INDUSTRY PROFILE

ORGIN OF MILK INDUSTRY:

Earlier people used to have animal milk for food. However, the people of ancient Babbly Lon,
Egypt and India raised dairy cattle as early as 400 B.C. At that time, the family cow was the
cheap source of milk. A family used as much it needed and traded or sold the rest to
neighbour.

A dairy industry grew; several cities passed laws to control the sale of milk.

Some of these laws made it illegal to add water to milk or to remove cream from milk.

However, none of the early laws set health standard for milk. Many dairies added chemical
preservatives to milk. But after sometimes these chemicals were found to be harmful, laws
prohibited their use. Gradually cities and states began supervising the milk industry in order
to protect public health. In 1856 an American inventor named Gail Borden received a patent
for the first successful milk condensing process.

About in 1885, dairies first used glass, jars and bottles, in which workers were filled milk by
hand. The invention of bottling machine in 1886 has proved that filling the containers easier
and faster.

In 1890, Stephen M. Babcock, an American agricultural chemist developed a list to measure

the fat content of the milk. The market value of milk depends on its fat content, which dairies
still determine by the Babcock test. In 1890s a few dairy plants introduced pasteurisation; a
process invented by the French scientist Louis Pasteur.

One of the greatest epics Mahabharata gives us the fact that dairying has an age-old
background. In those days cattle were treated as God. As the years passed, people started
using cattle to satisfy their needs of milk, milk products and for cultivation. But during olden
day's milk and milk products were not sold. Only after 1940's dairying was started in an
organised manner, in those days dairies were encouraged to make pasteurised butter,
mainly for the British army. One of such firm was "Urban Milk Supply Scheme". After
independence greater Bombay Milk Scheme has come into existence. By this time many
state government set up composite "Dairy Development Department" to facilitate milk
production, procurement, processing and marketing. A dairy is place which deals with
collection, processing of milk and manufacturing of various milk products on an industrial
scale

KARNATAKA MILK FEDERATION

KMF was instituted in 1984, by federating the 13milk unions in the state and thus forming the
state level apex organization. As a cooperative apex body of the state of Karnataka, it
represents dairy farmers' organization and also implements dairy development activities to
achieve the following objectives:

• Provides assured and remunerative market for the milk produced by the farmer
members.
• Provide quality milk to urban consumers.
 • To build village level institutions in co-operative sectors to manage the dairy
activities.
• To ensure provision of milk production inputs, processing facilities and dissemination
of know-how.
• To facilitate rural development by providing opportunities for self employment at
village level, preventing migration to urban areas, introducing cash economy and
opportunity for steady income.

LIST OF CO-OPERATIVE MILK PRODUCERS UNDER KARNATAKA

MILK FEDERATION
• Bangalore Milk Union
• Belgaum Milk Union
• Bellary Milk Union
• Bijapur Milk Union
• Dharwad Milk Union
• Gulbarga Milk Union
• Hassan Milk Union
• Kolar Milk Union
• Mandya Milk Union
• Mysore Milk Union
• Shivmoga Milk Union
• Tumkur Milk Union

DAIRYING IN INDIA:
Around 1500 to 2000 the Aryans were the first to domesticate cattle use for tilling their land
and obtain milk to be consumed as food. It was the Aryans who priced the milk of a cow
more than its meat, forbade its slaughter and created legends about it, even worshipped it.
Hindus even today consider cow as sacred. More of the total production of milk is obtained
from cows. In India, dairying has been practiced as a rural cottage industry since the remote
past. Semi commercial dairying started with establishment of military dairy farms and
cooperative milk unions throughout the country towards the end of the 19th century.

However, market milk technology may be considered to have commenced in 1956 with the
functioning of the central dairy of Aarey milk project technology in 1956 with the
establishment of AMUL dairy.

GROWTH AND PRESENT STATUS OF THE INDUSTRY:

The Indian dairy industry is heading towards new century with an accelerated and positive
momentum. With unprecedented growth in milk production by over two and a half time in the
two decades to about 58.8million tons in 1992, India has emerged as the largest milk
producer in the world with an annual milk production of 76 million tons. Food processing
industry ranks as the 5th largest industry in the country. Through the milk and the milk
products have 85% business in unrecognized sector; it is having only 7% growth per year.

The establishment of a cooperative structure as a ready and regular buyer or milk produced
gave a new turn to the rural economy. Today, over 275 dairy plants and 85 milk product
factories in the cooperative, public and private sectors handle an estimated 12-15% of the
total milk produced. In most of the countries in the world, the proportion of the milk delivered
to the dairies is over 90%.
The trends are now changing fast in India too. It is expected that the processing of the milk
on organized scale will increase sharply in developed countries. This will consequently
increase the opportunities for the value addition. While the value of the output of the dairy
products in the countries' food sector has increased from 5-7% during the same period. Now
the days of milk scarcity and imports are behind us. The organized sector can seize the
opportunity of tapping the market of value added dairy products like butter, cheese, lactose,
khova, paneer elt is beyond doubt to mention that the organized dairy industry has done a
splendid job by transforming itself from an import dependent enterprise to self sufficient
industry and the embarking on export of various products. And now it is poised for another
wave of expansion by undertaking large scale production of milk in the organized sector.

GROWTH PROCESS

KEY ITEMS UNIT 1976- 2015-16 2016-17 2017-18 2018-

77 19(upto

Feb'19)

Dairy Cooperatives Nos 416 14826 15074 15864 16045

DCS Registered

DCS Functioning Nos 13270 13517 14256 14521

Women DCS Nos 3949 3919 4122 4122

Registered

Women DCS Nos 3550 3549 3743 3777

Functioning

STEP Registered Nos 2104 2274 2374 2374

STEP Functioning Nos 1943 2088 2199 2199

Membership Nos 37000 23.50 lakhs 23.54 24.60 24.67

lakhs lakhs lakhs
 Ann. Avg. Milk LKPD 0.50 64.88 65.51 70.81 75.87
Procurement

Peak LKPD 72.30 june 77.63 84.44(june

72.84(july (june

Procurement 15) 16) 17) 18)

Avg. Milk Sales LLPD 95050 34.38 33.32 34.72 34.82

Avg. Curd sales LKPD 3.97 4.09 4.39 4.62

Avg. Good life sales LLPD 3.56 4.03 5.02 5.28

Daily Payment to Farmers RS.Crores 0.09 14.62 16.00 18.22 18.28

Total RS.Crores 8.82 11779 13133 13550 -

Turnover(KMF &

Unions)

MILK FEDERATION:
The Karnataka Co-operative Milk Producers Ltd came into existence on 1-5-

1984by federating the milk unions in the state and thus forming the state level apex
organization.

When all the project activities are completed, the main role of the federation will be to market
surplus milk products and to produce and supply centralized inputs.

Name Designation Place

of

working
RAKESH MANAGING DIRECTOR / KMF
CEO CO
SINGH,

IAS

M.T. KULKARNI DIRECTOR (MKTG) KMF CO

DR.G.T. GOPAL DIRECTOR (PURCHASE / KMF CO

CTI)

DR.D.N.HEGDE DIRECTOR(AH & KMF CO

SCHEMES)

B.M. DIRECTOR (ENGG/ADMIN) KMF CO

SURESH

KUMAR

RAMESH DIRECTOR (FIN) KMF CO

KONNUR

H. S. DIRECTOR (STEP) KMF

MANJUNATH CO

D.PRASANNA ADDL DIRECTOR (QC) KMF CO

KUMAR

M.S. SUHAEL ADDL DIRECTOR KMF

(SYSTEMS/PURCHASE) CO
 C.P.REDDY PUBLIC RELATION KMF CO
OFFICER

UNION CHIEFS

Name Designation Place of working

DR. G.T GOPAL M.D BENGALURU MILK

UNION

DR K SWAMY M.D KOLAR-

CHIKKABALLAPURA

MILK UNION

PEST ANALYSIS:

• Indian Dairy Industry is at cross roads

• Industry strongly dominated by the government sector and working in co-operative
mode is going to face keen competition from private sector
• Co-ops performed well in some states, but in many states, they are functioning as
parastatals, weak representative of farmer interest
• Currently co-op prices serve as a bench mark for pricing of dairy
• Weak co-ops competing with private sector may severely affect farmer interest

• POLITICAL

MYSORE diary is under the guidelines of kmf administration and financial matters.

Labors are paid according to 6 pay commission and also provided epic facilities according to
state government.MYMUL even gets grants from government. The land is owned by MYMUL
on rent basis from the government

• ECONOMICAL

Since milk is a daily use product the demand will be always high and also MYMUL has the
major portion of market sales are always at high. And the prices vary according to
government taxes and availability raw milk

• SOCIAL

Since most of employees are from nearest area culture differences is not there.

Every employee is provided uniform to feel the sense of unity. There are all types of age
groups in the organization and mostly elderly employees are in a higher job designation
• TECHNOLOGICAL

Milk is being test in every part of the process starting from procurement to dispatch through
automated machines such as lactometer. There are 15chilling unit, 3bays, 4pasterisation
unit, 4silos and more 10 engineers to take care of the machines. The process starting from
procurement to packaging is fully automatic with only 4people controlling the whole process

PORTER'S FIVE FORCE MODEL:

• THREAT OF NEW ENTRY

Brand preferences and consumer loyalty:

There is an immense level of brand preference of nandini milk in the minds of the people.

The level of preference specifically in the liquid milk sector is that they would go to the other
retailer only of the retailer does not have nandini milk.

• BARGAINING POWER OF SUPPLIER

Hear is appropriate bargaining power of supplier:

In olden days there were not any kind of cooperative soceities as the farmer was exploited
but nowadays the farmer's rights are protected under the cooperative rules and regulations
which ultimately results in moderate power of bargaining from the supplier.

• RIVALRY AMONG COMPETITORS

Mergers and acquisitions:

As such in the industry there are no mergers or acquisitions how ever if any MNC wishes to
entry though this route then the competition might be severe.

• THREATS OF SUBSTITUTE

Availability of attractive price substitute:

Different subtitutes are available for different category of products .There is ample availability
of low priced subtitutions from local vendors and retailers.

• POWER OF CUSTOMERS

This specifically deals with ability customers have to drive prices down.It is affected by how
many buyers are customer a company has, how significant each customer is,and how much
it would codt a customer to switch from one company to another company. The smaller and
more powerfull a client base, the more power it holds.

COMPANY PROFILE

MYMUL

MYSOREDAIRY.

BACKGROUND AND HISTORY:

Mysore Dairy with the capacity of 10 TLPD was started in the year 1965 under the control of
the Department of Animal Husbandry and Veterinary Services of Karnataka State, which
was transferred to Karnataka Dairy Development Corporation in the year 1974. The capacity
was expanded to 60 TLPD in 1980 under the scheme operation flood and transferred to the
Karnataka Milk Federation in

1984. As per the Government policy the Dairy and its Chilling Centers were handed over to
Mysore Milk Union on 01.06.1987. The capacity was expanded to 100 TLPD under the
Operation Flood Il and further expanded to 180 TLPD under Perspective Plan I Programme.

Under the World Bank aided Karnataka Dairy Development Projects, the activities on Dairy
Development were taken up in the year 1975. The Mysore District Cooperative Milk
Producers Societies Union Ltd was registered on 23.11.1976, having the jurisdiction
extended to the entire Mysore District and Five Talks of Mandy District. The Union undertook
the work of organization of Milk Co-operatives in

'AMUL Pattern' with the main objective of socio-economic reformation of the farmers in the
rural areas through Dairying as main subsidiary occupation.

Later the Union was bifurcated into Mysore and Mandya District Co-Operative Milk
Producers Societies Union Ltd from 01.04.1987. Consequent to the bifurcation of Mysore
District into Mysore and Chamarajanagar Districts, this Union is renamed as Mysore-
Chamarajanagar District Coop Milk Producers Societies Union Ltd. Later from April 2015
Bifurcation of Mysore-Chamarajanagar district milk union as Mysore milk union and
Chamarajanagar milk union.

VISION AND MISSION:

Vision:
• To march forward with a missionary zeal which will make KMF a trailblazer of
exemplary performance and achievements beckoning other Milk Federations in the
country in pursuit of total emulation of its good deeds.
• To ensure prosperity of the rural Milk producers who are ultimate owners of the
Federation.
• To promote producer oriented viable cooperative society to impart an impetus to the
rural income, dairy productivity and rural employment.
• To a bridge the gap between price of milk procurement and sale price.
• To develop business acumen in marketing and trading disciplines so as to serve
consumers with quality milk, give a fillip to the income of milk producers.
• To compete with MNCs and Private Dairies with better quality of milk and milk
products and in the process sustain invincibility of cooperatives.

Mission:
Heralding economics, social and cultural prosperity in the lives of our milk producer
members by promoting vibrant, self-sustaining and holistic cooperative dairy development in
Karnataka State.
Values:
Honesty, Discipline /Timeliness, Quality, Trust, Impartial, Savings, Transparency.

QUALITY POLICY

Mysore District Milk Union is committed to procure and supply safe Milk & Milk

Products to the satisfaction of consumer by:

Complying with statutory and regulatory requirements

Constant communication with all parties involved in the food chain

Adopting GHP, GMP & HACCP

Adopting scientific processing methods,

Training of employees Union/Dairy Co-operative societies.

ISO 22000 Documented and Under Implementation.

This commitment is supported by measurable objectives and brings about continual

improvement.

PRODUCTS AND SERVICES PROFILE:

The product profile refers to the study of the products information of the company. The
various milk and milk products manufactured at MYMUL are shown below:

The following are the products and their quantity offered by MYMUL.

Nandini Toned Milk

Nandini Toned Milk is the Karnataka's most favorite Milk. Fresh and pure milk containing
3.1% fat and 8.5% SNF. Available in 520 ml & 1 liter packs.

Nandini Homogenized Toned Milk

Nandini Homogenized Toned Milk is pure Milk containing 3.1% Fat & 8.5% SNF.

This is Homogenized and pasteurized. It gives you more cups of tea or coffee and is easily
digestible.

Nandini full cream milk:

Full milk; contain 6.1% fat and 9%soloid not fat. Rich creamier and tasted milk, ideal for
preparing homemade sweets and savories. Available in 500ml.

Nandini Ghee

A taste of purity, Nandini Ghee made from pure butter. It is fresh and pure with a delicious
flavor. Hygienically manufactured and packed in a special pack to retain the goodness of
pure ghee. Available in 200 ml, 500 ml, 1000ml packs & 15 kg tins.
Nandini Peda

Nandini Peda made from pure Milk. Available in 100gms & 250gms packs.

Nandini Peda made from pure Milk. Available in different flavor like Kesar peda.

Paneer

It is a tasty, wholesome and nutritious supplement for a variety of dishes. Add Paneer to
make dishes creamy and mouth-watering. Available in 200gand 1kg packs. Can be stored
for 30 days when kept frozen.

Khova

Add Khova to preparations like carrot halwa, gulab jamoon etc. and increase the richness of
its taste. Available in 200g packs. Can be stored for 30 days when kept frozen.

Cashew Burfy

Pure Milk based cashew burfi is available in 250gms.

Nandini Curd

Nandini Curd made from pure milk. It's thick and delicious giving you all the goodness of
homemade curds. Available in 250 grams and 500 grams packs.

Nandini Sweet Lassi

Nandini Sweet Lassi the most refreshing drink made from fresh curd.Best alternative to cool
drinks during summer.

Nandini Peda Kesar

Nandini Peda made from pure Milk. Available In different flavours like Kesar & Elaichi.

Good life

Cow's pure milk. UHT processed, bacteria free in a tamper proof tetra fino pack which keeps
this milk fresh for 60days without refrigeration until opened. Available in 500ml and in 200 ml
bricks.

Badam burfi

Badam burfi is a delicious treat made up of milk and it can be stored at room temperature.

Flavored milk

Sterilized flavored milk. Nutritious and wholesome milk available in 5 different flavors,
pineapple, rose, badam, pista and natural orange.

Masala majjige

It is one of the drinks available in the dairy. Its prepared using masala ingredients.
AREAS OF OPERATION:
As a district milk union under KMF, individually the union has no opportunities to expand
their operation because the MYMUL is structured under KMF as a district milk union of
Mysore district. The union itself acts as a branch of KMF but the union has opportunities by
way of marketing its milk products out of its limited market borders means of its district
market borders The district milk unions are controlled by the KMF, which acts as a mother
organization to all other district unions in Karnataka. The union receives all types of demand
orders from in and outside the country. Especially the milk powder has more demand from
foreign countries. The union will produce other milk products according to their demand rate.

PROCUREMENT:
To procure the surplus milk available in the primary milk producers' Co-operative societies of
the union jurisdiction area.

• Organising dairy co-operative societies at village level.

• Organising milk procurement route to procure milk.

All the dairy co-operative societies in the union jurisdiction will be a share holder to the
affiliated federal body where in the dairy co-operative societies will be assisted in procuring
milk in both shifts and providing technical input support to the producer members and to
make remunerative payment to the dairy co-operative societies on the quality parameter.

Milk production in its Milk shed area. In view of this, various technical input services like
veterinary health care, artificial insemination services, vaccination, supply of balanced cattle
feed and quality fodder seed etc. are provided for enhancing milk production and economic
development of farming community.

ANIMAL HEALTH AND EMERGENCY SERVICES

The union is taking special care to promote the health of the cattle of member milk
producers. Veterinary health care facilities have been extended to all the DCS.

Emergency veterinary routes, Health camps, Vaccination against Foot and mouth disease
are being provided to all functional societies. Mass deworming programme is carried out
twice in a year at all DCS. There is also a backup of Veterinary First Aid Services to needy
milch animals through trained DCS staff. Introduced Trio-NB-Sac and 'Godhara Shakthi' to
improve quality of Milk.

STEP (Support to Women Training & Education Program)

The Programme of STEP aims

• To organize exclusive Women Dairy Cooperatives and to take up employment cum income
generation activities.

••

To provide need based and extensive training for skill upgradation.

Mobilizing women in formation of Self Help Groups as a tool for income generating activity
and for easy access to credit.

52
COMPETITIORS OF MYMUL:
The major competitors of MYMUL are as follows:

: beata

• Arogya
• Gomatha : Siastiala

: Leisamik vendors

Jersey:

• Plant located at Andhra Pradesh

• Sale in union jurisdiction 45tlpd (100 tipd in city)
•
• MRP is 20per litre seller rate rs.22 based on quantity
• Commission ranges from 40-70 per litre
• Quality perception-thick and longer shelf life
• Flexible distribution-retailers, wholesalers or anyone willing to sell
• Payments cash and carry or while collecting empty crates on return trip.
• Availability- mostly retail outlets and now capturing institutional sales by any means.
• Vigorous advertisement especially at the point of purchase.

Dodla:

• Plant located at Nellore

• Availability of raw materials at cheaper rate.
• sale in union jurisdiction 18t|pd
• MRP rate Rs. 19per litre-seller rats Rs.22
• Commission ranges from 40-50paisa.

> Quality perception-thick and long shelf life.

• Flexible distribution-retailers or anyone willing to sell

• Returns will be accepted
• Payment-cash and carry or while collecting empty crates on return trip.
• Channel members are playing critical role in boosting the sales.
• Packing is attractive with multi colour pricing on sachets.
•
• • Consumers perceive that milk is good for making curds.
• Arogya:
• Plant located at Bangalore.
• Sale in union jurisdiction 10tlpd.
• MRP rats Rs.18per litre
• Commission ranges from 60paisa per litre.
• Availability- mostly retail outlets like bakeries, condiments and departmental stores.
• Packing is attractive with multi colour pricing on sachets.

> Concentrating on value added products and not much on milk

Loose milk vendors:

• Market share is next to Nandini.

• Loose milk from erode and local cattle rears.
 • > MRP rate Rs.7 to Rs12 per litre
• • Majority of the milk is heavily adulterated and no uniform quality.
• > Sales from 50ml and above
•

SWOT ANALYSIS

A SWOT analysis is a strategic planning tool used to evaluate the strengths, weaknesses,
opportunities and threats involved in a project or in a business venture or in any other
situation requiring a decision.

Environmental analysis

Internal Analysis

External Analysis

Strengths

Weakness

Opportunities

Threats

SWOT Analysis

SWOT Analysis of the Organization

STRENGTHS:

• Market leader.
• "Nandini" is a trusted house hold brand name.
• Two lakh farmer members.
• Provides excellent veterinary, Al, vaccination, Extension facilities, Feeds and Fodder
seeds supply etc., in the field, which cannot be thought off by any private operator.
Hence earned lot of goodwill from member producers, who patronize the union
throughout the year.
• Has earned the distinction of not failing to deliver the milk to market on time
throughout the year.
• There are days with no power supply, no water supply; but there is no day without
NANDINI milk supply.
• Highly remunerative and timely payment to producers.
• Union is in good financial position.
• ISO 9001-2000 certificate.
• Good institutional support from KMF, NDDB, etc.,

WEAKNESS

• Lack of flexibility in deciding about its operation. No authority over issues like pricing,
offering volume discounts etc.,
• Political interference.
• Organizational structure does not permit incentive/ reward for good performance.

OPPORTUNITIES
• Since the Mysore district is under Cauvery basin, perennial greens are available to the
cattle.

•
• Institutional markets, bakeries, hotels etc., are not fully tapped and these can be
captured preferably by direct marketing.
• Diversification of milk products like Peda, Mysore Pak.... etc.,
• Exploit the "Human Face", by positioning in the market as an organisation with social
responsibilities of serving the milk produced by paying remunerative price and
serving customer by offering hygienic quality product at a reasonable price
throughout the year. Union is not in the business to maximise the profit as in the case
of private dairies and is acting as price stabilizing force in the market. Projecting
these to the customers will reinforce the positive image of the organisation in
customer's minds as a caring organisation which service to them as its motto.

THREATS

• After liberalization, entry barriers in the dairy industry eased for new entrants.
• The competition from Co-operatives like Dodla, Heritage, Kamadenu.... etc.,
• Private dairies procure milk at low cost from producers and sell milk resorting to
unethical trade practices. It is a marketing war in which union has to fight by rules
and other private dairies do not fight by rules. Hence, there is no level playing field for
organization with social responsibilities to compete with organizations with purely
profit motive.
• Some private dairies are selling homogenised milk, which appears rich. The union
cannot homogenize all its huge quantity of milk due to lack of homogenizing capacity
and increase in processing cost.
• Plans of major companies like Reliance, ITC to enter into milk market in future.

Market Share of MYMUL:

• 60-70% of market share- Nandini.

• 05-10% of market share- loose milk vendor.
• 10-20% of market share- other private brands
•

PRESENT PROJECTS/STATUS:
• Establishment of 100 MTPD New Mega Milk Powder Plant with an approximate
outlay of Rs. 300 crores in Kannamangala Village, Channapatna Taluk, Ramanagara
District is envisaged, to meet surplus milk conversion requirement of southern part of
Karnataka
• Koppala Dairy with 60-100 TLPD capacity expandable to 8 LLPD at an estimated
cost of Rs.38 Crores
• Mega Dairy at Mysuru 6 LLPD capacity expandable to 8 LLPD at an estimated cost
of Rs.124 Crores
• New 3 LLPD to 5 LLPD capacity Dairy and 2 LLPD UHT Plant at Chamarajanagara
at an estimated cost of Rs. 125 Crores
• Chikkaballapura Dairy with UHT Plant at an estimated cost of Rs. 100 Crores
• Establishment of new dairy at Bagalkot with a capacity of 50 TLPD -1 LLPD at an
estimated cost of Rs.29 Crores
• Uppoor Dairy of capacity 1.5 - 2 LLPD at Udupi District. Rs - 80 Crores
• Establishment of new mega dairy and Milk products plant at Kanakapura -
Rs.447 Crores
 • Establishment of Milk Powder Plant of 30 MTPD capacity at Dharwad at a cost of Rs.
27 crores
• Mega Dairy at Mandya with capacity of 8 to 12 LLPD at an estimated cost of Rs. 180
Crores
• Construction of Quarters at KMF Central Office Premises at an estimated cost of
Rs.8 Crores

Projects Under PPP :

rostablishment of Deep Freezers at Chelaghatta an approximate cost of Rs.12

b) Establishment of 300 MTPD New Cattle feed plant at Arakalagoodu at an estimated cost
of Rs. 78 Crores

Establishment of New Dairy at Davanagere for SHIMUL of capacity 3LLPD to

5LLPD at a estimated cost of Rs.85 Crores

• Construction of Bull mother farm development at Nandini Sperm Satation,

Hessaraghatta,at an estimated cost of Rs.4 Crores
• Establishment of New 300MT capacity Cattle Feed Plant at Dharwad at an estimated
cost of Rs.23 Crores
• New Product Plant at Shivamogga dairy at an estimated cost of Rs.

25 Crores

FUTURE PROJECTS/PLANS

Projects Under PPP ;

• Establishment of Corrugated Box Manufacturing Unit at Challaghatta at an

approximate cost of Rs.25 Crores
• New Nandini Packaging Film Plant at an approximate cost of Rs.80 Crores

23 LLPD to 5 LLPD Capacity Dairy at Davanagere at an estimated cost of Rs. 85Crores

BALANCED SCORECARD:
A balanced scorecard is a performance metric used in strategic management to identify and
improve various internal functions of a business and their resulting external outcomes. It is
used to measure and provide feedback to organizations.

Data collection is crucial to providing quantitative results, as the information gathered is

interpreted by managers and executives, and used to make better decisions for the
organization.

The balanced scorecard was first introduced by accounting academic Dr. Robert Kaplan and
business executive and theorist Dr. David Norton. It was first published in 1992 in the
Harvard Business Review article "the scorecard measures that drive performance." Both
Kaplan and Norton took previous metric performance measures and adapted them to include
nonfinancial information.

Purpose Behind the Balanced Scorecard

The balanced scorecard is used to reinforce good behavior in an organization by isolating
four separate areas that need to be analyzed. These four areas, also called legs, involve
learning and growth, business processes, customers, and finance.

The balanced scorecard is used to attain objectives, measurements, initiatives, and goals
that result from these four primary functions of a business. Companies can easily identify
factors hindering business performance and outline strategic changes tracked by future
scorecards.

The balanced scorecard can provide information about the company as a whole when
viewing company objectives. An organization may use the balanced scorecard to implement
strategy mapping to see where value is added within an organization. A company also
utilizes a balanced scorecard to develop strategic initiatives and strategic objectives.

The Four Legs of the Balanced Scorecard

Information is collected and analyzed from four aspects of a business:

1. Learning and growth are analyzed through the investigation of training and
knowledge resources. This first leg handles how well information is captured and how
effectively employees utilize the information to convert it to a competitive advantage
over the industry.
2. Business processes are evaluated by investigating how well products are
manufactured. Operational management is analyzed to track any gaps, delays,
bottlenecks, shortages, or waste.
3. Customer perspectives are collected to gauge customer satisfaction with quality,
price, and availability of products or services. Customers provide feedback about
their satisfaction with current products.
4. 4 Financial data such as sales, expenditures, and income are used to understand
financial performance. These financial metrics may include dollar amounts, financial
ratios, budget variances, or income targets.

A review of choice in design

A review of choice in design is the determination and start of the general approach and
strategy adopted for a particular organizational study. The research has undertaken a
comprehensive plan of the sequence of operation for the descriptive study to achieve the
research objectives with the arrangement of condition for collection and analysis of data.

Primary data:
This is the process where first hand information was collected. The research derives it after
completing certain activities. Primary data is collected directly from the dairy.

Secondary data:The Secondary Data is readily complied data from statistical statements and
other sources. The data can be obtained from either published or non published sources

ORGANISATION STRUCTURE:
• The organization chart and accompanying baggage that show who reports to whom and
how tasks are both divided and integrated. Since mymul is a co-operative sector unit. The
structure of the organization is democratic. Major decision however is taken is at top-level
management of the company.

BUSINESS LEVEL FUNCTIONS AND PROCESSES

HUMAN RESOURCES MANAGEMENT;

HR Practices of MYMUL:

The following are the HR practices of MYMUL:

1. House rent Allowance:-

It is allowance provided to all permanent employees at the rate of 13% of basic pay.

2. Conveyance Allowance:-

Companies provide conveyance facilities to each employee from the place of residence to
the place of work. MYMUL: also provides this allowance because it is situated 10 km away
from MYSORE. Conveyance allowance of Rs. 225/month for persons owning
Scooters/Motorcycle, Rs. 500 for moped whereas Rs 1000

3. Provident and Pension Fund:-

This contribution is equal to that of employee contributions i.e. 12% of salary and it is divided
between provided and pension fund as 8.33% and 3.67% respectively.

The total accumulated is balanced in the individual PF account and is paid to employee at
the time of his retirement or on his leaving the service. In the event of the death of the
employee accumulated balance is paid to his legal heirs

4. Gratuity:-

The amount of gratuity payable is generally 15 days average salary. For this purpose salary
includes only basic pay, DA and completed service.

5. Compensation for disablement:-

The employees are covered under the group saving Life Insurance scheme. Who contributes
to the fund are as follows:

• Below SDC - Rs. 30

•
• Above SDC - Rs. 60
• Below superintendent - Rs. 90
• Above superintendent - Rs. 120
• Out of this 12% is kept for insurance
• In the event of disablement of any nature, insurance company will compensate as
per the terms and conditions

6. Leave Facilities:-

All permanent employees as on the date of settlement will be given leave facilities as
mentioned below.

• Earned leave
• Casual leave
• Commuted/half day leave
• Maternity leave
7. Medical Reimbursement:-

Contribution from employees is 1.75% (except washing allowance and conveyance

allowance), Rs 25 from management.

Total 6.5% should be remitted to ESI within stipulated time of 21 days. If an employee
becomes fully handicapped, company will provide him Rs. 170/month depending upon the
salary scale. If an employee earns less than Rs. 25 then management contribute Rs. 25 to
ESI Training and Development:

At MYMUL, training and development is an ongoing process. The workers are trained to
operate machines, reduce scrap and avoid accidents whereas the supervisors, managers
and executives are provided training which will enable them to grow and acquire maturity of
thought and action. The training and development efforts at MYMUL are designed to help
the employees satisfy their personal goals - through higher level of skills and competencies;
facilitate higher contribution at their present jobs and to prepare them for the next level of the
organization. The employees who are deployed for training are considered to be on duty and
they get the TA and DA as per the rules of MYMUL. Normally the training programs
conducted at MYMUL are:

• Workshop on good quality Ghee.

• Computer Basics.
•
• Quality Audit Programmers.
• Marketing management.
• Materials management.
• Workshop on First aid.
• Reclaim Grades for Milk Packaging Application and Food Laws.
• Total Energy Management Programmed.
• Marketing and Brand Management
• Improving sales effectiveness.

Classification of employees:
• Permanent employee: A permanent employee is one who is on the permanent rolls
of the union against the specific cadre and enjoying all such benefits as specified
under the regulatory rules of MYMUL or all such benefits which may be excluded
from time to time. Employees who are recruited are deemed to be permanent
employees subject to declaration of probation and confirmation by an order.
• Probationer employee: A probationer employee is one who is provisionally employed
to fill a permanent vacancy in a post for a period of probation which will not exceed 2
years on aggregate and whose name is entered on the rolls of the probationer
employees
• Apprentice: It means a learner who is engaged to undergo apprenticeship training
and who is paid a stipend and whose terms and conditions of apprenticeship are
governed by the provisions of The Apprenticeship Act of

1961. The Union Dairy is not obliged to employ him on completion of his apprenticeship
period

Functions:

1. Recruitment of candidates
2. Selection of best suited and right person
3. Training and development of employees
 4.
5. Framing of rules
6. Creating a good working environment
7. Motivating the employees to work hard
8. Maximizing the performance of employees
9. Maintenance of records
10. Maintenance of industrial relations
11. Employee Service and Benefits

Recruitment Procedure of appointment

• If a post is to be fulfilled by competitive examination, then after giving adequate

publicity in the leading Kannada newspaper and one of the national dailies (as the
appointing authority may determine).
• The appointment procedure will be carried in the order of merit subject to reservation
in Rule 3.6 from the list of candidates prepared by the selection committee or expert
panel.
• If it is by selection, after giving such adequate publicity in leading newspaper at least
one in Kannada and English to the recruitment as the appointing authority may
determine in the order of merit
• In case of the post being fulfilled by internal promotion from its own staff it is done by
a selection of a person on the basis of merit and suitability in all respect

MARKETING:
Departmental Hierarchy: Marketing department comprises of departmental head and further
divided into two categories and further into officers then to superintendents.

Salesmen and dispatcher.

FUNCTIONS

• A To capture the market share.

• To collect information about revenue.
• Maintain sales and other accounts.
• To attain major market shares.
• They conduct the market survey to analyze the consumers' feedback of their product.

Marketing Strategies adopted by MYMUL:

"Procure more, produce more, sell more, and earn more"

• By procuring and producing more MYMUL achieves economies of scale which

results in least cost distribution on each unit sold.
• It raises consumer awareness for Nandini by pamphleteering, raising health issues
related to consumption of adulterated milk and soon.
• 981 no of retailer ship during 2011-12 75 no till October 05 were commissioned.
• As per the demand for milk and milk products available throughout the day, 26
numbers of Franchise Outlets, 19 no of parlors are made functional.
•
• For the retailers who were not in a position to install chest cooler insulated boxes
numbering around 900 were distributed during the said period. Milk and milk product
were preserved in the insulated boxes and sold.
• Around 40 numbers of 400 liters capacity chest coolers under the cold chain
development has been distributed
Promotional Activities:

Door to door campaigning: - This is done through the sales force team by questioning the
consumers, reasoning them, issuing brochures etc. This is carried on periodically.

• Organizing meeting:- Organizing meetings is important public places and inviting

important period like doctor, professional, government officers etc.
• Visit to Non -Govt. Organizations:- Visiting to NGOs and creating awareness about
the product and its benefits, inviting them to the plant and showing them the
production procedures.
• Visit of school children to the dairy and promoting their products through them by
issuing samples.
• Inviting the consumer forum and creating awareness to them.
• Participating in trade shows, exhibitions and educate people
• Through advertising in major media's like T.V., News Papers, hoardings etc...
• It seals its product under the brand name ' NANDINI

QUALITY CONTROL DEPARTMENT:

Functions: The main function of quality control section is to control the quality and produce
best quality products. In Q.C section, the milk is tested before processing and even after
processing. Before processing the milk, it is tested for adulteration, fat content in the milk.
Milk 8% is rejected and above 8% of fat is accepted. After the milk is processed again, it is
tested for bacteria fat contents, acidity etc... Then the reports are prepared after conducting
tests. Then these reports are further submitted to KMF for further clearance and approval. If
my defects are found, then KM notifies and recommends for further better performance

Quality Control Techniques Adopted:

The various tests conducted in order to maintain the quality of milk are as under:

1. Garber Test: - To know the fat content present in the milk. It is mixed with sulphuric
acid. (MILK + H2SO4)
2. Milk Test: - To know the fact content present in the milk through electronic device.
3. Lactometer: - To know the stability of the milk and is conducted by mixing the milk
with water and using lactometer, stability is tested.

If milk water quantity is more in the milk the lactometer will immerse inside.

• MBRT test and ethylene blue radiate Test.

• Acidity Test.
• PFA Test and Prevention of food Adulteration Test

PROCEDURE:
EACH TANKER IS WEIGHTED AT THE WEIGH BRIDGE & THE SAMPLE

MILK IS TESTED IN ELECTRONIC FAT

→ MILK IS UNLOADED TO RAW MILK SILOS (4 SILOS JITU A CARACT A 1

HEATING AT 78 DEGREE C

AND MAINTAINED AT 45
AFTER PROCESSING, THE MILK IS CONVERTED INTO 4 TYPES OF MILK I.E. FCM, TM,
CTM AND HMST

WHERE

PASTEURIZED MILK IS

CHILLING OF MILK AT 5

DEGREE IN PASTEURIZE

NEXT THE MILK IS SENT FOR PACKING SECTION FOR

DISPATCHING SECTION, MILK IS KEPT AT 5 DEGREE C.

Functions:
The main functions of financial department are as under:

1. To manage cash.
2. To manage bills.
3. To manage transportation bills.
4. To manage pay bills.
5. To manage accounts.
6. Prepare IBP

1. Cash: -

There are two cash counters in the financial section,

i. Collection of sales proceeds counter: This is for cash collection of sales proceeds of milk
and milk products. Cash remitted by challan system from various milk distribution roots for
sale. A receipt is passed for the net amount collected from each of the distribution root
salesmen and this is being recorded in a on-line account. This entire amount collected by the
end of the day is remitted to bank the same day to the current account of the milk union.

Cash counter: Another cash counter is for handling impressed cash and cheques. Impressed
cash means amount required for meeting various payment.

Receipts are being issued for collection of cash towards receipts of EMD

(Security deposit repayment of advance drawn and such other outstanding) all these things
are recorded in a cashbook called petty cash book. This cashbook is being closed at the end
of day a verified by accounts office Asst. Manages finance. Cheques are also being drawn
for payments of bills whenever payments are required through cheques. For receipt of any
cheques received from outside official, general receipts are being passed in cash counter
using tally ERP9.

2. Bills:

Bills are being received from various suppliers and usually the purchase section after getting
the Material Receipts Information (MRI) from stores duly certified for quality and quantity,
sends bills to finance section in the related files and these bills are processed and entered in
the control register and after scrutiny from pre-auditors bills are put up for passing before MD
through Assistant Manager Finance. After the approval of MD the cheques are drawn in the
name of the parties. File with entries of cheque No. and a copy of the voucher is returned to
purchase section / to the concerned section. And the payment vouchers are accounted in
com

3. Transportation Bills: -

Following are the types of transportation bills:

i) Procurement Transportation Bills (PTC) ii) Distribution Transportation Bills (DTC)

iii) Mobile veterinary root bills

iv) Cattle feed transportation bills

v) LN2 transportation bills (Liquid Nitrogen)

vi) Hire vehicle transportation bills

4. Pay Bills: -

Attendance data are being received from time office as per the punch card entries, further
the attendance of chilling center staff and field staff are being received from concerned
section once in a month duly certified by section needs.

Based on these attendance extracts pay bill of all the 950 employees of the milk union are
being prepared through computers and salary is being distributed through Canara Bank
main Branch, Syndicate Bank of BDCC Bank by way of crediting the account of respective
employees in the Bank. These are various heads under which salary recoveries are made
such as Employees Provident Fund (EMF), Employees State Insurance Scheme (ESI),
Professional Tax, LIC, GSLIS (Group Saving Linked Insurance Scheme), pay advance, Bank
loan and such other deductions under about 45 account heads. These salary recoveries are
being sent to respective departments such as Regional PF commissioner,

ESI office,

Professional Tax Office, LIC of India, different banks where employees avail loans through
cheques. The account section prepares salary.

5. Accounts: -

The functions of account section are: •

To maintain record of day-to-day transactions, update entries in computer.

• Prepare monthly nominal accounts.

• Prepare annual financial statements such as receipt and payments, trading, and P/L
a/c and balance sheet and also to produce the same to statutory auditors and get it
audited Sources of Finance:

The main source of finance is sales realization (Retained Earnings). Sales are purely on
cash / cheques basis. As the nature of the product is highly perishable i.e., that milk and
other milk products. Hence because of this the product needs to be immediately sold to the
end users, as result money is generated immediately and routinely. Hence this forms the
only source and can be classified as short-term source finance. The other products of milk
and as their perish ability period is little more i.e., for a products of 3-4 months and sales are
realized and money gained out of it can be classified as long-term source of finance.
Sometimes they even get grants from the government.

The Union had an approximate turnover of Rs. 692.82 crores in the year 2016-

2017 as against Rs. 527.76Crores for the year 2009-10.

OPERATIONS:
MILK PROCUREMENT

The Milk produced by 99405 farmers at village level will be collected every day morning and
Evening at DCS. Under Clean Milk Production program, to maintain the freshness & quality
of the milk 121 Bulk Milk Coolers covering

377 DCS of Total Capacity 1,92,802 liters were installed at DCS level. During the year the
Unions daily average milk procurement is 9.32 Lakhs Kgs, which works out to be 551 kgs
per day per DCS. The milk procurement has increased by 2.15 % when compared to the last
year.

MYMUL is offering

me most remunerative milk procurement

price to member

producers. The operational efficiency is reflected on procurement prices paid to the member
producers. The average milk procurement price paid during the year was Rs. 19.06 for every
Kg of Milk supplied to the Union, which is 80% of total cost of production.

Cost consumption at mymul:

Transportation 4%

Process 5%

Packing 3%

Retail margin 3%

Sales & administration 6%

Miscellaneous 5%

Interest and bank charges 2%

Milk purchase 72%

SUMMARY OF FINDINGS, CONCLUSION AND SUGGESTION:

SUMMARY OF FINDINGS:
• MYMUL has a wide marketing network throughout the state.
• The customer awareness level towards Nandini milk is excellent because all the 100
respondents are aware of it.
• Proper training programs for farmers are an additional services provided by the
company which is improving Nandini's popularity among the farmers and ensures
quality and consistency of supply of milk from them.

> Majority of respondents belongs to the age group of 22-50 years.

• Majority of respondents are of female category.

• Majority of the respondents have chosen TV as the best media to increase the sales.
• Majority of the respondents buy the products because of their own decisions.
• Majority of respondents have suggested creativity in advertisement makes it most
memorable.

> Majority of respondents say Nandini's advertisement convey enough required information
about its products.

• Majority of the respondents say picturisation strategies impress the customers more.
• Majority of the respondents buy Nandini products because of their availability.
SUGGESTIONS:
 • The company should make more use of the different medias available like television,
radio and other medias which can attract lot of customers.
• It can be suggested that advertisements should be made more attractive and
innovative to draw the attentions of the customers.
• It can be suggested that different offers must be made available and that will attract
customers.
• Most of the customers buy Nandini products due to its ease availability, so maintain
products available to customers through effective distribution channels.

* It can be suggested that the company should have their upper held priorities towards
revising their pricing strategies to popularise the products for the mass greater reach outs in
the future period of time.

• Company can reduce the price of the product by adopting few cost reduction
techniques, so it will help attract different classes of people.
• Bonus and incentives can be given to the dealers in order to motivate them.

CONCLUSION:
• Though the study is not exhaustive, the data obtained is enough to understand the
attitude of the customers towards Nandini products.
• The result of the survey proves that Indians in spite of being price conscious,
nowadays they are more health concerned and quality oriented. To be dominant
players in the market, sales promotion is very crucial weapon. To maintain and retain
the tough customers and also, to build a good rapport with the channel partners.
• According to market research the consumer had given positive response regarding
all aspects of Nandini products. It shows Nandini is attracting consumers and
prospecting in business. But in a competitive field, one should not satisfy with one's
present performance. In order to maintain higher competitive efficiency, regular
market research will help an organisation to ascertain the consumer preference and
according to them for creating and maintaining brand image in the minds of people.