instill and create happiness in all the lives they touch, they live with the notion of
creating happiness for their employees through creating a workplace reality that is fulfilling and
enriching for them. They constantly listen to the employees and evolve our people practices.
 CHAPTER – 3 (PART- A)

FUNCTIONAL DEPARTMENTS

Departmentalization
Mother Dairy follows different departmentalization

1. Functional Departmentalization
2. Product Departmentalization
3. Process Departmentalization

There are different functional department which include Human Resource Department., Finance
Department, Procurement Department, Purchase Department, Marketing Department, Logistics
Department, R&D, Estate and Taxation Department.

Even product departmentalization can be seen, milk is processed in another department, ice –
cream is made in another department, ghee is made in another department.

Process Departmentalization can also be seen. After milk is processed it is sent in other department
where pouch packing is done.

PROCUREMENT DEPARTMENT

Process Flow of Mother Dairy (Milk)

Chilling and Main Collection Centre from Farmers

Raw Milk at Gate Quality Check at Reception
Farm Milk

Clarification, Homogenisation, Pasteurization, Standardization

Tanker Cleaning & Filling Raw Milk Storage Silos
PM Silo Ready

Quality Check for Tanker Dispatch

Tanker at Out
Milk Outlet
Gate
  Farmers and the Milk Co-operative Society:
The Operation Flood program helps both farmers as well as the city consumers. The program ensures
that the farmers get a fair price for their cow & buffalo milk and the consumers get best quality milk at
reasonable prices. In order to maintain freshness, this milk is chilled and then transported to Mother Diary
in insulated milk tankers by road and by rail.

 Checking the quality of milk:

At the dairy, stringent hygienic standards are maintained. The milk in the tankers is first checked for
quality and freshness and then unloaded into huge insulated stainless steel storage tanks. The presence of
impurities like urea, neutralizer, and germs like bacteria are checked. All these tests ensure that only good
quality milk is accepted. Once empty, the tankers are thoroughly cleaned and sanitized using acid and
alkali. The tankers are then finally rinsed with water.

 Raw Milk Reception:

Raw milk received through insulated road/rail tankers at a very low temperature thus retaining the
freshness of milk. The milk goes for more than 15 stringent quality tests before it is accepted for the
processing of milk.
Milk achieved from individual producers is checked for all basic quality parameters meeting the company
specification and required norms at respective collection and chilling centers.
Milk is then supplied to the dairy units through insulated milk tankers at <4-degree C.

 Processing of Milk:
Processing of milk is done in basically 4 steps:
 Clarification
 Homogenization
 Pasteurization
 Standardization

 Clarification:
The chilled milk from the silos goes to the clarifier after pre-heating. The clarifier spins the milk at very
high speed, removing all the dust particles that are invisible to naked eyes.

 Homogenization:
In this process, the milk is processed at very high pressure during which the large fat globules presently in
milk are broken down into tiny droplets. The milk fat gets evenly distributed in the milk and milk become
whiter and thicker. It improves Palatability of milk and is easily digestible.

 Pasteurization:
The milk is then pasteurized. This involves heating of milk to 72 degrees Celsius for 15 second and then
cooling it down to 4 degrees Celsius. The process kills all pathogenic bacteria present in the milk making.
It makes milk safe for consumption.
  Standardization:
Milk from different breeds of cow and buffalo may vary in its composition. Hence, to make Milk uniform
in composition, before supply to the market, it is standardized by raising or lowering its fat and SNF
percentage present in the milk to a desired level, so as to deliver the milk to consumers as per prescribed
norms of FSSAI.

 Dispatching of milk:
After processing, the milk is chilled and stored in silos and further chilled to about 2C, by the glycol
chilling system, and then dispatched to the milk shops in insulated road milk tankers. When the tanker
arrives at the shop the milk is transferred into a large refrigerated tank.

 Making the milk available

The control room is very vital to the efficient distribution of milk to the 900 shops across the city. It
organizes the tanker routes and its staff is responsible for ensuring that shops do not run out of milk. Each
milk tanker is fitted with a wireless set. As soon as the in charge at the control room learns that a
particular shop is running out of milk, he contacts the tanker nearest to the shop on the wireless which
then delivers the extra milk to it.

 Quality control all the way

A final quality check of the mill is also made at the shop itself. This ensures that milk reaching the
customers is of same quality as dispatched from the Dairy.

 Consumer Information
To raise the consumers’ awareness regarding Adulteration of milk, Mother Dairy has thrown open its
testing facilities. In its laboratories consumers can see for themselves how impurities and adulterants are
easily detected. Mother Dairy also has two "mobile labs" that can test milk in the residential colonies. All
this is part of a commitment to provide the consumers with the purest milk nature has to offer.

 Keeping Milk Cool

Mother Dairy takes care to keep milk cool at every stage-it is chilled before transporting in insulated
tankers; it is stored in insulated silos and kept in refrigerated tanks at the shops. Keeping milk cool slows
down the rate at which bacteria multiply. This also increases its shelf life.

 Caring for the Environment

Solar Panels: In an effort to conserve fuel, Mother Dairy utilizes the abundant solar energy to preheat the
water going into the boilers. This also minimizes the pollution caused by burning of fuels like coal, oil
etc.
 PRODUCTION DEPARTMENT

Production Department is most important part in any organization, firm, company or co-operative
sectors. Production can be made for the middle users or for the end-users (direct consumers). Production
do the main work of converting raw material into semi-finished or finished goods, it depends on what
kind of production the organization is doing.
In the context of Mother Dairy, people have endless demand for milk and milk products. MOTHER
DAIRY undertakes the procurement of milk and its production likewise satisfying the needs and demand
of people. It estimates the demand and accordingly production is done for which arrangement of Raw
material, finance and provision for selling is made by MOTHER DAIRY.

The Production Department is interrelated with the Personnel, Finance, and Marketing Department. On an
average 30 million litres of milk is processed by Mother dairy.

 Processing:
Processing of milk is controlled by process automation whereby state-of-the-art microprocessor
technology is adopted to integrate and completely automate all functions of the processing areas to ensure
high product quality, reliability and safety.
At mother dairy, the processing of milk is done by process automation whereby state of the art
microprocessor technology is adopted to integrate and completely automate all functions of the milk
processing areas to ensure high product quality/reliability and safety. There are four ways of milk
processing –

Firstly, Clarification, in which milk is spun at very high speed, removing all dust particles that are
invisible to the naked eye.

Secondly, Standardization which help to maintain uniformity by raising or lowering its fat and SNF
(solid not fat) percentage to a desired level, so as to deliver milk to consumers as per prescribed PFA
norms.

Thirdly, it is Homogenization which improves palatability of milk and Finally, Pasteurization, which
kills all pathogenic bacteria present in the milk and thus making it safe for consumption.

 Quality Control
Milk is supplied to the Dairy units through insulated Milk Tankers under refrigerated conditions to
maintain the freshness.

Strict Quality checks are performed for all incoming Milk received at Dairy units. These includes
organoleptic (Taster, Odor & Appearance), Physico-chemical (e.g. Temperature, Foreign matter, % Fat,
% SNF, %Acidity, % Protein etc.), microbiological (e.g. MBRT), also presence of any adulterations in
Milk (e.g. Formalin, urea, starch, sugar, Glucose, maltodextrin, nitrate, Salt, Hydrogen Per-oxide,
neutralizer, ammonium compounds and Fat adulterations).
Commodities, ingredients & packaging material used for our products are checked, approved and released
by Quality functions as per company specifications and requirements.
GMP & Hygiene
Good manufacturing Practices (GMP) for our manufacturing units are ‘a given’, they are part of our
heritage of producing best quality and safe products. We maintain highest level of GMP and hygiene
requirements for production and handling of safe products for our valued customers and consumers.

 Packing:
The Filling and packing is considered to be most sensitive operation having appropriate access control.
Zoning principles are applied in these areas to avoid any cross contaminations in our Finished Product.
Online quality control checks (e.g. net weight, leakages, seal integrity, batch coding, packing material
quality, filling temperature etc.) are carried out and recorded by our Packing In-charges.

Only QC approved and released Packaging materials are used for packing operations.

Packaging material used for our products is with the objective of retaining taste, freshness and unique
natural appeal.
Being a large organization, Mother Dairy comprises of separate departments to undertake
finance, accounts and tax related activities. Division of work performed by professionals and
experts in respective fields results in enhanced efficiency and specialization.
Let’s delve deeper into each departments’ roles and responsibilities.

FINANCE DEPARTMENT

Finance is the most crucial part in any organization. Finance is required in each & every stage of the
business. The finance department of a business takes responsibility for organizing the financial and
accounting affairs including the preparation and presentation of appropriate accounts, and the provision of
financial information for managers.

The primary purpose of the Finance Department is to monitor and report on the financial position of the
Mother Dairy and to provide an excellent level of service to their public customers and customers in other
City Departments.

The finance department has to deal with not only the procurement of finance but also with the proper
utilization of it. Finance is the basic requirement for purchase of assets, purchase of technology for
expansion of unit, production of goods, marketing, selling, etc. The department takes the decision regarding
financial matters, the responsibility of critical functional areas ultimately lies with the top management and
other decisions are taken by the lower management according to the organization matrix. Company has fully
working under ERP software SAP- Hanna.

Source of Finance in Mother Dairy

Mother dairy does not raise finance for short term as all the requirement for short-term finance are
fulfilled by the internal sources (i.e. reserves & surplus). Mostly, finance is raised from long-term sources
of finance. All the requirement of finance is fulfilled either by issuing equity shares or by taking loan
from “National Dairy Development Board”. The repayment of loan is done in equal instalments; the
amount is pre- decided. Generally, 8% interest is charged on the amount of loan.

The Main Areas Covered by Financial Department in Dairy

 Book keeping procedures.
 Creating a balance sheet & profit and loss account.
 Management information system (MIS)
 Management of wages & salary.
 Raising Funds.
 Cost allocation.
Capital Structure in Mother Dairy
Capital structure of an organization refers to procurement of capital. It includes all the financial. Thus
capital structures of an organization show how or through which sources money raised.
Mother dairy is a co-operative society and its capital needs are fulfilled by NDDB.
Mother Dairy is a Co-Operative Organization. It does not issue Right or Any Other Public Issue.
“MOTHER DAIRY” does not have any other source of raising fund, for any undertaking it is financed
by NDDB or self-financed.

ACCOUNTS DEPARTMENT
The account department is divided into different sections. (detailed description in Chapter – 3B).
1. Milk billing.
2. Pay roll.
3. Sales billing.
4. Costing.
5. Cash and Bank Management.
6. Book Writing.
7. Data Processing.

TAXATION DEPARTMENT
Running a company involves paying tax, and it is the duty of the tax department to handle these issues. A
tax accountant is responsible for assisting clients and companies with their financial and income tax
statements. Other core responsibilities include:
 Delivering a full range of tax services in compliance with laws and regulations within timeframe.
 Building relationships and interacting with clients to provide excellent planning, consulting
and expertise.
 Providing innovative tax planning and reviewing complex income tax returns etc.
 MARKETING DEPARTMENT

“It is clearly said that Marketing Department is the Front Face of any organization or firm” . This is
said because marketing is the only means from where the consumers can know about the upcoming
products of the firm or organization. This indirectly gives result in increased sales of products.
Marketing - in other sense, means promoting the product publically and to bring revenue through sales.
Marketing Department does the function of creating demand in people and generates sales from it, which
completely depends on marketing department.
Mother dairy is having a full-fledged marketing dept. where all the functions related to marketing are
performed. As a part of marketing strategy Mother Dairy has increased its Morning milk centers.
Also mother dairy has introduced various innovative distribution format such as: -

 Milk Shops.
 Franchise Shops.
 Kiosks.
 Insulated Containers.
 Container on wheel.
This distribution is itself so innovative that make mother dairy different than their competitors.

Strategies Implemented

1. Focused Approach
Mother Dairy wants to get into bigger markets and have bigger shares in those markets. The cooperative
is also expanding its product portfolio further to match rival offerings – particularly those of Amul. For
the first 22 years of its existence, liquid milk was the only dairy product that Mother Dairy offered.
It was in 1996 that it came up with ice-creams. But the real spurt came about four years ago, when it
introduced curd, flavored milk, and Lassi and mishti Dahi. It introduced butter a year-and-a half ago; ghee
and UTH milk a year ago; and cheese, about 10 months ago. And under its frozen foods and vegetables
brand Safal, besides the introduction of corn and mixed vegetables, it has plans to come out with frozen
potato-based snacks in a few months.
So while the product portfolio has been growing, Mother Dairy has plans for reach out to newer markets -
but the strategy here is more product-specific. In liquid milk, it will initially concentrate only on four
markets - Delhi, its home ground; the Junagarh region and Ahmadabad in Gujarat; Mumbai and
Hyderabad. Their objective of getting into newer locations is not to make Mother Dairy larger, but to
ensure that there is a large viable.

2. Product Differentiation
While Mother Dairy still may not have a product portfolio as large as Amul, which is also expanding
across the country in a big way and is a much bigger player, it's doing its bit. Mother Dairy says the
idea is not
just to enter new markets, but to do well in those markets - which mean bigger market shares in the
different product categories in whichever market it is present.
The drivers will be value created through quality of the offerings as well as innovations in products. This
will, of course, be backed by relevant marketing and promotion campaigns. Mother Dairy are bringing in
mass Indian flavors which are building up in terms of absolute percentage of contribution. Their attempt
is to make the taste experience in ice creams as familiar as possible so as to increase consumption.
Take the case of curd. It started off very slow but today, Mother Dairy claims it's growing at close to 60
per cent year-on-year in Delhi. Here again, the Indian flavor formula seems to have worked.
While curd from an MNC player is probably based on international formulation, they formulated it to
taste as close to home-made curd as possible.

3. Smart Marketing
On the marketing front, Mother Dairy says it's trying to take its product campaigns and communications
to a higher platform. For instance, in the case of milk, the campaigns do not talk about the obvious
benefits - milk is good for health, it has calcium and so on - but rather it targets children and are created
around ideas such as "The country needs you, grow faster".
As far as products such as butter, cheese and ice creams go, the campaigns have been created around
"taste". For butter again, the focus is on children. Here, Mother Dairy has dared to go different. Since 60
per cent butter is consumed by kids, the company wants them to sit up and take notice of its butter.
Makkhan Singh, a sturdy jovial cow (a cartoon character) has been made its brand ambassador.
While Mother Dairy has been carrying out school programmes - games and activities – involving a
gaming website on the character to attract children.

Clearly, Mother Dairy has aggressive plans. But, strong regional brands and other co-operatives will
continue to give it tough competition.
 HUMAN RESOURCE DEPARTMENT

There is a well versed Quote saying that “Employees are the assets of any organization” Which depicts
that they are most important tool of organization. Thus to maintain them for the organization, Personnel
department (Human Resource Department) is kept for the well-being of employees.
The function of Human Resource Department can be seen in each and every department of any
organization. Thus it can be easily said that “The Human Resource Department” is the heart of any
organization. The function of Human Resource Management is to manage the people working in the
organization. It mainly focused on the intrapersonal relationship and interpersonal relationship of
employees.
Human Resource Management in simple words means planning, organizing, directing and controlling of
procurement, recruitment, selection, training and development, compensation, integration, maintenance,
appraisal, allocation and separation of Human Resources
Thus, Human Resource Management refers to set of programme, functions and activities designed and
carried out in order to maximize the employee’s as well as organizational efficiency and effectiveness.

Human Resource Management at Mother Dairy

“Mother Dairy is one of the leading Dairy” It shares collaborative and friendly relationship with preferred
partners, employees, consumers and other workers involved to it. It maintains a transparency in handling
the above relations and stick to its standards.
The HRM function or Personnel department function in Mother Dairy is indeed vast. All major activities
since working of a worker – from the time of his/her selection in to an organization until he/she resigns or
get retired or leave job for any reason – comes under the preview of HRM.
The HR planning in Dairy is very smooth and transparent. It made Mother Dairy a HUGE BIG Family of
approximately 3000 employees. In Mother Dairy major attention is given on the welfare and Safety of
employees.
Dairy also focuses on developing human value and potential through various bearing and development
activities and provide favorable atmosphere. All these functions are performed by HR in Mother Dairy.

Human Resource Is Divided into Different Parts

The HR in Mother Dairy in mainly divided into four sections:
 Personnel Department
Recruitment, selection, training, industrial relations, negotiation with Union etc.
 Administration Department
Its handles canteen, security, welfare facilities, safety, any theft or loss, Absenteeism, events, AGM meeting
organizing, licensing work, hygiene of various deptt, etc.
 Time Keeping Department
It handles salary & wages, records of employees, provides benefit of statutory, ESS, Form fill up,
punching System, provident fund, ESI etc.

 Telephone Department & Computer Department

Maintains the connection of each department and provides facility of CUG to each employee to remain in
contact while doing work. So that if any query or problem occur they can contact each other easily.
Computer system handles the whole MIS in Mother Dairy.

Recruitment
Recruitment is a process of searching for prospective employees & stimulating them to apply for the job
in the org. Recruitment of an employee is done on the bases of “Human Resource Planning” carried by
Mother Dairy Management. At Mother dairy recruitment is done through both sources i.e. internal as well
as external sources for skilled employees and unskilled labor.

 Internal Recruitment:
Recruiting employees internally like promotion, transfers, etc.
 External Recruitment:
Recruiting employees form job portals, employment exchange, campus interview, advertisements. Dairy
uses External source of recruitment mostly.

Selection
Selection procedure includes the selecting Right candidate, at Right time, for right job. It is as follows:
 Application form
 Bio-data analysis
 Short-listing.
 Interviews
 References/security screening
 Ability tests
 Aptitude, intelligence and personality
 Work experience/short term contracts
 Medical check-ups.
 Placement/Appointment.
 PURCHASE AND STORE DEPARTMENT

Purchase Procedure
Mother Dairy’s main raw material is milk. The purchase department has only to pick up just 10% of other
raw material. The purchase procedure is as under:
1. First of all, respective department heads find out their need and get it approve by the
managing director.
2. Then they contact the stores department.
3. After this they send an indent to the purchase department.
4. The purchase department then asks for quotation from the suppliers.
5. After the quotations are received will then be selected.
6. The least cost giving suppler will then be selected.
7. Then take the approval and give the authority to the supplier who gets the quotation passed.
8. Then just let the finance department will make the payment the supplier after the delivery of
goods.
Inventory Management System

In Mother dairy, the store department uses the FIFO method. I.e. First in First Out method of inventory
management.

Types of Stores
 Cold Stores
The cold stores are used for storing milk, chhaach, flavored milk, Dahi etc. and many other
products.
 General Store 1
In this general store, the veterinary products, medicines, transportation instrument, buckets,
flavors for milk and Ice-cream are stored here.
 General Store 2
Here, plastic of milk bags is store; tins of ghee, milk powder etc. is stored.
 QUALITY ASSURANCE DEPARTMENT

Organizational Structure of Quality Control Department

QUALITY QUALITY SENIOR JUNIOR

CONTROL MANAGAER CONTROL OFFICER SAMPLER
CHEMIST CHEMIST

Activities Carried by People in Quality Control Lab

 Superintendent
The superintendent observes all the activities in the lab, packing and giving the guidance.
 Junior Officer
Here the officer looks after all Agmarks related to ghee and butter in the lab.
 Senior Officer
Here the senior chemist looks after IS/ISO 9062 IS 14001, HACCP, 2002 f 3A (food safety
management system) and ISO 9000-2000 certificates.
 Chemist
The chemist looks after all the society milk, pasteurized milk and other milk products.
 Sampler
The sampler takes the samples from the milk received from different co-operative societies.
 Micro Biologist (Milk Plant)
The microbiologist cleans up all the tools and machines, which are used for milk, butter and
buttermilk.
 RESEARCH AND DEVELOPMENT DEPARTMENT

A company's research and development department plays an integral role in the life cycle of a product.
The role of an R&D department is to keep a business competitive by providing insights into the market
and developing new services / products or improving existing ones accordingly. The future growth of the
business sits in a large part with the R&D department.

The R&D department have a range of responsibilities.

New Product Development

Existing Product Updates

New Product Research

R&D CENTER

Innovation and Staying Ahead of Treads

Quality Control Checks

 New Product Research

Before a new product is developed, a research and development department conducts a thorough
 toNew
study Product
support Development
the project. The research phase includes determining product specifications,
production costs and a production time line. The research also is likely to include an evaluation of the
needresearch
The for the product before
paves the way the
for design begins to ensure
the development phase.itThis
is a isfunctional
the time product
when thethat
newcustomers want
product is
actually developed based on the requirements and ideas created during the research phase. The
developed product must meet the product guidelines and any regulatory specifications.
  Existing Product Updates

Existing products of the company also fall under the scope of research and development. The
 Quality
department Control
regularly Checksthe products offered by the company to ensure they are still
evaluates
functional. Potential changes or upgrades are considered. In some cases, the research and
development
In department
many companies, is asked and
the research to resolve a problem
development teamwith an existing
handles product
the quality that on
checks malfunctions
products or
to 
find Innovation
a new and
solution ifStaying
the Ahead
manufacturingof Treads
process must change.
created by the company. The department has an intimate knowledge of the requirements and
specifications of a particular project. This allows team members to ensure the products meet those
standards
The so the
research andcompany
developmentputs out
teamquality products.
aids the companyIf in
thestaying
company also has awith
competitive quality assurance
others in the team,
it may collaborate
industry. with research
The department is able and development
to research on quality
and analyze the checks.
products other businesses are creating,
as well as the new trends within the industry. This research aids the department in developing and
updating the products created by the company. The team helps direct the future of the company
based on the information it provides and products it creates.
DISPATCH AND LOGISTICS

All activities carried out under the supervision and order General Manager of Marketing head i.e. order of
milk and milk products are dispatched as per the order of customers and retailer and all records of
dispatch are kept in dispatch register and computer.
 In dispatch department the work is divided in 3 shifts
1. Morning
2. Afternoon
3. Evening

 Sources of Mode of Transportation

There are trucks, tempos, insulated vans, three wheeler tempos are used to deliver the milk and the milk
products in all the three shifts.
 CHAPTER – 3 (PART B)
FUNCTIONAL ANALYSIS – ACCOUNTS DEPARTMENT

Finance includes rising of the financial resources & their utilization effectively & purposefully. Accounts
and Finance department in any firm helps the pace of the business to go smoothly. This particular aspect
makes financial management very feasible & important for the entire business.

It plays important role is determining the objectives or goal for which the company is steeled up.
Financial management is concerned with raising funds in the economic and suitable manner and using
these funds as profitable as possible.

The Accounts Department in Mother Dairy are specialized in providing accounting services and
managing the finances of the company. Its responsibilities include:

ACCOUNTS PAYABLE AND RECEIABLE PROCESS

STRATUTORY AUDIT BANK RECONCILIATION

ACCOUNTS
DEPARTMENT

REVIEW OF FIXED
ACCOU
ASSETNTING
PROVSIONS PITALISA
/ CATION

EARNEST MONEY DEPOSIT/ SECURITY DEPOSIT

BANK AND CASH MANAGEMENT
 1. ACCOUNTS PAYABLE

The Accounts Payable Process is the management and execution of the company’s short-term payment
obligations to vendors/suppliers. The accounting department keeps records of the goods and services
that your company pays for and ensures that all your business expenses get paid on time.

It also keeps track of all scheduled payments in the organization, such as inventory, payroll, and
other business-related expenses. It receives invoices from vendors, records them, and then processes the
payment checks.

The mission of accounts payable is to pay only the company's bills and invoices that are
legitimate and accurate, and The role of the keeping an eye on opportunities to save money, for
example, determining if there are discounts or incentives available for paying certain vendors more
quickly.

i. Purchase order (original invoice)

A purchase order (PO) is prepared by a company to communicate and document precisely what the
company is ordering from a vendor. The paper version of a purchase order is a multi-copy form with
copies distributed to several people. The people or departments receiving a copy of the PO include:
 the person requesting that a PO be issued for the goods or services
 the accounts payable department
 the receiving department
 the vendor
 the person preparing the purchase order
The purchase order will indicate a PO number, date prepared, company name, vendor name, name and
phone number of a contact person, a description of the items being purchased, the quantity, unit prices,
shipping method, date needed, and other pertinent information.

One copy of the purchase order will be used in the three-way match.

ii. Receiving report (duplicate invoice)

A receiving report is a company's documentation of the goods it has received. The receiving report may
be a paper form or it may be a computer entry. The quantity and description of the goods shown on the
receiving report should be compared to the information on the company's purchase order.

After the receiving report and purchase order information are reconciled, they need to be compared to the
vendor invoice. Hence, the receiving report is the second of the three documents in the three-way match.
 iii. Vendor Invoice (triplicate invoice)
The supplier or vendor will send an original invoice to the company along with material that had received
the goods and/or services on credit. When the invoice or bill is received, the customer will refer to it as a
vendor invoice. Each vendor invoice is routed to accounts payable for processing.

After the invoice is verified and approved, the amount will be credited to the company's Accounts
Payable account as per the Purchase Order Terms and Conditions and will also be debited to another
account (often as an expense or asset).

Three-way match
The accounts payable process often uses a technique known as the three-way match to assure that
only valid and accurate vendor invoices are recorded and paid. The three-way match involves the
following:

DOCUMENT WHAT IT SHOWS

Company Purchase Order What the company had ordered and at what
cost.

Company Receiving Report What the Company has received.

Vendor Invoice What the vendor billed the company.

In Mother Dairy the Payable Process goes through the following steps:

1. Recording of Material in Inward Register- After the company issues a Purchase Order (PO) to the
appropriate vendor, the supplies are supplied according to the PO terms within a specified time frame.
The payment procedure, begins with the Security Recording material in the Inward Register. Before
entering the premises, the products are inspected and registered in the register.

2. GRN (Goods Received Note in system) - The goods received are then physically checked as per the
description the quality and quantity in the store by storekeepers. Afterwards, GRN note is prepared for
these goods by entering the details in the system (Re-verification) and the transporter is sent back with an
invoice copy.

3. Quality Clearance by User- Later, the User of the goods is informed about the materials received who
scrutinize the goods and enter the details in the system after assuring that the goods are as per PO
requirement.
4. Dispatch of Invoice for Payment- The store boy collects the bills and send it to the Finance
Department for checking the agreed PO and payment terms.

5. Verification & Payment Processing- Finally, the Finance Department initiates the Payment Process
with the suppliers in accordance with the provisions of the PO and credits the corresponding account in
the system.

ACCOUNTING ENTRIES:

GL CODE ACCOUNT DESCRIPTION Dr/Cr AMOUNT

Stock/ Inventory GL Account Dr ******

To Goods Receipt Note Account Cr ******

GL CODE ACCOUNT DESCRIPTION Dr/Cr AMOUNT

Goods Receipt Clearing Account Dr ******

To Vendor Account Cr ******

GL CODE ACCOUNT DESCRIPTION Dr/Cr AMOUNT

Vendor Account Dr ******

To Bank Account Cr ******

 2. ACCOUNTS RECEIVABLE

Accounts receivable refers to money/cash or receipts that the business receives. The accounting
department is in charge of tracking and accounting for cash payments by customers for
goods sold and services rendered.

The accounting department records accounts receivable as assets. This includes the
revenue that the business makes and the invoices that are yet to be fulfilled.

All postings in Accounts Receivable are also recorded directly in the General Ledger. Different
G/L accounts are updated depending on the transaction involved (for example, receivables, down
payments, and bills of exchange).

3. BANK RECONCILIATION

Bank Reconciliation is an important process in accounting in which organizations match their bank
statements with the transactions that are recorded in their general ledger. Preparing a bank reconciliation
statement helps businesses to eliminate possible errors in transactions or bookkeeping.

Purpose:

 To scrutinize with regard to uncleared cheques.

 To scrutinize if any bank charges in the form of card charges, cheque bouncing
charges or cheques written charges etc. have been deducted by the bank.

 If there is difference with regard to balance in the bank as per our books of Accounts
and Bank Statement, the concerned authority will have to pass the necessary entries in
the books of Accounts to match the balances.

 In Mother Dairy, Bank Reconciliation is done in weekly, monthly and yearly basis or
as per the company policy.

 Bank Reconciliation is required at the time of finalization of Balance Sheet of the

Company.

 Uncleared cheques are reviewed on fortnightly basis and this is part of Company’s
CSR Activity.
  For uncleared cheques, the Account Department concerned employee follow- up with the
banks and find out the reason for the same.

Reasons:

· Mismatch of signatures
· Validity of Cheques expires
· Any Over writing on cheques
· Difference between figures mentioned in the cheque and written in words
· Error in recording the transactions
· Omission of accounting transaction etc.

For carrying out this activity, Mother Dairy maintains 3 general ledger account codes for each bank
account i.e.

i. Incoming Bank Account – All the bank receipts are initially recorded in this account.
ii. Outgoing Bank Account – All bank payments are initially issued from this account
iii. Main Bank Account – Once the receipts/ payments transactions are executed by the bank,
these transactions are transferred from the Incoming/ Outgoing Bank Account to the Main
Bank Account in the books of the Company automatically through Account Reconciliation
Procedure.

Responsibility: The authorized person in Accounts Department, matches the receipt and payment
transactions from the bank statement to the corresponding entry in Incoming/ Outgoing Bank Account
and later posts these transactions in Main Bank Account.

ACCOUNTING ENTRY:

GL CODE ACCOUNT DESCRIPTION Dr/Cr AMOUNT

(relevant) Outgoing/ Incoming Bank A/C Dr ******

To (relevant) Main Bank A/C Cr ******

 4. FIXED ASSET ACCOUNTING / CAPITALIZATION

Fixed assets, also known as tangible assets or property, plant, and equipment, is an accounting term for
assets and property that cannot be easily converted into cash.

For most businesses, fixed assets represent a significant capital investment, so it is critical that the
accounting be applied correctly.

These assets are capitalized so that the benefit of the asset extends beyond the year of purchase, unlike
other costs, which are period costs benefitting only the period incurred, therefore allowing the company to
spread the cost of the asset over its useful life and avoid drastic impacts to the income statement in the
period the asset was purchased.
Thus, Capitalization of the fixed asset is the process of recording the cost of the asset that has a useful life
longer than one accounting period to the balance sheet.

The process entails recording the purchase as an asset instead of a period expense, then amortizing, or
depreciating, portions of the purchase price over a set period, in regular intervals.

ACCOUTNING ENTRIES:

 Capitalize the cost of fixed asset to balance sheet

GL CODE ACCOUNT DESCRIPTION Dr/Cr AMOUNT

Fixed Asset Account Dr ******

To Cash/Bank/Payables Account Cr ******

 Allocate the cost of capitalized asset to income statement

As shown in the journal entry for capitalization of the fixed asset above, we do not record the expense
immediately after purchasing the fixed asset. However, as we use the fixed asset for the period, the
expense should incur as well in order to match the benefits we receive from the asset.

So, at the period-end an adjusting entry, is made to allocate the cost of the capitalized fixed asset to the
income statement by debiting the depreciation expense account and crediting the accumulated
depreciation account.
 GL CODE ACCOUNT DESCRIPTION Dr/Cr AMOUNT

Depreciation Expense Account Dr ******

To Accumulated Depreciation Account Cr ******

In this journal entry, the depreciation expense is an income statement item while the accumulated
depreciation is a contra account to the fixed asset on the balance sheet. Likewise, while total expenses
increase, total assets decrease as a result of allocating the cost of the capitalized asset to the income
statement.

5. EARNEST MONEY DEPOSIT (EMD)

Earnest money, also known as a pledge or security deposit, is a certain amount of money that a buyer
pays to a seller to demonstrate his good faith and intention to complete the transaction.

It generally ranges from 2 to 5 percent of the estimated cost.

The amount has to be submitted by a Bidder with application for tender in the form of Demand Draft or
Bank Guarantee.

Also it is refunded to unsuccessful bidders once the process of Selection of Successful Bidder gets
completed.

6. CASH AND BANK MANAGEMENT

Cash management, refers to the process of collection, management, and usage of cash flows for the
purpose of maintaining a decent level of liquidity, optimum utilization of the firm’s liquid resources and
for maintaining sound cash flow position of the organization.

Cash and Bank Balances consists of cash in hand, petty cash balance, imprest balance, bank deposits,
bank balances and cheques in hand.

Objectives of Cash Management

The objectives of cash management include:

· Fulfilling working capital requirements

· Handling unorganized costs
· Planning expenditure
· Appropriate utilization of funds
 · Reviewing Fund flow statement
· Initiating investments
· Lowering the costs pertaining to funds etc.

Functions Performed by Accounts Department for Cash and Bank Management

 Investing Idle Cash: The company needs to look for various short term investment
alternatives to utilize surplus funds.

 Controlling Cash Flows: Restricting the cash outflow and accelerating the cash inflow is an
essential function of the business.

 Planning of Cash: Cash management is all about planning and decision making in terms of
maintaining sufficient cash in hand and making wise investments.

 Managing Cash Flows: Maintaining the proper flow of cash in the organization through
cost-cutting and profit generation from investments is necessary to attain a positive cash
flow.

 Optimizing Cash Level: The organization should continuously function to maintain the
required level of liquidity and cash for business operations.

7. REVIEW OF PROVISIONS

Provisions are funds set aside by a business to cover specific anticipated future expenses or other
financial impacts.

Companies sometimes know they are likely to face unavoidable future costs, even though they may not
know exactly how large those costs will be or when they’ll need to be paid. Provisions help companies
plan for these expenses by allocating money in advance. Companies often estimate the amount to set aside
by examining historical data. Provisioning of expense also a part of compliance and audit requirement.

In accounting, the provision amount is stated as a liability on the balance sheet.

The Accounts Department creates provisions for the following future unforeseen obligations:
Unpaid Invoices, Depreciation, Guarantees and warranties, Tax payable, Accrued expenses etc. All
provision related details are provided by departments with proper format to accounts department.
ACCOUNTING ENTRIES:

 Journal Entries for Provisions for Expenses at the end of financial year.

GL CODE ACCOUNT DESCRIPTION Dr/Cr AMOUNT

Expense Account Dr ******

To Provision for Expense Account Cr ******

 When the obligation arises in next the financial year.

GL CODE ACCOUNT DESCRIPTION Dr/Cr AMOUNT

Provision for Expense Account Dr ******

To Vendor Account Cr ******

 Final payment of obligation to the respective Vendor.

GL CODE ACCOUNT DESCRIPTION Dr/Cr AMOUNT

Vendor Account Dr ******

To Bank Account Cr ******

 8. AUDIT SCHEDULES (STRATUTORY AUDIT)

Among the important characteristics of accounting information is the clarity of the financial data being
reported and evaluated by owners and managers.

Audit schedules can offer greater disclosure to balance sheets. While the assets and liabilities on a balance
sheet are often broken down into broad categories, the schedules can offer up insight by detailing
specifics about the broad categories.

 Some audit schedules that are typically run are:

o Accounts Payable - lists the number of vendors to whom the company have payments
pending.
o Accounts Receivable: details of customers having outstanding invoices
o Fixed Assets and Depreciation – details about particular asset number, gross cost,
description, and accumulated depreciation.
o Provision Schedule- Details of un-accounted expenses related to previous financial year.
o Prepaid Schedules- Prepaid expenses are future expenses that are paid in advance, such
as rent or insurance. On the balance sheet, prepaid expenses are first recorded as an
asset. As the benefits of the assets are realized over time, the amount is then recorded as
an expense.
o Inventory/ Closing Stock – lists the raw materials that are available for use for
manufacturing and the number of ready-to-sale products to the customers.
 CHAPTER - 4
COMPANY
ANALYSIS

Mother Dairy is one of the best cow milk brands in India. This brand has given rise to several dairy
products such as lassi, curd, paneer, butter and packed chaos for the people here.
Since its origins during the country’s White Revolution, the brand has grown from strength to
strength, diversifying from its flagship dairy products to include fruits and vegetables, frozen foods,
brand, edible oils, jams and fruit juices among other products that customers swear by.

PRODUCT MIX OF MOTHER DAIRY:

Mother Dairy Fruits & Vegetables Pvt. Ltd. offers the following products:

SAFAL-
DAIRY DHARA-
FRUITS AND
PRODUCTS COOKING OILS
VEGETABLES

 Dairy Products: Mother Dairy sells milk and milk products (Milk, cultured products, Ice creams,
Paneer and Ghee) at a national level through its sales and distribution networks for marketing
food items. It sources significant part of its requirement of liquid milk from dairy cooperatives. It
also manufactures and markets a wide range of dairy products that include Butter, Mishti Doi,
Paneer,
 Dahi, Ghee, Cheese, UHT Milk, Probiotic Products, Lassi & Flavored Milk and most of these
products are available across the country.

MOTHER DAIRY PRODUCT RANGE

MILK

DAIRY PRODUCTS

ICE - CREAMS
 OTHER PRODUCT BRAND AND DIVISIONS OWNED BY MOTHER DAIRY

 Safal: The company’s Fruit and Vegetable Division, Safal, is nothing short of a pioneer in its
segment. It is primarily engaged in retailing of fresh fruits & vegetables, but with unique product
offerings like Frozen Peas, Frozen Mixed Vegetables, Frozen Sweet Corn, Frozen Jackfruit, Safal
has become a pioneer brand in Frozen Vegetables segment across India with the promise of
providing great quality products to the consumers. It has a chain of 400+ own Fruit and Vegetable
shops and more than 20,000 retail outlets in various parts of the country.

 Dhara: While constantly innovating in the dairy space, the company has also found a strong
footing in the edible oil market with its marquee brand Dhara. Nowadays, it has become leading
brand of edible oils and is available across the country in over 2, 00, 000 outlets. The brand is
currently available in the following variants: Refined Vegetable Oil, Refined soybean oil, Refined
sunflower oil, Kachi ghani mustard oil and Filtered groundnut oil.
 PERTINENT MARKET SHARE INFORMATION

1. VALUE- WISE SHARE OF THE MARKET

Mother Dairy acquires about 66% of the market share in the Industry.

Mother Dairy – Production: 7 lakh liter (approx.)

Total sale of milk: 11-10 crore (approx.)

2. VOLUME WISE SHARE OF THE MARKET

Mother Dairy acquires about 70% of milk and milk products

Edible Oils and Safal -20%

 SWOT ANALYSIS OF MOTHER DAIRY

S W O T

1. Strengths of Mother Dairy

 Product lines
The company offers a wide variety of products and is spread over multiple sectors: Mother Dairy deals
with milk and other dairy products like ice creams, fruits, vegetables, groceries, edible oil, beverages,
frozen food, under its brand name.
 Cost-Effective Supply Chain
The company procures its raw materials from the major local farmers and cooperatives which gives them
the advantage of manufacturing and selling their products at a cheaper rate and in turn also creates
goodwill and trustworthy relationship with the farmers improving the overall efficiency.
 The company offers High product quality
The company is certified with high food safety standards and offers products with no artificial flavors
which are rich in vitamins and antioxidants leading to increased brand loyalty as they are known for
creating a national footprint in the competitive market of India.
 Geographical Advantage
Ease of accessibility, very strong and focused distribution at low cost and meeting the demands of the
target market has been possible due to the locational advantage which the company practices.
 Efficient marketing solutions
Mother dairy has come up with unique marketing strategies and solutions to cater to the untapped markets
along with practicing the First Mover Advantage in several market segments, giving them a competitive
edge.

 Strong Financial Position

Mother Dairy charges higher prices than their competitors which leads to a competitive advantage in
terms of higher capacity to invest in market research and development for innovation. The brand also
invests in High tech IT infrastructure for increased efficiency which is a result of a stronger financial
position.
 Patenting the products
Mother Dairy has generated a wide range of products over the years which have been patented and
copyrighted under the Intellectual property rights and by buying those rights from the creators which have
in turn given them a huge competitive advantage.

2. Weaknesses of Mother Dairy

 Difficulty in maintaining Competitive pricing

The brand needs to revise its pricing policy according to the products and services offered by them as they
are not considered justified in the market.
 High Packaging Cost
The products offered by the brand are perishable and need a lot of investment in technology and research
& development to decide their packaging and to keep them fresh while transporting them throughout the
country.
 Inefficient Inventory Management
Mother dairy lacks efficient management of the inventory and cash cycles, which is resulting in
weakening the operations and efficiency of the brand, but there still lies a huge scope of improvement.
Poor project management has led the company to lose a greater consumer base.
 Lack of Technological Development
Mother Dairy is lagging there on creating efficient technological infrastructure and in their digital
transformation, due to lack of funds, they are unable to cater to the technological needs of expanding and
restructuring the processes and lack Artificial intelligence and machine learning technologies in their
infrastructure.

 Distribution costs: The products of Mother Dairy are perishable and thus needs freezers and other
paraphernalia for distribution. The areas covered are also minimal in terms of expense. This increases the
cost of distribution heavily.

3. Opportunities for Mother Dairy

 Expanding in the Adjacent Markets

Mother dairy can inspect other market segments to further introduce new product features and services for
effective market growth.
 Greater Consumer Disposable Income
Mother Dairy can take advantage of the more disposable income that consumers are willing to spend by
building a new business model to attract consumers to spend on their products progressively and to
expand their competitive strategy.
 Increasing Quality and standards
Mother Dairy can reduce its excess production cost by just focusing on improving the quality and supply
of the most successful products of the brand.
 Access to Global Market
Mother dairy should tap the international market, but due to limited budget constraints, they can also
expand into new areas and bring new talent so they can expand in various segments worldwide.
 Developing New Technology
To assist the production of goods and services the company should spend on the IT infrastructure to cater
to the demands of the customers worldwide efficiently, as advanced technology can lead to reduced cost,
better quality products in lesser time.
 Government Aid:
The subsidies given by the government can be used to make the brand more environmental and consumer-
friendly by opening up new outlets and following the sustainability model.

4. Threats to Mother Dairy

 Barriers to Entry
There are barely any barriers to entry in the industry which leads to the emergence of new competitors
causing a threat to the brand. There are new entrants in the market because of the reduced costs and
increasing efficiencies in terms of customer reach through media platforms globally and domestically.
 Big Competitors
A few famous brands are directly aligned with the products also sold by mother dairy lie Amul, Brittania,
Kissan, Heinz, and Nestle.
 Debt:
The brand is majorly dependent on debt to expand from the past decade, which should be avoided, else it
will lead to huge interest costs.
 Greater bargaining power in the hands of the consumer
Due to this reason, there is a negative effect on the pricing of the products, the company should focus on
changing its business model than making other cosmetic changes.
 Labour Force
The negative word of mouth regarding the organizational problems might lead to exhaustion of the labour
force and the low availability of skilled labour in the market can make it difficult to employ labour.
 BCG MATRIX ANALYSIS

The BCG matrix is a strategic management tool that was created by the Boston Consulting Group, which
helps in analyzing the position of a strategic business unit and the potential it has to offer. The matrix
consists of 4 classifications that are based on two dimensions. These first of these dimensions is the
industry or market growth. The other of these dimensions is the relative market share of the strategic
business unit.

 STARS: Strategic business units with high market growth rate and high relative market share

 QUESTION MARKS. Strategic business units with high market growth rate and low relative
market share.

 CASH COWS: Strategic business units with low market growth rate but with high relative market
share.

 DOGS: Lastly, the strategic business units with low market growth rate and low relative market
share.
 BCG Matrix of Mother Dairy

 Stars
 The financial services strategic business unit is a star in the BCG matrix of Mother Dairy Creating a
National Footprint. It operates in a market that shows potential in the future. Mother Dairy Creating a
National Footprint earns a significant amount of its income from this SBU. Mother Dairy Creating a
National Footprint should vertically integrate by acquiring other firms in the supply chain. This will
help it in earning more profits as this Strategic business unit has potential.
 The Number 1 brand Strategic business unit is a star in the BCG matrix of Mother Dairy Creating a
National Footprint, and this is also the product that generates the greatest sales amongst its product
portfolio. The potential within this market is also high as consumers are demanding this and similar
types of products. Mother Dairy Creating a National Footprint should undergo a product development
strategy for this SBU, where it develops innovative features on this product through research and
development. This will help Mother Dairy Creating a National Footprint by attracting more customers
and increases its sales.
 The Number 2 brand Strategic business unit is a star in the BCG matrix of Mother Dairy Creating a
National Footprint as Mother Dairy Creating a National Footprint has a 20% market share in this
category. It also the market leader in this category. The overall category is expected to grow at 5% in
the next 5 years, which shows that the market growth rate is expected to remain high. Mother Dairy
Creating a National Footprint should use its current products to penetrate the market. This could be
done by improving its distributions that will help in reaching out to untapped areas. This will help
increase the sales of Mother Dairy Creating a National Footprint.

 Cash Cows

 The supplier management service strategic business unit is a cash cow in the BCG matrix of Mother
Dairy Creating a National Footprint. This has been in operation for over decades and has earned
Mother Dairy Creating a National Footprint a significant amount in revenue. The market shares for
Mother Dairy Creating a National Footprint is high, but the overall market is declining as companies
manage their supplier themselves rather than outsourcing it. The recommended strategy for Mother
Dairy Creating a National Footprint is to stop further investment in this business and keep operating
this strategic business unit as long as its profitable.
 The Number 3 brand strategic business unit is a cash cow in the BCG matrix of Mother Dairy Creating
a National Footprint. This is an innovative product that has a market share of 25% in its category.
Mother Dairy Creating a National Footprint is also the market leader in this category. The overall
category has been declining slowly in the past few years. Mother Dairy Creating a National Footprint
has the power to influence the market as well in this category. It should, therefore, invest in research
and development so that the brand could be innovated. This will help the category grow and will turn
this cash cow into a star. The overall benefit would be an increase in sales of Mother Dairy Creating a
National Footprint.
 The international food strategic business unit is a cash cow in the BCG matrix for Mother Dairy
Creating a National Footprint. This business unit has a high market share of 30% within its category,
but people
 are now inclined less towards international food. This change in trends has led to a decline in the
growth rate of the market. The recommended strategy for Mother Dairy Creating a National Footprint
is to invest enough to keep this strategic business unit under operations. If it no longer remains
profitable and turns into a dog, then Mother Dairy Creating a National Footprint should divest this
strategic business unit.

 Question Marks

 The local foods strategic business unit is a question mark in the BCG matrix for Mother Dairy
Creating a National Footprint. The recent trends within the market show that consumers are focusing
more towards local foods. Therefore, this market is showing a high market growth rate. However,
Mother Dairy Creating a National Footprint has a low market share in this segment. The recommended
strategy for Mother Dairy Creating a National Footprint is to invest in research and development to
come up with innovative features. This product development strategy will ensure that this strategic
business unit turns into a cash cow and brings profits for the company in the future.
 The Number 4 brand strategic business unit is a question mark in the BCG matrix for Mother Dairy
Creating a National Footprint. This strategic business unit is a part of a market that is rapidly growing.
However, this strategic business unit has been incurring losses in the past few years. It has also failed
in the attempts made at innovation by research and development teams. The recommended strategy for
Mother Dairy Creating a National Footprint is to divest and prevent any future losses from occurring.
 The confectionery strategic business unit is a question mark in the BCG matrix for Mother Dairy
Creating a National Footprint. The confectionery market is an attractive market that is growing over
the years. However, Mother Dairy Creating a National Footprint has a low market share in this
attractive market. The low sales are as a result of low reach and poor distribution of Mother Dairy
Creating a National Footprint in this segment. The recommended strategy for Mother Dairy Creating a
National Footprint is to undergo market penetration, where it pushes to make its product present on
more outlets. This will ensure increased sales for Mother Dairy Creating a National Footprint and
convert this strategic business unit into a cash cow.

 Dogs

 The plastic bags strategic business unit is a dog in the BCG matrix of Mother Dairy Creating a
National Footprint. This strategic business unit has been in the loss for the last 5 years. It also operates
in a market that is declining due to greater environmental concerns. The recommended strategy for
Mother Dairy Creating a National Footprint is to divest this strategic business unit and minimize its
losses.
 The Number 5 brand strategic business unit is a dog in the BCG matrix for Mother Dairy Creating a
National Footprint. This is operating in a market segment that is declining in the past 5 years. The
company also has negative profits for this strategic business unit. However, it is expected that the
market will grow in the future with environmental changes that are occurring. The recommended
strategy for Mother Dairy Creating a National Footprint is to invest in the business enough to convert
into a cash cow. This will ensure profits for Mother Dairy Creating a National Footprint if the market
starts growing again in the future.
 The synthetic fiber products strategic business unit is a dog in the BCG matrix of Mother Dairy
Creating a National Footprint. The market for such products has been declining, and as a result of this
decline, Mother Dairy Creating a National Footprint has been facing a loss in the past 3 years. The
market share for it is also less than 5%. The recommended strategy for Mother Dairy Creating a
National Footprint is to divest this strategic business unit to minimize any further losses.
 The artificially flavored products strategic business unit is a dog in the BCG matrix for Mother Dairy
Creating a National Footprint. These products were launched recently, with the prediction that this
segment would grow. However, with increasing health consciousness, people are now refraining from
consumption of artificial flavors. The market is shrinking, and Mother Dairy Creating a National
Footprint has no significant market share. The recommended strategy for Mother Dairy Creating a
National Footprint is to call back this product.
 PESTLE ANALYSIS OF MOTHER DAIRY

PESTLE analysis is a framework which is imperative for companies such as Mother Dairy, as it helps to
understand market dynamics & improve its business continuously. Mother Dairy PESTLE Analysis
examines the various external factors like political, economic, social, technological which impacts its
business along with legal & environmental factors.

I. Political Factors:
The political factors in the Mother Dairy PESTLE Analysis can be explained as follows:
 Mother Dairy is affected by not just the regulations change in the dairy sector, but also by
regulations that change in the allied sector such as livestock breeding.
 It has a good relationship with the political parties, and thus gets an upper hand, when new policies
are being designed, as they can put in their ideologies, regarding the policies that might affect the
industry and the company itself.
 The government policies have a huge role to play which benefit Mother Dairy. It Is through these
policies and incentives that the farmers get motivated to rear livestock or to breed chickens and
goats, for the mutton and eggs.
 Since dairy is a subset of agricultural products, there happens to be no tax on the sale of fresh milk,
which benefits both the customers and the sellers. This segment of dairy is deregulated by the
government of India, and there is 100% FDI approval, which makes it even more lucrative option.

II. Economic Factors:

Below are the economic factors in the PESTLE Analysis of Mother Dairy:
 Milk is a product that most consumers buy, irrespective of the cost associated with it.
 An increase in the cost of milk and its products might reduce the quantity but will not lead to complete
stoppage. The reduction in prices will again uplift the sale of the product, thus more the need as well
as disposable income, more will be the sale.
 Since milk and its products are perishable products the amount for which it is sold, should be relevant
to the product. A random hike or drop in price might cause intense competition in the market, which
will further lead to adverse consequences for all the players in the long run.
 A recent example is the price increase in the cost of milk, by Rs.2 started by Amul, has caught on, and
Mother Dairy has followed its steps and increased its cost by Rs. 2. This was done by the company to
help the livestock rears get a better price for their product.

III. Social Factors:

Following are the social factors impacting Mother Dairy PESTLE Analysis:
 There is a brand value that is associated with Mother Dairy. The consumers believe it is a brand that
creates good products and helps them live a healthier life. This belief of the consumer needs to be
fulfilled at all times to stay in competition.
 To stay relevant in the competition, it is important to stay ahead by keeping up with the changing
trends. The introduction of new products and services as per the requirement if the consumer is of
prime importance.
 The consumption of packaged foods has been increasing, and by working on increasing its capacity to
produce packaged foods, the dairy can increase its profitability while satisfying the consumers. Since
there is an increase in the need for low fat products, lactose free products, flavored yogurts and other
healthy products, the company must plan on expanding in these areas to satisfy the growing customer
demands.
 Mother Dairy has been instrumental in employing a majority of local people in areas of its operations,
thus helping in upliftment if the society.

IV. Technological Factors:

The technological factors in the PESTLE Analysis of Mother Dairy are mentioned below:
 Mother Dairy has utilized various technologies, over the past few years, to ease its operations. It has
made sure that there is judicious deployment of technology. These is integration between the various
IT departments of the company, and it was the first company in the milk industry to actually
implement and fully utilize SAP.
 The company utilizes the cloud service to store all its data, and to keep a track of other activities that
occur during the daily operations. They have developed a mobile app that can be used to detect, and
GPS track all their tankers, monitor the temperatures of their warehouses and dispatch vehicles
through the use of IOT.
 Analytics is being used to recognize the changing trends, and to modify their products according to the
changing taste of the consumer. The company has been utilizing vending machines to sell lose milk.
 With these advancements and many more to come in the field of IOT and Machine learning, Mother
Dairy is going on the right track.
 V. Legal Factors:
Following are the legal factors in the Mother Dairy PESTLE Analysis:
 Mother Dairy is bound by several legal factors. There are various legal regulations that the company
needs to follow. It may include the labour laws, compensation laws, related to the environment,
benefits to the employees, taxes, quality of the products etc.
 A team of experts needs to be in constant check for compliance related to the changes brought about.
The laws related to health and safety of the employees, quality and hygiene of its products need to be
followed.
 Apart from these, the company also needs to make sure, that it does not infringe the intellectual
property rights of any individual or organization, while creating new and advanced products.
 As a result of the recently introduced law for Single Use Plastic, Mother Dairy has switched to paper
made straws and cups for their products.

VI. Environmental Factors:

In the Mother Dairy PESTLE Analysis, the environmental elements affecting its business are as below:
 Mother Dairy has undertaken various social aspects of concern and has worked on them through
various projects to create an impact.
 The inclination of Mother Dairy’s sub brand Safal, towards organic products, has helped create a
market where the farmers who produce such kinds of products can come and sell it for good prices.
 Mother Dairy under the head of its green initiative, will be recycling approximately 830 tons of plastic
in 2019.
 The company has also installed solar panels in the industry premises to promote sustainable energy
usage.
 MARKETING MIX STRATEGY OF MOTHER DAIRY

PRODUCT PRICE

PROMOTION PLACE

1. Product Strategy:

o Mother dairy has a wide range of products to offer in the market which comes under milk-based
products and other food items in India. It has 3 sub-brands which are Dairy, Dhara, and Safal.
o Mother Dairy mainly produces all the dairy products in its product range. Dairy products are
classified as milk, milk products, and ice creams.

2. Pricing Strategy:

o Initially mother dairy has been using a penetration pricing policy to bring awareness among many
people and so that people buy their products.
o Its milk prices changes with change in inflation. Its pricing policy also differs from place to place
depending on geographical factors.
o Other milk brands also use similar pricing policies depending on the rise in prices of other input
factors.
 o The mother dairy ice cream uses competitive pricing for its regular ice cream flavors and also
uses premium prices for the special flavors provided by them.
o Safal brand uses market-based pricing for its vegetable and fruits products. Whereas, the edible
oil segment faces a lot of competition in the market and so it uses a competitive pricing policy
where it provides them with low-cost products with good quality.

3. Placement & Distribution Strategy:

o Mother dairy has its supplies in every part of the country. Having a proper distribution channel
and making its products easily available for its customers is a crucial part of the milk industry.
o To cater to this large market, it has over 1,400 retail outlets and more than 1,000 exclusive stores
in different places.
o Since it deals with perishable products and has a short shelf life, it deals with only the amount of
quantity required as per the region. Its suppliers are farmers and cooperatives which eliminates
the middlemen and helps in saving costs.
o After it is brought from the farmers in tankers or being collected at the collection centres, it is
then processed in the plants, and then it is delivered to its Local Area Distributors who then send
it to its exclusive Mother Dairy booth, convenience stores, supermarkets, and other smaller
retailers. Since consumers can find Mother Dairy booths very close to their homes, it has built
customer loyalty and preference.

4. Promotion & Advertising Strategy:

o Mother dairy used different marketing strategies in the market. It uses different modes to promote
its products like newspapers, television, radios, and social media.
o As there are firm competitors like Amul, mother dairy has come up with a strategy in which it
gains the mind share of the consumer with better communication strategies. Its ice cream segment
has gained a lot of popularity due to its television commercials.
o Whereas Safal uses green and environment-friendly themes to sell its products. Dhara brand has
been on TV commercials for quite a long time. It also has tied up with Paytm and UPI for
cashless payment at its booths and hence showing it is technologically updated.

On the study of the marketing mix of mother dairy, it can be concluded that the company has been using
some notable strategies in the market to grow.
It provides a wide range of products in the market for its customers under the Dairy, Safal, and Dhara.
Mother dairy uses different pricing policies as per the different segments like geographical regions,
competitors, etc. It has a large distribution network in the market and has been available at every place
which makes it easy for its customers to buy the products. It gains more customer loyalty when its
products are available easily in the market. It uses different marketing platforms in online and offline
channels like print, television, digital, etc. to promote its products.
 CONCLUSION

The project has been done to Analyze Organizational Structure of Mother Dairy Fruits and
Vegetables Pvt. Ltd.

From the complete evaluation it has been concluded that quality and purity is of utmost
importance in mother dairy. Mother dairy has different brands like Safal and Dhara, which
provide them support to take hold of the market. Today, Mother Dairy manufactures markets &
sells milk and milk products including cultured products, ice creams, paneer and ghee under the
Mother Dairy brand. The Company also has a diversified portfolio with products in edible oils,
fruits & vegetables, frozen vegetables, pulses, processed food like fruit juices, jams, etc. to meet
the daily requirements of every household. Where numerous industry pioneers have been forced
to shut shop, unable to keep pace with changing consumer tastes, Mother Dairy is constantly
evolving to provide maximum satisfaction to its consumers. High quality and reliable products
along with a robust network of local level milk booths and larger retail channels have ensured
that Mother Dairy has become a household name in the branded milk segment.

The dairy market in India is poised to grow strongly in the coming years and co-operatives like
Mother Dairy will face stiff competition from Multi-nationals like Britannia, Nestle, etc. With
competition rising, it would be interesting to see if these institutions with a strong socio
economic purpose manage to grow the way they have been growing in the past. With a robust
backend supply chain in place and a strong competitive positioning, we think Mother Dairy is
well positioned to fend off competition and grow sustainable in the coming years.
 REFERENCES

The following are the links to the websites from which the above research has been conducted:

 www.ndri.res.in
 www.censusindia.gov.in
 www.dairy.maharashtra.gov.in
 www.motherdairycalcutta.com
 www.articles.timesofindia.indiatimes.com
 www.kmfnandini.coop.com
 www.motherdairy.com
 www.nddb.org
 www.researcandmarkets.com
 www.thirdesight.in/article/motherdairy.html
 www.gyananalytics.com