packed and unpacked milk product

8/4/2019 Packed and Unpacked Milk Product

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PACKED MILK VS OPEN MILK - BUSINESSRESEARCH METHODS (BRM) REPORT

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Literature Review

Milk Market in Pakistan

Milk market consists of highly sensitive market because milk is a food item. The packed

and unpacked milk come under perishable food market. In Pakistan 20 billion litre of

milk is produced out of which only 0.6% is packed milk and 99.4% is unpacked milk,

which is sold by gawalas. So there great potential exists in our country for packed milk.

In the urban areas of Pakistan, pack milk has 2.6% share as compared to 97.4% share

of open/unpacked milk.

As compared to whole world, only in Sub Continent and in some African countries

unprocessed milk is sold. In rest of the world only process milk is allowed to sell.

Main Features of Milk Market in Pakistan

Pakistan is the seventh largest producer of milk in the world.

It produces 20 billion liter of liquid milk every year.

3 billion liter of milk is processed while 17 billion liters of milk is used in the country in

unprocessed form.

3 billion liters of milk (15%) processed is used in preparation of sweets, yogurt, butter,

cheese & pasteurized (milk sterilization) packed milk.

among this 3 billion liter of processed milk only 250 million liters milk is processed and

packed in Tetra packaging.

Annual yield of milk per animal is 1150 liters which is 1/5th of that in Western Europe
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Total animal production is 21 million which is more than North America but milk

production is low

It should be noted that only 100,000 of the total 9 million dairies in the country have

more than 10 animals.

Out of 20 billion liters only 5 billion-liter milk goes to urban areas in which only 0,194

billion is used by dairies for processing. It shows a great scope for the processed milk in

the country.

Packed Milk

Packed Milk is actually the processed milk. The companies in the business of packed

milk collect milk from the approved dairy farms and then process it. So the packed milkis not made from chemicals or synthetically.

In order to be converted to packed milk, the simple milk has to undergo the following

processes[2]:

Pasteurization

Standardization

Homogenization

The brief detail of each process is given below.

Pasteurization

Pasteurization is the process of boiling milk and then immediately cooling it to a lower a

very low temperature

The milk is pasteurized at 78o C killing 98% germs/bacteria. The milk afterpasteurization is then standardized.

Standardization

Standardization is the process in which the excess Fats and SNFs are removed from

the milk.
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The Pakistan Pure Food Laws are there for standardization. According to the law, 35%

Fats and 8.9% SNF (solid non- fats) must be there in the milk.

The milk is then homogenized.

Homogenization

Homogenization is a process in which all thecream in the milk is mixed into the milk.

In this process the milk is passed through 200 Bars of pressure, which in turn breaks

each cell to 0.5 microns that is 200 times smaller than its actual size. By applying this

enormous pressure the entire cream mixes in the total milk. This is the reason that on

boiling packed milk, cream does not accumulate on the top like ordinary milk.

Homogenized milk is then passed through the UHT.

UHT Treatment

In this process, the milk passes through 140C in 3 seconds and then immediately

cooled to 20C in the next 5 seconds, which in turn kills all the bacteria. This is the

most sophisticated and advanced process in the world.

Some of the issues regarding the use of packed milk in Pakistan are:

The Pakistan society is very complex society. People like show off. Higher classes

think prestigious for them to buy and use packed milk. So it is a favorable Social

indicator for this industry.

The Literacy rate in Pakistan is increasing so people are becoming aware and

conscious about the hygienic conditions of milk.

In Urban Areas the number of working women is increasing so they prefer to use

packed milk.

Recently Government had taken a decision that selling of unprocessed milk should be

banned in urban areas and at-least pasteurized milk should be sold. SMEDA and Local

Government were to implement this program. However, it is unlikely now that this

program is going to be implemented due to change of the government.


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24 plants have been registered for Processed milk and they have taken Heavy loans

from banks for this purpose but they have not utilized them fairly. All this is due to

Political pressure on banks.

No new Foreign investment due to Non uniform policies and unstable political situationin the country

Previous Researches Conducted

We tried to find if there was any previous research conducted on this topic, but we could

find no such research in local libraries.

Theoretical Framework

Problem Statement

To what extent are people responding towards the packed milk? The superiority of

packed milk is in the areas of hygiene, convenience, taste, nourishment and economy.

Price of packed milk is higher (almost double than fresh milk), but it is economical in the

sense that its quantity required to make a certain number of tea cups is half of that of

fresh milk.

We have observed that in spite of these advantages, most families prefer fresh milk. So

this problem is defined above and research was conducted as to whether fresh milk is

really preferred over packed milk and what could be the possible reasons for it.

Hypothesis

H0 = Fresh milk is preferred over packed milk.

H1 = Fresh milk is not preferred over packed milk.

Theoretical Framework

The theoretical framework was developed as follows:

People want to use that milk, which is easily available to them, which is low in price,

which is free of germs, which tastes better and is more healthy. Based on these


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observations, the most important variables regarding comparison of fresh and packed

milk are convenience, economy, hygiene, taste and nourishment.

The variable of primary interest or the dependent variable is preference for a type of

milk. The variables influencing this are independent variables:

Convenience

The more the milk is convenient in availability and usage, the more preference for it.

Economy

The more economical the milk, higher will be preference for it.

Hygiene

More hygienic the milk, higher the preference for it.

Taste

Better the taste of the milk, higher the preference for it.

Nourishment

The more nourishment the milk gives, the higher will be the preference for it.

Credit

It can be one of the influential factor in buying decision of milk. Mostly people prefer

fresh milk because it is available at doorstep and they have to pay the price in form of

monthly payments.

The moderating variable is the income of families. Certain families might strongly

believe that the independent variables are in favor of a certain kind of milk, but they will

prefer the one they can afford.

Objectives of the Research

The objectives of the research were:


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1) To find whether the consumers prefer fresh milk over packed milk, and find the

possible causes for it.

2) To find whether the advertisement affects the preference of people regarding the

packed milk.

Research Design

Research Tools

Tool of research used for the data collection were personal interviewing and

questionnaire. These questionnaires were distributed to the families residing in different

localities of Multan. These families covered almost all income groups.

Type of Study

Aim of this research was to study the influence of the independent variables that is

hygiene, taste, convenience, nourishment and economy in use over the dependent

variable, which is preference of milk. This study was correlational type of study. The

research was analytical in nature. This was an ex post facto research because variables

were neither controlled nor manipulated and no artificial setting was created for the

study. The research was a cross-sectional study. The time to complete the research

was about one and a half months. All of the data was primary in nature.

Unit of Analysis

The research was conducted to examine peoples reference of a type of milk regarding

their considerations of convenience, economy, hygiene, taste and nourishment. As milk

is a product relating to household consumption, therefore, the unit of analysis for this

research study was families of different localities belonging to different income groups.

Population and Sample

Population of the research undertaken comprised of the people of different localities of

Multan. Unstructured and structured interviews were conducted using a sample of 60

respondents, taking 10 sub-samples from each of the 6 areas. These areas were:

Gulgasht


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New Multan

Mumtazabad

Walled City (Qadeer abad, Harm gate/Pak gate)

Nishtar Road/Chungi No. 1

Cantt.

The whole population was equally divided into the relevant income groups so that

opinion of every income group family with reference to their milk preference could be

registered. The sampling procedure was, thus, judgement sampling.

Analysis and Results

Location

For finding any relationship between the use of packed milk and the region/area of the

city, the city was divided into 6 regions, and a sub-sample of 10 was taken from each

area. A cross tabulation of location with use of packed milk is shown below.

Interpretation

The table shows that there is not much relation between the location and the usage of

packed milk, except areas like Gulgasht and Nishtar, where the usage is relatively

higher, but not much significant.


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No. of Family Members

The table shows that the average number of members in a family is about 6, and a

standard deviation of 2.14, so the members vary from a minimum of 2 to a maximum of

13.

Usage of Various Types of Milk

The question we asked from the respondents was that whether they use packed milk,

open milk or both. The results are shown in the graph below.

This graph shows that mostly people (57%) use only open milk; about 40% people use

both packed and open milk, and only 3% of the people use only packed milk.

Education


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Educational qualification of a particular family is quite difficult to calculate, so we

devised a different scale to measure the educational qualification. For this purpose, in

the questionnaire, a question was put to the respondents to specify the number of

members having different levels of education like M.A./M.Sc./MBA, B.A./B.Sc./B.Com.,

F.A./F.Sc., etc. and then points were allocated to each category. Their sum was divided

by the total family members of the family. In this way, the score was normalized, and the

net score was taken as Educational Score. This score ranges from 1 to 7, and this

score was further divided into three categories, which are:

Grade Score

Low Educated Family 0.01 1.99

Medium Educated Family 2.00 3.99

Highly Educated Family 4.00 above

The result shows that there is not much relationship between the usage of packed milk

and the educational score of the families, however, in high education grade category,

there seems to be some preference of packed milk, but the sample size in not large

enough to support the proposition.

Advertisement

a) Awareness of Advertisement

Following table summarizes the awareness of advertisement that is to what extent, thepeople are aware of the advertisement of packed milk.


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The table above shows that families are aware of the advertisement of the packed milk

to a greatest extent. Out of 26 families, who use packed milk; only one family replied

that they have not seen the advertisement.

b) Recalling of the Advertisement

When families were asked whether they can recall the advertisement of their favorite

packed milk or not? The answer we get, that about 86% of the families can recall theadvertisement of their favorite packed milk easily.

c) Liking of the advertisement

Similarly, during the interviews, when the families were asked about liking or disliking of

the advertisement of their favorite packed milk in a general sense, most of the families

replied that they like the advertisement of their favorite packed milk. But they also want

further improvements in the advertisements.

d) Advertisement & Quality of Packed Milk

The opinion of people about companies who advertise for packed milk, whether the

qualities they claim in their packed milk, are actually there in the milk or not? The

following table summarizes the responses.


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INTERPRETATION

The responses regarding the qualities of the packed milk that are claimed in the

advertisement are somewhat equal. The answers are on the both ends (i.e., Yes or No).

Hence we are unable to make any strong inference from the responses that families are

able or unable to find all the qualities of packed milk, that are claimed in the

advertisement.

e) Influence of Advertisement

In order to see the influence of advertisement of the packed milk, following table

summarizes the findings

From table, it is obvious that out of the total 59 families, 51 families have seen the

advertisement of the packed milk and out of the total families, 27 families have

purchased the packed milk, while 24 families have not purchased the packed milk.

Hence the influence of the advertisements are not so strong.

People Purchasing Open Milk

Usage Rate

The following table summarizes the frequency distribution of the usage of the open milk.


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Interpretation

The frequency table shows that most of the families (48%) use 1-2 Litres of open milk in

a day. while 34% families use 3-4 Litres in a day.

Average Daily Expense on Open Milk

The average rate/Litre of open milk is Rs 15. If we multiply the average price with

quantity purchased in a day, then we find that the average daily, most families spend Rs

15 to Rs 30 on the consumption of the open milk.

Place of Purchase


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The graph shows that most of the people buy at the doorstep, from Gawalas, and

usually these gawalas provide milk on credit. Later we will see that what importance do

the people give to the credit factor. So, it may be the case that people prefer open milk,

because it is easily available at doorstep and on credit.

Various Uses of Open Milk

Following are various frequencies regarding the use of open milk

For Infants

The following table summarizes the findings regarding use of open milk as a food for

infants.

Interpretation

From table, it is obvious that most of the families (67%) do not use open milk for their

infants as a food for them.

For Drinking

The following table summarizes the findings regarding use of open milk as drinking.


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Interpretation

From table, it is obvious that most of the families (77%) use open milk for drinking

purpose

For Tea

The following table summarizes the findings regarding use of open milk , for making tea.

Interpretation

From table, it is obvious 92% families use open milk for making tea. Hence tea is the

most important use of the open milk.

Importance of Various Factors in Considering the Purchase of Open Milk

The effect of each variable behind the purchase of open milk is described separately

below

Availability

The following table shows the importance of availability factor in the purchase of open

milk.


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Interpretation

Among 69% families, the availability factor is important regarding the purchase of the

open milk

Credit factor

The following table shows the importance of credit factor in the purchase of open milk.

Interpretation

Among 65% families, the credit factor is not important regarding the purchase of the

open milk. Hence it is a weak variable. So what we had presumed previously; the

analysis of this factor doesnt support our assumption.

Economic Factor

The following table shows the importance of economic factor in the purchase of open

milk.

Interpretation


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From the above table, it is clear that the economic variable is very important in the

context of purchase of the open milk. Majority of families (71%) use open milk because

it is economical.

Hygienic Factor

The following table shows the importance of hygienic factor in the purchase of open

milk.

Interpretation

In the use context of open milk, the hygienic is an insignificant variable. Only 13%

families consider the hygienic factor to be important.

Purity Factor

The following table shows the importance of hygienic factor in the purchase of open

milk.

Interpretation

Among 67% families, the purity factor is not important regarding the purchase of the

open milk. Hence it is a weak variable.


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Taste Factor

The following table shows the importance of taste factor in the purchase of open milk.

Interpretation

In the use context of open milk, the taste factor is less significant variable. 67% families

do not consider the taste factor to be important.

Ranking of Various Factors Considered Important While Purchasing

Open Milk

Ranking for convenience

The following table shows the ranking of the availability/convenience factor in the

context of the open milk


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Interpretation

Among 63% of the families, the availability factor is very important. Hence it is an

important variable.

Economic/price

The following table shows the ranking of the Economic/Price factor in the context of the

open milk


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Interpretation

The economic factor is very important because 46% families and 40% consider it be

very important and important respectively.

Credit Factor

The following table shows the ranking of the credit factor in the context of the open milk


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Interpretation

For credit factor, the results are somewhat mixed. 40% families consider it to be not

important at all, While 30% and 28% families consider this factor to be important and

very important respectively.

Hygiene Factor

The following table shows the ranking of the hygiene factor in the context of the open

milk


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Interpretation

Taste

The following table shows the ranking of the taste factor in the context of the open milk

Interpretation

Taste is also an important factor from ranking point of view because 46% families

consider it to be very important while 30% families consider it to be an important one.

Purity

The following table shows the ranking of the taste factor in the context of the open milk


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Interpretation

46% families rank the purity factor as an important one, while 36% families rank it as

very important.

Summary of Ranking factors

Following is the summary of the ranking factors in the context of the purchase of the

open milk

Availability is the most important factor

Price it also the most important factor

People Purchasing Packed Milk

Preference of Brand


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The graph shows that mostly people prefer Haleeb, MilkPak is No. 2. This is probably

due to aggressive advertising of Haleeb, because the results of advertisement section

show that people who see advertisement of packed milk, usually they are influenced,

and go for purchasing that brand of milk.

The relation of each variable behind the purchase of packed milk is described

separately below

Availability

The following table shows the importance of availability factor in the purchase of packed

milk.


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The table shows that about 56% people consider it an important factor, because packed

milk is easily available, whenever and wherever people need it, easily portable.

Economic Factor

The following table shows the importance of economic factor in the purchase of packed

milk.

From the above table, it is clear that the economic variable it is not very important in the

context of purchase of the open milk. Though it is used in less quantity while making the

tea, and is more dense and concentrated, but people usually dont realize it. The same

question was asked differently, i.e., preference because it is used in less quantity in

making of tea, but the results were again the same.

Use of Less Quantity in Making Tea

Only 36% consider that it is used in less quantity and is thus, more economical.

Hygienic Factor


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The following table shows the importance of hygienic factor in the purchase of packed

milk.

In the use context of open milk, the hygienic is an insignificant variable. Only 32%

families consider the hygienic factor to be important.

Nourishment Factor

The result shows that it is a weak variable.

Purity Factor

The following table shows the importance of purity factor in the purchase of packed

milk.


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Among 40% families, the purity factor is important regarding the purchase of the open

milk. Hence it is a weak variable.

Taste Factor

The following table shows the importance of taste factor in the purchase of packed milk.

In the use context of open milk, the taste factor is less significant variable. 52% families

do not consider the taste factor to be important.

So out of all these variables, the availability factor seem to be more stronger than the

other variables.

Ranking of Various Factors Considered Important While Purchasing

packed Milk

Availability/Convenience

The following table shows the ranking of the availability/convenience factor in the

context of the packed milk


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The results in the table and graph show that people consider this factor quite important.

Thus it is a strong variable and explains the cause of purchase of packed milk.

Economic/price

The following table shows the ranking of the Economic/Price factor in the context of the

packed milk


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The result of the table and graph show that people dont consider it very important, but

yet, moderately important for purchasing the milk.

Hygiene

The following table shows the ranking of the hygiene factor in the context of the packed

milk


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The hygiene factor is also important because 59% families replied that this factor is very

important while 28% families replied that this factor is very important. Hence the most of

the families go for the purchase of open milk because they consider the hygiene factor

as important one. But this result is quite contradictory to the previous finding, where just

considering of this factor was identified.

Nourishment

The following tables shows the ranking of nourishment factor in context of packed milk.


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The table shows that the ranking this variable got is quite less than other variables, so it

seems quite a weak variable to explain the purchasing behavior of people while

considering this variable.

Purity

The following table shows the ranking of the taste factor in the context of the packed

milk


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63% families rank the purity factor as very important, while 27% families rank it as

important, while only for 9%, its an unimportant factor.

Taste

The following table shows the ranking of the taste factor in the context of the packed

milk


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Taste is also an important factor from ranking point of view because 63% families rank it

as very important, while 27% families rank it as important, while only for 9%, its an

unimportant factor.

Findings

From the research, we have found out the following things:

1) There was no significant relation found between the use of packed milk with different

areas of the city.

2) About 55% people use only open/unpacked milk, whereas only 3% people use

packed milk. The rest of the people use both packed and open milk. Therefore, the

hypothesis stated earlier, i.e., packed milk is preferred over unpacked/open milk is

rejected on the basis of results.


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3) Also, the relationship of education with use of packed milk is not very strong.

However, it cant be stated on solid grounds, because its difficult to determine how

educated a family is, and the method used by us to calculate the educational score is

quite tricky and may have flaws in it.

4) Out of total families, about 86% families are aware of the advertisement of packed

milk. Out of those families, who dont use packed milk at all, 78% families have seen the

advertisement of packed milk.

5) The influence on purchasing decision of the people after watching the advertisement

is not much, just around 45-50%.

6) Usage pattern of the people does not seem to affect the purchasing decision in case

of packed milk. The following table summarizes the usage rate for people who useunpacked milk alone, and people who use packed milk alone or with unpacked milk.

Usage People using open milk alonePeople using packed milk

alone or along with open

milk

< 1 Liter 5.8% 13.6%

12 Liter 48.1% 50.0%

34 Liter 34.6% 27.3%

> 4 Liters 11.5% 9.1%

7) Those people, who purchase open milk, mostly they purchase it from doorstep

(46.2%), or Bhana (32.7%). About same is the case with those people who use both

open and packed milk. Therefore, this variable is also cant be taken as an explanatory

variable.

8) In case of those people, who use open milk, 32% use it for infants, 76% use for

drinking and 92% use it for making tea. Whereas in case of those people, who use

packed milk as well, 13% use it for infants, just 22% use it for drinking, and 96% use it

for making tea. Therefore, we conclude that basically it is the taste, or the high cost,

which makes the packed milk undesirable for drinking. Whereas, it is more desirable for

the purpose of making tea.

9) While considering the importance of various factors, following table summarizes the

results and it is easy to conclude from the following table that those people who use


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unpacked/open milk, is the major factor influencing their purchasing decision, whereas

for people using packed milk, its the availability which is the most important.

Availability Credit Eco/Price Hygiene Purity Taste

Open 69.2% 34.6% 71.2% 13.5% 32.7% 32.7%

Packed 56.0% 16.0% 32.0% 40.0% 48.0%

Flaws in research

When we conducted research, we had not much time to review and refine the research

design, so afterwards, during the research and conducting analysis, it was found out

that there are two major flaws in this research, which needed to be taken care of:

1) Proper sampling: sampling should have been done in order to clearly identify the

distinct areas in the city, which are different from each other in buying decisions and

habits, i.e., people from Officers Colony and people from Walled City must be quite

different from each other. Also, proper clusters of various income levels should have

been made to identify more clearly the buying pattern of packed milk.

2) The last question of the questionnaire, regarding ranking the various factors while

purchasing the milk, we were unable to analyze it properly during the analysis stage.

Perhaps, if some different scale were used, the results could have been more reliable.

However, it was our first (properly conducted) research, and we learnt a lot from it.

packed and unpacked milk product

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