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A report on

“The study of the channel for the distribution of


Icecreams in Schools”
Submitted in partial fulfilment of the requirement
For MBA course (2009-2011)

By
Anup Dcruz
(Reg. No.: 0921302)
Under the Guidance of

Faculty Guide Company Guide


Prof. G. Ramachandran Mr. Himanshu Chopra
Sr. Lecturer Dept. of MBA, Regional Manager,
Christ University, Bangalore Mother Dairy, New Delhi

CHRIST UNIVERSITY INSTITUTE OF MANAGEMENT


BANGALORE -560 029
MBA 2009-2011
DECLARATION

I, Anup Dcruz, a student of Christ University Institute of Management Bangalore, hereby


declare that the project entitled “Channel study” of Mother Dairy is the result of my own
effort in the training which I did as a part of the curriculum for the fulfilment of the MBA
degree.

I also declare that this project is an original work of mine and it has not been submitted to any
other university or for any other degree.

PLACE SIGNATURE

DATE

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ACKNOWLEDGEMENT

I express my gratitude to Mr.Himanshu Chopda (Area Sales Manager), and Mr.Batra


(Regional Sales Manager) , who helped me during my research and provided their valuable
support in the completion of my project.

I would like to express my sincere thanks to Mr.G.Ramachandran faculty of CUIM for his
guidance and suggestion.

It has been a great and valuable experience for me and I was able to get a clear idea of the
various channels of the company. This experience will be of great help in my future.

I would like to pay my gratitude to Mother Dairy Fruits and Vegetables Pvt. Ltd., for giving
me a chance to undergo the summer training in Operations Specialization.

Finally, I would like to thank Christ University Institute of Management for providing me an
opportunity to do the summer training in a company of my interest.

DATE: SIGNATURE

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CONTENTS

Particulars Page No.


Introduction………………………………………………………………………………….6

Indian Dairy Industry……………………………………………………………………….7

Understanding the Ice Cream

- Composition…………………………………………………………………………9

- Manufacturing Procedure…………………………………………………………...11

- Difference between Ice cream and Frozen Dessert…………………………………13

Mother Dairy

- About the company…………………………………………………………………14

- Product Portfolio……………………………………………………………………16

- Mother Dairy Ice Cream……………………………………………………………18

- Porter‟s 5 Force analysis……………………………………………………………19

- Current Channels…………………………………………………………………....22

Supply Chain-A study……………………………………………………………………...24

Quality Control in Mother Dairy

- Quality Assurance in Processing…………………………………………………………28

- Milk Processing tree…………………………………………………………………29

- Methodologies ………………………………………………………………………30

- Process Diagram……………………………………………………………………..31

- Quality Practices……………………………………………………………………..32

- Management System policies………………………………………………………..32

- Mother Dairy going GREEN………………………………………………………...33

- Energy Management Policy………………………………………………………….34

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Project Description

- Importance of the research……………………………………………………………….36

- Research Methodology…………………………………………………………………...37

Analysis of the Research

- Overview of schools………………………………………………………………………38

- Sampling of schools……………………………………………………………………….39

- Establishing a Channel…………………………………………………………………….40

- Modes of selling…………………………………………………………………………...41

- Supply Chain………………………………………………………………………………43

Findings…………….……………………………………………………………………………...48

Financial Analysis………………………………………………………………………………....51

Recommendations………………………………………………………………………………….52

Mangolpuri Facility – A Study……………………………………………………………………53

Conclusion.............................................................................................................57

Learning................................................................................................................58

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Introduction:

Traditionally, in India dairying has been a rural cottage industry. Semi-commercial dairying
started with the establishment of military dairy farms and co-operative milk unions
throughout the country towards the end of the nineteenth century.

In earlier years, many households owned their own „family cow‟ or secured milk from a
neighbour who had one. Gradually farmers living near the cities took advantage of their
proximity to the cities & began supplying milk to the urban population; this gave rise to the
fluid milk-sheds we see today in every city of our country.

Prior to the 1850s most milk was necessarily produced within a short distance of the place of
consumption because of lack of suitable means of transportation and refrigeration. The Indian
Dairy Industry has made rapid progress since Independence. A large number of modern milk
plants and product factories have since been established. These organized dairies have been
successfully engaged in the routine commercial production of pasteurized bottled milk and
various Western and Indian dairy products. With modern knowledge of the protection of milk
during transportation, it became possible to locate dairies where land was less expensive and
crops could be grown more economically.

In India, the market milk technology may be considered to have commenced in 1950, with
the functioning of the Central Dairy of Aarey Milk Colony, and milk product technology in
1956 with the establishment of AMUL Dairy, Anand.

Indian dairy sector is still mainly an unorganized sector as barely 10% of our total milk
production undergoes organized handling.

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Indian Dairy Industry –

 Beginning in organized milk handling was made in India with the establishment of
Military Dairy Farms.
 Handling of milk in Co-operative Milk Unions established all over the country on a
small scale in the early stages.
 Long distance refrigerated rail-transport of milk from Anand to Bombay since 1945
 Pasteurization and bottling of milk on a large scale for organized distribution was
started at Aarey (1950), Calcutta (1959), Delhi (1959), Worli (1961), Madras (1963)
etc.
 Establishment of Milk Plants under the Five-Year Plans for Dairy Development all
over India. These were taken up with the dual object of increasing the national level
of milk consumption and ensuing better returns to the primary milk producer. Their
main aim was to produce more, better and cheaper milk.

Milk Production

 India's milk production increased from 21.2 million MT in 1968 to 88.1 million MT
in 2003-04.
 India is the largest producer of Milk in the World (replacing USA)
 Per capita availability of milk presently is 231 grams per day, up from 112 grams per
day in 1968-69.
 India's 3.8 percent annual growth of milk production surpasses the 2 per cent growth
in population; the net increase in availability is around 2 per cent per year.

Marketing

 In 2004-05, average daily cooperative milk marketing stood at 155 lakh litres,
registering a growth of 4.2 percent over 148.75 lakh litres in 2003-04.
 Dairy Cooperatives now market milk in about 200 class cities including metros and
some 550 smaller towns.
 During the last decade, the daily milk supply to each 1,000 urban consumers has
increased from 17.5 to 52.0 litres.

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Innovation

 Bulk-vending - saving money and the environment.


 Milk travels as far as 2,200 kilometres to deficit areas, carried by innovative rail and
road milk tankers.
 Ninety-five percent of dairy equipment is produced in India, saving valuable foreign
exchange.

Macro Impact

 The annual value of India's milk production amounts to about Rs. 880 billion.
 Dairy cooperatives generate employment opportunities for some 12 million farm
families.
 Dairy Farming is the single largest contributor to the economy(5% of GDP &13% of
employment)
 Dairy industry represents a huge opportunity being the largest single FMCG Market:
Urban Mkt size Rs 33000 Crores and organized sector Rs 11000 Crores representing a
huge opportunity for conversion and growth.

Key challenges before Indian Dairy Industry are as follows:

• Ensuring Quality

• Procurement and efficiencies in supply chain

• Product differentiation and value addition

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Ice cream :

Ice cream are usually made from dairy products, such as milk and cream, and often
combined with fruits or other ingredients and flavours. Most varieties contain sugar, although
some are made with other sweeteners. In some cases, artificial flavourings and colourings are
used in addition to (or in replacement of) the natural ingredients. This mixture is stirred
slowly while cooling to prevent large ice crystals from forming; the result is a smoothly
textured ice cream.

Ice cream has the following composition:

 greater than 10% milk fat by legal definition, and usually between 10% and as high as
16% fat in some premium ice creams (13% in case of Mother Dairy Ice cream)
 9 to 12% milk solids-not-fat: this component, also known as the serum solids,
contains the proteins (caseins and whey proteins) and carbohydrates (lactose) found in
milk
 12 to 16% sweeteners: usually a combination of sucrose and glucose-based corn syrup
sweeteners
 0.2 to 0.5% stabilizers and emulsifiers
 55% to 64% water which comes from the milk or other ingredients

Milk fat (or "Butterfat") / Fat


Milk fat, or fat in general, including that from non-dairy sources, is important to ice cream for
the following reasons:

 increases the richness of flavor in ice cream


 produces a characteristic smooth texture by lubricating the palate
 helps to give body to the ice cream, due to its role in fat destabilization
 aids in good melting properties, also due to its role in fat destabilization
 aids in lubricating the freezer barrel during manufacturing (Non-fat mixes are
extremely hard on the freezing equipment)

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The limitations of excessive use of butterfat in a mix include:

 cost
 hindered whipping ability
 decreased consumption due to excessive richness
 high caloric value

Milk Solids-not-fat
The serum solids or milk solids-not-fat (MSNF) contain the lactose, caseins, whey proteins,
minerals, and ash content of the product from which they were derived. They are an
important ingredient for the following beneficial reasons:

 improve the texture of ice cream, due to the protein functionality


 help to give body and chew resistance to the finished product
 are capable of allowing a higher overrun without the characteristic snowy or flaky
textures associated with high overrun, due also to the protein functionality
 may be a cheap source of total solids, especially whey powder

The limitations on their use include off flavours which may arise from some of the products,
and an excess of lactose which can lead to the defect of sandiness prevalent when the lactose
crystallizes out of solution. Excessive concentrations of lactose in the serum phase may also
lower the freezing point of the finished product to an unacceptable level.

The best sources of serum solids for high quality products are:

 concentrated skimmed milk


 spray process low heat skim milk powder

Sweeteners

A sweet ice cream is usually desired by the consumer. As a result, sweetening agents are
added to ice cream mix at a rate of usually 12 - 16% by weight. Sweeteners improve the
texture and palatability of the ice cream, enhance flavors, and are usually the cheapest source
of total solids.

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Stabilizers
The stabilizers are a group of compounds, usually polysaccharide food gums that are
responsible for adding viscosity to the mix and the unfrozen phase of the ice cream. This
results in many functional benefits, listed below, and also extends the shelf life by limiting
ice recrystallization during storage. Without the stabilizers, the ice cream would become
coarse and icy very quickly due to the migration of free water and the growth of existing ice
crystals.

Ice Cream Manufacturing Procedure:-

The basic steps in the manufacturing of ice cream are generally as follows:

 blending of the mix ingredients


 pasteurization
 homogenization
 aging the mix
 freezing
 packaging
 hardening

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Blending

First the ingredients are selected based on the desired formulation and the calculation of the
recipe from the formulation and the ingredients chosen, then the ingredients are weighed and
blended together to produce what is known as the "ice cream mix".

Pasteurization

The mix is then pasteurized. Pasteurization is the biological control point in the system,
designed for the destruction of pathogenic bacteria. In addition to this very important
function, pasteurization also reduces the number of spoilage organisms such as
psychrotrophs, and helps to hydrate some of the components (proteins, stabilizers).

Homogenization

The mix is also homogenized which forms the fat emulsion by breaking down or reducing the
size of the fat globules found in milk or cream to less than 1 µ m. Two stage homogenization
is usually preferred for ice cream mix. Clumping or clustering of the fat is reduced thereby
producing a thinner, more rapidly whipped mix. Melt-down is also improved.
Homogenization provides the following functions in ice cream manufacture:

 Reduces size of fat globules


 Increases surface area
 Forms membrane
 makes possible the use of butter, frozen cream, etc.

Ageing

The mix is then aged for at least four hours and usually overnight. This allows time for the
fat to cool down and crystallize, and for the proteins and polysaccharides to fully hydrate.
Aging improves whipping qualities of mix and body and texture of ice cream

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Freezing:-

Following mix processing, the mix is drawn into a flavour tank where any liquid flavours,
fruit purees, or colours are added. The mix then enters the dynamic freezing process which
both freezes a portion of the water and whips air into the frozen mix.

Hardening

After the particulates have been added, the ice cream is packaged and is placed into a blast
freezer at -30° to -40° C where most of the remainder of the water is frozen. Below about -
25° C, ice cream is stable for indefinite periods without danger of ice crystal growth;
however, above this temperature, ice crystal growth is possible and the rate of crystal growth
is dependent upon the temperature of storage. This limits the shelf life of the ice cream.

Difference between Ice cream and Frozen Dessert:-

Ice cream:-

 Ice cream are made of real fresh milk


 Ice creams are rich in protein , calcium, dairy cream and vitamins
 Ice cream are complete food , easy to digest and full of energy

Frozen Dessert:-

 Frozen desert are generally made of vegetable oil/fat


 The base of frozen desert could be any type of vegetable oil which is cheap in quality
 In frozen desert milk fat is replaced by vegetable oil hence they are not able to give
smooth taste and flavors which only ice creams made from fresh milk can give.

Mother Dairy provides only ice creams and not frozen desserts, hence its superior quality and
better taste. Its competitor, Kwality Walls, on the other hand, manufactures frozen desserts.
For a layman there is no perceivable difference in the taste of the two products.

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Mother Dairy Fruit and Vegetable Limited

Background:

Mother Dairy is the largest liquid milk brand in Asia. It started its operations in 1974 under
the Operation Flood program of the National Dairy Development Board. Operation Flood is
one of the largest dairy development projects in the world. Mother Diary, Delhi is an IS/ISO-
9002 & IS-15000 (HACCP) certified organization.

Mother Dairy markets & sells dairy products under the Mother Dairy brand (like Liquid
Milk, Dahi, Ice creams, Cheese and Butter), Dhara range of edible oils and the Safal range of
fresh fruits & vegetables, frozen vegetables and fruit juices at a national level through its
sales and distribution networks for marketing food items.

Mother Dairy markets approximately 2.8 million litres of milk daily in the markets of Delhi,
Mumbai, Saurashtra and Hyderabad. Mother Dairy Milk has a market share of 66% in the
branded sector in Delhi where it sells 2.3 million liters of milk daily, primarily because of
consistent quality and service reliability. It undertakes its marketing operations through
around 14,000 retail outlets and 845 exclusive outlets of Mother Dairy. In addition to toned
milk through Bulk vending, Mother Dairy also markets Full cream milk, standardised milk,
toned milk, double toned milk and Skimmed milk (lite) in polypacks.

The National Dairy Development Board (NDDB) commissioned Mother Dairy in the first
phase of Operation Flood in 1974. Considering the success of Dairy industry NDDB
established Fruit & Vegetable Project in Delhi in 1988 with "SAFAL" as its umbrella brand.
With a view to separating the commercial activities from developmental activities, the NDDB
merged Mother Dairy and the Fruit & Vegetable project into a wholly owned company
named Mother Dairy Fruit &Vegetable Ltd (MDFVL) in April 2000. This becomes the
holding company of Mother Dairy India Ltd (MDIL)- a marketing company and Mother
Dairy Foods Processing Ltd (MDFPL)- a processing company.

The company is a highly trusted household name for its wide range of milk products like
Milk, Flavoured Milk, Ice-Cream, Dahi, Lassi, Butter, Ghee, Cheese, etc.

Mother Dairy sources its entire requirement of liquid milk from dairy cooperatives.

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MOTHER DAIRY VISION:

With total commitment and teamwork, we at Mother Dairy shall strive to delight our
customers with quality products and services. We shall create an environment where
employees feel happy to work.

Through innovation, consistent learning and continuous improvement, we shall achieve


sustained growth and excellence and provide remunerative returns to farmers and other
stakeholders.

MOTHER DAIRY MISSION:

Our mission is to retain the leadership and further serve our customers in and around Delhi
by providing quality milk and select dairy and food products.

We shall strive to delight our customers by providing regular and timely services at
convenient points under clean and hygienic conditions, with a product mix for different
income segment. We shall create an environment of commitment and teamwork where
employees feel happy to work.

By innovation, continuous improvement, training and development and most efficient use of
resources we shall achieve consistent and sustained growth and provide remunerative returns
to farmers and other stakeholders.”

Mother Dairy has received the ISO 9002 certificate in 1994 for the quality of its food
products.

The objective of Mother Dairy is to:

(a) 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;

(b) Uphold institutional structures that empower milk producers and farmers through
processes that are equitable.

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.

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Product Profile

S.No. Product Name Brand Name Items


1. Milk and its Products Mother Dairy Packaged Milk (Full Cream,
Standardised, Toned, Double Toned,
Skimmed and Pro-biotic), Butter, Dahi,
Ghee, Cheese, Ice-Creams, UHT Milk,
Lassi & Flavoured Milk.

2. Edible Oils Dhara Refined Vegetable Oil, Refined Soybean


Oil, Refined Sunflower Oil, Refined
Rice Bran Oil, Kachi Ghani Mustard Oil
and Filtered Groundnut Oil.

3. Fresh and frozen fruit and Safal Fruits, Vegetables, Rice, Processed
vegetable products items (jams, juices, ketchup, pulp, etc.)

Mother Dairy‟s has a varied range of products. The different products categories are
explained below:

MILK:

Packaged Milk is available in 5 different variants:

1. Full Cream milk - milk fat 6%, SNF 9%


2. Standardised milk - milk fat 4.5%, SNF 8.5%
3. Toned milk - milk fat 3%, SNF 8.5%
4. Double toned milk - milk fat 1.5%, SNF 9%
5. Skimmed milk - milk fat 0.5%, SNF 8.7%

Other than packaged milk, Bulk Vended Token Milk is also available which is distributed
through vending machines installed in different regions of the city.

Mother Dairy also manufactures flavoured milk under the brand name of „CHILLZ‟. It is
available in three flavours namely Kesar Elaichi, Vanilla and Chocolate flavour.

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Milk Products:

Various milk products of Mother Dairy are:

1. Mother Dairy Ghee


2. Mother Dairy Butter
3. Mother Dairy Cheese
4. Mother Dairy Dahi (Curd)
5. Mother Dairy Lassi

Except all these milk products Mother dairy also manufactures Ice Cream under two
categories namely CHILLZ and Mother Dairy Ice Cream.

PROBIOTIC:

It is the latest product range launched by Mother Dairy. It mainly contains BB-12 friendly
Bacteria which results in better digestion and absorption of nutrients. It also contains
probiotic fibre which also results in better digestion. The various products in this category
are:

1. b-Activ Probiotic Dahi


2. b-Activ Probiotic Lassi
3. b-Activ Curd
4. Nutrifit (Strawberry & Mango)

SAFAL: Range of fresh foods & vegetables, frozen vegetables, fruit pulps and fruit juices
etc.

DHARA: It has a popular range of edible oils in different types as refined soya bean oil,
refined sunflower oil and filtered ground nut oil etc.

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MOTHER DAIRY ICE CREAM:

 In 1996 mother dairy came up with its ice-creams. Mother Dairy ice creams are now
being enjoyed across the markets of Delhi/ NCR, Mumbai, Kolkata, Punjab,
Rajasthan, UP & Uttarakhand.

 With India's per capita consumption of ice-cream - at 200 ml (in 2004) - being among
the lowest in the world, opportunity for ice-cream marketers is abundant. And Mother
Dairy is all geared up to take advantages of the opportunities ahead. Mother dairy has
a huge variety of ice-creams in its portfolio, from impulse to take away to gallons.
The range is available at Mother Dairy booths, retail outlets and push carts.

 In the ice cream business their major competitors are Amul, Kwality Walls, Cream
bell and Vadilal. Among these Amul and Kwality Walls are giving neck to neck
competition to Mother Dairy. There is also competition at regional level from the
unorganized sector.

 To stay ahead of the competition require special effort. Mother dairy ice-creams
strategy of product differentiation is value created through quality of the offerings as
well as innovations in products. And this is backed by a relevant marketing and
promotion campaigns. At present company claims 65 per cent market share in the ice
creams market in Delhi and the National Capital Region.

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Porter‟s 5 Forces Analysis:

In order to identify and assess the strength of external competitive forces on the ice cream
industry I utilized a common analytical tool, Porter‟s Five Forces Model. Porter‟s five force
industry analysis can be used to get a general over view of the threats to the profitability of
ice cream business. Though the model does not help in analyzing firm specific demand, it
gives some information of its business environment.

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Buyer Power

 Buyer power is determined by various factors such as switching costs, the relative
volume of purchases, the standardization of the product, elasticity of demand, brand
identity, and quality of the products.
 On one end are the large institutional buyers i.e. big hotels and restaurants which ask
for discounts, extended credit periods and the other end are small retail outlets like
general stores which have no power to negotiate with the firms.
 The power of buyers is relatively high when buyers are large, consisting of individual
customers, grocery stores, convenience stores, and restaurants nationwide. Since
retailers purchase ice cream products in large quantities, this gives buyers substantial
leverage over price.
 Customers are able to substitute one brand of ice cream to another at any point in
time. There are many ice cream products to choose from, so the buyers‟ cost of
switching to competing brands is relatively low.
Mother Dairy‟s strategy must include strong product differentiation so that buyers are
less able to switch over without incurring large costs. Mother Dairy upholds a strong
Brand Identity in the Delhi/NCR market. It is perceived as having a higher quality.
Thus, it is a strong point of differentiation.

Supplier Power

 The suppliers to the ice cream industry include dairy farmers, paper container
manufacturers, and suppliers of various flavourings. The principal inputs are
commodities available in competitive markets.

 Factors affecting the bargaining power of suppliers include the threat of forward
integration and the concentration of suppliers. There exist numerous potential
suppliers of ingredients. The ingredients provided by each supplier are not unique or
greatly differentiated. Furthermore, ice cream manufacturers are able to switch
between suppliers quickly and cheaply.
 Also, many of the suppliers‟ viability is tied to the well-being of large, established
companies. Therefore, the bargaining power of suppliers of ingredients is rather low.

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 However, Mother Dairy being a milk co operative has to empower the milk producers
and farmers so that they get a remunerative return. Therefore, a certain power is
vested in the hands of the farmer societies.

Threat of Substitutes:

There is no perfect substitute to ice creams because of its very nature. However, many
substitute products are available within the dessert and frozen food industry (cookies, pies,
Popsicles, cakes, chocolates, soft drinks) which are basically food items consumed at leisure.
Since substitute products are readily available and attractively priced, the competitive
pressures posed by substitute products can be considered moderate.

Potential Entrants:

 The barriers to entry within the ice cream industry are moderate due to the brand
preferences and customer loyalty towards the larger and more established companies.
 Other obstacles to new entrants include the requirement for large sources of capital,
specialized mixing facilities and manufacturing plants.
 In addition, the accessibility of distribution channels can be difficult for an unknown
firm with little or no brand recognition.

Industrial Rivalry:

The principal competitors in the ice cream industry are large, diversified companies
with significantly greater resources such as Amul, Kwality Walls, Vadilal and Cream
Bell, besides a lower threat from local manufacturers (kulfi etc. manufacturers).

Rivalry can be characterized as intense, given that numerous competitors exist, the
cost of switching to rival brands is low, and the sales-increasing tactics employed by
other rivals threatens to boosts rivals‟ unit volume of production.

Also, recently there has been a surge in the number of ice cream parlours (such as
Baskin Robbins, Gianis) in and around Delhi. The growing popularity of such
premium ice cream parlours providing specialty ice creams will also tend to affect the
business of existing companies.

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Current Channels:

Mother Dairy is the market leader in the Ice cream segment. Currently it has five channels of
distribution which are:-

1) Milk Shops

2) Retail

3) Vending

4) Modern Retail Formats

5) Mother Dairy Food services

MILK SHOPS

Or booths are the most important channels of Mother Dairy. Mother Dairy products are
available in over 5000 outlets out of which about 680 are exclusive Mother Dairy booths.
Mother Dairy Booths are strategically located all across Delhi and NCR, making it
convenient to pick up the daily requirement of Milk, Flavoured milk, Butter, Dahi, Lassi and
Ice Creams. The lifeline of Delhi, Mother Dairy booths all across the city provide milk early
in the morning and at evenings.

The supply of milk and other milk products to these booths are made directly from the
Mother dairy plant. Each Booth in the NCR region is identified with its Booth ID Number.
The booth owners are currently given a margin of 5% on the sale of Mother Dairy products.

Mother Dairy is providing ready built and fully equipped milk shops/booths to the Ex-
Servicemen, while its Fruit and Vegetable (Safal) Shops are opened for the ESM and their
dependent sons. A security deposit (refundable on termination) is required to be made to
Mother Dairy on selection. The concessionaire will undergo free training for two to four
weeks with Mother Dairy prior to allotment of booths/shops.

RETAIL CHANNEL

The retail channel includes small and big shops which sell Mother Dairy products with a
margin of 15%. Mother Dairy caters to the ice cream demands of this segment that includes
provision stores, bakeries, confectionaries, restaurants etc.

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VENDING

It is the prime channel of sales of Mother Dairy Ice Creams. These vending carts are placed
strategically in high footfall areas for example outside schools, colleges, parks, colonies, bus
stops, cinema halls, major markets and therefore provides the mobility and flexibility The
supply of ice creams to the vending machines and the maintenance is done by VRS (Vending
Redistribution Stockist).

Ice Cream vending Cart is ideal as a light weight cart that is very easy to push and store ice
creams. They are charged by plugging in to a power supply for 8 to 10 hours. These vehicles
are ideal for vending pre-packaged novelty ice cream. There are also high capacity „freezer
on wheels‟ which are specially located at India Gate. Dry ice carts are also used in areas
where no electricity is available.

The Vendor gets a margin of 14% on MRP on mother dairy ice creams. One vending cart can
store up to Rs. 5000 worth of ice creams at one time. The typical timings of vendors going
out for vending operation is from afternoon till midnight, depending on their allocated area.
Push carts are a key driver of growth as it contributes around 17% to the total revenues.

Mother Dairy has a chain of about 1850 vending carts in Delhi region.

Modern Retail:

This is a relatively newer channel which includes all the major retail outlets like Spencer‟s
daily, Big Bazaar, More, Reliance retail, etc. Through this, Mother Dairy taps the
overwhelmingly successful organized retail format.

Mother Dairy Food Services (MFS) :

This channel caters to hotels, banquet halls, the railways as well as airways. All these come
under the MFS. It is a one window stop to provide all Mother Dairy products (including
Dhara oil) to such customers. The margin given to them varies, as it is a tender- based
process. The purpose of this channel is to maintain a strong presence of Mother Dairy in
these areas and in the process gain profi

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SUPPLY CHAIN MANAGEMENT

Process of Procurement

• 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.

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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. These tanks have a capacity of 1 lakh litres each. The presence of adulterants
(impurities) like urea, neutralizers, preservatives 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.

Processing of milk:-

Unprocessed milk may contain small dirt particles invisible to the naked eye. In order to
remove these particles the milk has to be processed.

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Dispatching of milk

• After processing, the milk is chilled and stored in silos and further chilled to about 2
C. by the glycol chilling system, and then dispatched to the Milk Shops in insulated
road milk tankers. Prior to the milk being dispatched in tankers, it is tested for quality
to make sure that it meets the quality standards. 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 wit wireless set.

26
As soon as the incharge 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.

79 tankers in the morning and 75 tankers in the evening bring in milk from the regional
collection centres. After collection the same tankers are utilized for the delivery of the
processed milk to the vendors and outlets.

Mother Dairy has over 820 Milk Distribution Outlets in the National Capital Region.
Each of these outlets place their demand by raising an invoice one day in advance. The
demand is also calculated using the „Calendar‟ Scheme, in this depending on the pre-
calculated seasonal demands the outlets place their orders accordingly.

In order to satisfy immediate demand, 20 to 25 tankers are provided with a buffer stock
of 500 litres each day so that they can be mobilized to cater the demand in an area. To
coordinate its operations all the tankers are equipped with HAM radios.

Distribution Channels:

a) Token Distribution: Also, termed as “Lohe ki bhains” (metal buffalo), is an


Automated milk vending machine.

b) COW: Container on Wheels or COW is a manual milk distribution program in which


cycle-rickshaws are employed for milk distribution.

c) Retailers: The packaged milk is distributed via the retailer network throughout the city.

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Quality Control Of Mother Dairy

Quality Assurance in Processing:-

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, Standardisation which help to milk maintain uniformity by raising or


lowering its fat and SNF (solid not fat) percentage to a desired levels, 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. In case of packaged milk, the processing goes
through only three processes (excludes homogenization).

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29
Quality Control:-

Stringent quality control methodologies are employed in Mother Dairy.

a) The milk is tested for adulterations and quality at the time of collection from the farmers.

b) The Milk that comes from the collection points to the Mother Dairy plant is ensured to
have a temperature of not more than 7°C and is subjected to 15 product and quality checks.

c) The Milk quality is checked repeatedly after each processing phase and the temperature is
judiciously maintained less than 5°C always.

d) Before the milk leaves the plant for the delivery/distribution outlets the milk is tested
again.

e) The temperature of milk in the delivery trucks is always maintained less than 7°C.

f) All the trucks that deliver milk have specified guidelines to bring back 100 litres of milk
after distribution. This is done in order to test the delivered milk and to ensure that the
tankers are not adulterated during distribution.

g) Since all the employed processing procedures are automated, no contamination by human
hands takes place.

h) To ensure milk freshness the collection and distribution points are always chosen such that
the travel time between them is always less than 36 hours.

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31
Quality Practices:-

1) The Company strictly follows the guidelines laid in by Quality Control Programmes like
KAIZEN, TPM etc. As a result, all the employees are well aware of their rights and
responsibilities. Also, it is amongst the only companies to follow TPM in not
only production but also in case of Human Resources.

2) The Company has just become ERP enabled by adopting “SAMAVESH” from 1st August,
2008.

3) The Company is also environment conscious as it employs Solar Panels,


Rainwater Harvesting, Effluent Treatment Plants, etc.

4) Strict health and sanitation measures are employed so as to maintain high quality of
product quality and avoid any product contamination.

Management System Policy:-

• Apply state of the art technology and processes to enhance productivity that ensures
quality at competitive price.

• Apply processes for clean production, pollution prevention and optimize


resource utilization in all operations

• Follow food safety management system and apply HACCP (Hazard Analysis Critical
Control Points) principles to provide safe products to customers.

• Comply with applicable regulations and legislations.

• Mother Dairy pledge to provide quality and safe products under clean and
hygienic environment.

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Mother Dairy going GREEN:-

The following steps are taken and ongoing efforts are continuously made as per
"Management Systems Policy"-

•Minimize Waste generation

•Conservation of resources

•Use of renewable energy

•Recycling & re-use

As far as the environment management is concerned it has the following arrangements-

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

• Rainwater Harvesting- for maintaining groundwater level it has installed the plant in the
premises.

• Effluent Treatment Plant- The water used for cleaning the equipment and tankers is
treated at the effluent plant in the dairy before being discharged into the sewage system.

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Energy Management Policy:-

Mother Dairy Food Processing Ltd. commits themselves for optimum utilization of energy in
all Manufacturing activities as well as in office by:

• Monitoring closely and controlling the consumption of various forms of energy through an
effective Energy Management System.

• All round participation of all employees and educating them about energy conservation.

• Maximum utilization of renewable energy sources.

•Upgradation of processes, technology and use of energy efficient equipments.

• Optimum utilization of plant capacity.

• As a part of energy conservation and environment protection commitments, reduce the


specific energy consumption. As part of their energy conservation policy they saved Rs. 55
lakh of energy as per the current data with the help of 1oo% participation from the
employees.

They also have a Total Productive Maintenance (TPM) for distribution which says “to
eliminate accidents and breakdowns and increase the overall economic effect of all the
resources by developing a system to enhance the knowledge and skill of employees,
thereby increasing productivity and reducing costs.”

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IMPORTANT OBSERVATION:

 The most important observation during the summer internship was the hygiene factor
present inside the plant. The premises and the plant area was clean, the employees
have the orders not to touch milk with bare hands and they get their machines and
silos cleaned every weekend to ensure that the milk produced is safe for the
customers.

 Moreover, they have a specific TPM (Total Productive Maintenance) policy for
everything like for distribution, energy conservation, environment etc. and KAIZEN
policy for all the employees which they have to follow.

 They have these policies as strict code of conduct as they are manufacturing milk
which requires purity and hygiene and to give the best to the customers the company
needs to do this. That is why their policies can be seen at most of the places in the
premises.

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Project Description:-

The project deals with exploring the feasibility of sales of Mother Dairy Ice cream in a new
channel that involves the schools of Delhi Region and implementing it in the potential
schools. This includes short listing of appropriate schools (in terms of their location, student
strength, purchasing power of students), approaching the concerned authority of the schools,
discussion of the details of the proposal, rectifying any current issue with the school and
finally forming new channel partners.

Importance of the research:-

 The project research will help to understand the business feasibility in schools in
specific regions of New Delhi and how Mother Dairy can increase its sales through
these schools.

 Categorizing the schools under sub categories and analyze them in an elaborate way.

 Will also help to understand the suitable parameters required / available for selling
ice creams.

 The research will be helpful in understanding the whole operational aspect of selling
ice creams in the schools. Issues related to doing business with the school
administration or the canteen contractor.

 The research will also be important in improvising the current channel in order to
make it more cost effective and time efficient.

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Research Methodology:-

 The research mainly deals in entering into a channel with schools for selling ice
creams inside the school campus. Therefore this requires thorough understanding of
the school business and what are the parameters that should be considered in order to
place the vending cart.

 As any research requires data for the analysis , the data considered in this project
falls under two categories which are:

a) Primary Data: - These data include the data collected from the schools
during the survey. It includes information like school strength, purchasing
power, suitability of location, canteen contract availability, issues or
requirements of each school administration.

b) Secondary Data: - These data are generally the data which support the
primary data and hold an important position in the analysis of the research.
The secondary data includes information from the internet, newspaper, and
documents from Mother Dairy.

 The research requires doing a survey of the schools in order to understand all the
aspects which affect the sale of ice creams in schools. It involves gathering
information like the number of schools in a particular location, then listing down
schools of interest, fixing an appointment with the school administration for
discussing the details, understanding various issues from the school‟s as well as
Mother Dairy‟s perspective.

 The research then involves understanding the supply chain for the supply of ice
creams in the schools and the ways to improve it. It also involves studying the overall
supply of milk products from the producer to the end consumer.

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Analysis of the research

1. Overview of schools in Delhi –

Schools in Delhi are considered to be some of the highly acknowledged educational


institutions in India. Being the capital city of India, it is a place where people from varied
cultural and economic background migrate to for various purposes. There are many schools
whose standard of education can be compared to the schools abroad. The medium of
education in private school is mostly English. Schools in Delhi are run under the authority of
either CBSE (The Central Board of Secondary Education) or ICSE (Council for the Indian
School Certificate Examinations). The ingression of a large number of private schools in
Delhi has increased the competition.

The Government run schools have a centralized food supply system (Midday Meals
Scheme). There is mostly no canteen facility available in government schools. Any initiatives
of Ice cream supply within these schools require partnership with Directorate of Education,
Delhi Government – a long procedure. Lack of infrastructural facilities and low purchasing
power of its students make it unfeasible to operate business there.

Public Schools are run by an individual or a private organisation including religious bodies,
private trusts and philanthropic institutions. Private recognised schools are of two types.

A privately managed school that receives regular maintenance grant from the government,
local body or from any public authority is called a private aided school. A private unaided
educational institution is one, which is managed by an individual or a private organisation
and does not receive maintenance grant either from government, local body or any public
authority etc.

2. Identifying geographical spread of schools –

There are in total about 4995 schools in Delhi (2004-05). The enrolment figures amount to
1.7 million (17.5% of the population). Any attempt to map the school level education system
in Delhi is a daunting task. The data at hand is vast and complicated and the sources varied.
The Directorate of Education itself is not clear about the most basic information: the number
of schools it runs in Delhi. Schools and higher educational institutions in Delhi are
administered either by the Directorate of Education, the NCT government, or private

38
organizations. According to Directorate of education, there were 218 aided and 957 unaided
schools in 2000-2001. This totals up to 1,175 public schools. The data for the number of
private schools is neither easily available nor accurate. There is apparently no written record
of the number of public schools functioning in the city. Over the years, the number of private
schools in Delhi has increased substantially.

There are a total of 30.2 lakh students enrolled in all schools of Delhi. Of this, privately run
schools have a share of about 27.48% (2004-05).

3. Sampling of schools

To carry out the project a sample size of 72 private schools of Delhi was taken. The schools
covered in this project have been spread across South, Central and East Delhi. The schools
have varying student strength and the affluence level of students is contrasting in various
schools. The schools covered include both aided and unaided schools as well as those schools
which are run as a part of a larger society spread across India.

The schools were segregated into three categories depending on the number of students in
each school – less than 1000 (low sales opportunity), 1000 – 2000 (medium sales
opportunity) and above 2000(high sales opportunity). The reason for the segregation of the
school is to evaluate what fee (annual/ semi annual) or margin should be provided to the
school administration or the canteen contractor.

Band School Strength

Band A Less than 1000

Band B 1000-2000

Band C More than 2000

Schools under Band-A offer a low sales potential considering the fact that Mother Dairy
offers them a security deposit as well as a vending track / deep freezer (as per requirement) as
well as repair and maintenance charges. Also, schools under Band-A are mostly Junior
schools where students generally do not purchase Ice creams on their own. So, schools under

39
this band were not given final nod. Convent schools and Public schools are the ones that offer
a high potential of sales and business with them is suitable.

4 . Establishing a Channel

 In the first step, one needs to identify the potential schools where Mother Dairy Ice
cream can be sold profitably, for this New Delhi is divided into different regions
where prospect school are located.

 Now a list of schools is prepared for different regions of New Delhi where a good
opportunity for Mother Dairy ice creams exists which depended on the school
strength. For this schools were divided into 3 groups depending on the school strength
namely Band A, Band B, Band C.

 Next step was to visit the schools and discuss about the proposal with the concerned
person or admin. It also included getting primary information about the number of
students in the school, spending habit of the students, availability of the canteen in the
school.

 If the full contract for the sale of food items is with the canteen then talking with the
canteen manager regarding placing deep freezer of mother dairy inside the canteen,
else if the authority is with the school then discussing the proposal of placing vending
cart for the sale of ice creams inside the school campus.

 Convincing the school authority by telling the benefits related to the licence fee,
quality by the sale of ice cream, if the school is ready then collaborate with the area
VRS for placing a vending cart during recess time inside the school.

 In case of the canteen owner convincing them by telling them the benefits of selling
Mother Dairy Ice creams in terms of the margin, quality, distribution, service of the
deep freezer, commissions etc.

 Once the canteen owner is ready then collect the amount in form of
DD/Cheque/Cash in favour of the respective deep freezer manufacturing company.
Once all the formalities are done the canteen owner is provided with the deep freezer
and the supply of the ice creams to canteen within 2 to 3 days

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4. Modes of selling ice creams in schools

- Vending cart within the school premise: this requires permission from the school

authority with the help of a deal with either the school administration or the canteen

contractor. Mother Dairy prefers that its own vendor is employed at this cart. This

ensures that there is a maximization of ice cream sales as mother dairy vendors are

trained personnel and can utilize the push strategy to sell the products exclusively

works with this product for his livelihood. Also, it ensures better handling of the

cart/dry ice, ensures timely and optimum supply of ice cream in case of shortages and

efficient projection of future sales. In this case, the school authority will be paid an

annual/semi annual fixed amount (decided after considering various factors such as

student strength, purchasing power, recess timings, canteen location etc.). The vendor

gets his usual margin on sales and so does Mother Dairy.

- A Deep Freezer : may also be provided to the school if the sales prospects of the

school are highly attractive. A deep freezer can contain 200 litres of ice cream at one

time. However, it is sensitive as it needs to be plugged to a constant power source for

proper functioning. Repair and maintenance of a deep freezer is also costlier. A

security deposit maybe taken from the school if a deep freezer is provided. Canteen

owners are generally not given a deep freezer if they do not allow a Mother Dairy

vendor to be positioned along with it. This is because canteen owners are seen to be

stocking various other eatables such as soft drinks, noodles etc. which might alter the

optimum temperature within the deep freezer, thereby resulting in melting of the ice

creams. This may then require Mother Dairy to replace the damaged stock in order to

41
maintain its reputation and relation with the school. The canteen staff is ill-equipped

to take proper care of the deep freezer.

Here, the school may be given an annual/semi annual payment to install the freezer

and allow sales of ice cream and sales be done by Mother Dairy personnel. If the

canteen staff is involved in the selling operation, then a margin of up to 14% may be

given to them on ice cream sales.

Apart from this the canteen owners are also provided with the electricity allowances.

In addition to this the canteen owners are also provided the benefit of free servicing of

the deep freeze in case it malfunctions. The deep freezers generally provided by

Mother Dairy are from “CARRIER” company. Any kind of servicing is done by the

“Carrier” engineer.

- Setting up a kiosk: is also an option but requires a higher investment. It can be

beneficial to both school and Mother Dairy in a number of ways. School can get a

good amount as licence fee through this proposal as well as can give option of variety

of mother dairy products to its students inside the campus at a cheaper rate. For

mother diary also it is good in terms of long time relationship with the school in order

to do business. Though it may be a costly expense for Mother Dairy for setting up a

Kiosk but it can soon reach breakeven point if the school strength is good and

following up with the profits.

- Placing a vending cart outside the school premises: is done when permission is not

given for placing it inside the school campus. This is a widely used method of selling

ice creams. A few schools do oppose this, as it leads to a lot of commotion outside the

42
school and creates problems for the parked school buses. However, this is the major

source of revenue from ice cream business for Mother Dairy

5. Supply Chain for the distribution of Ice cream:-


The current model followed for the entire supply chain of milk and milk products at Mother
Dairy is represented by the following flowchart.

Production of milk
& milk products

Go direct Storage Facility Milk Shops


distributors

Vending Distributors Up Country (C&F


Agents)

Vending Retail Modern Retail Mother Dairy


Redistribution Format Food Services
Stockist

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DISTRIBUTION CHANNEL OF MOTHER DAIRY:

The distribution channel adopted by Mother Dairy is given as:

 Factory :-

 Mother Dairy has manufacturing plants in New Delhi, where the ice-cream is
made.

 The company has fleet of trucks which is outsourced, which are used to transport
Ice cream to the C & F agents.

 The company takes daily stocks with these agents and fills up the gap between the
required and the prevailing stock. The company decides the level of stocks to be
maintained as per the demand in the market. The factories send their trucks with
the required stock of Ice-creams.

 Carrying And Forwarding Agent: -

The main function of these C & F agents is to store the ice creams made in the factories
and to further transfer it to distributor. They are thus merely agents of Mother Dairy to
work on a fixed salary. They are only used for up country discharges. The company hires
their premises/ cold storage and they are entrusted with the task of safe keeping and
forwarding their products to the distributor. This incurs the following cost:

- Cost of storage i.e. warehousing, electricity


- Salary of the workers and the employees – workers include temporary used for
loading and storing functions. Employees include the accountants, manager and
operators, clerks and guards.
- Initial cost – Mother Dairy before assign any one as their C&F agents ask for certain
initial infrastructures. So it is essential for a prospective C&F to have adequate
storage space, proper cold storage facility and competitive workers and employees.

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Distributors:

 They form the next unit of distribution chain. Their main job is to collect ice creams
from the C&F agents and supply it to the retailers and in some case also to the
vending distributors. Thus forms a very important part of the chain as they augment
the physical reach of the company by adding new retailers to their fold.

 They also serve as a channel for getting feedback from the market that is the
consumers. They keep the company abreast of the demand pattern in the market as
regards which product is doing well and which is not. The distributors are appointed
on the basis of geographic region as well as the number of retailers.

 Presently Mother Dairy has only one distributor in my working areas to cater the
retailers as well as to vending distributors. The distributor‟s profit margin is 6%. The
distributor has a cold storage, which costs Rs 6 Lacs. The initial investment required
for distributor is Rs 10 to 15 Lacs.

Various heads of cost for a distributor:-

 Storage Costs: this forms an important component of the total costs. Firstly
sufficient in the form of well appointed premises to house the freezers and
facilitate transfer of stock to retailers and push carts. So the rent payable and the
security on the premises from part of the cost. Secondly the distributor is required
to have deep freezer to store ice cream product, which are highly perishable
products. Due to this region freezer assume great importance and their
maintenance is necessary to ensure that the products remain unspoiled.

 Distribution Cost: This is also a major part of the cost incurred by the distributor.
He has to employ refrigerated vehicle to transport ice cream to different retailer
and also to vending distributors. Normally, the vehicle used for this purpose is
Maruti van or specially designed vehicle in which deep freezer is installed, or
small auto rickshaws. Now, this small auto rickshaw comes into use in no entry
areas where big vehicles cannot enter. The freezers on these vehicles operate on
battery, which once charged work up to 8-10 hours easily.

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 Electricity Cost: The average electricity cost is Rs.8000 per month considering
the distributor has at least two deep freezers. The freezer run on around the clock
basis, as the product is perishable. The distributor also maintains the generator in
the case of power failure, which adds to the diesel cost.

 Staff, Including Electrician: The salaries to the staff also contribute significantly
to the costs. Apart from the labour employed for loading and unloading stock the
other staff such as administrative, accounts, drivers of the vehicle on its daily and
electrician is also kept handy.

 Miscellaneous Costs: These comprise the sundry expenses relating to the wear
and tear of the equipment, the dry ice used to preserve ice cream. Regular
payments to the police and also to the civic bodies like the Development
Authority who charge certain fees to the push carts which operates in the area.

 Stock In Hand: apart from the above mentioned cost, the distributor also have to
invest in the stock in the trade that is the volume of the stock they have on their
hands which have not been sold or payment has not been realized on which this
value varies depending on the size and area of the distributor and the number of
retailers.

Vending distributor :-

 He is the link in the chain that services the push cart. The vending distributor
operates pushcarts mainly but is free to tap retailers too. Push carts operators get a
profit margin of 14%.

 Push cart are popular outside schools, in residential colonies. The vending
distributors gets a margin of 4.75%. The normal practice is that the various push
carts operators gather at the distributors premises to get a refill. From there, they
disperse to their allocated positions and stay there till around midnight.

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Retailers:

Retailers were the favoured source for an ice cream before the starting of push carts. Mother
Dairy has an extensive retail network in Delhi Region. Now these are the exclusive outlets as
well as those, which stock other brands too. Their profit margin comes to 15% on MRP.
Retailers still occupy a place of importance because of the fact that are located in the market
place where consumers make most of the purchases.

 Deep freezer: the retailer has to pay full amount of deep freezer which usually
depends on the size (capacity) of the freezer and also the profile of the retailer. The
minimum cost of deep freezer is Rs 15075/.

 Electricity Charge: the cost of electricity has troubled retailers but their gained respite
as the deep freezer are high energy efficient which helps in reducing electricity cost as
the consumption is very low.

 Shortage of space: the retailers often decline to keep a new brand because of paucity
of space to keep deep freezers.

The only points where this channel can be accommodated is either through the Distributor or
through the Vendor/ VRS. The distributor has a wide network and has a regular supply of Ice
cream from the Mother Dairy plant.

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Findings:-

- School plays a vital role in promoting healthy snacks in the school canteen.
Permission from the school authorities was necessary for selling any items of food in
the school canteen.

- Generally, schools had no standard canteen norms or formal structure of carrying out
this process. Everything was done on an ad hoc basis. In case of a few schools, the
canteen contractor was directly approached and enquired. He was the sole authority
involved in carrying out the deal and finally setting up the channel.

- There were certain schools where there was no canteen. They were strictly against the
introduction of any food items within the school. The schools declined the offer to
setup any ice cream supply straight away.

- Although schools are against junk food, no written nutrition policy exists. There is no
formal structure that decides health promoting policies in school. Common inhibitions
still prevail among the people that Ice cream is a junk food and is fattening. Also most
assumed assume that ice creams lead to sore throats, cold and phlegm.

- Certain schools already had annual contracts with other ice cream manufacturers
(mostly Kwality and Vadilal), which generally cease and get renewed at around the
start of the summer season. These schools showed eagerness to work with Mother
Dairy (primarily due to Brand image), but were obligated under their current contract.
Follow up calling to these schools needs to be done.

- Some canteen contractors have bargaining power for placing a mother diary deep
freezer, due to the reason that they have been selling other brands of ice creams and
are getting higher margin as well as incentives therefore they demand more in terms
of margin and other benefits.

- No care was taken for the functioning and maintenance of the Deep Freezer by the
Canteen Owners. Inefficient and slow handling of cases of rectification of
malfunctioned Deep Freezers.

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SWOT ANALYSIS OF MOTHER DAIRY:-

Strengths:-

 India‟s best-known brand across all categories.

 Mother Dairy have India‟s one of the biggest frozen highway.

 Well-established distribution and delivery network for dairy based product.

 Biggest sourcing base for milk and dairy based product.

 Mother Dairy has a wide portfolio in the pure milk based ice cream, rather than frozen
desert.

 Large variety of ice cream and its reasonable price gives the value for money to
customer.

 Consumers have trust on the brand name of Mother Dairy, which is helping to Mother
Dairy build up a formidable image.

Weakness:-

 The main weakness of Mother Dairy is that the advertising strategy is not as
competitive as Kwality walls and other brand.

 The replacement policy of Mother Dairy is very tough, and because of this many
retailer don‟t want to go with Mother Dairy.

 One of the major weakness is availability of product & services in odd seasons.

 Company have no strategy for those canteen owners who don‟t want to invest in deep
freezer or financially weak.

Opportunities:-

 Exploitation of whole Delhi is still required.

 Mother Dairy has the opportunity to capture the most evolved young adult and
children market.

49
 Take an advantage of other company‟s outlet by convincing the retailer and provide
them extra benefits for selling Mother Dairy ice cream.

 In many areas people are not interested to invest big amount on ice cream so Mother
Dairy has a great chance to excel by introducing Ice cream of Rs. 2 or 3.

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Financial Analysis:-

From a total of 72 schools surveyed and approached, 51 schools showed a keen interest in
starting the services in the current academic year. 21 schools were either rejected (on account
of low purchasing power/low student strength/ low sales opportunity) or operation delayed
for the current academic year or showed no interest in this.

For the 51 schools, the total student strength is approximately 116000 students.

Now we make an approximation that not more than 10% of the students of any given school
will purchase ice cream on any given day within the school premises. Thus our potential
number of customers for each day is -

= 10% of total student strength = 0.1 * total student strength = 11600

The revenue per person per day has been found out to be about Rs. 8 to Rs. 12. This is
because school students mostly consume the impulse segment of our ice cream variants.

Thus total revenue in a day = 11600 * Rs. 10 = Rs. 116000

So, revenue for a month = 116000 * 25 days = Rs. 29,00,000

Thus Mother Dairy can get an additional sales figure of around Rs. 29,00,000 per month, if
this channel is functional.

This figure is limited to the sample of 51 schools. There are about 1000 schools in Delhi that
fall under the Band B and Band C. Extension of this project to these schools and an
aggressive strategy to pursue them will result in a very strong thrust to Mother Dairy‟s
revenues and another leap over its major competitors in the market.

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Recommendations:-

 Since majority of ice cream sales in any school consists of the impulse segment (up to
Rs.10), new flavours of candies and bars can be introduced seasonally to attract the
kids and maintain a strong hold in the competitive market. Our competitors - Vadilal
and Kwality Walls have a wider variety when it comes to this segment. So it is
essential to introduce more varieties in candies and bars.

 Introduction of a health segment (ice creams having higher nutritional content) can be
a measure to accommodate those schools which are highly concerned with their
canteen items. Also awareness among the people about the nutritional value of
Mother Dairy Ice cream and its point of difference of being an ice cream and not a
frozen dessert needs to be imparted. This is necessary so that it is not considered as a
junk food.

 Sales promotion activities such as free Mother dairy merchandise (stickers, stationery
equipments) with the purchase can be done.

 Schemes such as a discount on MRP at the return of a specific number of Mother


Dairy ice cream wrappers will help retain customers during the off season as well.

 Educational visits to Mother Dairy plants can be done to promote the brand among the
children. Thus brand recognition from a very young age determines loyalty and
retention in the future.

 Quizzes, painting competitions, sports competitions along with workshops and


seminars on healthy diet can be held in schools as a Social Marketing campaign. The
cause of a healthy living can be promoted strengthening brand equity.

52
Mangolpuri Ice Cream Facility – A Study

During my internship, I also got a chance to study the operations of the Ice Cream storage
and dispatch operations at the Mangolpuri Unit of Mother Dairy Fruit & Vegetable Pvt. Ltd.

The stocking facility of Mother Dairy located at Mangolpuri in West Delhi has a capacity of
stocking 55000 crates of ice cream. The stock is dispatched from two docks. The loading and
unloading of the vehicles is done manually by labourers with the help of trolleys with each
trolley capable of carrying six crates. The total number of trolleys at work was six. The total
number of labourers working in a 12 hr shift is 27. There are five types of vehicles with
different capacities which are loaded/ unloaded there -

 A large refrigerated van (capacity 525 crates)


 A medium refrigerated van (capacity 228 crates)
 Eicher trucks
 Tata ace
 Auto

Eicher trucks, Tata ace and autos are smaller vehicles and are refrigerated with the help of
dry ice.

Process:
 Stocking and dispatching is a 24 hr operation at the Mangolpuri facility. The vehicles
enter the facility and register its time-in in the log book at the gate.
 The dispatch takes place on FCFS (First come First serve bases). The vehicles then
dock themselves at the docking station and then the labours divide between
themselves the amount of stock which is to be loaded.
 The labourers then start the loading operations which take on an average 40 min. For
a bigger refrigerated van usually four labourers do the loading operation with two
present inside the truck to push out and load in the crates.
 Two workers are present in the cold room to help with the loading of crates on
trolleys. One supervisor is also there who checks whether the right quantity of the
stock is being loaded or not. A second log book is kept at the dispatch in which the
guard logs down the time –in and time-out of the vehicles.

53
Day Shift :-

Doc Tot
Dry Actual Tim
Veh.Ty k Lag Lag Time al Actual
S.NO. Ice From worki e
pe Tim time L1 L2 Tim time
Qty. ng Out
e e
Large; 17:5 19:3 19:3
1 Maan 1:00 18:55 0:02 1:37 0:35
U 5 0 2
Small; 18:4 19:0 19:0
2 Frdbd 0:02 18:46 0:01 0:24 0:21
U 5 8 9
Large; 19:5 21:1 21:1
3 Maan 0:35 20:25 0:00 1:25 0:50
U 0 5 5
Large; 21:4 22:2 22:3
4 Ptprgnj 0:15 22:00 0:03 0:47 0:29
U 5 9 2
23:2
5 Med.; L Jaipur 0:15 23:35 0:00 0:10 0:10 1:00 0:35
0
Large;
6 Maan 0:15 0:01 0:16 0:44 0:02 0:46 0:31 0:28
U
Large;
7 Maan 0:48 0:01 0:49 1:22 0:00 1:22 0:34 0:33
U
Large;
8 Maan 2:25 0:00 2:25 3:00 0:01 3:01 0:36 0:35
U
Large;
9 Maan 3:02 0:00 3:02 3:45 0:01 3:46 0:44 0:43
U
Large;
10 Maan 3:50 0:00 3:50 4:32 0:02 4:34 0:44 0:42
U
Large;
11 Maan 4:35 0:00 4:35 5:18 0:01 5:19 0:44 0:43
U

Date:-
6/4/20 Day
10 Shift

doc actu
dry lag time lag tim
veh k actual al
s.no ice dest time(mi taken(mi tim e remarks
type tim start finis
qty n) ns) e out
e h

DL1M
1 7:45 5 7:50 8:25 0:35 5 8:30
4774
DL1M
2 8:20 5 8:25 9:00 0:35 0 9:00
4772
DL1M
3 9:00 0 9:00 9:30 0:30 5 9:35
4736
DL1M 10:1 10:1
4 9:35 0 9:35 0:35 0
2578 0 0
HR 38 unlo 10:3 10:5
5 0 10:30 0:20
M 9922 ad 0 0

54
10:5 11:3 11:3 dry ice
load 5 10:55 0:35 0
0 0 0 issue
DL1M unlo 13:3
6 0:00
4741 ad 0
Dl1M 14:0 15:0 15:1
7 20 14:20 0:48 2
3520 0 8 0
Dl1M 265 15:1 16:2 16:2
8 3 15:15 1:05 5
2578 crates 2 0 5
operatio
DlL1P 14:4 15:1 15:2
9 5 14:50 0:22 8 ns
1626 5 2 0
halted
DL 1P 16:2 17:1 17:1
10 5 16:30 0:40 5
4736 5 0 5

Night
Shift

doc
dry finis lag tim
veh dest/ori k lag actual actual total
S.no ice h tim e
type gin tim time time time time
qty time e out
e
Large; 19:0 19:4 19:4
1 Maan 0:13 19:15 0:30 0:00 0:43
U 2 5 5
Large; 19:4 20:4 20:4
2 Karnal 0:02 19:50 0:55 0:02 0:59
U 8 5 7
Large; 20:5 21:3 21:3
3 Maan 0:00 20:50 0:47 0:00 0:47
U 0 7 7
Large; 23:1
4 Maan 0:15 23:25 0:08 0:43 0:00 0:08 0:58
U 0
Large;
5 Maan 0:08 0:00 0:08 0:52 0:44 0:01 0:53 0:45
U
Large;
6 Maan 1:07 0:02 1:09 1:45 0:36 0:00 1:45 0:38
U
Large;
7 Maan 1:46 0:01 1:47 2:25 0:38 0:02 2:27 0:41
U
Large;
8 Maan 2:35 0:05 2:40 3:10 0:30 0:00 3:10 0:35
U
Large;
9 Maan 3:12 0:02 3:14 3:51 0:37 0:01 3:52 0:40
U

55
Observations and recommendations:-

 The number of labourers working in the process never exceeded 10. This can be
attributed to the number of trolleys which are only 6.Thus the company can consider
increasing the number of trolleys to 12 which would increase the current utilization to
96.3% from 51.85% and decrease the time taken by 100%.
 The entries in the log book should also indicate the dock-in time and dock-out time
for better monitoring of the process.
 Some trolleys were under loaded as the labourers were seen carrying 3-5 crates as
against 6 (safe limit). Labour should be instructed to carry not less than 6 crates per
trolley this would keep the number of rounds to the minimum.
 Organising the storage of stacks with batch and type. This would reduce the delay
caused in locating the required type of ice cream.

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Conclusion:-

Working for an organization like Mother Dairy in the Delhi region is a pride for me and gave

me a chance to learn the skills and helped me to understand the real environment of business

and Delhi market potential for Ice creams.

In posh areas like South Delhi and east Delhi need a lot of planning before making any offer

to the customer. As far as ice cream is concerned the competition is tough with reputed

brands which fighting for their share in the market

But owing to its brand image, quality, price and taste Mother Dairy is undisputed leader in

retails with an evenly distributed retail outlet in Delhi, which results for higher sales for

Mother Dairy ice cream. As far as other revenues for sales from other channel like

retail,booths,modern retail Mother Dairy is doin a good business and needs to implement the

same strategy in the school channel as well.

The research also helped in identifying various issues in the schools related to the canteen

owners and plan out a methodology to rectify the problem.

At last it was a great experience to me working with Mother Dairy, a reputed brand in FMCG

sector because many of the management guru‟s said if you work successfully in FMCG

sector than you can survive easily in any sector.

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Learnings:-

By undergoing this project i was able to understand various channels of mother dairy

currently being implemented and also helped me to understand various aspects of selling ice

creams in schools of mother dairy. Doing business with school does not limit to the supply of

ice creams or any milk products and also depends on the type of relationship we try to make

with the school/ retailer. Apart from this another important aspect which i noted was the

schools where Mother Dairy Ice creams were already selling but due to malfunctioning of the

deep freezer the canteen owner was not able to make sale, thus inferring that a constant

servicing of the deep freezer is equally important as that of supplying ice creams to the

canteen owners. The project also helped me understand that not all schools are beneficial

in terms of revenues generated for Mother Dairy. It depends on various parameters like

location, strength, etc. My project also included a study of the operation of the ice cream

dispatch at the Mongolpuri Office of Mother Dairy. It helped me in understanding that the

time required to load and unload a truck full of ice creams depends fully upon the number of

labor working.The labor usually works under extremely low temperature( -21 degree

Centigrade) which results in various issues such as labor falling sick or becoming tired.

Mother Dairy therefore should take steps in order to make loading and unloading process

automated in order to save time and money.

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Biblography:-

 www.nddb.org

 www.motherdairy.com

 en.wikipedia.org/wiki/Mother_Dairy

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