Marketing Report of the Amul Company Assignment

Marketing Report of the Amul Company Assignment Words: 1706

However, with its sharp focus on domestic Indian market, Maul has successfully insulated Indian rammers from all the turbulence in global dairy trade. It is already providing the best employment option for displaced workers from urban manufacturing sector, who after losing their Jobs due to recession, have started reverse migration from cities back to villages 2. 1. 4 Ecological GAMMA could foresee the impact of below normal monsoon in August 2009 itself and started planning to maintain milk production, procurement and inventory levels.

Also, at a time when due to lower production of cereals, fodder prices had Jumped almost two-fold, GAMMA enhanced the supplies of cattle-feed to milk producers and maintained its prices below cost and were able to provide better returns to the milk producers to overcome the stress of draught 2. 1. 5 political Tussle for the chairmanship of Gujarat Cooperative Milk Marketing Federation Limited (GAMMA), the apex marketing body, emerged as the core issue among political parties. These parties planned gain entry into the cooperative giant”s affairs. Mr..

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Boat, who was enjoying his second three-year term, was a consensus candidate last year, even as the main political parties failed to choose a new head. Now, barely a year after his taking over for the second term, Mr.. Boat is under pressure to relinquish the office. 7 2. 2 Issue Priority Matrix Fig 1: Issue Priority Matrix for Maul 2. 3 Porter’s Five Forces Model Fig 2: Porter’s Five Forces Model 1. Bargaining Power of Suppliers GAMMA is a cooperative, which means it conducts business by collecting from large number of individual farmers who rely upon the cooperative to give them better price for their produce.

Therefore the bargaining power of such suppliers is low. Twenty nine lakes milk producers gain higher profits only through the co-operative which in turn drives down their bargaining power. 9 2. Bargaining Power of Buyers There are already other co-operatives existing in India, having their own established brands, which reduce the loyalty of current customers, thereby increasing their bargaining power. 3. Rivalry Among Competitors The market is highly competitive, existence of several players which have already established channels and partners constantly push the envelope.

The competition exists locally, nationally and internationally. 4. Threat From Substitute Although no real substitute exist for milk, however competition offers low priced products as well as variety, from skimmed milk to full cream as well as milk powder. 5. Barriers To Entry The competition among existing players is very intense and grown over the years from collection of more and more producers. The producers only supply to such established brands due to their reach and ability to maximize profits. Also the industry is capital intensive along with several legal barriers.

The current industry matrix puts Nestle at the top among others. Although the matrix is not exhaustive and does not include all market leading companies, it still shows where the gaps are and the critical success factors. Nestle takes the lead because of gig quality products and aggressive marketing, also the standards and technology used by Nestle is superior than Maul or Mother Dairy, which are domestic brands. Products availability is important factor, since even one miss pushes the customer to seek a different competitor. Maul however is not far behind and can catch up in areas of technology and marketing. . 4 Key Success Factors 12 The key success factors of the Maul industry are those things that affect industry members ability to prosper in the market place-accessibility to raw materials, packaging cost focus, Advertisement, product design, reputation & credibility, quality intro, strategic alliances, are ultimately so important that all firms in the industry must pay close attention to them. These key factors of success are critical in the dairy industry in particular, as they are the factors that shape whether a company will be time within the industry as driving forces and competitive conditions change.

After calculating the weighted score for all three companies, it seems that Nestle has got the highest weighted score compared to the other two companies. This is because Nestle is able to achieve a high score in product availability success factor and Advertisement success factor. Nestle plays a lead role in advertisement. Their marketing strategy is to reach each and every one through advertisements. They spend a lot in terms of Advertisements. While goodwill plays an important role for Maul, as it”s been in the market from past three generations, so the advertisement is the least role for their strategy.

Control over supply chain with industry best practices makes Maul the market leader in dairy products in India. Maul has 14 animal rearing practices, hygiene and sanitation awareness through safe milk incepts etc. Milk products create an inherent weakness, which is permissibility. The product can lose quality in a small time scope, therefore several other strengths relating to storage, movement and related logistics have to be improved. Another weakness is that some of the products are very unpopular and cannot compete with other players; this weakness is in terms of frozen products, which are considered low in quality.

The marketing for these products is missing and does not appropriately position it. Technology and transportation remain basic weaknesses which mar the efficiency of the entire supply chain. 3. External Factor Analysis Summary (FEES) 15 As a Global enterprise, Maul will be meeting global demands and ensure greater productivity and the opportunity to enhance integration in order to increase efficiency and effectiveness in the business. It already has wide geographic positions and hence this will give it an advantage to get access to gain presence in mature markets.

Efforts to exploit export potential are already on, as Maul is exporting to Bangladesh, Sir Lankan, Nigeria, and the Middle East. By following the new GAIT treaty, opportunities have increased tremendously for the export of agric-products in unreal and dairy products in particular. Local competitors are the major problem facing by Maul. They sell their products at a lower price, since being a low capital company; they have fewer expenses to take care of. Secondly as the environmental costs are rising day by day, it”s getting tough to carry the same pricing throughout. Thus cutting down the extra cost will surely help.

Adulteration is also a major threat to quality that takes place due to illiterate farmers from remote villages. 3. 3 Strategic Factor Analysis Summary (SFA) There are certain strategic factors, which are with a long-term mission, and some deed to be addressed in the short term. There are other factors, which do not fall into either of the terms mentioned above; they are classified as intermediate term. 16 3. 3. 1 Short Term The strategic factors that the company needs to satisfy in the short run are Economies of scale as it can change by building few more storage capacity at their new projects.

This will also benefit in global expansion of the company. As short term defines a period of a year or so, the solution should be found within a year for a proper success. 3. 3. 2 Intermediate Term yield management, supply chain demand and rising environmental costs. These are classified into intermediate duration because the company must be able to overcome its weaknesses, make use of the opportunities and defeat the threats. All this must be done at the right time to ensure efficient results.

In this case the factors are such that the earliest (short term) might not be the best decision to make, as the duration might not be sufficient to overcome all the issues with a clear outlay. 3. 3. 3 Long Term The strategic factors that the company needs to satisfy during this period are the strength of having a wide range of products. They must be able to continue to maintain many products varieties and build on them efficiently. Using R & D (Research and Development) to overcome the problem of bastardization as well as satisfying growing global demand is not an easy task and hence requires time and efficiency to meet the needs globally.

Last but not least is overcoming the threat of competitors in the long run. 17 4. 0 SOOT Analysts 4. 1 Strengths Demand profile: Absolutely optimistic. Milk being a necessity product, the demand will stay and the sales at GAMMA are bound to increase over a period of time. 0 Margins: Quite reasonable, even on packed liquid milk. The margins are enough Flexibility of product mix: Tremendous. With balancing equipment, GAMMA Availability of raw material: Abundant. Presently, more than 80 per cent of to limit the entry of potential entrants. Has kept adding a wide array of products to its product line. Milk produced is flowing into the unrecognized sector, which requires proper centralization. Maul & GAMMA have leveraged this and has got itself a strong base of suppliers who provide them milk throughout the year. Large number of dairy plants in public and cooperative sectors besides several others coming up in the private sector would result in competition. Because of this the end consumer would benefit and a good product mix would emerge. 0 Technical manpower: Professionally trained, technical human resource pool, highly recognized in the industry and have earned name for themselves as well as the federation.

Enhanced milk production: Increase in the milk production with consequently increased availability of milk processing has led to increase in consumption and faster access to the consumers through effective distribution. The technology is brought from Denmark and the production of milk has benefited from that. 0 Transportation: The transportation facilities and the easy availability of the facial trucks have provided a boost. Cold refrigerated trucks are there in place and the warehouses also have the cold storage facilities that facilitate the transportation.

Vast resources: Country has vast natural resources which offer immense potential growth and development for dairying. Moreover the financial resources available with the federation are immense and the reputation is such that in case of any further requirements, it can approach any institution and raise any form of capital. 18 Increasing purchase power and changing tastes of the consumers: The purchasing power of the residents is increasing. As a result a lot of products are being consumed. Moreover, the consuming habits are changing.

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