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Company Background
Kurien talked about the power of people and mobilization of people (farmers) with professio
Gujarat Cooperative Milk Marketing Federation (GCMMF), popularl known as !mul
"# #odhi, M$ of GCMMF
%uilt on the dual philosph of value for man and value for mone (farmers and &ustomers)
Origin
$e&ember '* + Kaira farmers formed a milk union in !nand &it (olson ba&kground)
-une '. + started pasteurizing milk for the %omba Milk #&heme
'/' + $r 0erghese Kurien joined the union as its GM
'// + #tarted produ&ing surplus milk, and therefore an investment to pro&ess surplus into mi
'/. + #weetened &ondensed milk
'*1 + %ab food and &heese
2ate '/1s and earl '*1s + entered into distribution &hannels with all parts of 3ndia, in&reas
'* + 2%# visited and 4ational $air $evelopment Fund was set up 56 in !nand to set up
#upport servi&es as well 888 3n&reased per &apita suppl of milk 888 3ndia from defi&
3n&reased in&omes of families and so&ial &hanges
Three tier Cooperative Structure
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!ll the above bodies retained a part of earnings to meet e9penses and rest passed on to farme
$emo&rati& ele&tion pro&ess
2020 Targets
Milk produ&tion in 3ndia :11 M; pa
C!G" for n9t / ears (:1'+:1) :1<
Milk pro&urement for ne9t / ears (:1'+:1) ':<
Milk pro&essing fa&ilit for ne9t / ears (:1'+:1)
:1' 4ew milk powder plant alanpur
4ew dair plant "ohtak
:1' 4ew butter plant Gandhinagar
4ew dair plants Faridabad, Kanpur, 2u&kn
4ew mega &heese plamt alanpur
4ew dair plants !mreli, Kut&h and #urend
Capa&it e9pansion %havnagar
Cooperative Development Programme
' =nion help (te&hni&al, managerial and marketing support): $edi&ated initiative to imporve animal health servi&e
> 3nternal Consultant $evelopment
#trategi& rodu&tivit ?nhan&ement
/ ?ntrepreneurship $evelopment rogramme
* Clean Milk rodu&tion
@ #ustainable e&ologi&al development
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al management
lk powder, butter and ghee
e &attle ield, farmer training, vet servi&es
&ooperatives in various parts of the &ountr (7peration Flood)
en& to self suffi&ien&
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s
/1,111 &r
'/*D'@ :@1 lakh litres per da
:>@ >.1 lakh litres per da
':1 M; dail 2argest milk powder plant till date
#erve markets of $elhi and 4C"E started operating
1 M; dail
w, Kolkata %eing built
4ear &ompletion $oubling &heese manufa&turing at e9i
anagar #oon operational
#aurashtra, Kut&h, orbandar and %otad Milk =nion
2eadership and vision relatedE Mahila related
Geneti&s, Calf rearing, Fertilit 3mprovement, e+animal portal
3n&rease in&ome and redu&e operational &osts
3nfrastru&ture, ma&hines and training
#aplings
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nal Centre for $isease Control) Man support staff
3ndian "ailwas
0alue Chain
;raining) Consumers patronage
of $air #&ien&e Member union
t #ervi&e, !nand Federation offi&ers and staff
"elevan&e to farmers and few major stru&tural &hanges
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10N!
itng D"#$%
P&"NTS
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Product $ange
rodu&ed * tpes of dair based produ&ts in :1'> :* new prod
3ndias largest e9porter of dair produ&ts, targeting 3ndian des&ent
Categor ;pe of Categor
' %read #preads
: Milk $rinks
> owdered Milk
Fresh milk
/ Cheese
* Cooking rodu&ts
@ $esserts
. 5ealth $rinks
'ro(th
#hare of %randed 7rganized #egment
'/* %utter .*< d
'/* Ghee >1< b
'*: Cheese */< h
'*. 3nfant Milk Food /1< h
'.@ $air Hhitener 1< f
'.@ Fresh ou&hed Milk 1< a
'* Condensed Milk *1< e
'@ aneer 1< g
' 2ong 2ife Milk *1< a' oghurt /< &
:11: Cream 1< h
:11: Flavored Milk @1< a
:11> 2assi 1< a
:11/ %uttermilk @1< a
Market leader in all produ&ts e9&ept &ho&olates and additives
Created new produ&ts su&h as &ottage &heese and frozen pizzas from s&rat&h
Milk #tarted own brand post end of %M#E value added produ&ts more profitable and so branded li
#uppl &hain to ensure distribution of milk wIo spoilage + both mornings and afternoonsD :1'
7nl national brand in milk
'1s + after resear&h 88 i&e &ream 88 made of milk unlike vegetable fat (=2) 88 pri&ed &o
Hith i&e &ream, also added frozen pizzas and oghurts added to the portfolio
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:1'+'/ erforman&e
!mul 2ong life milk ><
!mul #lim n ;rim milk !ugment growth
!mul 2ong life &ream :/<
!mul Hhipping &ream !&&elerated
!mul beverages (in ?;) >><
Fresh Milk :.< 2aun&h in 5derabad and
!mul Cheese :.< 2aun&h of new flavours
!mul Mithai Mate :<
!mul i&e&ream :@< Maintained leadership pos
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&ts in :1'+'/
3ndian $air Market rodu&t #egmentation
a *<
b :@D/1<
& @<
d *D/1<
e *D/1<
f >D/1<
g :<
h '<
'11<
uid milk other than value added produ&ts
+ >1 3ndian &ities and milk was /1< of revenues
petitivel and soon be&ame leading plaer (>< in :1'>) (h)
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unjab
tionE laun&hed ?3C and CrJme "i&h
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3ndias largest food produ&t marketing organization (4estle ne9t)D :1< growth for the past /
3&oni& butter advertising &aign laun&hed in '*1s believed to be the worlds longest runn
Brand Building
Milk had a &aptive &on&umer in %M# 88 found it diffi&ult to &ompete in segments su&h as o
ress #ndi&ate ad agen& gave the butter a tagline #impl the %est
'** + !&&ount to !# to dislodge olson 88 =tterl %utterl $eli&ious 88 Mas&ot !mul gir
Centred outdoor &aign around !mul girl 88 'st set of billboards in %ombai in '** 88 2
!sso&iated with &urrent events 88 b :1'>, 111 su&h billboards
Challenges
Conne&ting with outh + so sponsorship in man sports events
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ears
ng outdoor advertising &aign
lson (butter) 88 '/@ + 4ame !mul (amula, swadeshi)
d billboards in prime lo&ations 88 * months later olson faded awa
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Procurement
7wned b >D: million farmers in :1'> + $ail ':D. mn litres + dair pro&essing units + '@
./< produ&ers small and marginal
'/1 mn milk produ&ers in :1'/
'@1 :1'/
er &apita milk availabilit (gm I da) ''1 >'/
ro&urement limited to Gujarat in :1'> 88 problem of &ompeting with lo&al plaers
:1'1 + started pro&uring from Hest %engal, Maharashta and "ajasthan, but legal hassles 88 a
outh relu&tant to join 88 tedious work 88 make them entrepreneurs with large farms &an be
:1'+'/
;otal milk pro&urement '/D: mn kg ':D@< pa growth
ro&urement from @ states outside Gujarat 88 :1< additional Buantit of milk available
Distri)ution
! million retailers a&ross >,111 3ndian towns and '1,111 dealers@,111 e9&lusive fran&hised outlets (lo&ation)
2argest retail &hain in the &ountr (b number of stores)
$edi&ated i&e &ream parlours and was e9perimenting with &asual dining restaurants
distin&t distribution &hannels + fresh, frozen, &hilled and ambient
Continued e9apnding its produ&ts to rural &ustomer (pa&kaging usage)
Hith F$3 in retail + will ask for a higher margin
?9isting Halmart and Carrefour
Fresh /< >1<Chilled and 2ong life ':< >1<
Frozen ::< >1<
:1'+'/
#everal new bran&hes at -odhpur, Mangalore and Gwalior (now /* bran&hes)
#trengthened rural distribution rea&h )'@ super sto&kists &overing >:11 interior markets)
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$istributor Management #stem (3; better &ontrol over #uppl Chain) and !mul atra rogr
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istri&t member unions
L in&reased nutrition
lso problem of farmers in those states
one of the solutions
*/< growth over last / ears %e&ause of pri&ing to farmers having in
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mme (better awareness among business asso&iates) L #! implementation L C:C (Cow : C
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reased @/< during the last / ears 88 also to attra&t ne9t generation
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nsumer) integrated value &hain
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#ales of =#$ :D/bn in :1'>
:1< growth for the past / ears
!mul .1<
7ther 3ndian dairies @1<
Hestern &ountries >/+1<
:1'+'/
#ales / ears C!G" :'< :1@>> &r leveraging on
o growth 'D>1
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te&hnologi&al and marketing innovations
dedi&ation and hardwork of farmers
higher milk pro&urement
value &hain innovations 88 seamless integration through 3;
marketing effi&a&
e9pansion of distribution rea&h
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Competitors
3nfant milk, dair whiteners, &ho&olates and i&e &ream M4Cs su&h
%everages Global bever
ou&hed milk 2o&al &ooper
rivate dairies, parti&ulal in #outh 3ndia
M4Cs 88 urban &ustomers 88 premium produ&ts 88 higher margins to retailers
Pricing
0alue added produ&ts 2ower than &ompetitors !mul pri&es
Fresh milk #light premium
!mul wanted to sta premium even b providing &ompetitive pri&ing
"dvertising
2ess than &ompetitors through innovation + '< 88 1+/1< of this umbrella based pri&ing
2onger &aigns
%est spots but no freebies
!ds and sponsorships refle&ted 3ndian values and roots
Supply Chain=sed volume as advantage 88 ?9&lusive arrangements 88 2ow margins to distributors 88 2o
ro&urement also an advantage be&ause of higher paouts
*anagement
=nlike some &ooperatives in other states + free of politi&al interferen&e
0er transparent
oliti&ians ma however see the farmers as a sour&e of vote bank
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s 4estle, Kradt, 5=2 and 3ndian firms su&h as %ritannia
age giants su&h as Coke and epsi
atives and private dairies
erved as ben&hmark as value for moneD ;rust of &onsumers
w pri&es (4estle withdrew from butter be&ause low volume so not profitable for distributors)
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#ndian Dairy #ndustry
:1'> + 3ndia largest milk produ&ing and &onsuming nation #ame in :1'
1 mn families and 11 mn individuals involved in dair farming (se&ondar sour&e of in&
3ndia .:< having N : he&tares of land
Hestern &ountries su&h as =# and 4O
'11< /1< #elf &onsumption
/1< $istribution .1< =norganized milkmen
:1< 7rganized se&tor
$air market in :1'> (org and unorg) P@D* bn
Growth in re&ent ears @D/< pa
!vg 3ndian household bill :1+:/<
Composition of liBuid milk of milk produ&ts /<
Consumption was in&reasing be&ause of 3n&reasing C
Growing population
Hinter produ&tion was higher than summer + how demand suppl balan&e was maintained
2itres per animal per da 3ndia Globall
otential for in&reasing ield of animals > >1
1++ mn producer cooperative unions 888 '>>,111 village level dair &ooperatives 888 '
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E also one of the fastest growing
me) + managed b household women
#mall farmers owning an average of : &attle
2arge me&hanized farms of :,111+/,111 &attle were &ommon
//< ro&ured b private dairies, in&luding large M4Cs
/< Co+operatives
:1'/ P*/ bn 2argest agro &rop in 3ndia
:1'/ Milk produ&tion growing at D/< pa
4$ (outla of '.,111 &r) b G73 to improve the ield of mil&h animals
n farmers
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ow pri&es 88 seeking to dump