Вы находитесь на странице: 1из 45

CHAPTER 5

ORGANISATION PROFILE
5.1 Introduction –
For the study five dairy organizations were selected. The detailed information
regarding the marketing policies viz. product, price, promotion and distribution
policies of the dairy units were collected by the discussions with the Managing
Director, Marketing Managers and Assistant Marketing Managers of these
organizations.

5.2 Kolhaupur Zilla Sahakari Dudh Utpadak Sangh Ltd.

5.2.1 Introduction –

The Kolhapur Zilla Sahakari Dudh Utpadak Sangh Ltd., Kolhapur


was established on 16th March 1963 under Co-operative societies Act. It started
with collecting 700 liters of milk per day from 22 primary co-operative societies.
The basic function of the sangh was to procure the milk and supply it to the
government dairy which was located in Tarabai Park, Kolhapur.
In 1978, the National Dairy Development Board included Kolhapur
District under Operation Flood area. The project was financed by NDDB. Under
this project a 2-lac liters / day capacity dairy plant was constructed at Gokul
Shirgaon, Kolhapur. At Gadhinglaj and Bidri chilling centers of 75,000 & 50,000
liters /day capacity were also constructed under the project.
In 1985, the Government milk scheme, Kolhapur was handed over to
Kolhapur Zilla Sahakari Dudh Utpadak Sangh. During 1985 the average milk
procurement was 1,14,836 liters/day with 676 village level primary co-operative
societies. The production of milk in Kolhapur Zilla Sahakari Dudh Utpadak Sangh
started in 1985 and after one year the production of milk products was started. The
chilling centers were established at Lignnur, Borewadi, Tawarewadi and Gogave
having capacity of 1.25LLPD 1.00 LLPD, 1.00 LLPD & 0.50 LLPD respectively.
In 1987 packing unit, having a capacity of 4.00 LLPD was constructed at Vashi
Mumbai. In 1993, another packing unit of capacity 0.50 LLPD was started in
Manjiri (Pune).

98
The milk handling capacity of the Kolhapur Zilla Sahakari Dudh
Utpadak Sangh & chilling centers is 10.75 LLPD. Dudh Sangh covers 3499 village
level dairy co-operative on 210 milk routes for milk procurement. Milk & milk
products are sold under the brand name ‘Gokul.’ The Kolhapur Zilla Sahakari Dudh
Utpadak Sangh is also popularly known as Gokul.
Under guidance and assistance from NDDB & FAO, Gokul implemented
a quality management system, in order to improve the quality of its output. Gokul is
IS/ISO, 9001:2000 and IS: 15000:1998 certified dairy unit. It is also Quality
management and food safety system certified dairy, which is accredited by Export
inspection council.
Dudh sangh has won 12 national awards. Prominently, the first one
was in the year 1988-89 in the category of best Milk Product plants. The second,
for the year 1992-93 in the category of outstanding liquid milk plant. The third
and Fourth was in the year 1993-94 in the category of best Dairy processing
industry and best dairy development and public sector. It has received National
recognition in 1994-95 by winning NPC Award along with two national awards
for best performance in animal feed processing.

Installed plant capacity of the Gokul dairy is given considering Gokulshirgaon plant,
Lingnur chilling Centre, Gadhinglaj, Borawade chilling Centre, Bidri, Tawarewadi
chilling Centre, Chandgad, and Gogavave chilling Centre, Shahuwadi.
Table 5.2.1 Installed plant Capacity –

Plant Capacity (LLPD)


Gokul Dairy Plant, Gokulshirgaon 7.00
Lingnur chilling Centre, Gadhinglaj 1.25
Borawade chilling Centre, Bidri 1.00
Tawarewadi chilling Centre, Chandgad 1.00
Gogavave chilling Centre, Shahuwadi 0.50
(LLPD - Lakh Liters per day)
(Source: Kolhaupr Zilla Sahakari Dudh Utpadak Sangh Ltd., Kolhapur)

99
Manufacturing capacity of different products by Gokul is given in the following
table.

Table 5.2.2 Products Manufacturing Capacity

Product Capacity
Skimmed Milk Powder 41 MTPD
Butter 24 MTPD
Ghee 06 MTPD
Table Butter 03 MTPD
Shrikhand 01 MTPD
Curd 02 MTPD
Paneer 01 MTPD
Lassi 02 KTPD
(MTPD - Metric Ton per day)
(Source: Kolhaupr Zilla Sahakari Dudh Utpadak Sangh Ltd., Kolhapur)

Milk packing capacity of Gokul at Gokul Dairy, Washi, and Pune are given as
follows.
Table 5.2.3 Milk packing Capacity

Plant Capacity (LLPD)


Milk Pouch Packing - Gokul Dairy 1.00
Milk Pouch Packing - Washi (Mumbai ) 4.00
Milk Processing capacity - Washi (Mumbai) 1.00
Milk Pouch Packing - Manjari (Pune) 0.50
(LLPD - Lack Liters per day)
(Source: Kolhaupr Zilla Sahakari Dudh Utpadak Sangh Ltd., Kolhapur)

5.2.2 Objectives –

1) Development of infrastructure for the procurement of milk in rural areas to


ensure an assured market for milk producers through out the year, as well as to
offer the best remunerative prices.

100
2) Fulfill the growing needs for milk & milk products of the consumers in
Maharashtra and other territory.
3) Supplement the programme extension & inputs, with particular reference to feed
& fodder production and implement an intensive, breeding programme for milk
animals to increase milk production.
4) Imparting training for developing human resource at rural level for effective
leadership. Management skill and improvement of service to rural milk
producers.
5) Running co-operative development cell to increase awareness and to herald
active women participation for better management of co-operatives and their
positive role in democratic setup.

5.2.3 Extension Activities –


As mentioned in objectives Dudh sangh provides many extension activities as
follows -

1) Cattle Feed Plant -


Kolhapur Zilla Sahakari Dudh Sangh started the production of cattle
feed to meet nutritional requirement of the animals in the year 1982. In the
beginning the capacity was 100 MT which was expanded to 200 MT per day.
The cattle feed is marketed under the brand ‘Mahalaxmi’.
2) Gokul Gram Vikas Yojana -
In 1990 with the help of NDDB, Dudh Sangh implemented Gokul
Gram Vikas Yojana. From 1994, Dudhsangh conducts this programme. This
programme covers Women’s education, Member education, management
committee training, secretary training, Procurement & input training, Youth
group discussion, Women group Discussion, leadership development, Refresher
course etc. Recently, it has also included adoption for villages for development.
Initially, 175 villages were the beneficiaries. This number has now risen to
1027.

101
3) Dairy Business & Animal Husbandry Training Centre -
From 1984, Dudh Sangh has started the training centre for its
members and employees. Training regarding the various aspects of dairy
business such as accounting, management, milk testing etc. is provided.
4) Preventive & clinical veterinary services -
A team of 45-trained veterinary graduates operating from 33 different
locations in the district is catering to the preventive farmers. Each veterinarian
looks after about 10 villages and provides these services round the clock at the
farmer’s doorsteps.
It also provides breeding services. Dudh sangh has established 240
artificial insemination centers in its operational area. All the necessary inputs to
these centers such as liquid nitrogen, semen, sheath, cryogenic containers are
made available by the Dudh sangh.
5) Milkotester -
In order to ensure high quality of raw milk received from the villages,
Dudh sangh has supplied Milko Testers to the village Dairy Co-operatives. The
milko Testers are electronically operated machines to determine the fat
percentage of the milk. The milk supplied by every individual milk producer is
tested before acceptance and the payment is made based on the quality of milk.
The Dudh Sangh gives the subsidy of Rs. 3000 /- per milkotester.
6) Fodder Development -
Availability of sufficient quantity of good and nutritious fodder is
essential prerequisite for sustained milk production milk. In view of this, a
team of four agricultural graduates with the assistance of five supervisors is
working under fodder development section of the union. Under this programme
seeds of improved fodder varieties are distributed at 25 % subsidized cost.
About 10 tones of folder seed are distributed annually.
7) HRD Programme -
Quality of the work put out by the individual staff member depends
upon his technical competency as well as his attitude towards working. These
courses are conducted at various levels from workers to managerial cadre.

102
5.2.4 Marketing Organization –
In 1988, Dudh sangh started liquid milk marketing in Mumabi.
Initially the sale was 16,000 LPD. To meet the requirements of different
customers four different varieties of milk, Viz Classic (Buffalo) milk, Cow milk,
Tonned milk & Double tonned milk are marketed in Kolhapur , Pune, Mumbai
and other parts of Western and Southern Maharashtra. In Mumbai the total sales
is 3,50,000 LPD and in rest of the areas sales is 1,10,000 LPD. Along with the
liquid milk, Gokul is involved in marketing of the Ghee, Shirkhand, Milk
Powder, Paneer, Butter and dahi.

Figure No. 5.2.1


ORGANIZATION CHART
Board of Directors

Managing Director

Administrative Account Purchase Marekting Labour Welfare Dairy


Dept. Dept. Deptt. Dept. Dept. Dept.

Asst. General Manger Asst.General Manger


(Vashi, Mumabi)

Marketing Manager

Senior Officer (1)

Officers (3)

Clerks (26)
(Source: Kolhaupr Zilla Sahakari Dudh Utpadak Sangh Ltd., Kolhapur)

103
5.2.5 Product Policy -
Kolhapur Zilla Sahakari Dudh Sangh offers a variety of milk & milk
products.

Figure 5.2.2
PRODUCT MIX

Milk Shrikhand Ghee MilkPowder


(Product Line 1) (Product Line 2) (Product Line 3) (Product Line 4)

Full Cream Milk Shrikhand Ghee (Buffalo)


Tonned Milk Shrikhand (Elaich) Ghee (Buffalo)
Tonned Milk Mango Shrikhan Ghee (Cow)
Double Shrikhand Fruit
Tonned milk

Lassi Dahi Butter Paneer


(Product Line 5) (Product Line 6) (Product Line 7) (Product Line 8)

Cooking Butter
Table Butter
(Source: Kolhaupr Zilla Sahakari Dudh Utpadak Sangh Ltd., Kolhapur)

Gokul operates over eight product lines. Milk is available in


polythene bags and in 500 ml, and 1-liter packs. The depth for product line 1 is
seven. Shrikhand is available in polythene bags and cups. It is available in 100
g, 250 gm, and 500 gm sizes. The depth for product line 2 is nine. Ghee is
available in polythene gabs and jars. It is available in 200 ml, 500 ml, and 1
liter, 5 liter and 15-liter sizes. The depth for ghee is 12. Milk powder is
available in polythene bag and carton. It is available in 100 gm, 500 gm, and 1
Kg packs. Its depth is four. Paneer is available in only 200 gm pack Table butter

104
is available in 100 gm and 500 gm carton. Cooking butter is available in 500 gm
carton. Lassi is available in 200 ml polythene bag. Dahi is available in 200 gm
and 400 gm packs.
Market area covered by Gokul is Kolhapur, Mumbai, Pune, Sangli,
Satara, Ratnagiri, Kokan, Goa, and Belgaum. They export mainly butter & milk
powder to Middle East and Europe.

5.2.6 Pricing Policy -


Gokul offers the milk and milk products to the customers at
competitive price. The price of the milk is decided based on the fat content. For
milk, the dairy association decides the prices. Therefore, the milk prices are
same as that of the competitors. For milk products, there is the price war in the
industry and price is used as the major promotional tool. Price discounts are
offered to the wholesale buyers.

Table 5.2.4 The prices of the different products as on Dec. 2008

Product Rs. Per lit./ Rs.per kg.


Full Cream Milk 30.00
Tonned milk 19.00
Shrikhand (Ellichi) 80.00
Mango Shrikhand 92.00
Shrikhand Fruit 70.00
Ghee (Buffalo) 200.00
Ghee (Cow) 200.0
Milk Powder 164.00
Paneer 135.00
Table Butter 170.00
Lassi 30.00
Dahi 45.00
(Source: Kolhaupr Zilla Sahakari Dudh Utpadak Sangh Ltd., Kolhapur)
The prices of the milk in Satara, Pune, Mumbai & Kokan region are slightly higher
because of the additional transportation cost.

105
5.2.7 Promotional Policy -
As Gokul is the oldest dairy in the area, they have maintained the
good public relations. By providing the extension service to the milk producers,
they have earned goodwill in the market. In promotion mix, they depend more
on public relations & publicity. In Gokul they don’t have their advertising
department. They rely on the outside advertising agency for preparing the
advertisement messages and for media buying. The annual advertising budge is
Rs. 60/- Lakh. For setting advertising budget, they use affordability method.
For advertising their products, they use radio newspapers, local TV channels,
Point of purchase material, as the advertising medias. In sales promotion
strategy, they sponsor the local events. They place an advertisement in a
particular media depending upon the media availability. At the time of festivals,
generally they advertise the products.

5.2.8 Distribution Policy -


Gokul has developed a strong distribution network. Gokul distribute
the milk and milk products in Kolhapur, Sangli, Satara, Pune, Mumbai,
Belguam, Goa, Kokan. They have total 450 distributors. Distributors make an
advance payment in the bank and place an order. Packaged milk is send to the
distributor late in the night or early in the morning. Milk is send to the distributor
from manufacturing unit in insulated vans. For Kolhapur region, they have 20
insulated vans. Distributor’s sale the milk and milk products directly to the
customers or to the retailers. Pasteruised Milk is transported to Vashi, Mumbai
Plant, there it gets packed and then it is send to the distributors for sale. The
sales of milk is more in Mumbai and Kolhapur The cost of distribution in
Kolhapur is 40 paisa/liter, Sangli & Satara it is 50 paisa/liter, in Pune it is 80
paisa/liter & in Mumbai Rs. 1/ liter.
Whereas milk products are send to the distributors depending upon
the requirements and payments are made by the distributors after taking the
delivery of the products. Their wholesale buyers are other co-operative and
private dairy units, MNC’s. They also sale milk products directly to the
individual customers in bulk quantity as per the orders.

106
Gokul conducts environmental analysis on regular basis. They
conduct customer surveys as well as distributor or retailer surveys to understand
the market situation. They have implemented marketing information system for
the use of decision-making purpose. Their major competitors include warana
milk, Sphurti Products, Yalgud milk, Amul. Their marketing strategy is based
on the customer satisfaction.
Gokul is involved in many extension activities and extending corporate social
Responsibility towards milk producers, employees and society as a whole.
Through its regular market surveys, they found the social changes are taking
place, viz. the customers are becoming more health and hygiene conscious, they
use various packaged milk products at the various occasions, and the
consumption for milk product has increased.

5.2.9 Annual Production of milk and milk products


Milk and milk products annual production of Gokul from the year 1991 to 2009 is
given in the following table.
Table 5.2.5 Annual Production of milk and milk products

Year Milk (Lac Shrikhand Table Ghee Milk Butter


lit) (M.T.) Butter (M.T.) Powder (M.T.)
(M.T.) (M.T.)
1991-92 988 - - - - -
1992-93 1246 - - - - -
1993-94 1297 - - - - -
1994-95 1353 - - - - -
1995-96 1420.51 - - - -
1996-97 1597.52 142.62 33.64 302.55 2307.67 2436.45
1997-98 1597.52 94.60 53.43 349.26 1737.74 2140.82
1998-99 1627.79 87.60 69.86 395.50 1497.57 2078.33
1999-00 1545.20 48.3 33.2 370.5 1461.1 2440.3
2000-01 1658.13 44.0 35.3 209.0 1393.0 1862.4
2001-02 1844.28 53.8 22.8 275.7 3110.3 3522.3
2002-03 1902.88 45.4 20.5 432.7 2717.7 3342.7

107
2003-04 1839 30.0 97.0 471.0 1856.0 2604.0
2004-05 1892 35.0 102.0 408.0 1597.0 2558.0
2005-06 1909 64.0 76.0 333.0 1623.0 2584.0
2006-07 1946 85.00 703.0 327.0 2077.0 2338.0
2007-08 1784 88.00 187.0 396.0 3221.00 3390.0
2008-09 1860 116.0 497.0 328.0 2705.0 2719.0
(Source: Kolhaupr Zilla Sahakari Dudh Utpadak Sangh Ltd., Kolhapur)

Production of milk shows the increasing trend with some exception in 2003-04 and
2004-05. The production of Shrikhand has declined from 142.65 M.T. in 1995-96 to
44.0 M.T. in 2001-02. From 2002-03 it again started increasing. Production of
table butter shows increasing trend with some fluctuations. Ghee production was
almost constant over a period. Milk powder production has increased over a period.
Butter production level was also constant to some extent.

5.2.10 Annual Sales of milk and milk products.


Milk and milk products annual sale of Gokul from the year 1991 to 2009 is given in
the following table.
Table 5.2.6 Annual Sales of milk and milk products.

Year Milk Shrikha Table Ghee Milk Butter Total


(Lac lit) nd Butter (M.T.) Powder (M.T.) sales
(M.T.) (M.T.) (M.T.) (M.T.)
1991-92 988 - - - - - 988
1992-93 1246 - - - - - 1246
1993-94 1297 - - - - - 1297
1994-95 1353 - - - - - 1353
1995-96 1373.05 - - - - - 1373.05
1996-97 1374.08 130.17 36.45 292.29 973.40 2211.00 1410.5
1997-98 1504.26 101.92 52.62 328.39 1812.69 1330.0 1540.5
1998-99 1578.30 87.60 67.93 392.87 1043.54 1807.0 1612.26
1999-00 1565.02 42.4 30.2 370.3 1182.0 1203.0 1593.29

108
2000-01 1617.93 42.4 34.3 211.7 457.9 1171.0 1637.08
2001-02 1571.40 55.5 23.6 289.9 1738.3 2564.0 1618.11
2002-03 1658.55 36.5 17.5 429.2 2943.1 3440.0 1727.22
2003-04 1806 30.0 89.00 471.0 1069.0 1503.0 1837.62
2004-05 1811 32.0 100.00 399.00 1281.0 2910.0 1858.22
2005-06 1885 56.0 75.0 363.00 513.0 1235.0 1907.42
2006-07 2086 76.0 647.00 327.0 348.0 1262.0 2112.6
2007-08 2157 83.0 216.0 396.0 1247.0 1712.0 2193.54
2008-09 2256 110.0 517.0 328.0 1698.0 3059.0 2313.12
(Source: Kolhaupr Zilla Sahakari Dudh Utpadak Sangh Ltd., Kolhapur)

Graph 5.2.1 Annual Sales of milk and milk products.

Sale of milk has shown an increasing trend with some fluctuations. Sales of
Shrikhand declined from 1996 to 2001 & again from 2002 it has increased with
some fluctuations. Sales of table butter vary over a period. Ghee Sales have
shown an increasing trend over a period. Sales of milk powder increased from
1996 to 2009. Sales of butter have also increased with some variations over a
period.

109
5.2.11 Promotional Expenditure –
Annual promotional expenditure of Gokul from the year 1991 to 2009 is as follows.
Table 5.2.7 Annual Promotional Expenditure

Sr. Year Promotional


expenditure (Rs.)
1 1991-92 1,200,000
2 1992-93 1,550,000
3 1993-94 1,600,000
4 1994-95 1,750,000
5 1995-96 2,010,000
6 1996-97 2,200,000
7 1997-98 2,450,000
8 1998-99 2,720,000
9 1999-2000 3,230,000
10 2000-01 3,300,000
11 2001-02 4,050,000
12 2002-03 4,150,000
13 2003-04 4,000,000
14 2004-05 5,010,000
15 2005-06 5,150,000
16 2006-07 5,550,000
17 2007-08 5,809,560
18 2008-09 6,000,000

Graph 5.2.2 Annual Promotional Expenditure

Table 5.2.7 shows that promotional expenditure has increased from 1991 to 2006.

110
5.3 Warana Sahkari Dudh Utpadak Prakriya Sangh Ltd; Warana
Nagar
5.3.1 Introduction -

Warana Sahkari Dudh Utpadak Prakriya Sangh Ltd; popularly known as


Warana Dairy was established in 1968, with the purpose of providing an additional
source of income to the farmers from the surrounding villages. The milk is collected
from 78 surrounding villages. The cost of milk procurement is 75 paisa. It also
collects milk from the Karnataka – Maharashtra boundary. 50% milk procurement is
from the Warana Milk and Milk Products and Warana Dairy & Agro that collects
milk from Solapur, Barshi, Karmala and Bhum. Daily milk procurement is 5,00,000
liters. This comprises of cow milk and buffalo milk. Dairy plant has a capacity of
10,00,000 liters. 50% milk is converted in milk products such as Shrikhand, Milk
Powder, Ghee, Cheese, Butter, Lassi etc.
Warana Dairy markets the milk & milk products in the various areas like
Kolhapur, Mumbai, Pune, Sangli, Miraj, and Ichalkaranji etc. It also sale the milk
and milk products to the Defence Department of Indian Government. Warana Dairy
has acquired the ISO 9001-2000 & HACCP Food safety Certificate. Warana Dairy is
also producing Bournvita, Drinking Chocolate & Coaco Powder for Cadbury India
Ltd; 60% of the total production of the Cadbury India Ltd’s Bournvita is produced in
Warana Dairy.

5.3.2 Sister Concern Organisations –


1] Warana Sugar Factory
2] Warana’s Distillery
3] Warana Paper Factory
4] Electricity Generation
5] Warana Education Society
6] WAGPCOS
7] Warana Mahila Udyog
8] Warana Poultry
9] Warana Co-operative Bank
10] Warana Bazar

111
5.3.3 Extension Activities –

[1] Cattle Feed Plant –


Warana Dairy has established a Cattle Feed plant to manufacture a
good quality cattle feed and to make it available to the milk producers at afforcable
price. It is distributed through primary milk societies.

[2] Distribution of Milko Tester equipments –


Milko tester is used to check the quality of milk at the time of the
milk collection. Warana Dairy distributes these milko testers to the primary milk
societies.

[3] Training Programmes –


Warana Dairy Organises various training programmes, workshops,
seminars for its employees, primary societies and members regarding the clean milk
production, dairy business etc.

[4] Veterinary Services –


Warana Dairy provides the Veterinary services to the milk producers
through the 27 centres. In addition, they provide the mobile van services. They
provide verterinary services at the subsidised cost with the help of 18 doctors and 45
Attendents.

112
Figure 5.3.1
Marketing Organisation Structure
Board of Directors

Chairman

Managing Director

GM Admn. GM Accounts GM Marketing GM Personnel

Sr. Officer Mkt. (2)

Sales Officer officer A/C Kolhapur Center Ichalkaranji Center

Sales supervisor (5) Clerk (3) Sales representative

Clerk (3) Salesman (2) Sales repre. (2)

Labour (24) Sales Asst. Salesman (2)

(Source: Warana Sahkari Dudh Utpadak Prakriya Sangh Ltd; Warana


Nagar, Kolhapur.)

5.3.4 Product Policy –


Warana Dairy produces milk and variety of milk products such as ghee, butter, milk
powder, shrikhand, cheese etc. The product mix of the Warana is as follows –

[1] Milk - Warana Dairy Produces standarsised, pasteurised milk & they sell it in
polythene packages in two sizes i.e. 500ml & 1 liter.

[2] Shrikhand - It produces three varieties of Shrikhand viz. Badam Pista


Shrikhand, Kesar Shrikhand & Mango Shrikhand. Badam Pista Shrikhand is

113
available in 50gm, 100gm, 250gm, 500gm and 1kg cup. Mango Shrikhand is
available in 100gm, 200gm cup & 500gm polythene packs.

[3] Tetra Pack Milk - Tonned milk and double tonned milk is available in one-
liter tetra pack. The milk is sterilised at high temperature and packed in tetra pack,
which can be stored for 120 days without refrigeration until opened.

[4] Milk Powder - Warana Dairy produces two types of milk powder viz. Skim
milk powder and full cream milk powder. It is available in 100gm, 500gm, 1 kg
polypacks and 25 kg in craft paper bag with inner polythene bag.

[5] Ghee - Ghee is available in two varieties i.e. buffalo ghee and cow ghee
which is, available in 200ml, 500ml, 1 liter polypack, 1 liter plastic jar, 1 liter and
15 liter Tin and 200ml and 500ml Box packing.

[6] Table butter - Table butter is available in 100gm, 500gm pack and 9.1 gm
chiplet.

[7] Paneer – Paneer is available in 200gm, 500gm and 1 kg poly packs.

[8] Cheese – Cheese is available in two varieties mozerella cheese & processed
cheese. It is available in 100gm, 200gm, 500gm and 1 kg polypacks.

[9] Dahi – Dahi is available in 100gm, 200 gm and 400 gm cup.

[10] Lassi – Lassi is available in 200 ml polybag.

[11] Flavoured Milk – Flavoured milk is available in four varieties viz. Chocolate,
Butter-skotch, Ice-cream soda and milk masala are sale in 200 ml bottle.

Sale of Milk, Shrikhand and Ghee is more in retail. In addition, sale


of skim milk powder, full cream milk powder and butter is more in wholesale.

114
5.3.5 Price Policy –
Warana Dairy follows cost based pricing policy. The total cost is calculated
& certain profit margin us added to arrive at a price, which is again, depends upon
competition. Warana Dairy do not use price as a promotional tool, if competitors
lowers its price structure, they believes that customers will purchase quality
products.
The prices of different products are as follows –

Table 5.3.1 Prices of different products

Products Quantity Price (Rs.)


Mango Shrikhand ½ kg. Poly Bags 37
100 gram cup 10
200 gram cup 18
500 gram cup 40
Skim Milk Power 1 kg Poly Pack 88
½ kg Poly Pack 45.50
100 gram Poly Pack 10.50
Kesar Shrikhand 250 gram cup 21.50
500 gram cup 41
Dahi 100 gram cup 4
200 gram cup 7
Mozzarella Cheese 1 kg Poly Bag 135
½ kg Poly Bag 67.5
Paneer 200 gram Poly Bag 21
1 kg Pack 101
Shrikhand – Badam – ½ kg Poly Bag 34
Pista
¼ kg Poly Bag 17.5
100 gram cup 9
250 gram cup 20.5
500 gram cup 39

115
Ghee 1 lit. tin 156
½ lit. tin 73
15 lit. tin 2160
200 ml. Poly Pack 30
500 ml. Poly Pack 68
Lassi 200 ml. Poly Bag 5
Process Cheese 100 gram Poly pack 15
200 gram Poly pack 30
500 gram Poly pack 74
Table Butter 100 gram packet 13
500 gram packet 62
(Source: Warana Sahkari Dudh Utpadak Prakriya Sangh Ltd; Warana Nagar,
Kolhapur.)

5.3.6 Promotion Policy -


For promotion of the milk and milk products, Warana Dairy relies on
advertisement. They have advertising department. They mainly display their
advertisements in newspaper, radio and television. They advertise the products in
Mumbai, Pune, Ratnagiri, Goa and local levels and use local Medias at each place.
They take help of advertising agency. In festival season, they advertise their
products heavily. Around 3 to 4, lacs rupees are spend monthly on promotional
activities. In 1991, their advertising budget was Rs. 33 lacs, which has increased
gradually up to 1.3 crore in 2007-08.
Along with the promotion, they use publicity as effective media for
promotion. As they are involved in innovative methods and new product launch,
they use newspapers for publicity. They also employ sales representatives for
persuading the distributors and retailers to push the Warana’s products. In flush
period, they offer discounts to the retailers as a push strategy. They are using the
attractive packs for butter, cheese, ghee, paneer that communicates with the
customers.
The important problem faced by Warana Dairy was the perishbility of milk
& milk products. To overcome this problem they have introduced tetra pack milk
which can remain fresh for 120 days without refrigeration. For long distance

116
markets, they use tetra pack milk. As they have an active marketing department,
they conduct environmental analysis through its sales representatives. They have
developed Marketing Information system, which collects information from all the
sources, provides it to the marketing manager. They are aware about their
competitor’s products. Their major competitors are Chitale Dairy, Sphurti products,
Gokul Dairy and Amul Dairy. The thrust of their marketing strategy is customer
satisfaction. Their future plan is to start Warana Dairy and Agro Industries a
multistate union for milk collection.

5.3.7 Distribution Policy –


Warana Dairy Distributes the milk and milk products through distributors
and retailers. They distribute the products in four states viz. Goa, Karnataka,
Maharashtra and Andharapradesh. In Karnataka, they cover Belgaum, Hubli,
Dharwad, Bagalkot, Vijapur area. In Andhra Pradesh, they distribute the products in
Hyderabad. In Maharashtra, they market their products in Mumbai, Ichalkaranji,
Sangli, Miraj, Mumbai, Pune, Aurangabad, Jalgao, Solapur.
Their distribution network is as follows –
Warana Dairy

Mumbai Region Local Area Other

Warana Dairy’s Retailers Distributors


Own Depo
(Packing unit) Consumer Retailer

Distributor Consumer

Retailer

Consumer
(Source: Warana Sahkari Dudh Utpadak Prakriya Sangh Ltd; Warana Nagar,
Kolhapur.)

117
In Mumbai Warana Dairy have their own depot. The milk and milk
products are transported in insulated vans and packed in the Mumbai depot. From
there it goes through the distributor and retailers to the customers. In local area, they
distribute milk and milk products through retailers. In other areas such as Sangli,
Ichalkaranji, Miraj, Pune, Aurangabad, Jalgao, they send the products to the
distributor. Distributor gives it to the retailes and retailers distribute the products to
final customers.
Warana Dairy has insulated vans for delivery of milk & milk
products, which they take on, hire basis.
The number of delivery vehicles is as follows-

Table 5.3.2 Number of delivery vehicles

Capacity No. of vehicles


8 ton 04
6 ton 03
4 ton 04
3 ton 02
(Source: Warana Sahkari Dudh Utpadak Prakriya Sangh Ltd; Warana Nagar,
Kolhapur.)

Along with these vehicles they have their own two small vehicles
which are used to distribute products in local areas. In addition, they have 12
insulated tankers, which are used for the distribution of milk. The cost of
distribution of milk at local level is 24 paisa / liter & it varies depending upon the
distance. On average, the cost of distribution of milk products is Rs. 1.50 per kg.
They have seven retail outlets. One retail outlet is situated in
Kolhapur, 4 retail outlets are in Mumbai and 2 retail outlets are in Ichalkaranji.
They provide point of purchase material such as boards, in shop
material to the retailers, to promote the products. Their wholesale buyers include the
other dairy units located in Hyderabad, which purchase skim Milk Powder, and
butter in bulk. In addition, they export their products in Gulf countries like Kuwait,

118
Saudi Arabia & Sharjah, African Countries, Bangladesh and China. Now they are
trying to export the milk products to US, UK, Russia, South Africa & Bahrain.
Mainly they export Skim Milk Powder, full cream milk powder and tetra pack milk,
Ghee, Cream. In 2007-08 they exported the products worth Rs. 35,75,000. Their
exports amount for 7-8 per cent of total sales. They also supply to the Indian army
through its Misamari and Tejpur depots, which are located in Assam. They supply
tetra pack milk, ghee and milk powder to Indian army.

5.3.8 Contribution of each product to sales-


Contribution of milk and milk products such as ghee, shrikhand, SMP, curd, butter,
cheese, paneer of Warana Dairy are given in the following table.
Table 5.3.3 Contribution of each product to sales
Year Milk Ghee Shrikhan Milk Dahi & Butter Cheese Paneer Total
(Lac (ton) d (ton) Powder Lassi (ton) (ton) (ton) Sales
lits) (ton) (Lacs
lit.)
1991-92 633 425 1023 612 730 - - 660.9
1992-93 499 510 1140 590 945 - - 530.85
1993-94 478 546 1168 826 1522 348 - 522.1
1994-95 473 552 1475 989 1493 543 - 523.52
1995-96 493 567 1602 953 2145 208 - 547.75
1996-97 557 799.2 1788 1328 2317 119 1 - 620.522
1997-98 558 694 2035 1602 2852 362 1.2 - 633.462
1998-99 599 647 2340 1499 2344 366 7.2 - 671.032
1999- 685 666 2204 1819 2334 301 8.4 - 758.324
2000
2000-01 643 625 2470 2033 2989 378 23 13 728.31
2001-02 721 742 2027 2695 3031 391 28 - 810.14
2002-03 781 920 2011 2521 2988 653 32 31 872.56
2003-04 791 1,030 1986 - 2566 578 16 41 853.17
2004-05 773 854 1940 1717 2226 203 26 66 843.32
2005-06 744 893 2307 5700 2508 1895 51 103 878.52
2006-07 870 1119 2260 5109 3048 1185 38 138 998.97
2007-08 1024 1452 2286 7156 3017 1764 60 233 1183.68
2008-09 934 1546 2679 4752 3308 2632 66 272 1086.55

(Source: Warana Sahkari Dudh Utpadak Prakriya Sangh Ltd; Warana Nagar,
Kolhapur.)

119
Graph 5.3.1 Contribution of each product to sales

Table 5.3.3 shows the sales of milk and milk products. Sales of milk as well as
milk products ghee, shrikhand, milk powder, lassi, dahi, butter, cheese, and paneer
has increased over the years from 1991 to 2008-09. Butter has introduced in market
in 1993-94. Manufacturing of cheese has started in 1996-97. Dahi production started
in 2000-01. Panneer production started in 2001-02. All the products are having the
up ward demand.

5.3.9 Promotional Expenditure –


Warana’s promotional expenditure from the year 1991 to 2009 is given in the
following table.
Table 5.3.4 Year wise promotional expenditure

Sr. Year Promotional


expenditure (Rs.)
1 1991-92 3,330,000
2 1992-93 3,600,000
3 1993-94 3,750,000
4 1994-95 3,900,000
5 1995-96 4,010,000

120
6 1996-97 4,070,000
7 1997-98 4,300,000
8 1998-99 4,700,000
9 1999-2000 5,100,000
10 2000-01 5,800,000
11 2001-02 6,420,000
12 2002-03 8,170,000
13 2003-04 9,630,000
14 2004-05 11,000,000
15 2005-06 11,350,000
16 2006-07 12,000,000
17 2007-08 13,000,000
18 2008-09 14,100,000

(Source: Warana Sahkari Dudh Utpadak Prakriya Sangh Ltd; Warana Nagar,
Kolhapur.)

Graph 5.3.2 Year wise promotional expenditure

Table 5.3.4 shows that promotional expenditure has shown an increasing trend from
the year 1991 to 2009.

121
5.4 Shri Hanuman Sahakari Dudh Vyavasaik and Krushipurak
Sewa Sanstha Ltd., Yalgud, Kolhapur

5.4.1 Introduction -
Shri Hanuman Sahakari Dudh Vyavasaik and Krushipurak Sewa Sanstha Ltd. was
established on 14th July 1967 primarily to collect milk from milk producers and to
supply milk to the government milk scheme. Its main objective is to aid and provide
assets in the form of milch animals to farmers and landless laborers to undertake
Dairy activities and to raise their standard of living in particular and of the village
population in general & to improve dairy industry and to increase milk production.
Currently 50 primary milk societies supply milk to Shri Hanuman
Sahakari Dudh Vyavasaik and Krushipurak Seva Sanstha Ltd; Popularly known as
Yalgud. 6000 to 7000 liters of milk is collected from these 50 societies. There are
total 797 members of the society. Milk procured by Yalgud is supplied to Kolhapur
Zilla Sahakari Dudh Utpadak sangh Ltd; (Gokul) as Yalgud is a primary society of
the Gokul. The 50 primary societies are located nearby Yalgud. They distribute
milk & milk products in Kolhapur, Ichalkaranji, Miraj, Nipani, Jat and
Kawathemahankal. Daily milk collection has increased from 5585 liters in 2003-04
to 7395 liters in 2008-09.

5.4.2 Sister Concern Organisations -


Its Sister Concern organisation includes –
a) Sahakar Maharshi Late Tatyasaheb Mohite Sahakari Lift Irrigation
Sanstha Ltd; Yalgud.
b) Shri Hanuman Sahakari Lift Irrigation Sanstha Ltd; Yalgud.
c) Shri Mahalaxmi Nagari sahakari Pat Sanstha Ltd; Yalgud.
d) Shri Govind Sahakari Poultry Vyavasaik Sanstha Ltd; Yalgud.
e) Shri Hanuman Grahak Sahakari Sanstha Ltd; Yalgud
f) Shri Sumangal Mahila Audyogik Sahakari Sanstha Ltd; Yalgud
g) Shri Hanuman Sahakari Vahatuk Sanstha Ltd;
h) Sahakar Ratna Vaantrao Mohite Sahakari Housing Society Ltd; Yalgud
i) Shri Swami vivekanand Charitable Trust, Yalgud

122
j) Shri Shetakari Sahakari Dudh Utpadak Sangh Ltd; Nipani – Chikodi.
k) Sahakar Ratna Vasantrao Mohite Krishi Abhivrudhi Sangh Ltd; Nipani
l) Sahakar Maharshi Tatyso Mohite Vikas Sewa Society Ltd; Yalgud
Yalgud has received financial assistance of Rs. 40.60 lakh for dairy
development from the National Co-operative Development Corporation, New Delhi.
In addition, they have received Rs. 20 lakhs as subsidy and concession in sales tax
for 6 years from Western Maharashtra Development Corporation, Pune under
special incentive scheme 1988 of Maharashtra. It has got food safety management
system certificate ISO 22000: 2005 for dairy products.

5.4.3 Facilities provided to members –


Yalgud provides free veterinary aid through qualified staff of the society to
all the producer members in the form of preventive medicines, artificial
insemination etc. The society provides financial assistance for purchasing improved
varieties of milk cattle to farmers and landless labourers to enable them to undertake
Dairy business & improve their economic conditions.

Figure 5.4.1 Organisation Structure

Chairman

Managing Director

Secretary

Accounts Marketing Production Purchase


Manager Manager Manager Manager

Marketing Marketing
Executives Executive

(Source: Shri Hanuman Sahakari Dudh Vyavasaik and Krushipurak Sewa Sanstha
Ltd., Yalgud, Kolhapur)

123
Marketing Policies -
Dairy products manufactured by the Yalgud are marketed in Kolhapur,
Sangli, Satara, Ratnagiri and Belgaum District through their retail outlets or through
the agency system.

5.4.4 Product Policy –


Yalgud under its dairy project offers milk and milk products to the
customers. They mainly involved in marketing of standardised pasteurised milk. In
milk products, they offer variety of products such as Shrikhand, Mango Shrikhand,
Basundi, Ghee, Lassi, Dahi, Paneer, flavoured milk, Pedhe, burfi, milk powder, ice
cream. The sale for milk is more in the product mix.
This is the one organised dairy unit in Kolhapur district, which offers
different traditional milk products to the customers such as pedha, burfi, khoa,
kunda, modak etc.

Figure 5.4.2 Product Mix


The product mix is as follows –
Yalgud (Dairy Project)

Milk Milk Products Ice-Cream


(Product line 1) (Product line 2) (Product line 3)
* Pasteurized milk * Shrikhand * Venilla
* Tonned milk * Amrakhand * Strawberry
* Double Tonned milk * Basundi * Pineapple
* Flavoured milk * Pedha * Pista
* High fat milk * Burfi (Khoa & Mango) * Mango
* Kunda * Trutifruity
* Cream * Butter scotch
* Loni * Chocolate
* Modak * Keshar Pista
* Ghee * Choco Bar
* Khawa * Mango Bar

124
* Chakka * Orange Bar
* Paneer
* Milk powder
* Lassi
* Dahi
(Source: Shri Hanuman Sahakari Dudh Vyavasaik and Krushipurak Sewa Sanstha
Ltd., Yalgud, Kolhapur)

The production of different milk & milk products–


Consistently they are manufacturing pasteurised milk, Sumadhur milk, Shrikhand,
Basundi, Pedha, Burfi & Ghee.In 1997-98 Yalgud started manufacturing
Amrakhand & till to date they are manufacturing it and getting good revenue. They
stop producing Kunda from 2002-03 because, the demand was continuously
decreasing. Manufacturing of milk powder and cream has started in 1995-96, which
are used as the ingredients in many other products. Since 1997-98, they started
producing Lassi and the figures shows that they have increased its production.
Between the periods of 1996-97 to 2005-06, they were manufacturing tonned and
double tonned milk but they stop it because the demand was fluctuating. From the
year 1994-95, they started production of ice cream in various flavors up to 1999-
2000 they increased continuously production but in 2003-04, they stopped
manufacturing ice cream, as many Indian as well as Multinational companies have
entered into the market with the variety of flavours & mixes with new technology
and they implemented aggressive marketing strategy. From 1991 to 2008 the sales
was high for milk and shrikhand.

5.4.5 Princing Policy -


For milk & milk, products Yalgud implements cost based pricing and competitive
pricing methods. At the first step, they calculate the total cost, then through market
survey, analyse the competitor’s price and then arrive at a price, which is same or
slightly higher than the prices of the competitors. They do not use price as a
promotional tool. They do not compromise for the quality. For milk, the prices are
same. For milk products, prices vary depending upon the market conditions.

125
5.4.6 Promotion Policy – Mainly they use advertisement and personal selling for
promotion of the milk & milk products. As they directly sell the products to the
retailers, the delivery person performs the task of personal selling. In addition, the
retailers work as the sales people. They use print media i.e. local newspaper and
magazine for advertising their products. The advertisements are prepared by the
advertising agency. There is no pre-determined advertising budget; they spend as per
the opinion of the management.

5.4.7 Distribution Policy - Yalgud mainly distributes milk & milk products in
Kolhapur, Miraj, Sangli, Satara, Ratnagiri, Nipani, and Belgaum. They market the
products directly through retailers. They have 224 retailers all over the market area.
They have their own 12 retail outlets in Kolhapur, Sangli and Nipani viz. Central
Bus stand, Dabholkar Corner, Bhaskar Plaza, Shahupuri, Takala Road, SIBER Road,
Shivaji Stadium, Tarabai Road, Shahu Naka, Kagal Bus stand etc.
The retailers place an order in Kolhapur Head Office and then these are
forwarded through internet to Yalgud Plant. Then the orders are directly delivered to
the retailers with the help of 17 delivery vehicles. They supply products regularly to
retailers through 10 regular routes in Kolhapur. In other areas through 7 routes on
alternate days.
They provide some small hoardings to the retailers. They supply fresh and
quality products to retailers in time. Yalgud do not export the milk and milk
products.
Yalgud do not have Marketing Information System. They conduct some
opinion surveys of their regular customers to assess their requirement. Their major
competitors are Gokul, Sphurti, and unorganised dairies. They are aware about their
competitor’s product and always compare their own products with competitor
products for quality improvement.

126
5.4.8 Sale of Milk and Milk Products –
Sale of different milk and milk products of Yalgud from 1991 to 2009 is given in the following table.
5.4.1 Sale of milk and milk products
Sr. 1991- 1999-
No. Products 92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 2000 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09
1 Shrikhand (kg) 32141 32123 53816 58102 69142 74680 61764 55206 63349 73016 61840 63202 60766 63328 63852 69948 76489 91881
2 Amrakhand (kg) - - - - - - 6707 9947 8751 13491 9780 12233 16940 19145 19674 22758 27510 35051
3 Basundi (kg) 15048 14322 21454 22604 22038 25616 31810 38004 41605 49601 41430 39442 36390 36919 42297 47228 5119 59118
4 Pedha (kg) 18008 13202 23504 30405 30634 33167 35023 39378 46456 44612 35391 29934 29559 30988 31717 37385 30541 31688
5 Khoa Burfi (kg) 1024 546 854 1184 795 1601 1041 1067 1154 1155 769 784 933 972 1109 1405 1324 1357
6 Mango Burfi (kg) 1072 530 1016 901 955 959 665 649 740 745 506 632 748 793 952 1189 1020 1289
7 Kunda (kg) 696 383 565 543 551 613 477 366 495 250 52 - - - - - - -
8 Milk Powder
(kg) - - - - 8085 12611 27271 6769 29959 20124 24578 25808 18796 13718 15544 23743 3634 -
9 Cream (kg) - - - - 1120 31428 63237 42481 101545 36803 33111 27436 37242 39825 34576 45303 25627 -
10 Loni (kg) - 1500 - - - 8249 20237 1300 18891 10126 14316 16304 15547 11915 13222 20699 3055 -
11 Modak (kg) - - 280 311 492 759 1365 1847 1901 1901 1754 1714 2063 1685 1636 1389 1407 1938
12 Ghee (kg) - 5510 9186 4247 7542 25301 36063 21477 43097 14461 19324 17007 15373 15517 15820 13490 15066 13042
13 Milk Mithai (kg) 149 181 - - - 127 - - - - - - - - - - - -
14 Khawa (kg) 61 - 173 - 325 3612 3918 3398 - - - - - - - - - -
15 Chakka (kg) 41 - - - 284 1440 2222 2134 - - - 35 35 - - - - -
16 Malai Paneer
(kg) - - - - - - - - - - - - 531 1174 2018 2430 2607 2945
Toatal (kg) 68240 68297 110848 118297 141963 220163 291800 224023 357943 266285 242851 234530 234923 235979 242417 280967 239399 238309
17 Sumadhur Milk
(200ml) lit. 68110 43463 68892 76325 92046 94383 85574 82671 88833 90363 71590 68643 78137 81955 83744 89208 96774 97852
18 Lassi (200ml) lit. - - - - - - 2990 30404 40383 70371 35197 39309 52232 54818 57352 66638 63076 65175

127
19 Scheme milk
(lit.) - - - - - 259315 594510 410775 865443 307554 272690 226609 308415 275455 299071 423502 256574 -
Total conversion 68110 43463 68892 76325 92046 353698 683074 523850 994659 468288 379477 334561 438784 412228 440467 579348 416424 163027
(lit)
20 Pasteirised
milk(lit.) 957740 1250146 1653349 1513776 1467988 2071323 1806850 1784678 1450018 1191847 1078862 1016207 1274938 1377489 1539493 1408740 1407641 1615293
21 Tonned milk (lit.) - - - - - - - 562710 694234 264964 23480 2968 22418 94904 29822 - - -
22 Double Tonned
milk (lit) - - - - - 397173 1785745 1457731 1324494 732680 83129 103453 93402 - - - - -
23 Dahi (lit) - - - - - - - - - - - - - 9789 16291 14368 15507 20043
Total (lit.) 957740 1250146 1653349 1513776 1467988 2468496 3592595 3805119 3468746 2189491 1185471 1122628 1390758 1482182 1585606 1423108 1423148 1635336
24 Ice cream (lit) - - - 6166 13919 13004 14597 8927 9125 5230 5308 7223 1953 - - 107 - -
Total per Annum 1E+06 1361906 1833089 1714564 1715916 3055361 4582066 4561919 4830473 2929294 1813107 1698942 2066418 2130389 2268190 2.3E+07 2078971 2036672

128
From the table 5.4.1, it can be inferred that sales of milk and all milk products has
gradually increased from 2001-02 to 2008-09.

Graph 5.4.1 Annual Total Sales

5.4.9 Promotional Expenditure –


The promotional expenditure of Yalgud from 1991 to 2009 is as follows –
Table 5.4.2 Year wise promotional expenditure

Year Promotional Expenditure (Rs.)

1990-91 28,088
1991-92 34,861
1992-93 61,954
1993-94 1,63,810
1994-95 1,47,294
1995-96 2,43,070
1996-97 2,73,368
1997-98 2,17,630
1998-99 2,40,626

129
1999-2000 1,89,134
2000-01 2,10,748
2001-02 2,38,375
2002-03 2,42,394
2003-04 2,69,045
2004-05 3,53,917
2005-06 2,23,309
2006-07 2,21,068
2007-08 1,46,539
2008-09 3,03,734

(Source: Shri Hanuman Sahakari Dudh Vyavasaik and Krushipurak Sewa Sanstha
Ltd., Yalgud, Kolhapur)

Graph 5.4.2 Annual Promotional Expenditure

Table 5.4.2 shows that the promotional budget has grown steadily from 1991-92 to
2008- 09.

130
5.5 Bharat Dairy-

5.5.1 Introduction –

Mehta brothers started Bharat Dairy in 1947. It is a family owned business.


At the initial stage, Mehta has served for the other dairy units for 2 years. Then they
started collection and distribution of milk like a milkman. After some period, they
also started distribution of Dahi, Chakka, Loni. In 1985, the milk pasteurizing plant
was set up at Mangalwar Peth, Kolhapur with 200-liter capacity of milk handling.
Bharat Dairy is the first dairy to offer milk packed in polythene bags. In 1990, they
set up a plant in Gokul Shirgao MIDC with capacity of 4,000 liter per day. Their
current capacity is 40,000 liter per day. In future, they are going to expand the
capacity to 1,50,000 liter per day. In addition, they are going to establish Skim Milk
Powder Plant with higher capacity.

5.5.2 Procurement –
Bharat Dairy procures milk mainly from Karnataka State. Some quantity of
milk is procured from the villages located on the Karnataka- Maharashtra boundary
in Maharashtra state. They have two chilling centers one is at Nasalapur and other is
at Khemlapur located in Karnataka state. They also collect milk from four milk
cooperative societies. Everyday 40,000-liter milk is collected from Karnataka and
10,000-liter milk is collected from Maharashtra.
For milk procurement, they offer different payment rates to the milk producers
depending upon flush and lean season. Regular rate for milk containing 6.0 percent
fat is Rs. 14.20. Rate for milk containing 6.5 percent fat is Rs.15.20. The cost of
chilling is Rs. 2.00 per liter. Thus, their total cost of milk procurement is Rs. 17.20.

131
Organisation Structure –
This is a partnership firm.
Figure 5.5.1 Organisation Structure

FOUR PARTNERS

GENERAL MANAGER

MANAGER

SUPERVISOR ACCOUNTANT CLERK

LABOURER

(Source: Bharat Dairy, Kolhapur.)

Figure 5.5.2 Organisation Structure of Marketing Department –

MD Marketing

Area sales Manager ( Kolhapur, Pune. Mumbai)

Sales booking officer


ss
(Source: Bharat Dairy, Kolhapur.)

There are 35 people working in marketing department.


Total number of employees in the organization is 80. Out of which 35 are working
in processing unit, 35 are working in marketing department and 10 are working in
retail outlet.

132
5.5.3 Product Policy –
Bharat Dairy believes in quality products and innovation. Their product mix consists
of different product lines such as milk, skim milk powder, curd, shrikhand, basundi,
paneer, butter/ ghee. They market their products under the brand name ‘Sphurti’.
Under each product line, they offer various products as follows –

1) Milk – Milk is available in 500 ml and 1-liter packages. They offer toned
milk, double toned milk and standardized milk. Both cow milk and buffalo
milk is available. Milk processing capacity is 50,000 to 55,000 liter per day.

2) Skim Milk Powder – In flush period when milk supply is more, at that time
milk is converted into SMP. Depending on the excess milk, availability 200
to 700-ton SMP is produced per month. Generally, SMP is procured from the
other dairy unit as per the requirements.

3) Curd – 2000 to 3000 liter curd is produced every day. Curd is having 15 days
shelf life with refrigeration. Bharat Dairy is the first in Maharashtra to
market curd in packed form after Amul. At the beginning, curd is sold in
loose form, then it is sold in polythene bags and now cups are used to pack
the curd. For curd market, they are the market leader.

4) Shrikhand – Bharat Dairy produces 15 to 30 ton shrikhand per month.


Shrikhand is available in 250gm, 500 gm pouches, 100 gm, and 500 gm
cups. It is available in four varieties viz. kesar elaichi, mango, badam pista
and fruitkhand.

5) Basundi – 5 to 8 ton of basundi is produced per month. It is available in 250


gm and 500 gm pouches.

6) Paneer – 2 to 3 ton paneer is produced per month. It is available in 100gm,


200 gm and 500 gm pouch.

7) Butter / Ghee – 10 to 12-ton ghee are manufactured per month. It is available


in 200 ml, 500 ml and 1-liter pouch as well as in jar.

133
5.5.4 Price Policy –
Price of the milk is decided by the association of milk unions. They offer the milk
products at competitive rates. They use marginal costing and reverse costing for
calculating the prices for the products. They do not use price as a promotional tool.

5.5.5 Promotion Policy –


Bharat Dairy has fixed their advertising budget at 6 to 7 percent of the sales. They
use radio, local television cannels, newspaper, and POP material for advertising their
products. They promote their products regularly. At the time of festivals, they
concentrate on heavy advertisements. Their sales representatives visit to the
distributors and retailers to promote the products. They offer cash discounts to
wholesale distributers like customers who are purchasing for the functions, caterers,
and other dairy units. In addition, they sell butter to the small producers to produce
ghee.

5.5.6 Distribution Policy –


Bharat Dairy distributes various milk and milk products with the help of 30
distributors in Maharashtra and Karnataka. These 30 distributors distribute milk and
milk products to the retailers and retailers sell it to final consumers. In Mumbai, they
are having a super stockiest who distributes the products in Mumbai. In Kolhapur
city, they have the company retail outlet for direct distribution of the products to the
final customers. Thus, they use zero level, one level, two levels and three level
channels in different markets for smooth distribution of the products. They are
pioneer in distributing milk and milk products in Kolhapur, Sangli, Satara and
Karad. Recently they started distributing in malls. Their market area covers
Kolhapur, Sangli, Karad, Satara, Pune, Solapur, Nashik, Mumbai, Belgaum, Hubli,
Dharwad, Dawangiri, Gadag, Ratnagiri, Panjim, Vasco, Karwar.

134
5.5.7 Annual Sales and promotional expenditure of the Bharat Dairy –
Annual sales and promotional expenditure of Bharat Dairy from 1991 to 2010 are
given below.
Table 5.5.1 Annual Sales and promotional expenditure

Year Annual Sales (in Rs. Promotional Expenditure


crores) (in Rs. crores)
1991-92 1.75 0.11
1992-93 2.50 0.15
1993-94 3.5 0.21
1994-95 4.0 0.24
1995-96 5.0 0.30
1996-97 5.6 0.34
1997-98 6.6 0.40
1998-99 7.2 0.43
1999-2000 8.5 0.51
2000-01 9.0 0.54
2001-02 10.5 0.63
2002-03 12.0 0.72
2003-04 13.0 0.78
2004-05 16.0 0.96
2005-06 18.0 1.1
2006-07 25.0 1.5
2007-08 35.0 2.1
2008-09 42.0 2.50
2009-10 50 3

(Source: Bharat Dairy, Kolhapur.)

135
Graph 5.5.1 Annual Sales and promotional expenditure

The sales figure shows the increasing trend mainly because of the consistent quality
products and marketing. Every year they have made expenditure of 6 to 7 percent of
last year sales on promotional activities. Therefore, it also shows the increasing
trend.
Bharat Dairy conducts market survey like consumer survey, retailer’s survey
through their sales representatives. Moreover, they use the collected information for
marketing decision making. Their main competitor is Chitale Dairy, Pune. They
always keep the product quality high to beat the competitors. Their marketing
strategy relies on customer satisfaction. According to them, there are social
developments in the target market. The customers prefer packaged and branded
products.

136
5.6 Sahyadri Dudh Utpadak Sangh Ltd; Shinoli, Chandgad.
5.6.1 Introduction -
Sahyadri Dudh Utpadak Sangh Ltd; was established in the year 2000. The
founder Chairman, Mr. Dajiba Desai has started the dudh sangh at the Maharashtra –
Karnataka boundary only for the benefit of the milk producers situated in boundary
area. Because of Maharashtra – Karnataka border conflict, Karnataka Milk
Federation do not provide milk procurement facilities in the border area. For the
dairy units situated in Maharashtra, specifically in Kolhapur, the cost of milk
procurement in this area is more. Therefore, Sahyadri Dudh Sangh started procuring
milk from these areas. The cost of milk procurement is Rs. 17.70 per liter with
addition of 65 paisa as management charges per liter for 6.0 to 9.0 percent fat
content. Mainly, the raw milk is collected from the 282 milk societies situated in
Belgaum border area. The milk pasteurization capacity was 500 lit / day at the
beginning. Currently pasteurization capacity is 3000 lit./day.
Because of the natural climatic conditions the fat percent of milk is more (i.e.
7.5 to 9%) than the other areas. Therefore, the private dairy units such as Chitale
dairy, Pune Maskate dairy, Hyderabad and other dairies from Mumbai purchase
milk from the Sahyadri dudh Sangh to manufacture the various milk products. Their
market area covers Belgaum, Goa, Kankawali, Sawantwadi.
Figure 5.6.1 Oraganisation Structure –
Board of Directors

Chairman

Managing Director

General Manager

General Manager

Dairy Manager Marketing Officer


(Source: Sahyadri Dudh Utpadak Sangh Ltd; Shinoli, Chandgad.)

137
As the milk handling capacity is less, one dairy manager looks after all the
production & quality control procedures. Marketing Officer works directly under
general manager, as they do not have separate marketing department. Marketing
Officer visits to the various distributors and retailers to market the milk and milk
products. Sahyadri Dudh Sangh does not employ marketing information system and
they do not conduct environmental analysis. The dairy unit is well aware about its
competitors. Their major competitors are Karnataka Milk Federation, Hatson and
Aditya Milk.
Sadhyadri Dudh Sangh provides extension activities to the milk producers.
They provide financial assistance to milk producers through Sahyadri Co-operative
Society. In addition, they provide veterinary services for the cattle. They provide the
employment opportunities to the people residing in the border area.

5.6.2 Product Policy –


Sahydri Dudh Utpadak Sangh Ltd; manufactures liquid milk,
Shrikhand, Mango Shrikhand, Lassi, Dahi and Ghee. However, the sales are more
for liquid milk. The milk products are manufactured in very less quantity. Milk is
available in only one variety i.e. standardised pasteurized milk. It is available in
500ml & 1-liter Packages. Shrikhand and Mango Shrikhand are available in 250 mg
and 500mg cups lassi is available in 250 ml pouches. Ghee is available in 250ml,
500ml & 1 liter Packets. Milk and Milk products are sold under the brand name
‘Sahyadri’.

5.6.3 Pricing Policy –


They use competitive pricing policy for milk and milk products. As they are
comparatively new in the market they sale the milk & milk products at competitive
prices. They use cost plus pricing method & competitive pricing method to arrive a
price. Profit margin is 15 paise / lit. They offer the different prices to the wholesale
buyers who purchase loose milk for further production of milk products. As the
quality of milk is good because of the natural climatic conditions, they do not use
price as the promotional tool. Customers prefer Sahyadri Milk because of its quality
and taste.

138
Prices of the milk & milk products –
Milk - Rs. 30 per liter
Ghee - Rs. 200 per kg
Shrikhand - Rs. 85 per kg
(Source: Sahyadri Dudh Utpadak Sangh Ltd; Shinoli, Chandgad.)

5.6.4 Promotion Policy –


As such, they have not formulated any promotion policy. They only
give some advertisements in local newspapers and in some local magazines,
depending upon the festival seasons. They do not decide any advertising budget or
media plan. They spent a very few amount on advertisement. They do not go for any
sales promotion activities not for customers as well as not for distributors / retailers.
Marketing officer visits to the distributors & retailers to collect the orders. Only
because of its rich quality and taste customers demand for milk & milk products of
Sahyadri Dudh Sangh.

5.6.5 Distribution Policy –


Sahyadri Dudh Sangh sales the milk and milk products in Belgaum,
Goa, Kankavali, Sawantwadi. Their sales are more in Goa. They deliver the milk &
milk products with the help of three – owned insulated Vans. They use 407 trucks
for procurement as well as for distribution of milk. The cost of distribution is Rs. 1/
liter. They do not have any retail outlet. The Sahyadri Dudh Sangh sales the milk
and milk products in Belgaum, Goa, Kankavali, Sawantwadi in Goa are 15. In
Kankawali and Sawantwadi they have 2 distributors each.
They do not provide any marketing assistance to the distributors or retailers.
As small dairy unit, they do not export the products. They get a bulk order for loose
milk from Chitale dairy, Pune, Maskate dairy, Hyderabad, and Bombay. They take
the milk from Sahyadri Dudh Sangh because of its high fat content, which is used to
produce the other milk products. They directly purchase milk from Sahyadri Dudh
Sangh & send their insulated vans for transportation of the liquid milk.

139
5.6.6 Annual Sales of Milk & Milk Products –
Milk and milk products annual sale of Sahyadri Dairy from the year 2001 to 2009 is
given in the following table.

Table 5.6.1 Annual Sales of Milk & Milk Products

Year Sale of Milk (Rs.) Sale of Milk products (Rs.) Total Sales (Rs.)
2001-02 2,25,32,362 10,82,560 23614922
2002-03 6,55,25,668 49,950 65575618
2003-04 9,68,95,904 18,15,335 98711239
2004-05 10,39,35,045 -- 103935045
2005-06 10,47,97,384 10,469 104807853
2006-07 10,83,67,110 10,660 108377770
2007-08 12,26,81,615 -- 122681615
2008-09 13,51,23,399 5,89,673 135713072

(Source: Sahyadri Dudh Utpadak Sangh Ltd; Shinoli, Chandgad.)

Graph 5.6.1 Total Annual Sales

Table 5.6.1 shows that sales of liquid milk has increased steadily over a
period. This pattern is not found in milk products sale. The main reason is the
irregularity in availability of raw milk and more demand for the liquid milk.

140
5.6.7 Annual Promotional Expenditure
Milk and milk products annual promotional expenditure of Sahyadri Dairy from the
year 2001 to 2009 is given in the following table.
Table 5.6.2 Annual Promotional Expenditure
Year Promotional Expenditure (Rs.)
2001-02 77,985
2002-03 73,436
2003-04 88,925
2004-05 25,841
2005-06 90,753
2006-07 91,308
2007-08 19,712
2008-09 17,190
(Source: Sahyadri Dudh Utpadak Sangh Ltd; Shinoli, Chandgad.)

Graph 5.6.2 Annual Promotional Expenditure

Table 5.6.2 shows that promotional expenditure has shown increasing trend
except in the year 2004-05. In year 2007-08 & 2008-09, the promotional
expenditure was low because of the lower profit margin.

141
5.7 Conclusion –
The surveyed dairy organizations focus on the pasteurization of milk
products. Their sale is concentrated on the sale of liquid milk. These dairy
organizations mainly produce the milk products like ghee, shrikhand, curd,
butter, lassi, milk powder and paneer. They offer milk and milk products at
competitive prices. There is a very little vaiation in the prices of the
products. The dairy organizations distribute the milk and milk products with
the help of the distributors and retailers. The main market area is the
Kolhapur, Sangli, Satara, Pune, Mumbai, Belgaum, Goa and Kokan. These
dairy organizations make the use of local television, radio channels, and
local news papers for advertising their products.

142