North India collection model 3 tier collection 1. MPG (Milk producer group) 2. BMC 3.

Dairy
MPG set-up: Agent appointed by the farmer group. Agent receives commission basis value of milk supplied. Commissioned is paid by company, so as to ensure the agent is accountable for quality and qty of milk. Any deviation in the same is deducted from commission. Commission rates - MPG agent 4 5% After collection of milk, agent does composite sampling of milk and testing is done in front of transported. Transporter signs the despatch challan, Thus accountability transfers to Transporter (uptill BMC) 2 options available for delivery of milk from MPG to BMC Option1: Incase farmer groups are located within 3-5 km from BMC or no. of MPG covered by BMC is only 2-3 villages, then delivery of milk to BMC is by the MPG agent. In this case, agent gets a head load, in addition to commission. Head load rates varies basis distance of travel <3 km: Rs. 0.2 0.3 per lit >3 km: Rs. 0.4 /lit Option 2 Incase of bigger BMC coverage (more than 5 villages) then company arranges for transportation with defined routes and timing for lifting) BMC set-up: BMC is managed by agent. Mostly this agent is an MPG agent (as BMC is located adjacent) with additional responsibility for operating the BMC. The agent receives additional commission for BMC operation. Commission is again based on value of milk. Milk is received MPG wise and checked for Fat, SNF and other parameters. Commission rates BMC agent: 4% If the volume is low (1-2 KL per day), commission cost includes consumables also. Else, company also pays additional for consumable cost. Consumables include Teepol, sanitiser and testing chemicals, stationary. Company supplies adulteration kit (cost borne by company). Also, diesel expense is borne by company. Testing of other parameters is depending on size/capacity of BMC 1 2kl BMC Fat, SNF, Acidity, Alcohol, COB >5 KL BMC In addition; RM, BR, MBRT, NDDB adulteration kit test Antibiotic test is generally not done at BMC level.

Milk transportation to Dairy:

Tanker is accompanied by local supervisor (either contract employee or company employee). Role of supervisor is to conduct testing of milk for quality (fat on centrifuge method and SNF on Lactometer jar method). Supervisor signs the despatch slip on receipt at BMC and becomes accountable for delivery of milk upto Dairy. Expense in Milk collection Company bears the following cost in addition to agent commission adulteration kit (at BMC level) Repair and maintenance cost of equipment / testing equipment / DG etc. (both at MPG and BMC level, as applicable) Milk pricing strategy: Companies follow double axis method. Certain areas (in Haryana / Rajasthan) practise single axis method, that too, for Buffalo milk only. Single axis method benefits the farmer and thus is not prevalent. Recent trends in single axis method, also include deduction / incentive basis SNF(threshold @ 8.5%) Results allow a relaxation of 0.05% (test variations) which is not penalised.

Payment is done on 10 day basis South model

They follow the standard 3 tier model for collection 1. tier 1 - Farmer group collection point 2. tier 2 - Bulk milk cooler center or chilling center 3. tier 3 - delivered to Dairy Set-up of chilling center depends on the volume of milk being collected. Incase of low volume, milk is collected at BMC and mulitple BMC are attached to the Chilling center, else the milk from BMC is directly transported to Dairy. Both farmer groups and BMC operate on commission basis (commission on value of milk) Price is on calculated basis Total solids. Payment is done on weekly