Amul - Business Strategy
- 1. AMUL The Taste of India
- 2. Company Profile 2 AMUL stands for Anand Milk Union Limited Amul, is an Indian dairy cooperative society based at Anand in the Indian state of Gujarat Amul is a cooperative brand managed by a cooperative body, the Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), which today is jointly owned by 36 lakh (3.6 million) milk producers in Gujarat. In 1997, Amul ice creams entered Mumbai followed by Chennai in 1998 and Kolkata and Delhi in 2002. Nationally it was rolled out across the country in 1999. In January 2007, Amul introduced SUGAR FREE & ProLife Probiotic Wellness Ice Cream, which was a first in India. Amul’s market share is 38% in the industry
- 3. AMUL • Type – co-operative • Founded in – 1946 • Headquarters – Gujarat ,India • Industry – dairy • Key people - Gujarat Cooperative Milk Marketing Federation Ltd. (GCMMF) • Products - milk and related product • Revenue – Rs. 38,550 crores in 2019-2020 • Employee – 3.6 million (milk producing members) • Slogan – The Taste Of India.. 3
- 4. Mission, Vision and Objectives Objective To ensure that the maximum share of the consumer’s rupee goes back to milk producer “To provide more and more satisfaction to the farmers, employees and distributers” “To satisfy the taste and nutritional requirements of the customers of the world and committed to offering quality products that provide best value for money” Vision Mission
- 5. AMUL Products Amul Puffles Bakery Products Ice Cream Amul cattle Feed Cheese & Ghee Milk PowdersBread Spreads Amul Milk Amul Receips Happy Treats Mithai Mate Chocolates
- 7. Business Model Canvas • Sellers • Logistic partners • Distributors • Retailers • Dairy Procurement. • Product R&D • Distributing • Branding • Positive Customer Service • Marketing • Quality Dairy and Dairy products. • Low Cost Strategy. • Amul Girl • Middle Class • Kids • Female • Gym and Sports enthusiast (All age group of customers use Amul products) • Amul Retail Stores. • Departmental Stores • Maintenance • Customer feedback • Product Sales to individual's and Wholesale Retailers. • Ingredients- dairy and its products. • Production, Distribution Facility • Packaging Inputs Key Partners Key Activities Value proposition Revenue Stream Customer Segment Customer Relationship ChannelsKey Resources Cost Structure
- 8. SWOT Analysis Strengths Weakness Threats Opportunities • Portfolio of Product • Strong Brand Image (Amul Girl) • Quality • Distribution Network • Strong Supply Chain- White Revolution • Vast scope/Large market potential • Specific products for health conscious population • Social media engagement • Focusing on lagging product ranges • Growing public sensitivity towards animal husbandry • Increasing international competition • Supply fluctuations due to seasonal Issues • Dependence on the dairy unions and communities • Perishable product • Low investment in Marketing • Less Impactful Brand Image out side India
- 9. Existing Rivalry • Amul Dairy is one of the leading company in this competitive industry with a number of strong rivals like Unilever, Kraft foods and Group DANONE. Threat of New Entrants • There is low risk of new entrants to Amul Dairy as it has quite big network of distribution worldwide dominating with well-reputed image. Bargaining Power of Suppliers • In the food and beverage industry, Amul Dairy owes the largest share of market needing greater number of supply chains. • In reaction, Amul Dairy has also been concerned for its suppliers as it believes in long-term relations. Bargaining Power of Buyers • Thus, Amul Dairy makes sure to keep its consumers satisfied. • This has actually led Amul Dairy to be one of the devoted company in eyes of its purchasers. Threat of Substitutes • There has been a terrific risk of replacements as there are alternatives of some of the Nestlé's items such as boiled water and pasteurized milk. Porters Five Forces
- 10. BCG Matrix CASH COWS: • There are three products of Amul that fall under cash cow category, the first being Amul Milk and the second being Amul Butter and third is Amul Cheese. • The products hold high market share in these not so fast-growing industries. • Owing to the limited chances of industry growth, Amul is introducing a number of new product variations for different customer segments so as to maintain its market leadership. • For Example: Apart from its basic version of Butter and Milk, Amul also launched, Amul Butter Lite, Amul Tazza Milk and Amul Gold Milk to target customers who are more health conscious. STARS: • Amul Ice cream and Amul Ghee are two products that can be considered as Stars of the company. These are the products which have a high market share and holds a good potential to grow in the future as well.
- 11. Cont. QUESTION MARK: • Amul lassi has been marketed with the aim to increase the market share and compete with the other beverages available to the market. • Considering the increasing interest and demand for healthy products and beverages, the healthy milk from Amul poses a great potential to grow in the near future with a condition that it is marketed well. DOGS: • Dogs are those products that have low growth or market share and have a very limited chance of growing into a profitable business unit for the company. • Amul Chocolates, Amul Cookies, and Amul Pizza are few products which can be considered as Dogs for Amul. • Due to the heavy competition and limited innovation that these product categories face, it’s becoming difficult for Amul to gain market share for these products and make them a viable revenue generator.
- 12. Financials 22,972 27,043 29,255 32,960 38,542 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 2015-16 2016-17 2017-18 2018-19 2019-20 Revenue (In Crores) 271 470 819 365 Export (In Crores) 2016-17 2017-18 2018-19 2019-20
- 13. Value Chain Analysis FIRM INFRASTRUCTURE: Head, Zonal and Overseas Offices Inbound Logistics Procurement Cold Storage Chiller Tanks Transportation Operations Milk Processing Product Development Packaging Labelling Storage Outbound Logistics Dealers Distributors Local Area Vendors Customers Sales and Marketing Branding Innovation Product Portfolio Pricing Advertising Service & Support Customer Service Forum Feedback and Complaints Redressal MARGINS Support Activities HUMAN RESOUCE MANAGEMENT: Structured, Technology Induced, Leadership TECHNOLOGY: Integrated IT Infrastructure, B2B, Visibility and Transparency PROCUREMENT: Systematic and Set Policies
- 14. Distribution Network FARMERS Milk Processing Union and Warehouses Warehouses Wholesalers Retailers Home Delivery Contractors Consumer Consumer Village Cooperative Societies (With Chilling Units) Chilling Plants
- 15. Growth Strategies Cost Leadership Strong Distribution Network Product Portfolio Diversity Technological Agility
- 16. CSR Initiative 16 Blood donation Tree plantation Amul Scholarships Dairy Demonstration Farm
- 17. Sustainable Mission AMUL has been rated as the top Indian Green brand by the Global Green Brands study which researches consumers’ attitudes and perceptions towards ‘green’ issues. Gujarat Cooperative Milk Marketing Federation (GCMMF) stated that the International Dairy Federation has also awarded Amul Green Movement as the best environment initiative in the “sustainability category’’ in 2010. 17