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.
2.
3.
4.

Preface
Acknowledgment
Declaration
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 cooperative 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 to1997-1998 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 cooperative 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 short-term
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

QUALITY
CONTROL
MANAGER

QUALITY
CONTROL
OFFICER

SENIOR
CHEMIST

JUNIOR
CHEMIST

SAMPLER

WORKER

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 co-operative
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

Delhi-NCR

Quantity (Per Day)/(Million

ltrs)
30

2
3
4
Total

Saurashtra
Mumbai
Hyderabad-Haryana-Uttar Pradesh

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

MILK & MILK PRODUCT

25th (1970-1971)
3.03

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
Urban
ROUND
Rural

5.01
27th (1972-1973)
3.22
5.91
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

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

64.63
56th (July 2000- June 2001)
42.97
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 60th 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

1970s

1980s

1990s

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

391.82

465.66

542.47

547.02

550.77

578.88

668.00

720.98

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:

Ye 2004
2005

ar
Commodity
Milk
Dairy
Product

2005
2006

2006
2007

2007
2008

2008
2009

2009
2010

2010
2011

2011
2012

100

101.01

108.98

114.58

123.24

146.41

175

194

100

99.47

105.41

116.37

122.94

138.79

152.07

171.51

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