King: Amul secret of success

Tuesday, July 19, 2011

Amul secret of success

Exporting dairy products to Europe and US is not an easy deal even for high tech and wealthy corporate as these countries would expect very highest standards as far as milk products are concerned.

But, for 65 year old Amul Dairy, which is run by Co-operative Milk Producers' Unions situated in 13 districts of Gujarat, Export to US and Europe is a cake walk. The products of Amul in these Countries have an extreme demand as amul is loved by not only Indians settled there but also by natives.

The icing on the cake is Amul has now planned to set up dairy plants in these countries to boost sales and to set more standards.

In a survey that is conducted Campaign Magazine, Amul has out powered all India Brands and has attained 89th position among 1000 brands of Asia. It is the third year in a row where Amul has featured in the top 100 of the 1,000 Asian brands covered under the survey.

Amul- The Past and Present:

As advised by Shri Morarji Desai and under the guidance of Mr.Vargeese Kurian the very first cooperative society union was started in Anand in the year 1946 for collection of milk from farmers and selling the same in the nearby cities in the name of "Amul". This society could collect and sell 250 litres of Milk every day from the farmers initially.

With the financial help from UNICEF, assistance from the govt. of New Zealand under the Colombo plan, of Rs. 50 millions for factory to manufacture milk powder and butter was planned. From that point it never looked back.

Now this cooperate society has transformed into a milk Giant. It is the largest producer of Milk and milk products in India and the second largest in the world. Just see the following astronomical business statistics Amul.

Members:	13 District Cooperative Milk Producers' Unions
No. of Producer Members:	3.03 million
No. of Village Societies:	15,712
Total Milk handling capacity:	13.67 million litres per day
Milk collection (Total – 2010-11):	3.45 billion litres
Milk collection (Daily Average 2010-11):	9.2 million litres
Milk Drying Capacity:	647 Mts. per day
Cattlefeed manufacturing Capacity:	3690 Mts per day
Sales Turnover (2010-11)	Rs. 9774 Crores (US $ 2.2 billion)

Interestingly, though Amul was initially a government supported organisation, it never followed the typical red-tapism of the inherent to Governement. It has turned in to a vibrant, self sufficient, and competitive entity. To the surprises of many experts, it never even allowed MNCs such as Nestle, Unilever etc., who dominate FMCG market in India, to compete with it in dairy products market.

The system succeeded mainly because it provides an assured market at remunerative prices for producers' milk besides acting as a channel to market the production enhancement package. What's more, it does not disturb the agro-system of the farmers. It also enables the consumer an access to high quality milk and milk products. Contrary to the traditional system, when the profit of the business was cornered by the middlemen, the system ensured that the profit goes to the participants for their socio-economic upliftment and common good.

But , it never showed any signs of a typical cooperative society when it comes to propagating its brand. The Ads of Amul are obviously very famous. It really came out of shackles of typically boring advertising strategies of Government sponsored brand. The following ads would show that it has even not bothered to make fun of Govt, leaders, and famous icons to attract people towards its brand.