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Faculty Guide: Prof. Sudeep S Kumar Prof. Simon George Industry Guide: Mr. Manoj Prabhakar
Amul(GCMMF ) is the largest cooperative business of small producers with an annual turnover of 2.15 billion US $.
2.8 million milk producer member families with 13,759 village societies and 13 District Unions. 8.5 million liters of milk procured per day and Rs. 150 million disbursed in cash daily.
Largest milk handling capacity in Asia. Largest Cold Chain Network. 48 Sales offices, 3000 Wholesale. Distributors, 5 lakh retail outlets. Export to 37 countries worth Rs. 150 crores
Dr. Verghese Kurien, the World Food Prize and the Magsaysay Award winner, was the architect of Indias White Revolution, which helped India emerge as the largest milk producer in the world. Currently, its headed by Mr Parthi Bhatol
Amul An Overview
The industry can be divided into the branded market and the unbranded market. The branded market at present is 100 million liters per annum valued at Rs. 800 crores In 2008-09, in the branded ice cream market, Amul held the number one spot, with a market share or 38%, followed by Kwality Walls at 14%, Vadilal at 12% and Mother Diary at 8%
The per capita consumption of ice cream in India is approximately 300 ml, as against the world average of 2.3 liters per annum.
Vanilla, Strawberry and Chocolate together constitute approximately 60% of the market.
Sales
1700
2172
493
493 500
500
4 3.5 3 Sales(in crores) 2.5 2 2.9 2.5 Market Position 3.2 3.7 4
3.5
3 2.5 2 1.5 1 0.5 0 2 3 3
1.5
1
0.5 0 2007 - 08 2008 - 09 2009 - 10
2009 - 10
2008 - 09
2007 - 08
Identification of problems in the distribution and supply chain that adversely affect the sales of Amul Ice-cream at retail level. Study the behavior of the ice-cream market in Patna region. Strategies for improving market share of Amul ice-cream in retail and push-cart segment. Comparative study of different competitors vis--vis Amul in the ice-cream sector Major parameters to be considered in comparative study I. Quality II. Market-share III. Brand value
Project Objectives
The project was approached in 4 phases: Phase 1: The Silent Observation Phase a. Total number of shops visited was 40. b. Act as silent observers of the ice-cream market of Amul and its competitors in the Patna city, at retail level. c. Information regarding the behavior and perception of retailers as well as customers was gathered. Phase 2: The Retailer Survey Phase a. Consisted of visiting various outlets(A/B/C/D shops) in different geographic locations in the city. b. Personal interviews with different distributors, salesman and the retailers in the region. c. Questionnaire was primarily based on the information gathered in previous phase.
Methodology
Phase 3: The Consumer Survey Phase a. Collection of information regarding the consumers buying behavior and their perception of ice-creams and the related brands in the Patna town. b. General survey was conducted keeping in mind the fact that it was beyond the scope of project. Phase 4: Push-Cart Segment Survey Phase a. Targeted the push-cart distributors and brands actively involved in this segment. b. Analyze the market and figure out reasons for Amuls low presence in this segment.
Methodology
The conclusions derived after each phase: Phase 1: The Silent Observation Phase a. Different brands of ice-cream present in the Kankarbag area were: i. SnowBall ii. Creambell iii. Vadilal iv. Amul v. Golden vi. Rollick The graph below shows the customers preference in terms of taste and price Customer Preference Taste
No. of customers(in %) Candies 10% Cones 21% Chocobars 29% 50 40 30 20 10 0 Less than Between 5 5 to 10 4 10 35 46
Cups 40%
Between 10 to 25
Greater than 25
Research Analysis
Phase 2: The Retailer Survey Phase a. The sampling method used here is stratified sampling. b. The sample size was taken as 140 outlets for all strata. c. The regions covered in this phase were: i. Boring Road ii. Belly Road iii. Maurya Lok Complex iv. Gandhi Maidaan v. Kurjee( P&M Mall and Big Baazar) Breakup of the number of stores covered of each class in % in the Kankarbag region (Fig 1) and the whole Patna town (Fig 2).
Kankarbag Region A
8% B 22%
Patna Region
A 16% C 55% B 29%
C 70%
Research Analysis
Phase 2: The Retailer Survey Phase Contd The ice cream market is estimated to be between Rs 35 crore and Rs 40 crore
The graph below depicts the current market share of different brands in the town.
40 30 40
25 20
20
10 10 0 3
Amul
Cream bell
Snow ball
Golden
Vadilal
Rollick
Research Analysis
Phase 3: The Consumer Survey Phase a. The sample size in this case was 300. b. Customers are price-conscious and prefer the ice-creams in the range of Rs 5 to Rs 25. c. Most of customers are not brand-conscious and would go for any icecream which is readily available. d. Profile of respondents:
Occupation
Student 34% Home Maker 32% Female 56%
Sex
Male 44%
SelfEmployed 24%
Service 10%
Research Analysis
Phase 3: The Consumer Survey Phase Contd a. Sales of ice-cream increases by almost 50% in the marriage season. b. The major factors to be considered in this phase: i. Availability ii. Seasonality iii. Awareness c. Push-carts have major penetration among the customers. d. Profile of respondents: Income Level
< 2 lakhs 9% > 8 lakhs 15% 5 - 8 lakhs 22% 3 - 5 lakhs 34% 40 - 50 yrs 14%
Age Group
> 50 yrs 12% < 20 yrs 32%
2 - 3 lakhs 20%
30 - 40 yrs 16%
20 - 30 yrs 26%
Research Analysis
Phase 4: Push-Cart Segment Survey Phase a. The biggest factor that has been affecting Amuls presence in the market is its short and poor supply. b. Different players in the push-cart segment: i. Vadilal ii. Treat iii. Golden iv. Amul v. Sudha
Treat
0% Vadilal
Amul
Research Analysis
Bar-graph drawn below measures the over-all satisfaction level of retailers and distributors separately on a scale of 1 to 5.
Satisfaction Level
3.5
Satisfaction Level
Amul
Golden
Vadilal
Cream bell
Rollick
Snow ball
Golden
Vadilal
Rollick
Main factors affecting the satisfaction level of retailers are: Margins offered by the companies and Replacement policy.
S. No. Brands Margins Offered to the Retailers Replacement Policy
1
2 3 4 5 6
Amul
Snow - ball Cream - bell Vadilal Golden Rollick
17.5 %
35 40 % 17 19% 17 19% 30 40% 18 19%
Conditional
None None Conditional None None
Data Analysis
Factor Analysis: The different factors considered are: a. Price b. Quality c. Availability d. Packaging e. Taste f. Awareness Three important factors on which the sales of Amul ice-cream depends in the Patna region.
Factor 1 Taste Awareness Quality Factor 2 Price Factor 3 Availability
Data Analysis
STRENGTHS 1. A well-known brand. respected for its quality, thus less effort required to market Amul ice-creams. 3. Huge demand from customers. 4. Ice-cream made up of fresh milk, unlike others which are made up of vegetable oils.
WEAKNESSES 1. Very poor supply. 2. Inability to provide the entire range of ice-creams during the peak season. 3. Low number of distributors. 4. Very low number of push-carts in the city. 5. No incentive of any kind by the company in the push-cart segment.
OPPORTUNITIES 1. Exploit its huge customer demand by maintaining its demand-supply equilibrium. 2. Increase in the number of push-carts will lead to increase in distributors and in turn will mean increase in sales. 3. There are areas which still need to be tapped. Ex Eco Park (near Strand Road).
THREATS 1. Tendency among the Amul pushcart vendors to switch to other brands. 2. Ice-cream buying behavior mainly depends on the availability in this region 3. Difficult to compete with the local players
Push-cart supplied by Amul is manufactured by Voltas (currently by Rockwell) and is shipped from Kolkata. The details of the price-list:
HAPC Rockwell Tricycle Push-Carts 38250 Voltas 41384 39114
Data Analysis
1. Amul ice-creams have a huge demand in the town. 2. A brand respected for its quality, hence less effort required to market. 3. Adheres to the norms of ice-cream as against frozen dessert made of pure milk. 4. Local players very strong in the region. 5. Very poor supply. 6. Entire range of ice-creams absent in the retail stores. 7. Stock outs faced during peak season. 8. Very low number of push-carts in the town. 9. Very few distributors in the push-cart segment present. 10. No incentive in the push-cart segment. 11. Consumers mostly not brand biased while purchasing ice-creams. 12. Target setting done on an annual basis.
Conclusions
Can put up a factory of the best selling items like cups and chocobars, in the local vicinity.
Increase the number of distributors in the retail as well as the push cart segment.
Tap the areas in the town where there is huge sales potential.
Recommendations
The target setting needs to be done on monthly basis rather than the annual basis and it needs to be aggressive.
Recommendations
References
Thank You