A

Project Report
On
Potential and Future of Dairy industry

An Insight of Mother Dairy

Submitted to:INTERNATIONAL INSTITUTE OF BUSINESS STUDIES

In partial fulfilment of the requirement of the award
For the degree of
MASTER OF BUSINESS ADMINISTRATION
Under the guidance of
Mrs Seema Mishra

Mr Sachin
Rohtagi

Ast Dean

Professor

IIBS NOIDA

IIBS NOIDA
Submitted By:Anand Kumar Tiwari
BU-S 12
Second Semester 2013

CERTIFICATE

I hereby certify that the work which is being presented in the

MBA. Project Report entitled An Insight of Mother Dairy, in
partial fulfilment of the requirements for the award of the
Master of Business Administration and submitted to
International Institute of Business Management, Noida is an
authentic record of my own work carried out during Second
Semester under the supervision of Prof Sachin Rohtagi,
Finance Department.
The matter presented in this Project Report has not been
submitted by me for the award of any other degree elsewhere.

Place:
Date:

Authorised Signature

TABLE OF CONTENT
1. Preface
2. Acknowledgment
3. Declaration
4. Executive Summary
About the industry
About the NDDB
About Operation flood
About the company
Process
About Functional Department
Production Department
Finance Department
Marketing Department
Human Resource Department
Purchase and store Department
Quality Assurance Department
Dispatch And Logistics
Department
5. Facts And Figures
Milk Production in India
Milk Production by Mother Dairy
Comparison Chart
Per Capita Consumption And Expenditure
Graphical Representation of NSS Data
Milk production across countries
Indias contribution to dairy Industry
Index no of Whole sale price.
6. Mother Dairy Export
7. De-Galleria
8. CSR Activity
9. SWOT
10.
Recommendations

11.

Annexure
PREFACE

As MBA students our aim should not be only to learn theoretical concepts in the
classroom, but it becomes more important as how we apply those concepts in
practices.
In present scenario the world is developing so fast, and thus the technological and
application theory is changing at a greater phase. The study inculcates students to
think out of the box, rather than emphasising within the box. We are coming across
many modern theories and implementation of machineries, to start new business.
We must have the knowledge of theories and practical, through it, the student can
able know about how to apply their mind in the real business world.
This program of industrial visit is to create awareness about the industrial
environment amongst the students. Such Industrial visit also plays vital role in MBA
programme.
The importance of industrial visit and project preparation has been widely accepted
in the education institutions. Thus knowing the importance of such practical visit, our
college is providing with such a programme to enhance the overall development of
the students.
MOTHER DAIRY gave me the golden opportunity to carry out my visit in such a
great organization. I have prepared the detail report regarding the Potential and
future of dairy Industry. I have tried my best to collect all necessary information
relating to the project work.

ACKNOWLEDGEMENT

This project is done as a semester project, as a part of course titled MOTHER

DAIRY. Im really thankful to my instructor Mr. Sachin Rohtagi, Assistant Professor,
for Financial Management, International Institute of Business studies, Noida, for his
valuable guidance and assistance, without which the accomplishment of the task
would have never been possible.
I would also like to thank him for giving this opportunity to explore into the real world
and realize the interrelation of Dairy Industry and Economics, without which a society
can never progress. In my project I have chosen the topic- Potential and Future of
the dairy Industry and as the study of the same, done for Delhi-NCR Region, one of
the famous and most populous regions of India.
This report contains an over view of Dairy industry of North West Region and the
Various Development and planning by co-operative societies and national dairy
development board, for a better understanding of the various steps implemented by
the government to overcome the growing demand of the dairy requirements of the
country. Im also thankful to all those working for Mother Dairy for providing me with
relevant information and necessary clarifications.

DECLARATION

I, Anand Kumar, hereby declare that the report on MOTHER DAIRY entitled
Future and Potential of Mother Dairy is a result of my own work and my
indebtedness to other work publications. Correction if any will be duly acknowledged.

Place: NOIDA
Date: 17th June 2013

Anand Kumar Tiwari

EXECUTIVE SUMMARY

The report consists of the details on Mother Dairy India Ltd. It is one of the most
effluent companys of India for processed milk and milk Products. The main aim of it
is the welfare of the society by providing quality milk to its consumers at an
affordable price. This report also contains the detailed information about the rise in
population with respect to rise in dairy industry. The dairy industry has being studied
in detail, so that that can be converted into information which can be used by mother
dairy for strategising its marketing advertisement areas.
It has various functional departments such as the Production, Human Resource,
Finance, Marketing, Purchase and Stores, Quality Assurance, Dispatch and
Logistics.
This report is descriptive in nature but contain vital data of the capacity of Indian
dairy industry and competitors to mother dairy. This report will help mother dairy to
make strategies for their long term objective.
This will enable the company to take appropriate decision as needed to increase as
well as to retain its customers in the market. The data has been analyzed by
presenting it in the form of graphs and tables and based on it; the interpretations
have been made for the same. The results and findings have also been made for the
organization to help management in their decisions. Lastly, the recommendations
have also been made for the organization.

ABOUT DAIRY INDUSTRY

Introduction:
The dairy sector in the India has shown remarkable development in the past decade
and India has now become one of the largest producers of milk and value-added
milk products in the world. The dairy sector has developed through co-operatives in
many parts of the country. During 1997-98, the States (Delhi-Haryana-Uttar Pradesh)
had 17574 million tones production capacity, which rose to 29719 million tons by the
year 2012. In addition to many processing plants, many government co-operative
societies and chilling centers have being made.

About the Indian dairy Industry

In India, the dairy sector plays an important role in the countrys socio-economic
development and constitutes an important segment of the rural economic.
Dairy industry provides livelihood to millions of homes in village, assuring supply of
quality of milk and milk products to both urban and rural areas. With view to keeping
pace with the countrys increasing demand of milk and milk products, the industry
has being growing rapidly.
According to research report Indian Dairy Industry Analysis India is worlds largest
milk producers accounting of around 17% of the global milk production. Besides,
India is also one of largest consumers of milk and milk products. Due to rich
nutritional qualities, the consumption of dairy product has being growing
exponentially in the country, and considering such facts and figures, my study
anticipates that the milk production in India will grow at a CAGR of around 4% during
2012 to 2015.
With rising use of dairy product, the secondary market of dairy product has been
flourishing, my report observed.

Covering the necessary aspects of the Indian dairy industry, the study facilitates
knowledge about its current market scenario and future growth. Analyzing the past
and current state of the industry, the report tries to find out how trends like the entry
of international companies and packaging are attracting the consumers and heeding
towards further growth in the market. This way, it present a clear picture of the
direction, in which the industry is likely to proceed in the coming years.
The government is taking several initiatives and running plans and programs like
National Diary Plan and Intensive Dairy Development Program to meet the growing
demand for milk in the country. Our report talks about such schemes, and
government regulations to present an objective and balanced picture of the industry.
The study also discusses the opportunities and strengths of the dairy market in a
complete SWOT analysis, and provides an insight into the competitive landscape.
We hope that our comprehensive research will help clients align their business
strategies as per market dynamics, and make sound investment decisions.

ABOUT NDDB

ABOUT NDDB

National Dairy Development Board (NDDB) was founded to replace...

Exploitation with empowerment.
Tradition with modernity.
Stagnation with growth.

An instrument for the development of Indias rural transforming dairying into an

instrument for the development of Indias rural people. Prior to NDDB, the milk
market was vastly governed by local private dairy and these dairies were neither
producing milk nor they were animal breeders and hence law of demand and supply
was unheard by those whose intentions were purely to make more money from both
the sides that is from producers of milk (farmers) and consumers at large.
Establishment of NDDB broke that spell and traders were side lined in due course.
The National Dairy Development Board was created in promote, finance and support
producer-owned and controlled organizations. NDDBs efforts are co-operative
principles and the Anand Pattern of Co-operation
Philosophy of NDDB
Co-operation is the preferred form of enterprise, giving people control
over the resources, through democratic self governance.
All beneficiaries, particularly women and under privileged, must be
involved in co-operative management and decision making.
Technological and evolution search for better way to achieve the
objective in the dynamic market.
The NDDB was created in 1965, fulfilling the desire of the Prime Minister of India
the late Lal Bahadur Shatri to extend the success of the Kaira Co-operative Milk
Producers union (Amul) to other parts of India.
That success combined the wisdom and energy of farmers with professional
management to successfully capture liquid milk and milk product markets while
supporting farmer investment with inputs and services.
NDDB began its operations with the mission of making dairying a vehicle to a better
future for millions of grassroots milk producers. The mission achieved thrust and
direction with the launching of Operation Flood, a programme extending over 26

years and which used World Bank loan to finance Indias emergence as the worlds
largest milk producing nation. Operation Floods third phase was completed in 1996
and has to its credit a number of significant achievements.
As on March 2001, Indias 96,000 dairy co-operatives integrated through a three tier
co-operative structure The Anand Pattern, owned by more than ten million
farmers, procure an average of 16.5 million litres of milk every day. The milk is
processed and marketed by 170 milk producers co-operative unions which, in turn,
own 15 state co-operative milk marketing federations.
NDDB also promotes other commodity-based co-operatives, allied industries and
veterinary biological on an intensive and nation-wide basis. Dr. (Ms) Amrita Patel
serves as the Chairman of NDDB; Dr. Varghese Kurien was the founder Chairman.

ABOUT OPERATION FLOOD

Introduction to Operation Flood
Operation Flood has been one of the worlds largest rural development programmes.
It was started by Indias National Dairy Development Board (NDDB) in 1970. One of
the largest of its kind, the programme objective was to create a nationwide milk grid.

Operation Flood strategy

The bedrock of Operation Flood has been village milk producers cooperatives,
which procure milk and provide inputs and services, making modern management
and technology available to members. Operation Floods objectives included:

Increase milk production (a flood of milk)

Augment rural incomes

Reasonable prices for consumers

Programme Implementation
Implementation of Operation Flood
Operation Flood was implemented in three phases.
Phase I
Phase I (1970-1980) was financed by the sale of skimmed milk powder and butter oil
gifted by the European Union then EEC through the World Food Programme. NDDB
planned the programme and negotiated the details of EEC assistance.
During its first phase, Operation Flood linked 18 of Indias premier milk sheds with
consumers in Indias four major metropolitan cities: Delhi, Mumbai, Kolkata and
Chennai.
Phase II
Operation Floods Phase II (1981-85) increased the milk sheds from 18 to 136; 290
urban markets expanded the outlets for milk. By the end of 1985, a self-sustaining
system of 43,000 village cooperatives covering 4.25 million milk producers had
become a reality. Domestic milk powder production increased from 22,000 tons in
the pre-project year to 140,000 tons by 1989, all of the increase coming from dairies
set up under Operation Flood. In this way EEC gifts and World Bank loan helped to
promote self-reliance. Direct marketing of milk by producers cooperatives increased
by several million litres a day.

Phase III
Phase III (1985-1996) enabled dairy cooperatives to expand and strengthen the
infrastructure required to procure and market increasing volumes of milk. Veterinary
first-aid health care services, feed and artificial insemination services for cooperative
members were extended, along with intensified member education.
Operation Floods Phase III consolidated Indias dairy cooperative movement, adding
30,000 new dairy cooperatives to the 42,000 existing societies organised during
Phase II. Milk sheds peaked to 173 in 1988-89 with the numbers of women
members and Womens Dairy Cooperative Societies increasing significantly.
Phase III gave increased emphasis to research and development in animal health
and animal nutrition. Innovations like vaccine for Theileriosis, bypass protein feed
and urea-molasses mineral blocks, all contributed to the enhanced productivity of
milch animals.
From the outset, Operation Flood was conceived and implemented as much more
than a dairy programme.

Rather, dairying was seen as an instrument of

development, generating employment and regular incomes for millions of rural

people.

Achievements of Operation Flood

Operation Flood can be viewed as a twenty year experiment confirming the Rural
Development Vision (World Bank Report 1997c.)
1.

It resulted in making India the largest producer of milk and milk products, and
hence is also called the White Revolution of India. It also helped reduce malpractices
by milk traders and merchants.

2.

This revolution followed the Indian Green Revolution and helped in

accelerating organic, decentralized development across the board, alleviating
poverty by offering gainful employment, and also providing access to better nutrition.

3.

Operation Flood has helped dairy farmers direct their own development,
placing control of the resources they create in their own hands.

4.

A National Milk Grid links milk producers throughout India with consumers in
over 700 towns and cities, reducing seasonal and regional price variations while
ensuring that the producer gets fair market prices in a transparent manner on a
regular basis.

ABOUT THE COMPANY

MOTHER DAIRY
"Mother Dairy" is the single largest brand of milk in India as well as in Asia,
marketing about 4.45 million litres of milk per day. Mother Dairy commands 62%
market share in the organized sector in and around Delhi, primarily because of
consistent quality and service whatever be the crisis - floods, transport, strike,
curfew etc. Mother Dairy, Patparganj, Delhi, is presently manufacturing & selling
around 8.5 lakh litres of toned milk through bulk vending shops.
Mother Dairy, Delhi is an IS/ISO - 9001:2000 and Hazard Analysis Critical Control
Points (HACCP) and IS-14001:1996 Environment Management System (EMS)
Certified organisation.
Mother Dairy was the first Dairy in the country to implement ISO-14031
(Environment Performance Evaluation) project. The companys Quality Assurance
Laboratory is ISO/IEC- 17025:1999 certified by NABL (National Accreditation Board
for Testing and Calibration Laboratory), Department of Science & Technology, India.
This provides assurance to 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 phase 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 processing
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 trusted house hold name for its wide range of milk products
like Milk, Flavoured Milk, Ice-Cream, Dahi, Lassi, Table Butter, Dairy Whitner, Ghee
etc. The application for the award is being made 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 Club 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 to19971998 from National productivity Council and a commendation Certificate for Rajiv
Gandhi National Quality Award, National Energy 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 only 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 located Mother Dairy booths across Delhi and NCR make it convenient
for you to pick up your daily requirement of Milk, Flavoured milk, Butter, Dahi, Lassi,
Cheese, Chaas.mouth watering Ice Creams.
The focus is on key markets for each of the categories. In the curd category, they
have been in Delhi for a while now and launched in Mumbai just three months back.
They hold a 60 per cent market share in Delhi, but it is too soon to gauge where we
stand in Mumbai.
Objectives and Business Philosophy of Mother Dairy
The main stakeholder of Mother Dairy was the farmer member for whose welfare 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 making a
large profit. Thus they look at the price given to their suppliers as not a cost but as
an objective.
Mother Dairy had, as its main objective, carrying out activities for the economic
development of agriculturists by efficiently organizing marketing of milk and dairy

produce, agricultural produce in raw and/or processed form and other allied
produce.
This was to be done through:
Common branding
Centralized marketing
Centralized quality control
Centralized purchases and
Pooling of milk efficiently
Mother Dairy had declared, as its business philosophy, the following:
ensure that milk producers and farmers regularly and continually receive market
prices by offering quality milk, milk products and other food products to consumers at
competitive prices and; uphold 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 such 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 experience 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.

PROCESS
The Process Flow of the Mother Dairy
Clarification

Standardization

Processed Milk

Pasteurization

Homogenization

Deep Chilling

Dispatch

Raw
.

Raw Milk Reception:

Raw milk received through insulated road/rail tankers at a very low temperature thus
retaining the freshness of milk. The milk goes for more than 15 stringent quality tests
before it is accepted for the processing of milk.
Milk achieved from individual producers is checked for all basic quality parameters
meeting the company specification and required norms at respective collection and
chilling centres.
Milk is then supplied to the dairy units through insulated milk tankers at <4 degree C.

Processing of Milk:
Processing of milk is done in basically 4 steps

Clarification
Standardization
Homogenization
Pasteurization

Clarification:
The chilled milk from the silos goes to the clarifier after pre-heating. The clarifier
spins the milk at very high speed, removing all the dust particles that are invisible to
naked eyes.

Standardization:
Milk from different breeds of cow and buffalo may vary in its composition. Hence, to
make Milk uniform in composition, before supply to the market, it is standardized by
raising or lowering its fat and SNF percentage present in the milk to a desired level,
so as to deliver the milk to consumers as per prescribed norms of FSSAI.
Homogenization:
In this process, the milk is processed at very high pressure during which the large fat
globules presently in milk are broken down into tiny droplets. The milk fat gets evenly
distributed in the milk and milk become whiter and thicker. Milk is homogenized for
consumers who do not like cream layer on top. Homogenization improves
Palatability of milk and is easily digestible.
Pasteurization:
The milk is then pasteurized, named after Louis Pasteur, a French Scientist who
invented the process to use in wine. Pasteurization was first applied by Dr. Soxhiet of
Germany. This involves heating of milk to 72 degree Celsius for 15 second and then
cooling it down to 4 degree Celsius. The process kills all pathogenic bacteria present
in the milk making. It makes milk safe for consumption. Pasteurization, unlike boiling
does not affect the nutritional value of the milk.

ABOUT FUNCTIONAL DEPARTMENTS

Production Department is most important part in any organization, firm, company

or co-operative sectors. Production can be made for the middle users or for the end-

users (direct consumers). Production do the main work of converting raw material
into semi-finished or finished goods, it depends on what kind of production the
organization is doing.
In the context of Mother Dairy, people have endless demand for milk and milk
products. MOTHER DAIRY undertakes the procurement of milk and its production
likewise satisfying the needs and demand of people. It estimates the demand and
accordingly production is done for which arrangement of Raw material, finance and
provision for selling is made by MOTHER DAIRY.
The Production Department is interrelated with the Personnel, Finance, and
Marketing Department. On an average 30 million litres of milk is processed by
Mother dairy.
Major Products of Mother Dairy:
Following are the some milk products that the Mother Dairy products and sale in
different areas of Delhi-NCR.
Full Cream Milk
Standardised Milk
Toned Milk
Double Toned Milk
Skimmed Milk
Flavoured milk pouch
Flavoured milk bottles
Goras chhas
Jira Chhas
Dahi
Cheese

8 lakh litres per day

10.75 lakh litres per day
4.36 lakh litres per day
2 lakh litres per day
4.89 lakh litres per day
33149 pouches per day
31114 bottles per day
14,39,04 pouch of 500ml per day
14,16,552 pouch of 200ml per day
2,80,711 pouches of 200ml per day
N/A

Activities of Production Department:

There are mainly Eight (8) activities done by the Production Department. They
are as follows:

1. Raw Material Receiving Dock

2. Clarification
3. Homogenization
4. Pasteurization
5. Chilling
6. Processed Milk
7. Deep Chilling
8. Dispatch In Insulated Tankers
Mother Dairy has set up a modern plant for the production process. It has
established its plant in a modern high tech style which functions nearly 80%
automatically.

Finance Department

Finance Department
Finance is the most crucial part in any organization. Finance is required in each &
every stage of the business. Business is nothing but a process of making money
through money. The finance department of a business takes responsibility for

organizing the financial and accounting affairs including the preparation and
presentation of appropriate accounts, and the provision of financial information for
managers
The primary purpose of the Finance Department is to monitor and report on the
financial position of the Mother Dairy and to provide an excellent level of service to
their public customers and customers in other City Departments.
It can be acquired through various sources. After the acquisition of finance, the work
of utilization of finance is to be decided. The finance department has to deal with not
only the procurement of finance but also with the proper utilization of it. Finance is
the basic requirement for purchase of assets, production of goods, marketing,
selling, etc. The finance department takes the decision regarding financial matters.
Thus, we can say that finance dept. is one of the most important dept.
Source of Finance in Mother Dairy
Mother dairy does not raise finance for short term as all the requirement for shortterm finance are fulfilled by the internal sources (i.e. reserves & surplus). Mostly,
finance is raised from long-term sources of finance. All the requirement of finance is
fulfilled either by issuing equity shares or by taking loan from National Dairy
Development Board. The repayment of loan is done in equal instalments, the
amount is pre-decided. Generally, 8% interest is charged on the amount of loan.
The Main Areas Covered By Financial Department in Dairy

Book keeping procedures.

Creating a balance sheet & profit and loss account.

Providing information to management.

Management of wages & salary.

Raising Funds.

Cost allocation.

Capital Structure in Mother Dairy

Capital structure of an organization refers to procurement of capital. Capital structure
including all the financial. Thus capital structures of an organization show how or
through which sources raised.
Mother dairy is a co-operative society and its capital needs are fulfilled by NDDB.
Mother Dairy Is A Co-Operative Organization. It Does Not Issue Right Or Any Other
Public Issue. Therefore There Is No Question Of Any Bonus.
MOTHER DAIRY does not have any other source of raising fund, for any
undertaking it is financial by NDDB or self financing.

MARKETING DEPARTMENT

Marketing Department
It is clearly said that Marketing Department is the Front Face of any
organization or firm. This is said because marketing is the only means from where

the consumers can know about the upcoming products of the firm or organization.
This indirectly gives result in increased sales of products.
Marketing - in other sense, means promoting the product publically and to bring
revenue through sales. Marketing Department does the function of creating demand
in people and generates sales from it, which completely depends on marketing
department.
Mother dairy is having a full-fledged marketing dept. where all the functions related
to marketing are performed. As a part of marketing strategy Mother Dairy has
increased its Morning milk centres.
Also mother dairy have introduced various innovative distribution format such as

Milk Shops.
Franchise Shops.
Kiosks.
Insulated Containers.
Container on wheel.

This distribution is itself so innovative that make mother dairy different than their
competitors.
Strategies Implemented
1. Focused Approach
Mother Dairy wants to get into bigger markets and have bigger shares in those
markets. The cooperative is also expanding its product portfolio further to match 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, flavoured milk, and Lassi and mishti Dahi. It
introduced butter a year-and-a half ago; 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 plans to come out with
frozen potato-based snacks in a few months.
So while the product portfolio has been growing, Mother Dairy has plans for reach
out to newer markets - but the strategy here is more product-specific. In liquid milk, it
will initially concentrate only on four markets - Delhi, its home ground; the Junagarh

region and Ahmadabad in Gujarat; Mumbai, which it entered a year ago; and
Hyderabad, where it moved in a little more than a year ago. They have no plans to
go everywhere with liquid milk. What's the need to get into those markets that
already have strong co-operative brands? Their objective of getting into newer
locations is not to make Mother Dairy larger, but to ensure that there is a large viable
Distribution network and consumer brand to take care 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
approximate 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 Spread
However, 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 two years ago that Mother Dairy entered its first market
outside Delhi - UP and Punjab. Today, it's extended its operation to Haryana, Jaipur,
Mumbai and Kolkata as well. Next year, it plans to go south to Hyderabad and
Bangalore.
In the case of butter and cheese, it's 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 Bengal and north-east. For ghee, although
the current focus is the northern region, it has plans for a nationwide presence.

As far as Mother Dairy's non-dairy products are concerned, edible-oil brand Dhara
has already has nationwide presence.
3. Product Differentiation
While 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, it's
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 relevant marketing and
promotion campaigns. Mother Dairy are bringing in mass Indian flavours which are
building up in terms of absolute percentage 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 it's
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 Marketing
On the marketing front, Mother Dairy says it's 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. 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.
It's cheese for children again. A couple of Year 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 superheroes - 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 about 20,000-25,000 snaps being taken.
Cheese was also something that helped the company bond better with its retailers.
In November 2005, retailers in Delhi displayed banners proclaiming, "Cheese ke
saath bees ke 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 didn't even needs.
The exercise resulted in better ties with retailers. A positive response made Mother
Dairy to repeat it in Kolkata as well. Clearly, Mother Dairy has aggressive plans. But,
strong regional brands and other co-operatives will continue to give it tough
competition.

HUMAN RESOURCE DEPARTMENT

Human Resource Department

There is a well versed Quote saying that Employees are the assets of any
organization Which depicts that they are most important tool of organization. Thus
to maintain them for the organization, Personnel department (Human Resource
Department) is kept for the well being of employees.
The function of Human Resource Department can be seen in each and every
department of any organization. Thus it can be easily said that The Human
Resource Department is the heart of any organization. The function of Human
Resource Management is to manage the people working in the organization. It
mainly focused on the intrapersonal relationship and interpersonal relationship of
employees.
Human Resource Management in simple words means planning, organizing,
directing and controlling of procurement, recruitment, selection, training and
development, compensation, integration, maintenance, appraisal, allocation and
separation of Human Resources
Thus, Human Resource Management refers to set of programme, functions and
activities designed and carried out in order to MAXIMIZE the employees as well as
organizational efficiency and effectiveness.

Human Resource Management at Mother Dairy

Mother Dairy is one of the leading Dairy It shares collaborative and friendly
relationship with preferred partners, employees, consumers and other workers

involved to it. It maintains a transparency in handling the above relations and stick to
its standards.
The HRM function or Personnel department function in Mother Dairy is indeed vast.
All major activities since working of a worker from the time of his/her selection in to
an organization until he/she resigns or get retired or leave job for any reason
comes under the preview of HRM.
The HR planning in Dairy is very smooth and transparent. It made Mother Dairy a
HUGE BIG Family of approximately 3000 employees. In Mother Dairy major
attention is given on the welfare and Safety of employees.
Dairy also focuses on developing human value and potential through various
bearing and development activities and provide favourable atmosphere. All these
functions are performed by HR in Mother Dairy.

HIERARCHY OF PERSONNEL DEPARTMENT

MANAGING DIRECTOR

GENERAL MANAGER (P&A)

MANAGER
(PERSONNEL)

MANAGER
TIME KEEPING

MANAGER
(ADMIN)

SUPERINTENDE
NT
(TELEPHONE)

OFFICER

OFFICER

OFFICER

SR. OFFICER

JR. OFFICER

JR. OFFICER

JR. OFFICER

SR. EXECUTIVE

SR.EXECUTIVE

SR. EXECUTIVE

JR. ASSISTANT

JR. ASSISTENT
TIME KEEPER

JR.ASSISTANT
(ADMIN)

Human Resource Is Divided Into Different Parts

The HR in Mother Dairy in mainly divided into four sections:

Personnel Department
Recruitment, selection, training, industrial relations, negotiation with Union
etc.

Administration Department
Its handles canteen, security, welfare facilities, safety, Any theft or loss,
Absenteeism , events, AGM meeting organizing, licensing work, hygiene of
various dept, etc.

Time Keeping Department

 It handles salary & wages, records of employees, provides benefit of

statutory, ESS, Form fill up, punching System, provident fund, ESI etc.

Telephone Department & Computer Department

Maintains the connection of each department and provides facility of CUG
to each employee to remain in contact while doing work. So that if any
query or problem occur they can contact each other easily. Computer
system handles the whole MIS in Mother Dairy.

Trade Union in Dairy

Trade unions are the voluntary collective group of employees or employers formed to
promote and convey their interest through collective actions to the organization.
At Mother dairy, there are unions.

1. Mother Dairy, Yelahanka, Bangalore.

To get adequate bonus

Strive for better working condition.
To secure better pay scale for employees in keeping with the prevailing
standards of living in the country.
To work for welfare and development of workers educational facilities and
group benefit scheme for them.
Recruitment
Recruitment is a process of searching for prospective employees & stimulating them
to apply for the job in the org. Recruitment of an employee is done on the bases of
Human Resource Planning carried by Mother dairy Mgt. At Mother dairy
recruitment is done through both sources i.e. internal as well as external sources.

Internal Recruitment:

Recruiting employees internally like promotion, transfers, etc.

External Recruitment:

Recruiting employees form job portals, employment exchange, campus interview,

advertisements. Dairy uses External source of recruitment mostly.
Selection
Selection procedure includes the selecting Right candidate, at Right time, for right
job. It is as follows:

Application form

Bio-data analysis

Short-listing.

Interviews

References/security screening

Ability tests

Aptitude, intelligence and personality

Work experience/short term contracts

Medical checkups.

Placement/Appointment.

PURCHASE AND STORE DEPARTMENT

Purchase and Store Department

Inventory Management System

In Mother dairy, the store department uses the FIFO method. I.e. First in First Out
method of inventory management.
Purchase Procedure
Mother Dairys main raw material is milk. The purchase department has only to pick
up just 10% of other raw material. The purchase procedure is as under:
1. First of all respective department heads find out their need and get it
approve by the managing director.
2. Then they contact the stores department.
3. After this they send an indent to the purchase department.
4. The purchase department then asks for quotation from the suppliers.
5. After the quotations are received will then be selected.
6. The least cost giving suppler will then be selected.
7. Then take the approval and give the authority to the supplier who gets the
quotation passed.
8. Then just let the finance department will make the payment the supplier
after the delivery of goods.
Types of Stores

Cold Stores
The cold stores are use for storing milk, chhas, flavoured milk, Dahi etc. and
many other products.

General Store 1
In this general store, the veterinary products, medicines, transportation
instrument, buckets, flavours for milk and Ice-cream are stored here.

General Store 2
Here plastic of milk bags is store; tins of ghee, milk powder etc. is stored.

QUALITY ASSURANCE DEPARTMENT

Quality Assurance Department

ORGANIZATIONAL STRUCTURE OF QUALITY CONTROL
DEPARTMENT

SW J
OAUE
RMN A
KP I
ELO
RE
R
C
HT
EO
M
FI
S
TE
G

U
L

Y
C
O
N

M O
I

A
A
R

C
R

Activities Carried By People in Quality Control Lab

Superintendent
The superintendent observes all the activities in the lab, packing and giving
the guidance.

Junior Officer
Here the officer looks after all Agmarks related to ghee and butter in the lab.

Senior Officer
Here the senior chemist looks after IS/ISO 9062 IS 14001, HACCP, 2002 f 3A
(food safety management system) and ISO 9000-2000 certificates.
Chemist
The chemist looks after all the society milk, pasteurized milk and other milk
products.

Sampler
The sampler takes the samples from the milk received from different cooperative societies.

 Micro Biologist (Milk Plant)

The microbiologist cleans up all the tools and machines, which are used for
milk, butter and buttermilk.

DISPATCH AND LOGISTICS

Dispatch and Logistics

All activities carried out under the supervision and order General Manager of
Marketing head i.e. order of milk and milk products are dispatched as per the order
of customers and retailer and all records of dispatch are kept in dispatch register and
computer.

 In dispatch department the work is divided in 3 shifts

1. Morning
2. Afternoon
3. Evening
Sources of Mode of Transportation
There are trucks, tempos, insulated vans, three wheeler tempos are used to deliver
the milk and the milk products in all the three shifts.

FACTS AND FIGURES

Facts and Figures

Milk production in India

350
300
250
200
Production (Million Tonnes)

150

Per Capita Avaiblity

(gms/day)

100
50
0

SOURCES: Department of Animal Husbandry, GoI

Conclusion:
Rise In total production capacity- 5%
Rise in Consumption (gms/day)- 3.55%

Production by Mother Dairy

Sr No

Operational States

1
2
3
4
Total

Delhi-NCR
Saurashtra
Mumbai
Hyderabad-Haryana-Uttar Pradesh

Quantity (Per Day)/(Million

ltrs)
30
6.5
7.75
2.2
46.45

Comparison Chart
Total Contribution by Mother Dairy in India-2012

Million Liters

Mother Dairy
Amul

Conclusion:

68 % of the Indian market is dominated by unorganised players

Mother dairy can use this as an opportunity, and plan strategies to capture the
market.

Per capita monthly Consumption & Expenditure in Milk & Milk Products
NSS
ROUND
Rural
Urban
ROUND
Rural
Urban

MILK & MILK PRODUCT

25th (1970-1971)
3.03
5.01
27th (1972-1973)
3.22
5.91

ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural

32nd (1977-1978)
5.29
9.16
38th (1982)
8.45
15.15
42nd (1986-1987)
13.48
23.32
43rd (1987-1988)
13.63
23.83
44th (1988-1989)
15.65
26.74
45th (1989-1990)
18.35
29.53
46th (1990-1991)
19.04
32.37
47th (July-Dec 1991)
21.90
37.21
48th (Jan- Dec 1992)
23.00
42.00
49th (Jan-June 1993)
23.00
41.00
50th (July 1993-June 1994)
27.00
45.00
51st (July 1994-July 1995)
27.00
49.00
52nd (July 1995-June 1996)
32.38
56.45
53rd (Jan-Dec 1997)
39.31
62.75
54th (Jan- June 1998)
36.54
64.63
56th (July 2000- June
2001)
42.97

Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban
ROUND
Rural
Urban

75.90
57th (July 2001-June 2002)
41.91
75.82
58th (July 2002- Dec 2002)
45.34
78.19
59th (Jan 2003- Dec 2003)
44.69
80.03
60th (Jan 2004-June 2004)
47.60
82.98
61st (July 2004-June 2005)
47.31
83.30
66th (July 2009-June 2010)
80.55
137.01

Sources: Levels And Pattern of consumer expenditure, various issues, National

Sample Survey Organisation, Ministry of Statistics & Program implementation, GOI.
Thus the above table shows the increase in consumption of milk and milk Products,
in Rural and Urban India both. Per capita monthly consumption and expenditure in
milk and milk products have risen since 1970 to till date, thus a major opportunity for
milk industry as well as Mother Dairy.

Graphical representation from 60 th National sampling survey to 66th Nationals

sampling survey to give clear cut idea of the increase in consumption and spending
in rural and urban India.

160
140
120
100
Rural Rs

80

Urban Rs
60
40
20
0
Round 60th

Round 61st

Round 66th

Conclusion:
Rural increases from 60th to 66th round is by 69.22%
Urban increase from 60th to 66th round is by 65.11%

Milk Production across countries (Million tonnes)

Year
Country

1970
s

1980
s

1990
s

1996

1997

2000

2005

2010

INDIA

20.80

31.56

53.68

68.36

70.88

79.66

95.62

117.00

CHINA

1.96

2.93

7.04

10.19

10.09

12.37

32.02

41.14

RUSSIA

0.00

0.00

0.00

35.82

34.13

32.28

31.15

32.14

BRAZIL

7.24

12.06

15.08

19.20

19.36

20.53

25.53

31.82

USA

53.07

58.24

67.01

69.86

70.80

76.02

80.25

87.46

PAKISTAN

7.45

9.01

14.72

22.97

23.58

25.57

29.44

35.49

WORLD

391.8
2

465.6
6

542.4
7

547.02

550.7
7

578.88

668.00

720.9
8

Indias contribution to world in Dairy Industry

800
700
600
500
World (Million Ltrs)

400

India (Million Ltrs)

300
200
100
0
1970 1980 1990 1996 1997 2000 2005 2010

Finding:
Rise in production from 2005 to 2010 by 22.12%
Contribution to world dairy industry 16.22%

Index Number of Wholesale Price:

Year
Commodity
Milk
Dairy
Product

2004
2005

2005
2006

2006
2007

2007
2008

2008
2009

2009
2010

2010
2011

2011
2012

100

101.01

114.58

123.24

146.41

175

194

100

99.47

108.
98
105.
41

116.37

122.94

138.79

152.07

171.5
1

Finding:
Rise in Index no of wholesale Price of Milk from year 2010 to
2011 by 10.85%.
Rise in Index no of Wholesale Price of Dairy Product from year
2010 to 2011 by 12.78%

Conclusion:
There is vast Scope in Milk industry as there is rise of 10.85% in index
no of whole sale price of milk.

MOTHER DAIRY EXPORT

Mother Dairy Export

Mother Dairy Fruit & Vegetable Pvt. Ltd, a USD 1 billion (1000 million) company and
a leading manufacturer of dairy products and processed foods with well established
brands such as Mother Dairy (packaged milk, ice-cream, butter etc.), Safal (fresh
fruits & vegetables, purees, pulp, concentrate, blend, frozen vegetable, Preserved
Gherkins & fresh fruits & vegetables etc) and Dhara (packaged edible oil).
Mother Dairy manufacture tropical fruits pulps & concentrates of the highest quality
in India and export fruits pulps & concentrates and fresh / frozen vegetables / fruits to
over 40countries worldwide including USA, Europe, Middle East, Russia and Far
East Asia. Mother Dairy has some of the reputed multinationals clientele like Coke,
Pepsi, and Unilever etc in their basket.
Mother Dairys International Marketing operations are managed by a dedicated
export division that manages a network of international distributors & OEM
customers - supported by its state of art manufacturing plants and Innovation centre
in India.
Mother Dairy / SAFAL maintains Superior quality through processing at ISO 9002,
ISO 22000, FDA, FPO, Kosher, Halal, Global GAP, Ecocert, SGF and HACCP
certified plants and GMP procedures are followed at all stage of processing. No
wonder that Mother dairy / SAFAL is the preferred choice for dairy products,
confectionary products and fruit juice producers, MNCs and traders across the globe.

De- GALLERIA

Product Gallery

Product Gallery

Milk Variants with Nutritional value

Double Toned: Fat-1.5% SNF-9.0%

Toned Milk: Fat-3.0% SNF-8.5%

Full Cream: Fat-6.0% SNF-9.0%

Skimmed Milk: Fat-<0.5% SNF-8.7%

Standardised Milk: Fat-4.5% SNF-8.5%

Full Cream Premium: Fat-7% SNF-9.0%

Cow Milk: Fat-3.5% SNF-8.5%

UTH Toned Milk: Fat-3% SNF 8.5%

CSR ACTIVITY

CSR ACTIVITY BY MOTHER DAIRY

Mother Dairy no doubly provided value to farmers and safe milk to consumers.
Corporate Social Responsibility (CSR) is thus an integral part of the business model
on which Mother Dairy operates.

Multitude of social development and other initiatives have been nurtured by Mother
Dairy from its earliest days. At Mother Dairy, their commitment to ethical conduct and
social responsibility is core value of doing business, and is strongly aligned with their
vision to create and increase value for farmers and to provide affordable, safe,
healthy and tasty products to consumers.

Community
Mother Dairys prime commitment is to serve farmers
Mother Dairy sources significant part of its requirement of Liquid Milk from Dairy
Cooperatives. Similarly Safal sources its requirement of Fruits and Vegetables from
farmers/growers association and Dhara helps the Oilseeds Grower Cooperatives by
sourcing the production of the wide range of Dhara edible oils from them. This
ensures that the farmers get the appropriate prices for their yield and quality. Mother
Dairy also works towards improving the standards of the farmers by educating them
about better farming techniques, hygienic practices and modern methods of dairy
farming. This initiative by Mother Dairy is directed towards making the farmers
independent and financially self sufficient.

Environment
Mother Dairy commitment towards environment

Mother Dairy promotes the Bulk Vended Milk, better known as 'Token' milk. Mother
Dairy pioneered the concept of hygienically processed milk that is retained hygienic
to the consumer in an unpacked condition. Mother Dairy sells approximately 10.5
lakh litres of token milk in Delhi alone and thus ensures more than 5 tonnes less
consumption of plastic in Delhi every day.

SWOT
Strength:
Different Variety of Milk.
Recognized brand name.

 66% of Delhi-NCR market share

Trust of customer

Weakness:
No Of Outlets are less.
Pays less to Farmers as compared to Amul.
This in return causes difficulties in engaging farmers.

Opportunity
As the dairy industry is rising with rate of 5%, whereas population is
rising by 17% making vast scope for expansion.
As the rise in Index of Wholesale price of Milk roused by 10.85%, thus
there is huge potential in Milk industry.
Rise in Index no of Wholesale Price of Dairy Product from year 2010 to
2011 by 12.78%, thus making it profitable for Dairy Industry.

Threats
Facing tough competition from competitors like AMUL.
Pricing policy for procuring milk is far less than its competitors, causing
loss in faith of farmers
Supply chain management of competitors are much better.

Recommendations
Must focus on growing market opportunity.
Must revise its strategy of procurement of milk from farmers in regards to
payment of price/litres.
Overseas market have huge capacity, must work aggressively on global
expansion
Mother dairy facing challenges in Saurashtra region, due to AMUL which has
market value of 10000 Cr.

 Mother dairy loosing competition to Amul, due to weak supply chain

management of Mother dairy.
Thus Mother dairy must focuses on its supply chain management.
There is huge gap in rise in population and rise in milk industry, thus the
population is rising by 17% and rise in dairy Industry is 4%.
Mother dairy can utilized this in positive way to diversify itself in regard to
expansion as well as product differentiation.

Annexure

www.ndri.res.in
www.censusindia.gov.in
www.dairy.maharashtra.gov.in
www.motherdairycalcutta.com
www.articles.timesofindia.indiatimes.com
www.kmfnandini.coop.com
www.motherdairy.com
www.nddb.org
www.researcandmarkets.com
www.thirdesight.in/article/motherdairy.html

www.gyananalytics.com