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8/7/2019 Dlm Project Ppt Newest

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Amity Business School

A study on Distribution andLogistics of


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Presented by:

Kapil Sharma 20

Hitesh Wadhwani 31Sridhar 34

Shubham Tiwari 48

Vivek Upadhyay 56


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Amity Business SchoolObjective

To study the distribution and logistics network of

AMUL.

To study the conflict resolution strategies of

AMUL.

To study the Training and motivation of AMUL.


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Amity Business SchoolIntroduction

Amul means priceless.Worlds biggest vegetarian cheese brand

Worlds largest pouched milk brand

Largest food brand in India

Amul has a glorious tradition and legacy of 65 years till

now.

The brand Amul is marketed by the Gujarat

Cooperative Milk Marketing Federation.(GCMMF)


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Amity Business SchoolAmul Product


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Amity Business SchoolBusiness model


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Amity Business SchoolAmul logistics

video


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STATE MARKETING FEDERATION

ALL DAIRIES IN STATE

DISTRICT MILK PROCESSING

UNION EVERY DISTRICT

VILLAGE COOPERATIVE SOCIETY

ALL VILLAGES IN DISTRICT

Milk Producers/farmers


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Farmers 2.79 millions

VCS 13328

District Unions in India 13


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Amity Business SchoolProcurement channel


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NDD

B/NCDF

I

FEDERATION

GCMMF

FEDERATIONSin Other States

UNIONS

AMUL and 13 other district level

VILLAGE SOCIETIES

13,328 Village Level Milk Collectioncentres

Individual milk producers

2.79 million milk farmers


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Village Dairy Cooperative Society (VDCS)

Collection of surplus milk & payment based on quality

& quantity.

Providing support services to the members.

Selling liquid milk for local consumers of the village.

Supplying milk to the District Milk Union


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Amity Business SchoolDistrict Cooperative Milk Producers Union (Milk

Union)

Procurement of milk from the Village Dairy Societies of

the District.

Arranging transportation of raw milk from the VDCS to

the Milk Union.

Providing input services to the producers.

Conducting training on Cooperative development


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Amity Business SchoolCont..

Providing management support & regular supervision to theVDCS.

Establish Chilling Centers & Dairy Plants for processing themilk.

Selling liquid milk & milk products within the District.

Process milk into various milk & milk products.

Decide on the prices of milk to be paid to milk producers.


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State Cooperative Milk Federation

(Federation)

Marketing of milk & milk products

Establish distribution network

Arranging transportation from the Milk Unions to the market.

Creating & maintaining a brand Providing Technical Inputs, management support & advisory

services.

Decide on the products to be manufactured at various Milk

Unions (product-mix) Conduct long-term Milk Production, Procurement, Processing

& Marketing Planning

Conflict Resolution & keeping the entire structure intact


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Distribution Channel


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Village cooperative socities

(with chilling units)

Village cooperative socities

(without chilling units)

LocalRestaurants/

Other Milk relatedbusiness

Milk Sold toVillage &

Local Residents

Farmers

NetworkServices

* Veterinary

Services* Animal

Husbandry* Animal

Feed Factory

* Milk CanProducers* Agriculture

University* Rural Mgmt

Institute* Trucking

Facilities

Milk processing union &

warehousesChilling plants

GCMMF Warehouses

Wholesale Dealers

Retailers Home DeliveryContractors

CONSUMERS CONSUMERS

DEPOS


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Amity Business SchoolDirect retailing-APOs

Amul has recently entered into direct retailing through "AmulUtterly Delicious" parlors created in major cities.

Amul has plans to create a large chain of such outlets to bemanaged by franchisees throughout the country.

More than 6300 APOs are already existing.


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STATE MARKETING FEDERATION

Depots-47

APOs- 6300+

customers


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Amity Business SchoolAmul & E-Commerce


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Amity Business SchoolSelection of channel members

Authentication of channel members.

Proof of solvency

Safety ofInventory Details of storage equipment

Details of the delivery vehicles

Details of salesmen and their technicalcompetence.


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Training of channel members

Product Information

Communication Techniques

warehousing System

E-commerce Handling

Advertisement


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Motivation of Channel Members

GCMMF strongly believes in maintaining a good relationship with the channel members so that they aregenuinely motivated to work for the company. Also if the channel members are motivated, they can also Initiate advertising & sales promotion schemes on behalf of the company.

The following are the motivation programs run by the company

Motivation to Wholesale Dealers:

One of the main factors, which keep the WD motivated, is the margin. Usually the margins offeredby the company are 8% & it is raised to 8.5%.

Amul being a cooperative cannot afford to give heavy monetary incentives. Amuls products areconsidered to be value for money since the company does not believe in charging high margins.

various counseling measures are undertaken by the company to improve the overall working of thedistribution network.

Sometimes wds are gifted with the bonuses,discounts,appliances etc.

Amul keeps their wholesale dealers motivated by registering them with the Amul network and making

them a part of it.


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Motivation To The Retailers

Trade schemes: these are undertaken by the company only for the hard selling items e.g. Icecreams, flavored milk etc. for these the company raises the margins by 2%, also schemes likegood packaging incase of butter and cheese is undertaken by the company.

Glow boards: the company puts up glow boards at the retailer and pays the major portion ofthe cost.

Schedule of the salesmen: they provide the retails with this schedule so the retailers can preestimate the quantities of the various products needed.

Infrastructure facilitation: the company facilitates the retailers to buy freezers and fridges byformulating an easy payment program and a commitment to buy back the equipment at areasonable price when the value of the equipment has depreciated.

Passing The Benefits :Here WD plays an important role by passing the monetary as well asNon monetary benefits to the retailers.


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Evaluation of channel members

Beat plan: This plan is generated for the various product categories i.e. diary dry,diary wet, Dhara and ice cream. A weekly schedule is prepared for various

markets and the retailers the turnover for each of the product is calculated for thewholesale dealers.

Cumulative performance: the performance of the dealers is averaged out over aperiod of three years where a comparison is made of the present performance vis--vis the previous ones.

Target versus achievement: the performance and the targets are compared andtherefore the gaps are identified which help in evaluating the WD and planningfor the next year as well. This is done for each of the product category.

Surprise Visits: Surprise visits by Head to retailers to evaluate wholesale dealers.


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Conflicts

Ownership of assets: Previously the company used to give the cooling equipment on lease to theretailers, when the company wanted the stuff back; the retailer disagreed to comply and created issuesof ownership.

Stocking issues: The company doesnt want the retailers to stock the competing brand in the companyleased fridges, which at times s hard to manage as retailers tend to do it often.

Replacement of products: The deterioration in the product calls for fail in replacement by thecompany this major issue of vertical conflict.

Credit policy: Compared to the market, the companys credit period is less that specially incase ofinstitutional sales is very important.while Wholesale dealers dont have any credit facility at all.

Margins: The Company provides least margins to all the channel members. For e.g. The retailersmargin in case of butter is 8% as compared to Britannias 12% .

Voilation of Distribution Pattern: one channel member selling goode to the customer of other.


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Co-operation among channel members

Amul quality circles: The members of the local channel meet together every month to share issues andthe achievements of the channel members. This is an ongoing activity facilitated by the companyoffices in different locations; this enables the channel members to learn together and reduces thehorizontal conflicts.

Agreement defining rights: The company makes the distributors sign an agreement where the areas ofoperation for each of the distributors are defined, therefore avoiding any conflict amongst thedistributors regarding their areas of operation.

Pilot salesmen scheme: To reduce the financial burden of the distributors this scheme is run wherebyhalf the cost of the salesmen is born by the company and the rest half by the distributor

Scheduling of sales: The WDs provides Schedule of the distributors sales men to the retailers so thatthe retailers can plan out and place the orders in advance.


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Comments and Suggestion:

Amul should go in for exclusive outlets in most of the shopping malls.

The advantages are:

Full range display Easier to promote new products

Easy to push impulse purchase products

Brand building will be facilitated

More no. of Pushcarts for ice creams and flavoured milks.

Trade promotion.

Home delivery.

Increase the margins for the hard selling items

Additional salesmen on the field


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Lessons for Managing Larger Networks

Long term perspective

Simultaneous development of markets and suppliers

Network partnership vs. ownership

Cost leadership and value for money

Technology and Information Sharing


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THANK YOU

ANY QUESTIONS PLEASE

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