Presented by:

DIVYA BODDU09020242007SIIB MBA-AB

BIRTH OF AMUL

• 1929 Peston Edul Polson established Polson Model Dairy at

Anand to manufacture butter, ghee and casein.• 1944

Inauguration of Bombay Municipal Corporation Milk Supply. Monopoly rights were awarded to Polson for Procuring milk from Kaira.

• 1946 KDCMPUL formed to counter exploitation by Polson’s

Dairy (Anand)And so did GCMMF and brand Amul correspondingly

Pandit Jawaharlal Nehru, Indira Gandhi, Morarji Desai and others at the inauguration of Amul Dairy.

Amul Dairy, Anand [today]

• Type :Cooperative• Headquarters: Anand, India• Key people: Chairman, GCMMF - P. G. Bhatol• Industry :Dairy Products • Revenue :INR 67.11 billion, $15.04 billion USD (‘08-’09)• Employees :735 employees of Marketing Arm. However,

real pool consist of 2.8 million milk producers • Website: www.amul.com• CRISIL assigned "AAA/Stable/P1+" to the various bank

facilities of GCMMF.

AMUL FACTFILE

AMUL - LOGO

Competitive rivalry is high due to other brands and

local players

Threat of new

entrants is high ‘coz there are no entry barriers

Bargaining power of

customers is high ‘coz of various

competitors

Threat of substitutes is high ‘coz

of availability

of other products

Bargaining power of

suppliers is low ‘coz the

suppliers are rural

milk producers

PORTER’S 5 FORCES

3 C’S MODELAre extremely satisfiedMoved from loose milk to

packaged milkReady to try more productsImproved socio-eco

conditions

Largest milk brand in AsiaMore than 30 dairy brandsMarket leader in ghee and butterVery strong supply chainEnjoys fine reputationQuality with affordability

Defending against Mahananda, Vijaya, Milma, and other cooperative milk brands

Aggressive moves against Britannia, Nestle, Mother Dairy, Kwality

CSAIntelligent marketing

AMUL’S SUCCESSSales Turnover Rs (million) US $ (in million)

1994-95 11140 3551995-96 13790 4001996-97 15540 4501997-98 18840 4551998-99 22192 4931999-00 22185 4932000-01 22588 5002001-02 23365 5002002-03 27457 5752003-04 28941 6162004-05 29225 6722005-06 37736 8502006-07 42778 10502007-08 52554 13252008-09 67113 1504

GCMMF bags APEDA AWARD for 11th year in a row [‘06-’07]

Amul Pro-Biotic Ice-cream Gets The International Dairy Federation Marketing Award At World Dairy Summit [2007]

Ramkrishna Bajaj National Quality Award [2003]

Amul - The Taste Of India (GCMMF) Receives International Cio 100 Award For Resourcefulness [2003]

Rajiv Gandhi National Quality Award – 1999

ISO 9001 and HACCP Certification , Australia 1st food company in Asia one of the 100 companies in the world

AMUL’S SUCCESS

AMUL’S REASON FOR SUCCESS

BRAND VALUE OF AMUL

LOW COST STRATEGY

ROBUST SUPPLY CHAIN

DIVERSE PRODUCT MIX

STRONG DISTRIBUTION NETWORK

TECHNOLOGY AND e-INITIATIVES

State Marketing Federation

All dairies in a State (GCMMF in Gujarat)

22 State Federations in India

District Milk Processing Unions

Every district in the state

12 district unions in Gujarat

170 unions all over India

Village Co-operative Societies

All villages in a district

72,774 villages in India

Milk Producers

All milk producers in a village

2.1 million in Gujarat

9.31 million in India

ANAND

PATTERN

SBUS OF AMUL

BCG MATRIX OF AMUL

PRODUCT PORTFOLIO

Veterinary Services

Pelleted Cattle Feed

Education on Animal Husbandry

Facilities for Artificial Insemination

Genetic improvement of indigenous cattle

SERVICES RENDERED

• SegmentationConsumer basedIndustry basedNot so easy

• Targeting Amul parlours

• Positioning A mass market player, no premium offerings USP – Quality with affordability “Amul” as “Taste of India” - creating value New offerings for health conscious and vibrant India

AMUL’S STP

• One of the most conservative FMCG entities — GCMMF — spends a mere 1% of its turnover on promotions.

• Amul butter girl is one of the longest run ad campaigns in the country for 43 years!!!

INTEL MARKETING-

TOPICALS

Amul Ice-cream 1996 Category re-visited in 1999 Amul Cheese in 2001 Amul Masti Chaas in 2004-05 Nutramul and Kool Kafe in 2006 Amul Koko — cold chocolate drink in 2009

ROTATIONAL PROMOTION STRATEGY

OTHER PROMOTIONAL

STRATEGIES

AMUL’S SUPPLY CHAIN

• "Amul Utterly Delicious" parlours.

• Ahmedabad, Bangalore, Baroda, Delhi, Mumbai, Hyderabad and Surat.

• Prominent locations.• Amul franchisee plans.

AMUL PARLOURS

• ERP initiatives ‘94• Tata Consultancy Services • Implementation project - Enterprise- wise Integrated

Application System (EIAS).• AMCUS – automate milk producers logistics.• Zonal offices, regional offices and member’s dairies -VSATs• Geographic Information Systems (GIS)• IIM A supplemented Amul’s IT - Dairy Information System

Kiosk(DISK). • www.amul2b.com• Plans to introduce Internet banking services and ATMs

SUPPLY CHAIN ADD-ONS

• Decided by the GCMMF by conducting market

• Price is inclusive of several elements like,Cost of milk. Labour cost. Processing cost. Packaging cost. Advertising cost. Transportation cost. Sales promotion costs. Taxes etc.

PRICING -AMUL

TASTE OF COMPETITION

T.O.C

• Ice cream: Amul parlours; launched “Fundoo” to combat HUL’s Max

• Pizza: Launched ready to cook pizza “Utterly delicious”

• Butter: Protect market share with price• Curd: Alignment with other milk coops• Dairy whiteners: Dominate with Amulya

T.O.C – STRATEGIES

• 1st sparks – Aug ‘02

• Mother Dairy cuts prices in butter war with Amul [‘05]

• NDDB -free sugar with its milk. GCMMF- discount on vanilla ice cream against purchase of Amul milk [Mar ‘06]

• GCMMF sold 2,000 tons skimmed milk powder to Mother Dairy [Mar ‘06]

• Amul-Rs 30 off on vanilla ice cream after returning the 30 empty pouches of Amul milk.[’06]

• NDDB plans to import 10,000 MT skimmed milk powder to meet the domestic demand. [Sep ‘09]

• NDDB - 6,000 litre of milk @ Rs 330 per kilo fat to milk pourers (MPs) @ Surendranagar [ Oct ‘09]

AMUL - NDDB TWIST

• Capital structure• Working capital• Sources of capital

Federation Fix deposit of society Interest from bank like SBI, BOB, Share Capital of AMUL

FINANCE MATTERS !

• Less control over milch yield• Cannot accommodate transport delays

(perishables)• Dependence on poor infrastructure for supply

(roads, electricity etc)• Increasing population , increasing requirement• Adulteration• Saturation point not far away• Unorganized players• Other dairy co-operative societies• Competitors are companies, not bound by

inherent obligations of co-operatives

WEAKNESSES & THREATS

• U.S.A, Nepal, South Africa, Kenya, Bhutan, Bangladesh, Thailand, Australia, and Gulf countries etc

• Prospective markets- Russia, UAE, Japan, Sri Lanka• Agreement with Wal-mart• Agreement with Glaxo• Amul’s growth rate in international market : ~34%

AMUL GOES GLOBAL

• Product improvisation -Amul basundi, gulab jamun, chocolates etc.

• Advertising – Cable channels, newspapers etc.• Strengthen liquidity and working capital• Supply chain add-ons• Venture into processed fruits and vegetables.• Try nullifying threats