Case Study: Mother Dairy Milk

Case Study get dairy farm Milk spawn dairy MilkCase Study On start dairy farm nonobjective overprotect dairy farm is looking to subscribe to advantage of the opportunity which argon in galore available for all draw manufactures. M some other dairy-Delhi was set up in 1974 under the operation flood programme. it is now a subsidiary bon ton of National dairy ontogeny Board (NDDB). sire Dairy sources its intact-cut requirement of liquid milk from dairy farm cooperatives. Similarly, fetch dairy sources fruits and vegetables from framers/growers associations.Mother dairy also contri to a greater extentoveres to the cause of oilseeds grower cooperatives that manufacture/pack the Dhara range of toothsome oils by undertaking to nationally mart al dhara convergences. Of the three As of marketing-availability, acceptability and affordability, Mother dairy is already endowed with first two. Hence no efforts atomic number 18 needed to make it acceptable. Its availability is non a limitation either, because if the ample scope for increasing milk ingatheringion, given the prevailing low yields from dairy cattle. It leaves the third vital marketing factor affordability. How to make milk affordable for the large majority with limited purchasing power? That is essence of the challenge.Current theories of dodge and organization suggest that Mother Dairy benefit from cogitate diversification and tight coordination of the multidivisional structure. This Project aims to probe into this issue by using theoretical cloth of strategy, structure and performance. three issues will be addressed by usa) What strategies and structure does Mother Dairy adopt in a constantly changing and turbulent developing economy?B) Do the influences of Mother Diary presume in interaction effects with environmental conditions?C) How does Mother Dairy make its competitor not to grasps its market in the gurgaon bea?IntroductionMother Dairy is the single largest brand of milk in De lhi, India as head as in Asia, marketing about 1.9 million litres of milk per daytime.Mother Dairy commands 40% market address in the organised sector in and round Delhi, primarily because of consistent fiber and serv scrap what ever be the crisis-floods, transport strike, curfew etc. Mother Dairy, Patparganj, Delhi, is enterly manufacturing selling around 8.5 lakh litres of tonned milk through and through passel vending shops.Mother Dairy, Delhi is an IS/ISO-90012000 and Hazard Analysis Critical Control Points (HACCP) and IS-140011996 Envoirnment Management System (EMS) Certified organisation.Mother Dairy was the first industry in orbit to implement ISO-14031(Envoirnment motion Evaluation) project. The comanys Quality Assurance Laboratory is ISO/IEC-170251999 certified by NABL (National Accreditation Board for Testing and Calibration Laboratory), Department of Science Technology, India.This provides assurance to the consumer in esteem of Quality and rubber of products manufactured and marketed by Mother DairyBackground of Mother DairyThe main reasons for the low yield argon Lack of use of scientific practices in mulching.Inadequate availability of fodder in all seasons.Unavailability of veterinary health services.Indian Dairy reapingsThe term Indian Dairy Products refers to those milk products, which originated in undivided India.Flow Chart of Conversion of Milk Into Traditional Indian Dairy ProductssMilkCultured Condensed Acid PrecipitationShrikhandGheeLassiKadbiMisti DoiRabriKheerKkoaPaneerSandeshChhanaRasgoolaPantodaRasmalaiBurfi Pedha Kalakand GulabjamunMajor PlayersThere be virtually 15 major Dairy reconciling unions in India, namelyAndhra Pradesh Dairy Development Cooperative confederation Ltd (APDDCF)Bihar State Cooperative Milk Producers conspiracy Ltd (COMPFED)Gujarat Cooperative Milk Marketing Federation Ltd (GCMMF)Haryana Dairy Development Cooperative Federation Ltd. (HDDCF)Himachal Pradesh State Cooperative Milk Producers Federa tion Ltd (HPSCMPF)Karnataka Cooperative Milk Producers Federation Ltd (KMF)Kerala State Cooperative Milk Marketing Federation Ltd (KCMMF)Madhya Pradesh State Cooperative Dairy Federation Ltd (MPCDF)Maharashtra Rajya Sahakari Maryadit Dugdh Mahasangh (Mahasangh)Orissa State Cooperative Milk Producers Federation Ltd (OMFED)Pradeshik Cooperative Dairy Federation Ltd (UP) (PCDF)Punjab State Cooperative Milk Producers Federation Ltd (MILKFED)Rajasthan Cooperative Dairy Federation Ltd (RCDF)Tamilnadu Cooperative Milk Producers Federation Ltd (TCMPF)West Bengal Cooperative Milk Producers Federation Ltd. (WBCMPF)National Dairy Development Board (NDDB) is the central cooperative board of the country and was created to promote, finance and support producer-owned and controlled organizations mentioned above.Two main players Amul of GCMMF and Mother Dairy of NDDB is the leading(p) brand in India. Our main focus is to analyze the strategic move of NDDB for mother Dairy from top to bottom. Thu s we are going to concentrate on the progress of Mother Diary and NDDB for their future strategies.Historical Background of Mother DairyMotherDairy is the single largest brand of milk in India as well as in Asia, marketing about 2.2 million litres of milk per day. Mother Dairy commands 40% market share in the organized sector in and around Delhi, primarily because of consistent step and service whatever be the crisis floods, transportstrike, curfew etc. Mother Dairy, Patparganj, Delhi, is presently manufacturing selling around 8.5 lakh litres of tonned milk through bulk vending shops.Mother Dairy, Delhi is an IS/ISO 90012000 and Hazard Analysis Critical Control Points (HACCP) and IS-140011996 Envoirnment Management System (EMS) Certified organisation. Mother Dairy was the first Dairy in the country to implement ISO-14031 (Envoirnment Performance Evaluation) project.Thecomanys Quality Assurance Laboratory is ISO/IEC- 170251999 certified by NABL (National Accreditation Board for Testing and Calibration Laboratory), Department of Science Technology, India. This provides assurance to the consumer in respect of Quality and Safety of products manufactured and marketed by Mother Dairy.The National Dairy Development Board (NDDB) commissioned Mother Dairy in the first strain of Operation Flood in 1974. Considering the success of Dairy industry NDDB established Fruit Vegetable Project in Delhi in 1988 with SAFAL as its umbrella brand.With a view to separating the commercial activities from developmental activities, the NDDB merged Mother Dairy and the Fruit Vegetable project into a wholly owned company named Mother Dairy Fruit Vegetable Ltd (MDFVL) in April 2000. This becomes the holding company of Mother Dairy India Ltd (MDIL) a marketing company and Mother Dairy Foods Processing Ltd (MDFPL) a process company. MDFPL is a multi unit company, with units at various locations in India. Mother Dairy, Delhi is one of the units of MDFPL.The company is a highly tru sted house hold name for its wide range of milk products like Milk, Flavored Milk, Ice-Cream, Dahi, Lassi, Table besidester, Dairy Whitener, Ghee etc. The application for the award is being make for Mother Dairy, Delhi unit. Mother dairy has taken up the concept of Total Productive Maintenance (TPM) wholeheartedly.The number of employees involved in KAIZENS and the no. of KAIZENS per employee are very encouraging. Mother Dairy is a member of CII-TPM nightspot and the KAIZENS done by Mother Dairy employees have been selected and presented in 2nd ,3rd ,4th and 5th National Kaizen Conferences held from time to time during the last three years. Our TPM efforts have resulted in increase in MTBF and decrease in MTTR, quality improvement, Cost reduction and reduction in accidents.Mother Dairy has received Best Productivity Performance award for three consecutive years starting from1987-88 to1989-90 and again from1995-96 to1997-1998 from National productivity Council and a commendation C ertificate for Rajiv Gandhi National Quality Award, National pushing Conservation Award 2004, Oil and Gas Conservation Award 2004, Indian Innovation Award 2004 and Safety Initiative Award 2005.Over the years, Mother Dairy has not just served the daily need of milk of the consumers of Delhi, it has also extended its milk to other States like Haryana, Uttar Pradesh, Maharashtra, Andhra Pradesh Gujarat and is expanding its wings rapidly to serve the masses. Strategically laid Mother Dairy booths across Delhi and NCR make it convenient for you to pick up your daily requirement of Milk, Flavored milk, Butter, Dahi, Lassi, Cheese, Chaas.mouth watering Ice Creams.The focus is on key markets for apiece of the categories. In the curd category, they have been in Delhi for a fleck now and launched in Mumbai. They hold a 60 per cent market share in Delhi, unless it is too soon to gauge where we stand in Mumbai.Objectives and parentage Philosophy of Mother DairyThe main stakeholder o f Mother Dairy was the farmer member for whose public assistance it existed. Unlike other organizations, their objective is not to maximize the profit. They are more interested in giving the best price for the farmers for their milk than in do a large profit. Thus they look at the price given to their suppliers as not a cost exactly as an objective. Mother Dairy had, as its main objective, carrying out activities for the economic development of agriculturists by fficiently organizing marketing of milk and dairy produce, agricultural produce in raw and/or elegant form and other allied produce. This was to be done throughCommon branding centralized marketingCentralized quality controlCentralized purchases andPooling of milk efficientlyMother Dairy had declared, as its business philosophy, the followingensure that milk producers and farmers regularly and continually receive market prices by whirl quality milk, milk products and other food products to consumers at competitive price s anduphold institutional structures that empower milk producers and farmers through processes that are equitable.The biggest strength of Mother Dairy was the trust it had created in the minds of its consumers regarding the quality of its products. NDDB, and its brand Mother Dairy, stood for guaranteed purity of whatever products it had produced. Adulteration was simply not done in any of its products.In India, where much(prenominal) trust was hard to come by, this could provide a central anchor for Mother Dairys future business plans. For more than 40 years Mother Dairy helping to create a national network has been adapted and extended to other commodities and areas. Their constant effort to learn and to enrich have it off is central to their approach and capacities. In times to come, Mother Dairy shall strive to become a leading player in the food industry in India.Strategies Implemented1. Focused ApproachMother Dairy wants to get into bigger markets and have bigger shares in t hose markets. The cooperative is also expanding its product portfolio further to harmonize rival offerings particularly those of Amul. For the first 22 years of its existence, liquid milk was the only dairy product that Mother Dairy offered.It was in 1996 that it came up with ice-creams. But the real spurt came about four years ago, when it introduced curd, looked milk, lassi and mishti doi. It introduced butter a year-and- halfago ghee and UTH milk a year ago and cheese, about 10 months ago. And under its frozen foods and vegetables brand Safal, besides the introduction of corn and mixed vegetables, it has come out with frozen potato-based snacks in a few months. So while the product portfolio has been suppuration, Mother Dairy has plans for reach out to newer markets but the strategy here is more product- specialized.In liquid milk, it will initially concentrate only on four markets Delhi, its home ground the Junagarh region and Ahmedabad in Gujarat Mumbai, which it entered a few years ago and Hyderabad, where it moved in a little more than a couple of years ago. They have no plans to go everywhere with liquid milk. Whats the need to get into those markets that already have strong co-operative brands? Their objective of get into newer locations is not to make Mother Dairy larger, but to ensure that on that point is a large viable distribution network and consumer brand to take finagle of surplus milk.In Mumbai, where the liquid milk market is close to 40 to 42 lakh (4 to 4.2 million) litres a day, only about 20-22 lakh (2-2.2 million) litres a day is in the organised market and that too is highly fragmented with a number of smaller players with shares of about 10,000-20,000 litres a day. Mother Dairy claims a share of 170,000 litres a day, with the biggest player, Mahananda, selling about 800,000 litres a day and Aarey and Amul about 250,000-300,000 litres a day each.In Hyderabad, Mother Dairy claims it has a 15 per cent market share of the approxi mate 9-10 lakh (900,000 to 1 million) litres a day of the organised market. These are still early days in the two markets, but we are looking at 10-12 per cent growth in the overall fresh milk segment.2. Wider SpreadHowever, as far as other dairy products are concerned, Mother Dairy plans to expand across the board. Other than milk, for most state federations, dairy products are still a small part of their operations. So they are taking their products to regions across India, where they see enough market potential.In ice creams, it was only a bit more than two years ago that Mother Dairy entered its first market outside Delhi UP and Punjab. Today, its extended its operation to Haryana, Jaipur, Mumbai and Kolkata as well. Next year, it plans to go south to Hyderabad and Bangalore.In the model of butter and cheese, its present across north India, Mumbai and Kolkata, and has plans to enter Bangalore by year-end. In UTH milk, it has entered Mumbai and the milk-short areas of West Beng al and north-east. For ghee, although the current focus is the northern region, it has plans for a nationwide presence.As far as Mother Dairys non-dairy products are concerned, edible-oil brand Dhara has already has nationwide presence.3. Product DifferentiationWhile Mother Dairy still may not have a product portfolio as large as Amul, which is also expanding across the country in a big way and is a much bigger player, its doing its bit. Mother Dairy says the idea is not just to enter new markets, but to do well in those markets which mean bigger market shares in the different product categories in whichever market it is present.The drivers will be value created through quality of the offerings as well as innovations in products. This will, of course, be backed by pertinent marketing and promotion campaigns.Mother Dairy are bringing in mass Indian flavours which are building up in terms of absolute pct of contribution.Their attempt is to make the taste experience in ice creams as familiar as possible so as to increase consumption. Take the case of curd. It started off very slow but today, Mother Dairy claims its growing at close to 60 per cent year-on-year in Delhi. Here again, the Indian flavour formula seems to have worked.While curd from an MNC player is probably based on international formulation, they formulated it to taste as close to home-made curd as possible. If the offering fits well with the Indian consumer, the resistance is lower and acceptance more.4. Smart MarketingOn the marketing front, Mother Dairy says its hard to take its product campaigns and communications to a higher platform. For instance, in the case of milk, the campaigns do not talkabout the obvious benefits milk is good for health, it has calcium and so on but kinda it targets children and are created around ideas such as The country needs you, grow faster. As far as products such as butter, cheese and ice creams go, the campaigns have been created around taste.For butter agai n, the focus is on children. Here, Mother Dairy has dared to go different. Since 60 per cent butter is consumed by kids, the company wants them to sit up and take come across of its butter. Makkhan Singh, a sturdy jovial cow (a cartoon character) has been made its brand ambassador.While Mother Dairy has been carrying out school programmes games and activities involving Makkhan Singh in Delhi, it has plans to take such activities to Mumbai and Kolkata as well. It also runs a gaming website on the character to attract children.Its cheese for children again. A couple of months ago, Mother Dairy carried out a retail natural action Cheese khao superhero ban jao, where kids buying cheese at a retail outlet were invited for a photo op dressed as superheros through Polaroid cameras and the framed picture show was presented to them. The activity was carried out in about 150 outlets in Delhi and Mumbai, with about 20,000-25,000 snaps being taken.Cheese was also something that helped th e company bond develop with its retailers. In November 2005, retailers in Delhi displayed banners proclaiming, Cheese ke saath bees ki cheez, a proposal that said if a consumer buys Mother Dairy cheese, the retailer can offer him anything worth Rs 20 from the shop which worked better than offering something free with the product, which the consumer didnt even needs.The exercise resulted in better ties with retailers. A positive response made Mother Dairy to repetition it in Kolkata as well. Clearly, Mother Dairy has aggressive plans. But, strong regional brands and other co-operatives will continue to give it hardy competition.Perspective Strategies applied by Mother DairyMother Dairy maps the future of dairying in India, setting realistic goals forStrengthening Cooperative Business, merchandise Enhancement,Assuring Quality andCreating an data and Development interrogation.The plan was realised with the successful completion of the Operation Flood Programme and has been develo ped by the State Milk Marketing Federations and the Milk Producers Cooperative Unions in consultation with the Dairy Board. The goals and strategies to meet them have been drawn by its actual implementers Federation and Unions and supported by NDDB.1. Strategy for Strengthening Cooperative BusinessRecruit, train and motivate increasing numbers of women to work for Mother Dairy to achieve significant improvements in dairy culture, as they primarily shoulder animal. husbandry related responsibilities in rural India.Consolidation and growth in milk and milk product marketing, promoting better equity for regional cooperative brands and developing suitable and skilled manpower.Education of producer members, opinion leaders and trained professionals to be expanded and strengthened.Empower topical anesthetic leaders, strengthen societies and equip their staff and members with the skills and information they need. act upon the State and Central Governments to remove the shackles on coop erative laws so dairy can compete on equal terms with other forms of enterprise.2. Strategy for Production EnhancementImprove the production potential of indigenous breeds of cattle such as Sahiwal, Gir, Rathi and Kankrej and breeds of buffalo such as Murrah, Mehsana and Jaffarbadi through appropriate selection programme. click non-descript cattle with Holestein Friesian in areas with adequate feed and fodder and with Jersey in resource-poor areas.Increase the production and use of high quality feed appropriate to local conditions.Increase production and availability of green and ensiled fodder.Encourage unions, NGOs and cooperatives to put common property area under improved pasture and fodder tree.Expand first-aid coverage through village level societiesIncrease vaccination of animals against HS, BQ and FMDDevelop Mastitis and Brucellosis control strategies3. Strategy for Assuring QualityIdentify and address quality related problems at every stage from the producer at the village cooperative, to the dairy plant and the process of final delivery to the consumer.Facilitate improvement of hygiene, sanitation, food synthetic rubber and operating efficiency in the dairy plants and sensitize dairy personnel to product quality aspects as per international standards.4. Strategy for Creating an Information and Development ResearchLink large cooperatives, Unions, Federations and NDDB in a national network that collects, adds value and disseminates information Ensure availability of analytical information for Policy Planning and conclusiveness Support Mother Dairy has different plans for its dairy business, which includes flavoured milk, lassi, curd, butter and cheese besides its toned milks. Each of these products has a regional stronghold, with a shelf vitality of 10 days. However, the company is looking at alternatives that would increase the shelf life and allow the products to be distributed in other parts of the country as well. In the ice cream segment, the company has been able to capture 15 per cent of the market, and hopes to increase it to 20 per cent by 2008.On MDILs marketing strategies while the company does a lot of innovative advertising and on field activities, it spends 3-4 per cent of the turnover on marketing. All categories were experiencing a growth of 30-40 per cent per annum, and that the turnover was growing at 15-17 per cent every year. Mother Dairy had clocked a turnover of Rs 1,800 crore in 2005-06 and was looking at clocking Rs 2,200 crore in 2006-07.Diversification Moves by Mother DiaryAfter becoming a pan-India player recently, dairy kitchen range Mother Dairy, a subsidiary of the National Diary Development Board, is now eyeing a turnover of one billion dollar in the next two years.Following expansion of their business in other cities and with the launch of new products, they are expecting to cross one billion dollar turnover by the end of FY 2009. The dairy chains topline has been growing at a rate of 22-25 pe r cent per annum and is expecting a turnover of Rs 2,700 crore this fiscal. Mother Dairy will be the second dairy chain in the country after Amul to cross the one billion turnover milestone, if it achieves the target.For over three decades, Mother Dairy restricted its presence mainly in the National Capital Region in the fresh milk and other milk products segment. This year it went for a market expansion across the country. They have a plan to capture all the top six markets in the milk and milk products segment in the country.It has recently entered the fresh milk market in Hyderabad and simultaneously made foray into curd, ice-cream and lassi segments in Mumbai market. Mother Dairy markets dairy products such as fresh liquid milk, ice-creams, and other milk products. It also markets Dhara range of edible oils and the Safal range of fresh fruits and vegetables and fruit juices.Mother Dairy are present by and large in most of the big categories now it is more about foraying into nic hes and value-added versions in the same categories. For instance, they have been in the curd and lassi categories for around five-six years, but they have now forayed into probiotic curd and lassi.Advertisement and Promotion by Mother DairyOn the marketing front, Mother Dairy says its trying to take its product campaigns and communications to a higher platform. For instance, in the case of milk, the campaigns do not talk about the obvious benefits milk is good for health, it has calcium and so on but rather it targets children and are created around ideas such as The country needs you, grow faster.As far as products such as butter, cheese and ice creams go, the campaigns have been created around taste. For butter again, the focus is on children. Amul butter may be selling the most, but the advertising and promotions are almost always targeted at adults, points out an analyst citing Amuls popular Utterly-Butterly campaigns.Here, Mother Dairy has dared to go different. Since 60 per cent butter is consumed by kids, the company wants them to sit up and take notice of its butter. Makkhan Singh, a sturdy jovial cow (a cartoon character) has been made its brand ambassador.While Mother Dairy has been carrying out school programmes games and activities involving Makkhan Singh in Delhi, it has plans to take such activities to Mumbai and Kolkata as well. It also runs a gaming website on the character to attract children. Equity and empathy are being built for the brand, the values for which it stands, and the various other Mother Dairy products, which draw their core values from Mother Dairy milk.Its cheese for children again. A couple of months ago, Mother Dairy carried out a retail activity Cheese khao superhero ban jao, where kids buying cheese at a retail outlet were invited for a photo op dressed as superheros through Polaroid cameras and the framed photograph was presented to them. The activity was carried out in about 150 outlets in Delhi and Mumbai, with a bout 20,000-25,000 snaps being taken.It claims that the exercise resulted in better ties with retailers. A positive response made Mother Dairy to repeat it in Kolkota as well. Clearly, Mother Dairy has aggressive plans. But, strong regional brands and other co-operatives will continue to give it tough competition. It will not be a cakewalk anymore.Mother Dairy and Its Programme for Management of ChangeMother Dairy looked at all its operations, strengths and weaknesses as well as opportunities available, and came to the conclusion that it had to become more customer centred (rather than merely being farmer or supplier centred). This required paying close solicitude to the customer needs and quality. Mother Dairy realized that it was not enough that Mother Dairy itself was wedded to these ideas the entire supply chain had to conform.Hence it launched a Total Quality Management or TQM to ensure the high quality of the products from the starting point (the village farmer who supplied m ilk) right through the value chain until it reached the consumer. This meant the need for the involvement of farmers, transporters, factory personnel, wholesalers and retailers, each of whom had a role to play. What began as a TQM movement radually became a movement for management of change in the entire value chain.Mother Dairys Management of Change (MOC) initiative was launched in six areas cleanliness of the dairy co-operative societies, planning and budgeting of the dairy cooperative society, artificial insemination service, quality testing and milk measurement by the dairy co-operatives, animal feeding and management practices and self leadership development. Analysis and the Result of The CaseThe strategy implied by Mother Dairy was that it wanted to increase its market share by providing the best quality to its consumers and building trust with the customers in the long run unconnected other organization, there objective is not to maximize profit. Their strategy involves pay ing the best price to the farmers then making a large profit. Thus there objective is to give the best price to there suppliers.Few common strategies adopted by them is as followsCommon brandingFocused approachProduct differentiationSmart MarketingProduct enhancement and assured quality etcRecently to increase its market share it has introduced several new products positioned against its competitors like amul. whatever of the items are ice-cream, lassi, curd, mishti doi etc.The modus operandi includes providing the best quality and taste which is almost a substitute to the home made products. So the mother dairy is trying to get more familiar taste and come closer to the consumers directly.In case of the marketing of the mother dairy products as in the case modelling of marketing of cheese, in which they have targeted a age group. They are much targeted to a particular age group especially kids and a younger hatful who are in the growing age. End NotesMother dairy plans to increa se its market share with the introduction of new products and enhancing its market outside delhi to other places. Mother dairy has launched its ice-creams ,curd ,probiotic curd, sweet curd etc. to increase the market share.The advertisement strategies used by Mother dairy is also unique and better than its competitors. A specific age group is targeted and effort is made to sustain that age group of customers. Also profit is the least important motive of it but customer merriment is the main roots of their growth. .Bibliography1. http//www.thehindubusinessline.com/2004/12/31/07hdline.htm2. http//www.rediff.com/money/2006/jul/04spec1.htm3. www.nddb.org4. www.motherdairy.com5. http//www.fnbnews.com/article/ articled=191216.http//www.icmrindia.org/casestudies/catalogue/Business%20strategy2/National%20Dairy%20Development%20Board-Dairy%20Cooperative%20Movement.htm7. Empowerment Case Studies National Dairy Development Board8. www.indiadairy.com9. Opportunities and Challenges in the Indian Dairy Industry Dr. K. G.Karmakar and Dr. G. D. Banerjee