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Submitted to JNT University, Hyderabad for the partial fulfillment of the requirements for the award of Degree of


Submitted by SUNIL KUMAR .R


Under the Guidance of Mr. R. RAMESH

Department of Business Management




K.Sharath Babu
B.Tech, MBA, M.Phil (Ph.D)

Head of the Department Department of Business Management


This is to certify that the project report entitled A STUDY ON CONSUMER BUYING BEHAVIOR TOWARDS VIJAYA DAIRY MILK was carried out by Mr. SUNIL KUMAR R, H.T.No 07C31E0032. Under my guidance. He has completed his project work as per the rules prescribed and submitted to the JNT University, Hyderabad for the partial fulfillment for the award of degree of Master of Business Administration. It is a bonafide work done by him and has not been submitted else where either in part or in full for any degree or diploma of any university earlier.




I, SUNIL KUMAR R, H.T.NO. 07C31EOO32 studying MBA at BALAJI INSTITUTE OF TECHNOLOGICAL AND SCIENCES of here by declare that the project report entitled CONSUMER BUYING BEHAVIOUR TOWARDS VIJAYA DAIRY MILK submitted in partial fulfillment for the award of degree of Master of Business Administration is an original work done by me and not submitted for the award of any degree, diploma, fellowship or other similar titles or prizes.



I would like to thank Mr.CH. SATYANARAYANA, Manager, Vijaya Dairy, Warangal, for giving me an opportunity to do project and helping me in carrying out my project. I would like to thank our Principal Dr. P. NAGESWARA REDDY for permitting me to do the project. I am highly indebted to my Head, Department of Business Management Mr. K. SHARATH BABU for his immense support in completing the project. I am highly thankful to Mr. R. RAMESH, Asst. Professor for his valuable guidance throughout my project work. I also thank my parents, friends and all those who directly or indirectly extended their support in completion of my project.



Everyday we are coming across with television advertisements, newspaper commercial direct mails and sales calls. Someone is always trying to sell something.

Anything that can be offered to a market for attention, acquisition use or consumption that might satisfy want or a need it includes physical object, services and persons places, organization and ideas.

To satisfy their needs and wants of the people who are depending on market where transaction take place.

People are participating in marketing by satisfying their needs and wants through exchange. Exchange is an act obtaining a desired object from someone by offering and something in returns.

Marketing is a social and managerial process by which individuals and groups obtain what they want and need through creating and exchanging products and values with others. Activities such as product development research. Communication, distribution, pricing and services are Core Marketing activities

If a market do good job of understanding consumer needs, develop products.That provide superior values and prices, distribution and promotes them effectively, these products will sell very easily.

Peter F Drucker: A Leading Management thinker put them in this way, Aim of marketing is to make selling superfluous. The aim is to know and understand the customer so well that the product or service fits and sells itself. Outstanding Marketing companies stay close to customer.

Duddy &Rerzon: Marketing is the economic process by mean of which goods and services are exchanged and their values determined in terms of money prices.

American Marketing Association : Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods , services to create exchanges that satisfy individual and organizational goals


An important part of the marketing process is to understand why a customer or buyer makes a purchase. Without such an understanding, businesses find it hard to respond to the customers needs and wants. Marketing theory traditionally splits analysis of buyer or customer behaviour into two broad groups for analysis Consumer Buyers and Industrial Buyers Consumer buyers are those who purchase items for their personal consumption Industrial buyers are those who purchase items on behalf of their business or organization. Businesses now spend considerable sums trying to learn about what makes customers tick. The questions they try to understand are:

Who buys? How do they buy? When do they buy? Where do they buy? Why do they buy? For a marketing manager, the challenge is to understand how customers might respond to the different elements of the marketing mix that are presented to them. If management can understand these customer responses better than the competition, then it is a potentially significant source of competitive advantage.

Definition of Buying Behavior

Buying Behavior is the decision processes and acts of people involved in buying and using products. Need to understand: Why consumers make the purchases that they make? What factors influence consumer purchases? The changing factors in our society. A firm needs to analyze Purchase behavior for: Buyers reactions to a firms marketing strategy has a great impact on the firms success. The marketing concept stresses that a firm should create a Marketing Mix (MM) that satisfies (gives utility to) customers, therefore need to analyze the what, where, when and how consumers buy. Marketers can better predict how consumers will respond to marketing strategies.

Stages of the Consumer Buying Process

Six Stages to the Consumer Buying Decision Process (For complex decisions). Actual purchasing is only one stage of the process. Not all decision processes lead to a purchase. All consumer decisions do not always include all 6 stages, determined by the degree of complexity. The 6 stages are: 1. Problem Recognition(awareness of need) Difference between the desired state and the actual condition. Deficit in assortment of products. Hunger--Food. Hunger stimulates your need to eat. Can be stimulated by the marketer through product information--did not know you were deficient? I.E., see a commercial for a new pair of shoes, stimulates your recognition that you need a new pair of shoes.

2. Information search
o Internal search, memory.

o External search if you need more information. Friends and relatives (word of mouth). Marketer dominated sources; comparison shopping; public sources etc. o A successful information search leaves a buyer with possible alternatives, the evoked set. o Hungry, want to go out and eat, evoked set is o Chinese food o Indian food

3. Evaluation of Alternatives
Need to establish criteria for evaluation, features the buyer wants or does not want. Rank/weight alternatives or resume search. May decide that you want to eat something spicy, Indian gets highest rank etc. If not satisfied with your choice then return to the search phase. Can you think of another restaurant? Look in the yellow pages etc. Information from different sources may be treated differently. Marketers try to influence by "framing" alternatives.

4. Purchase decision
Choose buying alternative, includes product, package, store, method of purchase etc. 5. Purchase May differ from decision, time lapse between 4 & 5, product availability.

6. Post-Purchase Evaluation


Outcome: Satisfaction or Dissatisfaction. Cognitive Dissonance, have you made the right decision. This can be reduced by warranties, after sales communication etc. After eating an Indian meal, may think that really you wanted a Chinese meal instead.

Types of Consumer Buying Behavior

Types of consumer buying behavior are determined by: Level of Involvement in purchase decision. Importance and intensity of interest in a product in a particular situation. Buyers level of involvement determines why he/she is motivated to seek information about a certain products and brands but virtually ignores others. The four types of consumer buying behavior are:

Routine Response/Programmed Behavior

Buying low involvement frequently purchased low cost items; need very little search and decision effort; purchased almost automatically. Examples include soft drinks, snack foods, milk etc.

Limited Decision Making


Buying product occasionally. When you need to obtain information about unfamiliar brand in a familiar product category, perhaps. Requires a moderate amount of time for information gathering. Examples include Clothes--know product class but not the brand. Extensive Decision Making/Complex high involvement Unfamiliar, expensive and/or infrequently bought products. High degree of economic/performance/psychological risk. Examples include cars, homes, computers, education. Spend a lot of time seeking information and deciding. Information from the companies MM; friends and relatives, store personnel etc. Go through all six stages of the buying process.

Impulse buying, no conscious planning. The purchase of the same product does not always elicit the same Buying Behavior. Product can shift from one category to the next. For example: Going out for dinner for one person may be extensive decision making (for someone that does not go out often at all), but limited decision making for someone else. The reason for the dinner, whether it is an anniversary celebration, or a meal with a couple of friends will also determine the extent of the decision making.


Factors that influence the Consumer Purchase Decision making Process

A consumer, making a purchase decision will be affected by the following three factors: 1. Personal 2. Psychological 3. Social The marketer must be aware of these factors in order to develop an appropriate MM for its target market.

Unique to a particular person. Demographic Factors. Sex, Race, Age etc. Who in the family is responsible for the decision making. Young people purchase things for different reasons than older people.

Psychological factors
Psychological factors include: Motives: A motive is an internal energizing force that orients a person's activities toward satisfying a need or achieving a goal. Actions are effected by a set of motives, not just one. If marketers can identify motives then they can better develop a marketing mix.


MASLOW hierarchy of needs!! o Physiological o Safety o Love and Belonging o Esteem o Self Actualization Need to determine what level of the hierarchy the consumers are at to determine what motivates their purchases. Motives often operate at a subconscious level therefore are difficult to measure. Perception What do you see? Perception is the process of selecting, organizing and interpreting information inputs to produce meaning. IE we chose what info we pay attention to, organize it and interpret it. Information inputs are the sensations received through sight, taste, hearing, smell and touch. Selective Exposure Select inputs to be exposed to our awareness. More likely if it is linked to an event, satisfies current needs, intensity of input changes (sharp price drop). Selective Distortion Changing/twisting current received information, inconsistent with beliefs. Advertisers that use comparative advertisements (pitching one product against another), have to be very careful that consumers do not distort the facts and perceive that the advertisement was for the competitor. A current example...MCI and AT&T...do you ever get confused?


Selective Retention Remember inputs that support beliefs, forgets those that don't. Average supermarket shopper is exposed to 17,000 products in a shopping visit lasting 30 minutes-60% of purchases are unplanned. Exposed to 1,500 advertisements per day. Can't be expected to be aware of all these inputs, and certainly will not retain many. Ability and Knowledge Need to understand individuals capacity to learn. Learning, changes in a person's behavior caused by information and experience. Therefore to change consumers' behavior about your product, need to give them new information re: product...free sample etc. When making buying decisions, buyers must process information. Knowledge is the familiarity with the product and expertise. Inexperience buyers often use prices as an indicator of quality more than those who have knowledge of a product. Non-alcoholic Beer example: consumers chose the most expensive six-pack, because they assume that the greater price indicates greater quality. Learning is the process through which a relatively permanent change in behavior results from the consequences of past behavior. Attitudes Knowledge and positive and negative feelings about an object or activity-maybe tangible or intangible, living or non- living.....Drive perceptions Individual learns attitudes through experience and interaction with other people. Consumer attitudes toward a firm and its products greatly influence the success or failure of the firm's marketing strategy. Attitudes and attitude change are influenced by consumers personality and lifestyle.


Consumers screen information that conflicts with their attitudes. Distort information to make it consistent and selectively retain information that reinforces our attitudes. IE brand loyalty. There is a difference between attitude and intention to buy (ability to buy). Personality All the internal traits and behaviors that make a person unique, uniqueness arrives from a person's heredity and personal experience. Examples include: o Compulsiveness o Dogmatism o Self confidence o Friendliness o Adaptability o Ambitiousness o Authoritarianism o Introversion o Extroversion o Aggressiveness o Competitiveness. Traits effect the way people behave. Marketers try to match the store image to the perceived image of their customers. There is a weak association between personality and Purchase Behavior, this may be due to unreliable measures. Nike ads. Consumers buy products that are consistent with their self concept.


Lifestyles Recent US trends in lifestyles are a shift towards personal independence and individualism and a preference for a healthy, natural lifestyle. Lifestyles are the consistent patterns people follow in their lives. Example healthy foods for a healthy lifestyle. Sun tan not considered fashionable in US until 1920's. Now an assault by the American Academy of Dermatology.

Social Factors
Consumer wants, learning, motives etc. are influenced by opinion leaders, person's family, reference groups, social class and culture. Opinion leaders Spokespeople etc. Marketers try to attract opinion leaders...they actually use (pay) spokespeople to market their products. Michael Jordon (Nike, McDonalds, Gatorade etc.) Can be risky...Michael Jackson...OJ Simpson...Chevy Chase Roles and Family Influences Role...things you should do based on the expectations of you from your position within a group.People have many roles. Husband, father, employer/ee. Individuals role are continuing to change therefore marketers must continue to update information.

Family is the most basic group a person belongs to. Marketers must understand: o That many family decisions are made by the family unit 17

o Consumer behavior starts in the family unit o Family roles and preferences are the model for children's future family (can reject/alter/etc) o Family buying decisions are a mixture of family interactions and individual decision making o Family acts an interpreter of social and cultural values for the individual. The Family life cycle: families go through stages, each stage creates different consumer demands: o Bachelor stage...most of BUAD301 o Newly married, young, no children...me o Full nest I, youngest child under 6 o Full nest II, youngest child 6 or over o Full nest III, older married couples with dependant children o Empty nest I, older married couples with no children living with them, head in labor force o Empty nest II, older married couples, no children living at home, head retired o Solitary survivor, in labor force o Solitary survivor, retired o Modernized life cycle includes divorced and no children.

Reference Groups Individual identifies with the group to the extent that he takes on many of the values, attitudes or behaviors of the group members. Families, friends, sororities, civic and 18

professional organizations. Any group that has a positive or negative influence on a persons attitude and behavior. Social Class An open group of individuals who have similar social rank. Criteria: Occupation, Education, Income, Wealth, Race, Ethnic groups and possessions.

Social class influences many aspects of our lives. I.e., upper middle class prefer luxury cars Mercedes. o Upper -upper class, .3%, inherited wealth, aristocratic names. o Lower-upper class, 1.2%, newer social elite, from current professionals and corporate elite o Upper-middle class, 12.5%, college graduates, managers and professionals o Middle Americans-middle class, 32%, average pay white collar workers and blue collar friends o Working class, 38%, average pay blue collar workers o Lower Americans-lower class, 9%, working, not on welfare o Lower-lower class, 7%, on welfare Social class determines to some extent, the types, quality, and quantity of products that a person buys or uses. Lower class people tend to stay close to home when shopping, do not engage in much prepurchase information gathering. Stores project definite class images. Family, reference groups and social classes are all social influences on consumer behavior. All operate within a larger culture.

Culture and Sub-culture


Culture refers to the set of values, ideas, and attitudes that are accepted by a homogenous group of people and transmitted to the next generation. Culture also determines what is acceptable with product advertising. Culture determines what people wear, eat, reside and travel. Cultural values in the US are good health, education, individualism and freedom. In American culture time scarcity is a growing problem. IE change in meals. Big impact on international marketing.



India is wide and large country, which is highly concentrated in rural society and spread over 5, 65,742 villages, which is nearly about 70% of the overall population. Agriculture is the main income source. Dairying is complementary to Agriculture income and playing important role in the stability of rural economy. The cow was adored as the deity Kamadenu with its milk as nectar for human life.

Milk and its product depute an important and compulsory part of daily life. From early ages of human life milk is considered as the most significant and complete food among all the food products. Milk gives energy, body building proteins, bone forming minerals, vitamins, Lactose, fast and fatty acids, etc. Besides providing certain essential fatty acids, it contains nutritional components for easy assimilation of food and digestion.

All these properties make milk an important food product in the universe.

As Indian Economy is predominantly agricultural dependent, Dairy and Animal Husbandry from an important activity of its Economy. This dairying activity constitutes 10% of total G.D.P. Agriculture being a seasonal activity it cannot give regular income throughout the year certain activities like dairying, sheep rearing, poultry, etc. are taken up. Major part of the milk is produced in rural areas, but the demand for milk is mainly from the urban area. Urban consumers receive milk through private milk vendors who collect milk from rural areas i.e. village.


Dairy in India was not in an organized manner till 1895. There were military dairies until 1940 with modern processing facilities like that of pilot dairy at Anand.

After independence in 1947 greater Bombay Milk Scheme was started and Airey milk colony was established. Milk was supplied from Kaira District Co-operative Milk Producer Union known as Anand Milk Union Limited (AMUL) to greater Bombay Milk Scheme.

In 1951, Government started Key Village Scheme to improve the productivity intensive cattle development productivity of milk cattle under Five Year plan Scheme. Productivity intensive cattle development Project was started through scientific breeding, feeding and right management practices.

In 1960, under the pattern of greater Bombay Milk Scheme some state Governments in India started milk supply schemes procuring milk from rural areas paying remunerative price to the milk producers. Then dairying acquired national level recognition. India has the largest cattle and buffalo population but its share of the milk production is 10% only. In India, the average animal milk capacity per cow is only 150 liters per year and buffalo 50 liters per year. In some countries due to dairy development activities, the average milk production per cow is 300 liters to 400 liters per year. In India at present the level of milk consumption is only 19 ml per head while a healthy person requires at least 21ml daily. In India, many problems arise in marketing of the milk. The main problems are lack of adequate and timely supply of milk, poor quality and adulteration of milk leakage of packets, high and low discrimination of prices.


Government of India adopts several measures to improve the marketing system, quality and sales of milk in rural as well as in urban areas. Consequently, today most of the urban areas covered by Dairy Co-operative Societies of their respective states.

Recognizing the nature of business, the dairy industry concerted into a commercial institution of AP Dairy Development Corporation Limited in 1974. With a mission of industrializing rural dairying, tapping and promoting the dairy industry with greater development opportunities to the people of Andhra Pradesh.

Because of the changing scenario in the competitive environment in the last five years, the role of Government and voluntary organization has been limited with a major focus on private industry. Governing companies like Heritage, Cream line dairy, Ravila etc. The role of NDDC and Vijaya Dairy has been subsided.

Keeping this in view and devised an effective marketing strategy for Vijaya Dairy with a competitive orientation. Warngal and Hanamkonda Milk Producer Co-operative Union Limited is one of the unit of Andhra Pradesh Dairy Development Co-operative Federation Limited is selected.


This project is based on the study on consumer buying behavior towards Vijaya Dairy Milk.


The Main objective of the study is to know the consumer purchase towards Vijaya Dairy milk


The study is to find out the various attributes in a product which results in purchase To identify level of consumer satisfaction and the consumer needs To study the factors affecting the consumer buying behavior To offer pertinent suggestions to the company in understanding consumer behavior



As learning is a human activity and is as natural, as breathing. Despite of the fact that learning is all pervasive in our lives, psychologists do not agree on how learning takes place. How individuals learn is a matter of interest to marketers. They want to teach consumers in their roles as their roles as consumers. They want consumers to learn about their products, product attributes, potential consumers benefit, how to use, maintain or even dispose of the product and new ways of behaving that will satisfy not only the consumers needs, but the marketers objectives.

The Scope of My study restricts itself to the analysis of consumer buying behavior, with special reference from VIJAYA DAIRY MILK, Warangal. The scope of my study is also restricts itself to Warangal region only. And the study depends on psychological aspects and the opinions may differ from one consumer to another.



This chapter describes the methodology of the study. This project is based on information collected from primary sources. After the detailed study, an attempt has been made to present comprehensive analysis of consumption of Vijaya Dairy Milk consumed by the people. The data had been used to cover various aspects like consumption, consumer buying behaviour and customers satisfaction regarding Vijaya Dairy Milk. In collecting requisite data and information regarding the topic selected, I went to the residents of Warangal and collected the data.

Survey design: The study is a cross sectional study because the data were collected at a single point of time. For the purpose of present study a related sample of population was selected on the basis of convenience.

Sample Size and Design: A sample of 100 people was taken on the basis of convenience. The actual consumers were contacted on the basis of random sampling.

Research Period:


Research work is only carried for 5 or 6 weeks.

Research Instrument: This work is carried out through self-administered questionnaires. The questions included were open ended, dichotomous and offered multiple choices.

Data Collection: The data, which is collected for the purpose of study, is divided into 2 bases: Primary Source: The primary data comprises information survey of Consumer Buying Behavior towards Vijaya Dairy Milk. The data has been collected directly from respondent with the help of structured questionnaires. Secondary source: The secondary data was collected from internet, References from Library.


Limitations of the Study:

The survey is restricted to Warangal tri cities only. Since the Sample size is 100 and the data may not represent the accurate results. The views expressed by the consumers may not be 100% accurate. The time period of the project is only six weeks, which may not be sufficient for the study



In the history of world dairying, the year 1998 has been a lucky year for India. We have just emerged as the highest milk producing country in the world and that too in the 50th year of our independents. Increasing the annual milk production from 20 million tones in 1970 to around 14 million tones in 1998 is no mean achievement.

Infact, it is unique success story of Indias dairy development contributed by the small holders. Our country has the largest bovine population in the world (195 million cattle and 77 million buffaloes). The results of White Revolution are quite visible with our per capital milk consumption rising to 210 g per day inspite of the ever increasing human population. All the has largely been a developmental agency of governmental, nongovernmental and cooperative institutions. Indian deriving has over the years created an identify of its own. It has also succeeded in having a competitive edge due, to its low-investment, energy-efficient, cost

Effective production system. A recent survey conducted by the Food and Agriculture Organization (FAO) of the United Nations has declared India as the top milk producer in the world, surpassing USA. The credit for enabling India to reach this milestone goes to millions of small and marginal farmers and land less labourers for their untiring efforts and the institutional support provided by the National Dairy development board under the Operation flood Programmed. Here, a noteworthy aspect is that India has achieved this coveted position without giving any incentive or subsidy to it dairy farmers unlike most of the developed dairying nations.


The dairy sector provides round-the-year employment which no other agri business can do. Besides, it also provides a safety net to the weaker sections of our society. But unfortunately this sectors contribution to the Indian economy and its growth potential have not yet been properly recognized. The industrial sector has been regularly receiving several forms of subsidies and incentives since independence. The agriculture sector too has its own share of privileges and subsidies. But, if one goes through the budgetary allocations of all the plans made so far, dairyings share is too insignificant as compared to any other sectors. And, never any special incentive was given to it. The dairy sector is also deprived of the special banking support as is provided to the industrial as well as agriculture sectors.



Dairy Industry in the Emerging world Scenario: Dairying has played a prominent role towards household nutrition security and also in strengthening our rural economy. It has been organized as an instrument to bring about socio-economic transformation. Also the dairying sector has helped national economy by emerging as the largest milk producer in the world. The import dependent Indian dairying soon become not only self sufficient but also poised for an export oriented dairying nation. This has been primarily attributable to the implementation of the Operation Flood Programme launched in 1970 under the aegis of the National Dairy Development Board. The architect of the quite Revolution Dr. Kurien deserves special compliments. However, the gains of the White Revolution achieved through the cooperative networking of the small and marginal farmers, and land less labourers are needed to be sustained to cope with the rapid transformation that are now taking place consequent to the GATT Agreement and establishment of the World Trade organization (WTO). In future, international trade will be strongly regulated by the WTO regime. New ever and stricgter Sanitary and Phytosanitary Standards are being framed for regulating quality standards. Under these circumstances, our practices for production and processing milk cannot stay at variance with the international standards.


The Uruguay Round of Multi-lateral Trade Negotiations signed on 15th April. 1994 us well as General Agreement on Tariffs and Trade (GATT) the world economies are swiftly


gearing to adjust with the situation arising due to the withdrawal of trade subsidies. The major dairying countries of the world, which had heavily relied on these subsidies, are now readjusting their internal economies in order to produce milk at the competitive price. One sound economic principle guiding the trade globally is, "if a commodity cannot be produced at competitive prices, it is wiser to import". Since such changes were anticipated, most of the European Nations had the acumen of streamlining their economies long back. The Eastern Europe has consciously reduced production of milk from 39 MT in 1991 to 35 MT in 1998. In the same period, West Europe has reduced milk. Production from 129 MT to 126 MT. Several other adverse factors, such as the perceived image of production has led to a decrease in butter production on a global basis. The world production of butter has declined from 5.03 MT in 1991 to 5.01 in 1997. Withdrawal of subsidies coupled with reduced demand of skim milk powder has led to the decline of its production from 1500 MT to 1100 MT. It is paradoxical that as a global impact of GATT, EU has resorted to conscious reduction of domestic milk production, even though the demand for cheese and whole milk is rising. Consequently, to fill up this gap, world trade of cheese has gone up from 950MT to 1300 MT during 1993-96. There has also been an increased from 1050 MT to 1300 MT in the global of whole milk Powder.


With the changing declining trends in the domestic/export markets as well as profits for conventional dairy products, such as milk powder, butter etc., need for product diversification that permits value addition, long life-cycle and greater income has become quite obvious. Growing awareness towards the beneficial role of milk and milk products in 32

maintaining normalcy of human health has led to the development of a new range of functional floods, also called 'health foods' or 'nutraceutical' or even 'mood elevating/refreshing foods'. It is widely recognized that components derived from milk such as immunoglobulin, lactoperoxidase, lactoferrin, lysozyime, vitamin binding proteins etc, play an 'extra nutritional' which are formed during the passage through digestive tract. Fermented milk products such as yogurt in particular provide beneficial microbes, which favorably influence the microbial ecology of the gut-system. These, in turn, effect various biochemical functions to protect human health. Biotechnology has been successfully employed to develop genetically modified strains of dairy cultures that tend to reduce risks of enteric infections, hypercholestemia,, rate of proliferation of an cancer cells as well as augment immune system besides offering may other health promoting attributes. The dairy industry in advanced countries is rapidly diversifying its product mix to produce arrange of dairy foods that is targeted to reduce the role of medicine in maintaining normalcy of dairy foods that is targeted to reduce the role of medicine in maintaining normalcy of human health. Japan the world leader in this sector. where the current market of US$ 5.5 billion is still last growing. In the USA 11 billion. Hence, biotechnology, Bioengineering and food science offers new opportunities to Industry, which we must capitalize through, required R&D efforts, both in the public and private sectors. Dairy industry is also fast diversifying to develop special food ingredients derived from milk. Which can be deployed advantageously to improve the sensory quality attributes. These include fractionated casemates whey protein concentrates, enzymatic hydrolyses prepared by employing innovative energy efficient unit processes. Packaging is another area, which is receiving intensive R&D inputs for developing low cost,


biodegradable materials to prevent further damage to the environment and ensure greater food safety. However, greater challenge lie before the Indian dairy industry in modernizing the unorganized sector engaged in the preparation of wide range of indigenous milk products. Intensive scientific, R&D and financial input are necessary to develop industrial manufacturing and packaging system. Apart from the development of

continuous/mechanized systems for industrial production of ghee, khoa, gulabjamun, shrikhand and burfi, very little progress had been made in this area. The weakest link is in developing appropriate packaging systems that may conform to the international standards of product safety, shelf life and labeling requirements. It is in this context, India is yet to take advantage of UHT technology, which could otherwise help in minimizing post-harvest losses and also accord greater physical access in remote and difficult areas.


INDIAS CHANGING SCENARIO (Dairy industry) India's competitiveness:

Livestock sector is the backbone of India's economy in terms of income employment equality sustainability and foreign exchange earnings. By virtue of traditional practice of utilizing the crop resides as feed for the milk animals, India has been able to achieve milk production of 70 million MT at a very competitive 'Farm Gate Milk Price on global basis. India enjoys competitive edge over Newzealand, Australia and the USA of being able to produce milk at a lower cost. Livestock products have registered a compound growth rate of 5.26% per annum, during the preceding decade. Milk and milk products account for 66% of the total value of livestock products. Another noteworthy feature of Indian dairy scenario is that all the milk is produced by a very large number of milk animals having low productivity. Thus, only marginal improvement ion animal productivity is capable of making a substantial impact. On the other hand. in the technologically advanced countries, even small targets for increased milk production present major challenge, since animals have already attained their maximum genetic potential and the production systems have also been optimized. India has well-organized dairy infrastructure of 7,800 rural milk cooperatives and a processing capability of abut 12million litre per day in about 280 dairy plants. India has a strong HRD capability to meet the multi sectoral requirement of the dairy industry. India has generated very valuable experience and competence in treopical dairying, which can serve as model for developing countries. In particular, India has developed a very precious R & D reservoir for buffalo; milk processing. This provides opportunities for export of


technologies to partner countries through an integrated approach for accessing remunerative markets. With the liberalization of world economies, Indian dairy industry has also ventured to explore the export markets. A rather modest, beginning has been made through exports of milk powders, being Rs. 318.5 to 22 countries, mainly Bangladesh, Srilanka, Nepal, UAE, the Philippines and the Netherlands


Cheese has the potential of emerging as the No. 1 dairy product in India, with its present estimated demand of 1800 tones projected to rise to 30000 tonnes by 2000 AD. The global cheese market is also beckoning the Indian producers. For, after the WTO enforced withdrawal of the milk producer subsidy, European producers would Fine it difficult to market cheese at competitive prices. Prospects of cheese production in India is quite bright. This is because of the fact that cheese has all the attributes of an ideal dairy product. Cheese is a fermented dairy product. Fermentation has occupied a place of pride in the food preservation practices from time immential. It improves nutritional value and enriches the flavor, body and texture of the product. Fermented milk products have been reported to have therapeutic. Anticarcinogentic and anticariogenic properties. Cheese represents a balanced food with concentrated from of energy and good quality? protein. As such, it is only food, which could prove to be an appropriate substitute to non-vegetrial diet. Cheese has high food and nutritive value. It is an excellent source of high quality protein, rich source of calcium and phosphorous, an excellent source of several


fat-soluble vitamins. To consumers, it provides good nutrition, variety. Convenience for use. Portability, food safety and novelty of flavor and texture. Process cheese spread and slices have proved to be an ideal bread-mate. The consumption of bread is increasing very fast in India. Butter, the traditional spread for bread, is not avoided because of its high fast content. The other conventional spread like jam and jelly are considered as junk food. Thus it is the cheese, which can provide nutritionally sound spread for bread.

Milk is procured from the farmers by the dairy units and goes through various tests and processed to obtain good satisfactory results from the consumers. It involves the following steps. Testing Chilling Pasteurization and chilling Packaging



Milk procured undergoes through various tests such as: Ph Test: The Ph value gives the measure of the time acidity of milk. Generally ph ranges from 6.6-6.8. milk over ph 6.9 is considered as suspicious of disease or lactation of milk. Acidity Test: It is used lo find out the quality and heat stability of milk and also to check the content of lactic acid present in it. Sedimental Test: It presents a rapid and quantitative means indicating the cleanliness of milk as regards to visible dirt. Alcohol Test: It is made to detect whether milk has tendency to curdle during the sterilization process. On Boiling Test (COB): COB test is meant to have final confirmation of the quality of milk. Since, with high acidity and salt content clots on boiling due to precipitation of protein it is rejected. Fat test: It is conducted to estimate the fat percentage present in the milk that

is procured form the farmers.

CHILLING: Milk procured from various areas throughout the settle from framers is brought to their respective dairy units by solo milk tanker, where the milk is chilled. Milk is chilled to very low temperatures so that it last longer and does not perish. This is very important for milk storage, as it can be stored at very low temperatures only.



Pasteurization is a process where milk is churned at. high speed and sterilized by heating at high temperatures. Here the milk is made free from derived amount of fats, edible oils and also disease causing germs after pasteurization process. Chilling process takes place for longer storage of milk.

PACKAGING: It is a technique of using most appropriate container to protect, carry, identify and merchandise any product. Manufacturer desires his product to reach in safe delivery to the consumers through the various stages of ; manufacture, storage, transport, distribution and marketing. The packaging of any product is judged as follow: It must protect and preserve the commodity until it reaches the consumers. It must be suitable for selling and distribution system. It must attractive to the consumer. Easy to open, store and dispose. Reasonable in cost.


Many products are obtained from milk. They are: CREAM: It is obtained from cow or buffalo milk or of a combination there of

which separated from it by means of centrifugal force, where milk is rotated at the high speed with which, the cream moves away from the axis. This cream is generated during the rotation and is taken from the sides of the separator. Generally the fat content in the cream is of the 25% taken from the sides of the separator. Generally the fat content in the cream is of the 25%. BUTTER: Butter is a fat rich product containing about 80% of milk fats while the rest is a water, salt curd and also colour is added to some types of the butter and cooking butter. GHEE : It is the most important ingredient- in day life of nay Indian. Ghee is the pure clarified fat derived solely from milk or curd or from desibuytter or from cream to which no coloring or preservative is added. It is obtained by pre-stratification method i.e.. Rise in temperature of milk to I 10-120c. the shelf life is 6 months only. CHEESE: It is obtained by draining after coagulation of milk with a harmless milk cultures. It has a minimum of 42% of milk fat. The most common cheese used is the cheddar cheese. It is hard, ripened cheese made from pasteurized milk to which small amount of lactic is added. The shelf life of cheese is 4-6 months only.


FROZEN PRODUCTS: The most common frozen products that water one's mouth arc ice creams, kulfi and choc-bar. These are obtained from cow or buffalo milk or combination there of or from cream. They have 10% milk fat and are prepared with mixtures of dry fruits of nuts or both to have an excellent taste. These frozen products are cooled below 4c only. The shelf life of froze products l-2rnonths only.


PANEER: It is obtained from cow or buffalo milk or combination thereof by precipitation with sour milk and lactic acid. The milk fat content is a minimum of 50% of the product. KHOA: It is obtained from cow or buffalo milk or a combination there of by rapid drying. The milk fat content in a khoa is 20% product. DAHI : Dahi or commonly called curd is obtained from boiled milk by souring, natural or otherwise, by a harmless lactic acid or bacterial culture. DRIED MILK : It is milk powder, which is prepared by spray drying of fresh skimmed milk of cow or buffalo or a mixture thereof. It when mixed with water becomes milk. Its shelf life is up to a period of 9 months.


India is currently the second largest milk producer in the world after the USA milk production has increased from 23 m MT in the years 1972-73 to 58.6 m MT in 1992-93 i.e a rise of 150% over a period of 20 years, this phenomenal rise of the dairy sector in Indian can largely be attributed to the successful implementation of the "operation flood" program space under NDDB.

In AP major quantity of milk is procured from CHITTOR and VIJAYAWADA districts. During the 'FLESH' season (SEP-MAR) and 'LEAN' season (Apr-Aug) of every year, maximum and minimum amount of milk is respectively procured, Finally country's milk export is low due to exploitation of farmers and improper utilization of sources.



This chapter gives detailed information about the development availability under taken by Warangal Dairy and the existing management system of Warangal Dairy etc. It is also contains of a fries profile of Warangal Dairy. In Warangal districts around 60% of the population depends on agriculture of their livelihood. It also has a tourist with a range of 3.7 lakhs hectors. In Warangal district different types of cattle breed are found. There are certain types of buffaloes in the District, according to the Animal husbandry department. The buffalo living in Warangal are apart from production of milk, cattles are used for agricultural purpose. There is a Dairy plant in Warangal town and foremilk chilling centre, each at Thorrur, Mulugu, Narsampet and Jangaon. Their milk chilling centres collect milk from collection centres in the villages. The collected milk is chilled at the concerned chilling centre and it is transported to the Warangal Dairy. The processed milk at Warangal Dairy is marketed to the milk consumers in the tri-city of Warangal, Hanamkonda and Kazipet in the form of distribution. Warangal is considered as Municipal Corporation which covers the entire area of Warangal city and some sub urban areas like Hasanparthy etc., it covers there towns mainly Warangal, Hanamkonda and Kazipet. Warangal is considered the centre of trade while Hanamkonda was famous for Government offices and educational Institutions. The importance of Kazipet because of its being Railway Junction.



In Warangal District Organizational attempts to procure and distribute milk in the year 1968. Milk supply of farmers of Warangal District was formed in Organized Cooperative sector under the intensive milk supply scheme; these activities were looked alter by the State Government Department of agriculture and Animal Husbandry. Under this scheme a medium size of Dairy was sanctioned with a capacity of 12,000 litres per day, when the State Government has established the Dairy development in 1970. Warangal Dairy has bought under its shadow. Again when the state government established Andhra Pradesh Dairy Development co-operation limited (APDDC LTD) Warangal Dairy came under their control. The Government of Andhra Pradesh has decided to implement operation Flood-II Programme in the state. A.P.Organization structure of APDDCF Ltd., from 1981 onwards. At present Warangal is under the supervision and control of APDDCF Ltd. To meet the requirement of procedure as well as consumers in Warangal town, a bulk cooler is installed at that period with the installation of cooler, milk supply to the Warangal was started on 10th March 1969. The construction of building and

installation of plant and machinery was completed in 1971. Dairy opening ceremony was help on September 1971. It was speed over as area of 5 acres and 24 guntas. The cost of construction was more than Rs. 20 lakhs. An initial stage milk automatic bulk machine with a capacity of 5,880 bottle per hour was installed. In the year 1982 the pre packed machined was instandand milk is now being supplied in polythene sachets. At present there are two pre packed machines functioning each with a capacity of 5000


milk sachets per hour. The milk in Warangal is distributed through more than 100booth need over the tri-city of Warangal. In addition to this milk is also being supplied on credit to instructors like hospitals, hotel, Railways, canteen and Central Jail etc., Relating to this Warangal Dairy has there Dairy parlors for selling milk products like whole milk powder, ghee, butter, cheese etc.



Warangal Dairy Organization is using VIJAYA Brand labels to sell their products to the consumers wherein some other states, the Dairy federation is using AGMARK Brand to market their products. Warangal Dairy is a District level unit and all the policy decisions are taken at the head office level. Warangal unit is only a functioning unit, which operates the work to achieve the objection of Dairy federation.


To provide the good market for all rural as well as urban markets. To create awareness among Vijaya brand products like milk. Supply of pasteurized milk to the people of Warangal, Hanamkonda and Kazipet at reasonable price. To increase the sales by improving the quantity of Vijaya brand milk. To avoid the distance and convenience of customer. To educate people to buy milk (Vijaya) through advertisement and marketing. Fulfillment of social obligation.



Distribution of milk is done through three methods. They are Cash Sales method Advance Sales method Credit Sales method

The milk sales are being conducted in the tri-cities of Warangal, Hanamkonda and Kazipet through 98 booths is a Credit Institutions. The sales have reached now up to 15,000 litres per day. For prompting sales of company product the study of consumer behaviour is inevitable or compulsory. Marketing manager should take decisions

regarding. Brand, discount, packaging, commission, advertising policy, gifts, free samples etc., by studying consumer behavior.


Today APDDCF offers the widest spectrum of milk products in India, under the brand name VIJAYA. These include Ghee, Bhutter, Processed Cheddar, Chese and Cheese spread, UHT Milk, flavoured milk, slim milk in Tetra packets, sterilized Cream, Skim milk powder, Dairy Whitener, cooking butter and ice cream. Several among these carry the Agmark, an attestation of quality by Government of India and the ISI mark of Bureau of India standards. The brand VIJAYA denotes quality & quality, which makes it a trusted name in millions of house hold across the country. In addition, APDDCF also manufactures products such as sterilized favour milk, apnner, Doodh peda and Dairy parlours and a chain of retailers spread across Andhra Pradesh.



With a strong desire to develop the dairy industry in the state, involving the milk procedures in organizing the procurement production, processing and marketing of the milk produced in rural areas. For this purpose, the Government of Andhra Pradesh has taken a decision to convert the Andhra Pradesh Dairy Development Corporation Limited into Andhra Pradesh Dairy Co-operative Federation Limited (APDDCF LTD) on 5th September, 1981. For the administrative convenience of APDDCF its

organization structure formed into milk sheds in 25 Districts of Andhra Pradesh. Each milk shed is under the charge of a Joint Director or a Deputy Director.

State Level

Apex Body

District Level

APDDCF Milk Unions


Village Level


Milk Producers co-op societies

Three-tier Dairy Co-operative Structure

In Andhra Pradesh the Co-operative sector is having 3 tiers. It is having societies. Union and federations. They are,


At village level, milk producers Co-operative societies. At District level, milk producers Co-operative Unions. At State level Co-operative milk producers federation. Out of 23 Districts of Andhra Pradesh, Operating, Flood-II Programmed is being conducted in 16 districts. The 7 Districts, which are not covered under this program, are Adilabad, Karimnagar, Warangal, Khammam, Mahaboobnagar, Nellore and Ananthapur. This program cannot be adopted in these Districts because their daily procurement is less than 20,000 liters per day. Today, Dairy Industry in Andhra Pradesh has emerged as a powerful instrument of socio-economic change. There are 63 Dairy units in different parts of the state

including 48 milk chilling centres, 9 District Dairies and 6 milk product factories About 6,400 villages co-operative Societies are procuring milk from 11,900 villages among 286 routes. It is estimated that 5 lakhs milk producing families and 24 lakhs consumers are benefited by the activities of the APDDCF. The dairy Industries concentrating on increasing the procurement was 636 lakh liters. It is increased to 2.52 lakh liters in the year 1985-1986 and it has increase enormously in 1992, 1993 to the effort of 8,000 lakh liters per day. In the present year 2006-07, the dairy industries concerning on the

increasing procurement was above 50, 000, 00 lakh liters per day.


S.No 1 Brands Vijaya No. of Respondents 35 % of Respondents 35% 49

2 3 4

Jersey Mulkanoor Others Total

15 40 10 100

15% 40% 10% 100%

Others 10% Vijaya 35%

Mulkanoor 40% Jersey 15%

The above graph depicts that majority of respondents (40%) are prefer the Mulkanoor, 35 of respondents are preferring Vijya Milk.



S.No 1 2 3 4 Attributes Milk Vendors Milk Dealers Retail Stores Others Total No. of Respondents 35 20 45 0 100 % of Respondents 35% 20% 45% 0% 100%

Others 0% Milk Vendors 35% Retail Stores 45%

Milk Dealers 20%

From the above graph, it is observed that 45% of respondents are buying the Milk from Retail stores, 35% are buying the Milk from Milk Vendors.



S.No 1 2 3 Attributes Loose Milk Packet Milk Both Total No. of Respondents 35 48 17 100 % of Respondents 35% 48% 17% 100%

Both, 17 Loose Milk, 35

Packet Milk, 48

The above graph shows that 48% of respondents are buying the milk in Packet form, 35% of respondents are in Loose Milk.



S.No 1 2 3 CHANNELS Advertisement Retail Stores Neighbors / Friends Total No. of Respondents 0 75 25 100 % of Respondents 0% 75% 25% 100%

Advertisemen t Neighbors / 0% Friends 25%

Retail Stores 75%

From the above graph, it is known that 75% respondents are came to know about Milk from Retail Stores, 25% of respondents are came to know by Neighbor/Friends and Advertisement.



S.No 1 2 3 4 Attributes Lit 1 Lit 1 Lit 2 Lit Total No. of Respondents 45 35 8 12 100 % of Respondents 45% 35% 8% 12% 100%

2 Lit, 12 1 Lit, 8 Lit, 45

1 Lit, 35

The graph indicates that 45% of respondents are consuming Ltr Milk, 35% of respondents are consuming 1 Ltr Milk.



S.No 1 2 3 4 Attributes Margin Quantity Demand Brand Image Total No. of Respondents 35 30 10 25 100 % of Respondents 35% 30% 10% 25% 100%

Brand Image, 25 Margin, 35

Demand, 10

Quantity, 30

The graph depicts that 35% of respondents are compelled to buy the Milk by Margin as main attribute, 30% of respondents are Quantity as main Attribute.



S.No 1 2 Options Yes No Total No. of Respondents 65 35 100 % of Respondents 65% 35% 100%

No 35%

Yes 65%

The graph depicts that 65% of respondents are willing to continue the Vijaya Milk forever, 35% of respondents are not willing to continue the Vijaya Milk.



S.No 1 2 3 4 Opinion Excellent Good Average Poor Total No. of Respondents 15 35 45 5 100 % of Respondents 15% 35% 45% 5% 100%

Poor 5%

Excellent 15%

Average 45% Good 35%

The above graph shows that 45% of respondents are saying Quality of Vijaya Milk is Average, 35% are saying well.



S.No 1 2 3 4 Attributes Tea/Coffee Feeding Children Curd All Total No. of Respondents 45 30 15 10 100 % of Respondents 45% 30% 15% 10% 100%

All 10% Curd 15%

Tea/Coffe e 45%

Feeding Children 30%

The graph depicts that 45% of respondents using the milk for the purpose of Tea/Coffee, 30% are for the purpose of Feeding Children.



S.No 1 2 Options Yes No Total No. of Respondents 65 35 100 % of Respondents 65% 25% 100%

No 35%

Yes 65%

Graph shows that 65% of respondents are saying that advertisement plays a role to promote the milk brands, 35% are saying no.



S.No 1 2 Options Yes No Total No. of Respondents 20 80 100 % of Respondents 20% 80% 100%

Yes 20%

No 80%

The graph shows that 20% respondents are facing the problem while consuming of Milk, 80% of respondents are not facing any problem.



Opinion YES NO Total IF YES No. of Respondents 95 05 100 % of Respondents 95% 05% 100%

Table 3.12(2)
Opinion Jersey Mulkanoor Others Total No. of Respondents 30 50 20 100
NO 5%

% of Respondents 30% 50% 20% 100%

Y ES 95%

Others, 20 Jersey, 30

M ulkanoor, 50

The above graphs depicts that 95% respondents are changing their brand and they will prefer 50% Mulkanoor and 30% of respondents will prefer Jersey.



S.No 1 2 Reasonable yes No total respondents 75 25 100 percentage 75% 25% 100%

No 25%

yes 75%

Most of the people i.e, 75% of people accepted that Vijaya milk price is reasonable.25% of the people dont accept the price of Vijaya milk.



S.No 1 2 3 4 Change Options Quantity Quality price Service Total No. of Respondents 0 10 15 75 100 % of Respondents 0% 10% 15% 75% 100%

Quantity Quality 0% 10% price 15%

Service 75%

Most of the people i.e, 75% people want changes in Vijaya milk product,15% of the people want change in price of Vijaya milk.


Majority of the respondents are using packet milk. Most of the respondents are prefer to purchase Mulkanoor. Majority of the respondents are consuming milk for tea/coffee and feeding children. Maximum no of respondents consume liter milk. Most of the respondents are preferring packet milk. Maximum of the respondents are aware of vijaya milk through kirana, general stores and neighbors. Most of the respondents accepted that vijaya milk price is reasonable. Most of the respondents feel that vijaya milk is having quality. Majority of the respondents change their brand when vijaya milk not available in the market. Majority of the respondents want changes in vijaya milk product


1. Vijaya Dairy should concentrate more on quality to improve the sales of product. 2. The Organization should improve the sales of product, more advertising can be

3. Look out for strategies, which will help in being different from the competitors like

having catchy PUNCH LINES which could attract the customers

4. The Vijaya Dairy should improve on availability and distribution of milk 5. The Organization can provide the milk booths to convince the customers in

different locality.
6. As Mulkanoor is consumed by many people so the Vijaya Dairy Milk should

maintain some strategies to improve the Sales in market. 7. Print date of packing on the sachets in order to discourage the supply of old stock



Dear Respondent,


1) WHICH IS THE BRAND OF MILK YOU PREFER TO PURCHASE? a) b) c) d) Vijaya Dairy Jersey Mulukanooru Other

2) HOW DO YOU GENERALLY BUY THE MILK? a) Milk Vendors b) Milk dealers c) Milk booths 66

3) IN WHICH FORM YOU WOULD LIKE TO BUY YHE MILK? a) Loose milk b) Packet milk c) Both

4) HOW DO YOU CAME TO KNOW ABOUT VIJAYA BRAND MILK? a) b) c) d) Advertisements General Stores Neighbors Others

5) HOW MUCH QUANTITY OF MILK DO YOU CONSUME DAILY? a) b) c) d) Liter 1 Liter 1 1/2 Liter 2 Liter


7) DO YOU PREFER TO BUY THE VIJAYA BRAND FOR EVER? a) Yes b) No 8) IF YES/NO PLESE GIVE REASON ____________________________________________________________


b) Good c) Average d) Poor

10) FOR WHICH PURPOSE DO YOU CONSUME THE MILK? a) b) c) d) e) Tea / Coffee Feeding Children Curd All Other

11) DO YOU THINK ADVERTISING PLAYS ANY ROLE IN PROMOTING MILK BRANDS_______ a) Yes b) No 12) IF YES IN WHAT WAY ____________________________________________________________ 13) IS THE PRICE OF THE VIJAYA MILK IS REASONABLE? (A)Yes (B) No

14). DO YOU NEED ANY CHANGES IN VIJAYA PRODUCT? (A)Quantity (C)Price (B) Quality (D) Service



16) IF YES, PLEASE GIVE REASON / WHAT TYPE OF PROBLEM? ________________________________________________________________ ___

17) IF VIJAYABRAND IS NOT AVAILABLE IN YOUR AREA, THEN WILL YOU CHANGE YPUR BRAND? (A)Yes (B) No 18) IF YES WHICH BRAND DO YOU PREFER? (A) Swakrushi (B) Thirumala (C) Vyshnavi (D) Telangana (E) Mulkanoor (F) Others

19) PLEASE OFFER ANY SUGGESTIONS TO IMPROVE THE QUALITY AND SALES OF VIJAYA BRAND MILK? _____________________________________________________________ ____


1. Philip Kotler, Marketing Management, Pearson Publishers, 12th Edition, New Delhi. 2. Leon Schifman & Lesile Lazer Kanulk, Consumer Behavior Eastern Economy Edition Publishers 8th Edition, New York. 3. C.R. Kotari, Research methodology, Kalyani publishers, New Delhi, 1972.

4. S.J. Bedker and G.C. Berry, Marketing Research 1st Edition, Oxford University.


References : www.apdairy.com www.nddb.com www.apddcf.govt.in


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