SUMMER INTERNSHIP PROJECT on
Understanding of Home Delivery Milk Sales through Card System & Development of Standard Operating Procedure to Increase Sales through Card System
Mother Dairy Fruits & Vegetables Pvt. Ltd., Hyderabad
BALAJI INSTITUTE OF MODERN MANAGEMENT
As partial fulfilment of requirements for the award of the Post Graduate Diploma in Management
The satiation and euphoria that accompany the successful completion of the project would be incomplete without the mention of the people who made it possible.
I take this opportunity to express my sincere gratitude to Mr. Srinivas Raju (DGM, Sales) for his valuable guidance, support and encouraging words during the entire project duration.
I feel privileged in expressing profound sense of gratitude and indebtness to Mr. Muhammad Shuyeb (Assistant Brand Manager) for his invaluable support, guidance and suggestions which helped me to do the project.
I owe my wholehearted thanks and appreciation to Mr. Vivek Mallik (Regional HR) and the entire staff of the company for their cooperation and assistance during the course of my project.
I would also thank my Institution and my faculty members without whom this project would have been a distant reality. I also extend my heartfelt thanks to my family and well-wishers.
I hereby declare that this project report on, “Understanding of Home Delivery Milk Sales through Card System” at Mother dairy Fruit and Vegetable Pvt Ltd., Hyderabad, which is being submitted in partial fulfilment of the requirements for the award of the Post Graduate Diploma in Management 2012-14, is the result of the work carried out by me, under the mentorship of to Mr. Srinivasa Raju (DGM, Sales) and guidance of Mr. Mohammad Shuyeb (Regional Brand Manager ) of Mother Dairy Fruit &Vegetables Pvt. Ltd.
I further submit that this project work has not been submitted to the Mother Dairy Fruit &Vegetable Pvt. Ltd before or after for any other purpose.
Signature of the Mentor
Self – Signature
Signature of the Guide
This project focuses on finding out right awareness, percentage of milk sales on Card, benefits and challenges of Card system to consumers, agents and development of SOP for the same. The project was started on 15th of ay, 2013 after knowing all the relevant information about the milk sales through card system, and distribution channels, under the guidance of Mr. Srinivas Raju (DGM Sales) and Mr. Mohammad Shuyeb (Assistant Brand Manager). The summer internship project includes the study of retailers (agents) and consumers in the Hyderabad region to know their awareness, understanding, perception of agents and consumers towards sale of milk on card system with home delivery and through retail. For this I used the method of personal interviews and questionnaires both for agents as well as the consumers. The sample size of consumers and agents were 300 and 200 respectively to carry out the personal interview.
The first part of internship is the study of consumer perception and understanding towards Mother dairy milk sales through card system and more specifically the factors affecting the consumer to buy and not buy milk through Card System.
The second part of my project involves the study of agents, dealing in mother dairy as well as competitor brands through the scope of home delivery & Card System and their problem areas in context with the card system.
TABLE OF CONTENT
Industry and Company overview
Objective & Scope of Study
Review of Literatures
Data analysis results and Interpretation
Findings & Recommendations
SOP to increase milk sales through Card System
Bibliography & Webliography
Milk production in India has doubled and has reached the 116.2 million tonnes a year thus becoming India’s No.1 farm commodity. The current market size of the dairy industry is INR 2.6 trillion and is estimated to grow up to INR 3.7 trillion by 2015. So there is stiff competition among the business organizations dealing with milk and milk products in Hyderabad to become the market leader.
The players are putting their strenuous efforts to retain the existing consumers and capture the new market and for this milk sale on Card System is one of the method. Mother Dairy is not far behind in the competition and hence the objective of this project is understanding of milk sales on card system with home delivery as well as through retail.
This helps in getting practical experience about marketing research, channel distribution, sales, and developing new strategies. To achieve this objective primary data was required hence survey was conducted on retailers as well as consumers through set of questionnaires. The sample size is 200 for agents and 300 for consumers to conduct the research in 60 days.
This project will help the company in getting idea about the awareness of Card System to consumers and retailers and to analyse the factors which influence consumer to buy or not buy milk on Card System. This project also reveals the benefits and problem faced by retailers and consumers on Card System. This project provides a clear picture to company about Card System and by taking help of this project company can make strategies to retain their existing card holder consumer and make new consumers.
INDUSTRY AND COMPANY OVERVIEW
2.1 INDIAN DAIRY INDUSTRY - A PROFILE
The dairy industry in India has been on a steady path of progression since Indian independence. It has grown from producing 17 million tonnes of milk in 1951 to producing 121 million tonnes in 2011. Today, India is one of the largest milk producing countries in the world. This solid progress is primarily attributable to structural changes in the Indian dairy industry brought about by the advent of dairy cooperatives.
The Indian dairy industry reported a market size of USD 48.5 billion in FY2011. With a Compound Annual Growth Rate (CAGR) of 16 percent, it is anticipated to reach USD 118 billion in 2017. On the back of a rise in disposable income, coupled with strong demand for dairy products, the Indian dairy industry is all set to experience high growth rates in the next five years.
The consumption pattern of dairy products in India is quite unique as compared to some of the western countries. Consumption is primarily skewed towards traditional products; however, westernized products are gradually gaining momentum in the urban areas. Interestingly, buffalo milk accounts for the largest share of the total milk produced in the country. Since the pricing of milk is based on the fat content, buffalo milk offers higher profit margins as compared to cow milk as it contains higher fat.
The Indian dairy sector is characterized by high fragmentation. It is dominated by the unorganized sector comprising of 70 million rural households. The per capita availability of milk in India stands at 289.4 grams per day. Backed by strong domestic demand, the per capita availability of milk is anticipated to reach 336 grams per day in FY2017.
Despite being the one of the largest milk producing countries in the world, India accounts for a negligible share in the worldwide dairy trade. The ever increasing rise in domestic demand for dairy products and a large demand-supply gap could lead India to be a net importer of dairy products in the near future.
2.2 BACKGROUND OF DAIRY INDUSTRY
Beginning of organized milk handling was made in India with the establishment of Military Dairy Farms. Handling of milk in Co-operative Milk Unions
established all over the country on a small scale in the early stages. Long distance refrigerated rail-transport of milk from Anand to Bombay since 1945.
Pasteurization and bottling of milk on a large scale for organized distribution was started at Aarey (1950), Calcutta (Haringhata, 1959), Delhi (1959), Worli
(1961), Madras (1963) etc.
Establishment of Milk Plants under the Five-Year Plans for Dairy Development all over India. These were taken up with the dual object of increasing the national level of milk consumption and ensuing better returns to the primary milk producer. Their main aim was to produce more, better and cheaper milk.
Some facts of Indian dairy industry are as follows:-
2.2.1 Milk Production
India's milk production increased from 21.2 million tonnes in 1968 to more than121 million tonnes in 2011-2012.
India is the largest producer of Milk in the World (replacing USA)
Per capita availability of milk presently is 290 grams per day, up from
112 grams per day in 1968-69.
India has annual growth of milk production is 4 percent.
Bulk-vending - saving money and the environment.
Milk travels as far as 2,200 kilometres to deficit areas, carried by innovative rail and road milk tankers.
Ninety-five percent of dairy equipment is produced in India, saving valuable foreign exchange.
2.2.3 Macro Impact
The annual value of India's milk production amounts to about Rs. 900 millions.
Dairy cooperatives generate employment opportunities for some 12 million farm families.
Dairy Farming is the single largest contributor to the economy(4% of
GDP & 26% of agricultural GDP).
Dairy industry represents a huge opportunity being the largest single
2.2.4 Key challenges before Indian Dairy Industry are as follows:
Procurement and efficiencies in supply chain
Product differentiation and value addition.
2.3 COMPANY PROFILE
2.3.1 OVERVIEW OF THE MOTHER DAIRY
Mother Dairy was set up in 1974 under the Operation Flood Programme, a wholly owned subsidiary of the National Dairy Development Board (NDDB). Mother Dairy markets approximately 3.2 million liters of milk daily in the markets of Delhi, Mumbai, Saurashtra and Hyderabad. Mother Dairy milk has a market share of 66% in the branded sector in Delhi where it sells 2.5 million liters of milk daily and undertakes its marketing operations through around 1400 retail outlets and over 1000 exclusive outlets of Mother Dairy.
It is Mother Dairy’s constant endeavour to: Mother Dairy milk has a market share of 66% in the bra
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. To ensure this Mother Dairy operates such that the farmer gets 85% of the total cost of sales.
Uphold institutional structures that empower milk producers and farmers through processes that are equitable. Mother Dairy markets app.2 million liters of milk daily in the markets of Delhi, Mumbai,
Mother Dairy is an IS/ISO 9002, IS 15000 HACCP and IS 14001 EMS certified organization. Moreover, its Quality Assurance Laboratory is certified by National Accreditation Board for Testing and Calibration Laboratory (NABL) - Department of Science and Technology, Government of India.
The company derives significant competitive advantage from its unique distribution network of bulk vending milk booths, retail outlets and mobile units. Mother Dairy ice creams launched in the year 1995 have shown continuous growth over the years and today boasts of approximately 62% market share in Delhi and NCR. Mother Dairy also manufactures and markets a wide range of dairy products that include Butter, Mishti Doi, Paneer, Dahi, Ghee, Cheese, UHT Milk, Probiotic Products, Lassi & Flavoured Milk and most of these products are available across the country.
Safal is the market leader in the organized fruit & vegetable retail business in Delhi NCR where it sells an average of 300 MT/day through a network of 350+ exclusive retail outlets under brand name Safal/ Safal Pure Veg, supported by a state-of-the-art large and ultramodern Central Distribution Facility located in Delhi with an annual capacity to handle and process 2,00,000 MT of fresh fruits and vegetables. Safal today operates the largest number of F&V Stores in Delhi
NCR and has further expansion plans in place. Retail Outlets are also present in Bangalore under the brand name Safal Daily Fresh.
Safal has a prominent presence in Export market spread across 40 countries viz., USA, Europe, Russia, Middle East, Asia and Africa and exports Fresh Fruits & Vegetables (Grapes, Banana, Gherkin, Onion, etc.), Fruit Pulp & Concentrate, Frozen Fruits & Vegetables, etc. A state-of-the-art fruit processing plant of fruit handling capacity of 15,000 MT annually, setup in 1996 at Mumbai supplies quality products in the international market. With increasing demand another state-of-the-art fruit processing plant has been set up at Bangalore with fruit handling capacity of around 50,000 MT annually.
The Dhara range of edible oils is marketed by Mother Dairy. Today it is one of the leading brand of edible oils and is available across the country in over 2, 00,000 outlets. The brand is known for its PURITY and focuses on the indigenous oil. The brand is currently available in the following variants: Refined Vegetable Oil, Refined Soybean Oil, Refined Sunflower Oil, Refined Rice Bran Oil, Kachi Ghani Mustard Oil and Filtered Groundnut Oil
2.3.2 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:
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 farmer 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 Dairy’s 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.
2.3.3 Product Profile
Milk and its Products
Packaged Milk (Full Cream,
Standardised, Toned, Double Toned Skimmed and Pro-biotic), Butter, Dahi, Ghee, Cheese, Ice Creams, UHT Milk, Lassi & Flavoured Milk.
Refined Vegetable Oil, Refined
Soybean Oil, Refined Sunflower Oil, Refined Rice Bran Oil, Kachi Ghani Mustard Oil and Filtered Groundnut Oil.
Fresh and frozen fruit and vegetable products
Fruits, Vegetables, Rice, Processed
Items (jams, juices, ketchup, pulp, etc.)
2.4 MOTHER DAIRY, HYDERABAD
Mother Dairy started its operation in Hyderabad in the year 2005 as a part of Andhra Pradesh Dairy Development Cooperative Federation Ltd (APDDCF)
The milk is procured and processed by Nalgonda- Ranga Reddy Milk Producers Mutually Aided Cooperative Union Limited (NARMAC) which extensively works for Mother Dairy
Mother Dairy has launched milk and curd in Hyderabad market with milk having three variants namely Full Cream Milk (FCM), Toned Milk (TM), and Double Toned Milk (DTM). They are available in the size ranges of 200ml, 500ml, and 1liter.While curd is available only in the range of 200ml.
Mother Dairy Hyderabad differentiates its operations from that of Delhi in terms of the concepts of agents, transporter cum distributor , limited variants etc
The milk is procured by NARMAC from the nearby 2 villages namely Nalgonda and Ranga Reddy which is processed in the plant by processes like pasteurization, homogenisation etc and is then distributed to different types of agents like roadside agents, retailers, milk booths and parlours with the help of outsourced logistics.
At present Mother Dairy has 5.9% market share in Hyderabad market. It sells around 1, 30,000 liters milk every day. Amongst Hyderabad and Secunderabad it covers around 6% of geographic areas.
Hyderabad dairy market is very competitive market having around 35 milk brands which includes some state level brands like Vijaya, Vishakha etc and some national level brands like Heritage. Other brands include many local brands like Nandi, Mukunda, Jyoti, Vaishnavi etc.
Also, the customers are somewhat differentiated on the different aspects like political aspects, community aspects, regional aspects, language aspects etc.
Mother Dairy defines its sales in three different regions namely Hyderabad, Secunderabad and Upcountry region.
Mother Dairy Hyderabad distributes milk to the agents through three different distributors, which cover different areas. The information about these three distributors is given below:-
Number of agents
Type of agents
Total sales (in Liters)
BHEL, ECIL, Himayat nagar, Kukatpally, Mallapur, Moosapet, Nallakunta, Ram nagar, Uppal
Automatic milk vending unit (AMVU), Institutions, Retailers, Roadside agents, Wholesalers,
AUTO and Redistributors
Old city, Mehandi patnam, Banjara hills, Disukh Nagar, Ramanthapuram,
LB Nagar, Golnaka
Automatic milk vending unit (AMVU), Institutions, Retailers, Roadside agents, Wholesalers,
AUTO and Redistributors
Ramoji Film City, Warangal, Apollo Hospital
AMVU, Institutions, Retailers, Roadside agents, Wholesalers,
AUTO and Redistributors
2.4.1 DISTRIBUTION CHANNEL OF MOTHER DAIRY:-
RS= Roadside Agent SH=Shops/Kiranawalas MB=Milk Booths/Parlours
OBJECTIVE AND SCOPE OF STUDY
3.1 OBJECTIVE OF PROJECT
• Objective of project is to understand the milk sales through Card System including Card counter sale and home delivery sale and development of SOP to increase milk sales through Card System.
3.2 SCOPE OF STUDY
Completion of the project could help marketing team to develop marketing strategies as per the market condition and demand. Also it will help to understand the current market scenario and essence of marketing in stiff competition. The scope of the study is:
• To find out the awareness of retailers and consumers about Card System.
• To analyze the consumers and retailer’s perception about the card system.
• To find out factors which influence a consumer to buy milk through Card System(Retail and home delivery)
• To analyze the reasons for not buying milk on Card System inspite of the awareness.
• To analyse the benefits to agents on Card System.
• To understand the challenges being faced by Agents in executing the Card System.
The dairy industry involves processing raw milk into products such as consumer milk, butter, cheese, yogurt, condensed milk, dried milk (milk powder), and ice cream, using processes such as chilling, pasteurization, and homogenization. Typical by-products include buttermilk, whey, and their derivatives. While most countries produce their own milk products, the structure of the dairy industry varies in different parts of the world. In major milk-producing countries most milk is distributed through wholesale markets. In developing countries, the past practice of farmers marketing milk in their own neighbourhoods is changing rapidly. Notable developments include considerable foreign investment in the dairy industry and a growing role for dairy cooperatives. Output of milk is growing rapidly in such countries and presents a major source of income growth for many farmers. Dairy plants process the raw milk they receive from farmers so as to extend its marketable life. Two main types of processes are employed: heat treatment to ensure the safety of milk for human consumption and to lengthen its shelf-life, and dehydrating dairy products such as butter, hard cheese and milk powders so that they can be stored.
The global market for Dairy Products is forecast to reach US$494 billion by the year 2015. Recovery in consumption post global recession, continuing population growth, rising demand from developing countries, trade liberalization, and continued growth in advertising are expected to fuel market growth. In the present situation, as customers demand dairy products that fit their diet and nutritional chart, the scope for the growth of new, innovative, and healthier products has increased. As per the recent report of GIA (Global Industry Analysts) the global market for dairy products continues to be driven by exceptional growth in Asia, Latin America and the Caribbean.
Asia-Pacific is projected to increase at a compounded annual growth rate of about 5.0% over the years 2007 through 2015.
4.1 OPERATION FLOOD
Operation Flood was implemented in three phases.
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 India's premier milk sheds with consumers in India's four major metropolitan cities: Delhi, Mumbai, Calcutta and Chennai.
Operation Flood's Phase II (1981-85) increased the milk sheds from 18 to136; 290 urban markets expanded the outlets for milk. By the end of1985, 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 liters a day.
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 Flood's Phase III consolidated India's dairy cooperative movement, adding 30,000 new dairy cooperatives to the 42,000 existing societies organized during Phase II. Milk sheds peaked to 173 in 1988-89 with the numbers of women members and Woman’s Dairy Cooperative Societies increasing significantly.
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. "Operation flood can be viewed as a twenty year experiment confirming the Rural Development Vision" (World Bank Report 1997c.)
4.2 HISTORICAL BACKGROUND OF NDDB
The National Dairy and Development Board was founded in 1965, with the mission of organizing poor milk producers, thereby transforming dairying into an instrument for the economic development of India’s rural people. The formation of the NDDB stemmed from the vision of the then Prime Minister of
India, the late Lal Bahadur Shastri, to extend the success of the Kaira Cooperative Milk Producer’s Union (in the state of Mother) to other parts of India.
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" in 1970, a programme extending over 30 years and which used World Bank loan to finance India's emergence as the world's largest milk producing nation. During this period, dairy commodity surpluses were building up in Europe. Imports from Europe had already adversely affected the dairy industry in India. Imports by individual players in India would have resulted in a market glut and a fall in the prices throughout the country. With the backing of government policy, and with the assistance of the World Food Program, NDDB imported food aid in the form of milk powder and butter oil, and marketed it under its own brand name. The surplus from these sales was invested in the expansion of the cooperative movement in the dairy industry. Operation Flood's third phase was completed in 1996 and has to its credit a number of significant achievements.
Since its inception, the Dairy Board has planned and spearheaded India's dairy programmes by placing dairy development in the hands of milk producers and the professionals they employ to manage their cooperatives. In addition, NDDB also promotes other commodity-based co-operatives, allied industries and veterinary biological on an intensive and nation-wide basis.
4.3 MAJOR PLAYERS
There are virtually 15 major Dairy Cooperative Federations in India, namely:
1) Andhra Pradesh Dairy Development Cooperative Federation Ltd (APDDCF)
2) Bihar State Cooperative Milk Producers' Federation Ltd (COMPFED)
3) Gujarat Cooperative Milk Marketing Federation Ltd (GCMMF)
4) Haryana Dairy Development Cooperative Federation Ltd. (HDDCF)
5) Himachal Pradesh State Cooperative Milk Producers' Federation (HPSCMPF)
6) Karnataka Cooperative Milk Producers' Federation Ltd (KMF)
7) Kerala State Cooperative Milk Marketing Federation Ltd (KCMMF)
8) Madhya Pradesh State Cooperative Dairy Federation Ltd (MPCDF)
9) Maharashtra Rajya Sahakari Maryadit Dugdh Mahasangh (Mahasangh)
10 Orissa State Cooperative Milk Producers' Federation Ltd (OMFED)
11) Pradeshik Cooperative Dairy Federation Ltd (UP) (PCDF)
12) Punjab State Cooperative Milk Producers' Federation Ltd (MILKFED)
13)Rajasthan Cooperative Dairy Federation Ltd (RCDF)
14)Tamilnadu Cooperative Milk Producers' Federation Ltd (TCMPF)
15)West Bengal Cooperative Milk Producers' Federation Ltd. (WBCMPF)
National Dairy Development Board (NDDB) is the central cooperative board of
the country and was created to promote, finance and support producer-owned and controlled organizations mentioned above.
5.1 RESEARCH METHODOLOGY
The research was conducted from June 2013 to July 2013. The research includes meeting with retailers, distributors and consumers. It includes preparation of the questionnaire to be answered by above people for knowing the awareness and understanding of consumers and agents towards the card system of mothers dairy and competitors in Hyderabad market. The views of the above parties were recorded in the research as per the questionnaire made.
5.2 RESEARCH APPROACH
In order to successfully conduct the research the unbiased opinion of the respondents was desirable. The I conducted the research as the representative of Mother dairy company and sometimes the representatives of the other company like Heritage or Vijaya in order to have an unbiased opinion of the concerned persons and it worked to achieve desired goal.
5.3 TYPE OF RESEARCH
As far as my research is concerned this is descriptive and somewhat exploratory research. I am conducting a survey on sample which is not continuous. To understand the home delivery of milk through card system it is required to find out the variables which in relation with the home delivery of milk through card system. There are many variables which can be known through exploratory research which are in relation with card system but without descriptive research we cannot reach on decision.
5.4 DATA TYPE
The data is primary data collected through face to face interview. Here data required for the understanding of home delivery of milk through card system is from the Hyderabad city and in current time frame hence I cannot go for secondary source of data as it is published previously.
5.5 RESEARCH INSTRUMENT
The research instrument was the structured questionnaire formulated for the respondents. Respondents were milk retailers and consumers and there was a separate questionnaire for retailers and consumers.
5.6 TYPES OF QUESTION
The second important aspect in the designing a question is to decide which types of question are to be used. Question can be classified in various ways.
Questionnaire contains following type information-
1. Open-ended question
2. Dichotomous question
3. Multiple-choice Question
Both the questionnaire consists of all three types of question. Mostly all questions are multiple type questions. Dichotomous and open ended questions are few in number.
5.7 PHRASING OF QUESTION
Following factors were taken into account while phrasing the questions:
The first and foremost question we have to ask as a researcher is: what language is the respondent is going to understand and respond in?
My questionnaire were printed in English and administered to the respondents in the languages he understand i.e. Hindi and English.
Increasingly, consumers are getting weary of answering questions for market research. As I also have to ask questions from the agents and they are too busy in their business. Hence I made my questionnaire as short as possible by avoiding unnecessary questions so that it did not take much time to get the information.
Sequencing of question:
I arranged the questions in a sequence starting from introductory question and then proceed to main body of question.
Scale of measurement used in questionnaire:
1. Ordinal scale
2. Interval scale
5.8 SAMPLING PLAN
The sample size was 200 for agents (retailers) and 300 for consumers (including mother dairy and competitors)
Milk is a basic commodity which is used by almost every household hence the sample taken to conduct research does not require any strata or segment of population. So, a simple random sampling technique was used to conduct the research.
5.9 METHOD OF SURVEY
It is direct form of investigation, involving face-to-face communication with free feedback information. It offers a sense of participation.
Personal interview is done through the set of questionnaire asked to respondents in different locality of Hyderabad city. The survey helps in understanding the current market scenario and finding out which variables are in relation with the home delivery of milk through card system. Observation approach is also used to verify income, status and standard information.
5.10 DETAILS OF CARD SYSTEM FOR WHICH SURVEY WAS CONDUCTED
Card System is a method to sale milk by taking advance for a month from buyer and giving discount of 65 paisa on per liter of milk provided by Mother Dairy.
Out of this 65 paisa 50 paisa goes to buyer and 15 paisa goes to retailers on per liter of milk sales.
5.10.1 Area of operation:
The areas of operation were the research was done are as follows.
DATA PROCESSING AND ANALYSIS
The data collected from the survey is compiled in excel sheet and the interpretation after analysing each question from questionnaire is given below.
6.1 CONSUMER ANALYSIS
6.1.1 Analysis framework:
6.1.2 Customer awareness about card system:
The analysis of data shows that out of 300 respondents 171 respondents are aware of card system and 129 respondents do not know about card system i.e. 57% consumers are aware and 43% are unaware of card system.
But it’s very important to know that what type of awareness consumers have about card system i.e. what is card system according to a consumer? The answer to this is studied with the help of the following analysis:
6.1.3 Card system according to consumer’s point of view:
Interpretation: As seen above 57% respondents are aware of card system. But their awareness is not exactly about how the actual card system policy provided by Mother Dairy. Only 22 % people are such who are benefitted by the actual policy on cards.
From pie chart we can see that out of total aware respondents, 70% of them do not know that there is a discount given on per liter of milk purchase by company, and the benefits and discount they get from card system.
The 8% people who have chosen option “c”, are those who have good relation with the agent and been his customer over a long period of time, and thus, getting discount benefit from the agents own end.
a) Making advance payment to the agent and getting a discount on per liter purchase.
b) Making advance payment to the agent and not getting a discount on per liter purchase.
c) Using cards to note down the milk purchases and pay money at the end of the month with a discounts from agent.
d) Using cards to note down the milk purchases and pay money at the end of the month without any discounts from agent.
6.1.4 Do you buy milk through card system?
As seen above 57% consumers from the sample of 300 consumers are aware of card system.
From fig. we can see that 23% consumers buy milk through card system from retails which means “counter sales” according to the agents. These 23% people bring their cards to the agent everyday while purchase of milk, and each day is marked on their cards by the agents. This is how they keep a record of the purchase.
17% consumers buy milk through card system with home delivery. This means that out of total aware consumers 40% consumers buy milk through card system and 60% consumers buy milk without card system.
Out of total 171 aware consumers only 68 consumers buy milk through Card System and 103 do not buy milk on Card System.
Yes, Through retail 23%
yes, With home delivey 17%
Do you buy milk through Card System
6.1.5 Factors which influences a consumer to buy milk through card system (From retail):
We can see that the factors which influence a consumer to buy milk through card system are mostly surety of milk packet available with the agent, i.e. 66% consumers buy milk through card system because of surety of getting milk packet available with agent.
23% consumers buy milk through card system because some milk sellers charge rs. 2 more than MRP if they purchase it on counter sales.
8% consumers buy milk on card system because of discount given on per liter of milk purchase.
3% consumers buy milk because they face money change problem frequently and faith on agent/retailers, good relation with milk seller etc.
Factors which influence a consumer to buy milk through card system(From retail)
Surety of milk packet available for you every day with the agent
Overpricing on MRP
6.1.6 Factors which influnce a consumer to buy milk through home delivery card system.
Interpretation: It can be analysed through the pie chart that 41% of the consumers prefer card system due to delivery on time, 42% due to convenience, 15% to just not down daily milk purchase and only 2 % due to discount passed on to them.
Factors which influnce a consumer to buy milk through home delivery card system
delivery on time
Only to note down daily purchase of milk
6.1.7 Why you do not buy milk through card system?
Earlier we have seen that out of total card aware consumers 60% do not buy milk through card system. Hence our intension is to know that why card system aware consumers do not buy milk on card system and the reasons are:
From pie chart we can see that 64% consumers don’t buy milk on card system because they are not a consistent buyer of milk.
19% consumers don’t buy milk because they do not want to pay in advance to agents.
17% consumers don’t buy milk on card system because the quantity of milk they buy is not fix, they buy milk while returning from office, they buy milk in morning and this meant for morning walk, they do not want to buy same brand of milk daily etc.
Out of 103 consumers who do not buy milk on Card system 66 consumers don’t buy milk on Card System because they are not a consistent buyer of milk and 20 consumers do not buy on Card because they don’t want to pay in advance to agent.
Why you don’t buy milk through card system?
Do not want to pay in advance
Not a consistent buyer of milk every month
6.1.8 Getting discount on milk purchase through card system:
Earlier we have seen that out of total aware consumers only 40% consumers use card system to buy milk. But all of them were not getting the discount on per liter of milk they purchase.
From pie chart shown above we can see that only 23% consumers are getting discount on per liter of milk they purchase and 77% consumers buy milk on card system but they are not getting any benefit.
Total number of consumer who buys milk through Card System is 68 out of total sample and only 16 consumers are getting discount on per liter of milk purchase.
Getting Discount on Milk Purchase through Card System
6.1.9 Problem faced by consumers in using card system:
91% of consumers who are using card system are not facing any problem in card system.
8 % consumers say that they have problem in giving advance payment to the agents for the cards.
Other 1 % states that they have problem in adjusting the amount while their absence in taking milk.
Problem faced by consumers on Card system
problem in giving advance in specified time
some times adjustment problem
6.1.10 Suggestions from card holder consumers on card system:
When it was asked to card holder consumers that give suggestion on card system only 25% consumers have given their suggestion.
17% consumers told that awareness is required about card system
8% card holder consumers told that agent should provide discount on per liter of milk purchase.
Suggestions from consumers
6.2 ANALYSIS OF AGENTS:
6.2.1 Awareness about Card System:
Interpretation: It has been found that 99% of the agents are aware that mother dairy provides its own card for milk sales, only 1% of the agents are unaware that company provides card from its own end. This is a negligible percentage.
6.2.2 Card System according to Agent’s point of view:
We have seen that 99% agents are aware of Card System. But there is a need to know that what type of awareness is with Agents in context of Card System.
From pie we can see that 75% of the agents know that what exactly card system is.
25% Agents who are aware of Card System do not know what exactly Card System provided by Mother Dairy and other companies is.
Agents awareness about Card System
Card System awareness from Agent's point of view
Making advance payment to the company and getting a discount on per liter purchase
Making advance payment to the company and getting a discount on per liter purchase and passing that benefit to the consumer by taking advance payment from them
Using cards to note down the milk purchases and collect money at the end of the month without any discounts from consumers.
6.2.3. Procurement of card:
It’s clear from the pie chart that 58% agents sell milk on their own card and only 42% agents sell milk on card provided by company.
6.2.4 Status of Card holder customers:
It has been asked to agents what the current status of card holder consumers is and the answers are.
78% agents are saying that number of card holder customers is constant, 14% agents are saying that card holder consumers are increasing and according to rest 8% agents card holder customers are decreasing.
How do you procure the cards
Provided by compnany
Status of card holder customers
6.2.5 How do you make your consumers aware of Card System?
We can see that 55% agents are saying that they aware their consumers about card system and 45% agents saying that consumer are aware of card system by other means or promotional activities by companies.
How do you make your consumers aware of card system
Promotional Activities and by Other means
6.2.6. Benefits to Agents on Card System:
50% agents are saying that benefit of the card system is retention of consumers.
30% agents are saying that they are getting more margin on milk when they sale milk through cars system.
According to 18% agents benefit of card system is more sales and brand loyalty.
And rest 2 % agents say that because of card system they can sale other products along with milk and their customers are fixed and they can use this customer base for some other business.
Benefits to agents on Card System
Customer retention and surety
More margin on sales
More sales and brand loyalty
6.2.7 Challenges faced by Agents to sale milk on Card System:
A major challenge faced by agents to sale milk on card system is lack of awareness of consumers.
2nd challenge is customer resistance to pay in advance.
3rd challenge is maintaining the records of card holder customers.
4th challenge is absence or vacation of customers.
5th challenge is competitor’s card pricing policy.
Customer resistance to pay in advance
Lack of awareness
Competitors card pricing policy
Absence or vacation of customers for milk purchase
Challenges of Card System
FINDINGS AND RECOMMENDATIONS
Mostly all Agents are aware of the Card System but consumer awareness is very low.
Agent inspite of awareness and knowledge about the card system, does not pass the benefits to consumers in majority of the cases.
In most of the cases advance payment is being taken by the agents.
Card has become just a tool to track daily purchase of milk.
The only benefit of the card is to make sure that milk is available with the agents and to avoid overpricing on MRP.
Major benefit of card system to agents is retention of consumers followed by more margins on sales through card system.
Major Challenge faced by agents on Card System is lack of awareness followed by customer resistance to pay in advance, maintaining the records of consumer card, absence of card consumer and competitor card pricing policy respectively.
In areas of Hyderabad, like Barkatpura, Himayath nagar, YMCA, Hyderguda, Begumpet, S.R Nagar and many more there are rarely any agents supplying mother dairy milk. In these areas the consumers are unaware of mother dairy brand existing in Hyderabad.
Local dairies like Venkateshwara provide more margins on commission. More than Rs. 5. Thus these agents keep that brand and promote it, whenever a customer walks in and asks for milk packet.
In quantitative term:
Out of to total sample 57% consumers are aware of Card System but there awareness is not exactly as the Card System provided by Mother Dairy or any other competitors companies.
Out of these 57 % Card System aware consumer only 22% consumers knows that what exactly Card System provided by the company is.
This means that 12.6 % of the total sample is aware of Card System provided by Mother Dairy or any other competitors companies.
Out of these 57% Card System aware consumers 23% consumers buy milk on Card System through retail and 17 % buys milk on Card system with home delivery.
Out of total aware consumers only 40% consumer buys milk on card system and 23% consumers are getting discount on per liter of milk purchase.
Out of total sample 23 % consumers use card system to buy milk and 5.5 % consumers are getting discount on per liter of milk purchase.
Most influential factor to buy milk on card system through retail is surety of milk packet available for buyer every day with Agent followed by overpricing on MRP and discount.
Delivery on time is the most influential factor to buy milk on card system with home delivery. 15% of consumers use card system for home delivery to just note down the daily milk purchase.
Not a consistent buyer of milk is the major reason of not using card system followed by problem in advance payment on time and variability in quantity of milk purchase.
Out of total sample of agents 99% of them are aware of Card system.
Out of total aware agents 75% are familiar with the Card System provided by company.
Those agents who are aware about the companies card system, 58% of them sale milk on their own card. While interviewing them, they said, that own printed card eliminates the hassle of timely payment of advance collected amount from the consumers to the company. They are taking advance payment from the consumers on their own printed card as well as company card but not depositing that to the company.
55% agents provide awareness about card system to consumers.
The recommendation for the company for further growth and more sales and capture of market through card system are as follows:
Right kind of awareness should be provided by Mother Dairy to consumers.
Agents should be motivated to pass the benefits (Provided by company) to consumers.
It is recommended to develop a new system in which consumers can avail the card directly from the company.
Mother dairy should come up with scheme for customers along with agents as it would be a real boost to the sales and also help the company to get back its lost customers.
Mother Dairy visibility is very low in Hyderabad in terms of advertisement hence Mother Dairy should come up with advertisement of brand as well as advertisement of benefits of card system.
STANDARD OPERATING PROCEDURE TO INCREASE MILK SALES THROUGH CARD SYSTEM
8.1 SOP FLOW CHART:
8.2 EXPLANATION: 8.2.1 SELECTION OF LOCALITY: Area of operation should be where, there is no presence of Mother Dairy or there is no awareness about actual Card System. Gachibowli has been selected and there is a base sale of 300 liters. Gachibowli promises good potential for card system since it is a developed market containing people with good income levels. The market shares of different players is as follows
•Selection of locality---Gachibowli
•Developement of infrastructure
• Integrated brand promotion
•Analysis and action on result
8.2.2 STATISTICS OF MILK SALES AT GACHIBOWLI • 20 agents whom we surveyed sell about 5000 LPD. Out of which fifty percent and are Home Delivery. Home Delivery is being done by either taking advance or payment by the end of the month. • The problem agents face in card system is irregular timing of the customer for the payment of bills.
In Gachibowli the milk being sold through home delivery is 2535 liters which is 51 percent of the entire market. This base sale forms the potential market for card system. 8.2.3 MODE OF PAYMENT IN HOME DELIVERY SALES. In Home delivery the payment by the agents is generally collected in advance or later which is based on the relation which he holds with the customer. The ratio of advance payment and post payment is as follows
Homed delivery, 2535, 51%
Retail , 1200, 24%
Counter sales, 365, 7%
Commercial sale, 900, 18%
Sixty percent of the population pays advance to the agents which can be the potential for card system sales
8.3 DEVELOPMENT OF INFRASTRUCTURE 8.3.1 SUPPLY CHAIN Supply chain is required to ensure the availability of the product at the customers end. There should be a proper supply of milk hence appointment of agents is required in areas where, there is no Mother Dairy presence. The executive should appoint new agents and ensure proper supply chain to the consumers. To serve the house hold community located in Gachibowli we require approximately 10 agents supplying to the housing societies. The agents can be appointed by giving special margins or trade schemes initially to place the product. 8.3.2 RETAILING To ensure the availability of product for the consumers in retail markets as well, retailing has to be done rigorously. 20 retail outlets in selected areas are to be selected and the supply has to be maintained through the agents. The agent sells with a margin of Rs1.50.
Advance , 1515, 60%
Late payment, 1020, 40%
8.3.3 FINANCIAL FLOW The executive phone number is shared during the Campaigning and he would be the point of contact for new consumers to avail prepaid cards. Once an executive receives a call he would guide the existing agent to the new customer. The consumer will pay money to company representative and company representative will submit the money to company. The margin on per liter of sales will be provided by company to agents. The flow of money is given below.
Supply of milk The time frame to avail cards or to renew the existing cards is from 1st of every month to 12th. This time frame ensures effective supervision on card sales as well as the accounts. 8.4 INTEGRATED BRAND PROMOTION – IBP Integrated brand promotion is defined as a brand using a wide range of communication and promotional tools to create brand exposure. Our target area for market test is small hence large scale advertisement is being avoided. Advertising media vehicle will be POP, Wall painting and Pamphlets. For integrated brand marketing to work all of the marketing should work together.
8.4.1 ADVERTISING: Advertising is a form of communication for marketing and used to encourage, persuade, or manipulate an audience (viewers, readers or listeners; sometimes a specific group) to continue or take some new action. Most commonly, the desired result is to drive consumer behaviour with respect to a commercial offering. It has been found in market research in many areas of Hyderabad consumers don’t know about the Mother Dairy milk. Hence advertising is important to
aware the consumer about the Mother Dairy offerings. There are various modes of advertising but most effective mode will be wall painting and posters. The modes of Advertising are Pamphlets Wall Painting POP at the retailers end Newspaper inserts Advertising is a non personal presentation of goods and services and only non personal mode to communicate the consumer about Card System is not sufficient. Hence campaigning is required 8.4.2 CAMPAIGNING IN TARGET AREAS: Creating brand and Card awareness & generating trail rate is the prime objective of Campaigning. It can be done through temporary kiosks. These kiosks can be made at different localities. To ensure the customers coming to the kiosk and to increase the trail pamphlets will be distributed through the newspapers a day prior to the campaign. Before campaigning the housing society manager or influencer person of that particular area or society will be contacted and communicated about the activity to promote the campaign. The pamphlet consists of products list and as well as it communicates about the redemption coupons given at the kiosk. Free samples of milk will be distributed and awareness about Card System can be done through these kiosks. The executives on kiosk will provide information on schemes and also about the Card System to consumers. Card will also be made available to these kiosks and those consumers who will be interested can immediately buy the Card. The cards are sold by the company in the kiosks and the money as well as the contact points of the customers is given to the agent in that region. 8.4.3 BENEFITS OF CAMPAIGNING: Boost sale of prepaid Cards We can test the appeal of our product and services Increased sale to current and lapsed consumers.
Addition of new consumers Direct follow up on a promotion Development of new market and retention of existing one.
8.4.4 TIME FRAME: Campaigning will be done on the weekends in the morning as well as evenings on selected societies which have a population of 300-500 houses. On the last day of the campaign redemption coupons for purchase of milk are given to ensure increased trail rate. Using the redemption coupons the customer can avail discount on purchase of milk as follows. First day 1 Rs redemption Second day 2 Rs discount Third day 4 Rs discount
At the end of the third day if customer avails all the redemption coupons and buys a monthly card for two months, the customer would get a free dental check up. The other options apart from dental check up can be Redemption of money. Gift coupons of Big Bazaar. The discount on the second day and third day are only available for customers if they redeem the coupons continuously. To ensure this the redemption coupon has unique number on it so that the executive can track the purchase by the consumer.
8.4.5 AVAILABILITY OF CARDS: The executive phone number is shared during the Campaigning and he would be the point of contact for new consumers to avail prepaid calls. Once an executive receives a call he would guide the existing agent to the new customer.
8.5 OTHER CAMPAIGNING ACTIVITIES: 8.5.1 MOTHER DAIRY’S MOTHER’S EVENING. Mother Dairy will sponsor a gathering of 15-20 women's. In that event Snacks, Tea ,Cold drinks will be provided and at the end of the event information about Mother Dairy and Card System will be provided. • Events will be conducted in a house of society. • House owner will call his/ her friends for gathering. • Prize will be given to that house hold who will conduct this event. • At the end of the event information about Mother Dairy and its offerings as well as Card System will be provided. • If any other household will interested to conduct this event in different societies M.D will sponsor the same.
8.5.3 BRANDING FROM AGENTS END: Once campaigning is over through kiosk, there should be continuation of brand building from agents end. Agents should be motivated to give awareness to consumer about Card System and sale Mother Dairy milk by various schemes and rewards like discount coupons and free dental checkups.
8.6 ANALYSIS AND ACTION ON RESULT: Result will be analysed on the basis of increase in sales volume. If desired level of sales is achieved then exclusive Mother Dairy milk parlour could be open in that particular location.
9.1 CONCLUSION OF THE PROJECT
The final outcome of the project is that the awareness about the Card System provided by companies is very low to the consumers and the percentage card holder consumers are also very low. So the company should take every step possible to convert the buyer who buys milk without card system to card holder consumer.
9.2 LIMITATIONS OF THE PROJECT
Hyderabad is a vast area with around 64 lakh consumers. Thus meeting and surveying majority of them in different areas were not possible within the given time limit. Yet the sample of 300 consumers, (mother dairy and competitors) was extracted.
Language barrier posed problems. Majority of people in Hyderabad are Telugu community and are not comfortable with Hindi and English. specially while interviewing the agents language became the main barrier as they were not able to follow our language. The sales executive explained the agents what we wanted to ask and vice versa. This created the communication.
It was observed that different agents answered differently to the questions. It was also observed that they were trying to conceal some matters from us. Their answers varied, and analysis was made according to that.
The time chosen for agent survey was around 5 a.m. to 10 a.m. in the morning because they are available only during this time, but usually they are extremely busy as this is the peak selling time for them. Most of them were not eagerly willing to respond to the survey.
Time chosen for consumer survey was around 11 p.m. to 1 p.m. and again 3 p. m. to 6 p.m. at evening for their comfort and proper interaction. Consumers usually don’t tend to entertain sales people and mostly tend to keep a sceptic eye on them. Thus it was really challenging to convince them about our genuineness and interact with them.
BIBLIOGRAPHY & WEBLIOGRAPHY
10.2 TEXT BOOKS
Marketing Research – By Naresh Malhotra
Marketing Research – By Rajendra Nargundkar
For collecting the data a structured questionnaire is prepared to get detailed and structured information regarding the project. Given below is the questionnaire:
11.1 QUESTIONNAIRE FOR CONSUMERS
1) Name –
2) Occupation –
3) Address –
4) Contact number- email-id-
5) How much litters of milk you buy per day?
6) Type of milk you consume
Cow ____ Buffalo _____
• Packed ……………
Brand ______________________________ Type: Toned ___ Double toned ___ Standard ___ Skimmed ___ Full Cream ___
7) Are you aware of card system?
(a) Yes (b) NO
If yes go to Q.No-8
8). According to you card system is
a) Making advance payment to the company and getting a discount on per liter purchase.
b) Making advance payment to the company and not getting a discount on per liter purchase.
c) Using cards to note down the milk purchases and pay money at the end of the month with a discounts from company.
d) Using cards to note down the milk purchases and pay money at the end of the month without any discounts from company.
9) Do you buy milk through card system?
(a)Yes (b) No (c) Yes, with home delivery
If (a) go to question number 10, (b)-Q11 and if (c)-Q12
10) What influences you to buy milk through card system?
(a) Discount (b) surety of milk packet available for you every day with the agent (c) to avoid overpricing on MRP (d) others…
11) Why you don’t buy milk through card system?
(a)Not aware of card system
(b)Do not want to pay in advance
(C) Not a consistent buyer of milk every month
(d) Any other reason …………………………
12) What influences you to buy milk through home delivery card system?
(a) Convenience (b) delivery on time (c) Discount
(d) To keep an account
13) Are you getting any discount on MRP if you buy milk through card system?
(a)Yes (b) No
14) Since how long are you using card system?
15) Card system which you are using is company owned or agent owned?
(a) Company owned (b) Agent owned
16) What is your monthly household income?
• Up to Rs.10000
• Rs.10000 to 15000
• Rs.15000 to 25000
• Above Rs.25000
17) Who purchase milk for your family every day?
18) Are you facing any problem in card system?
(a) Milk not reaching on time (b) Problem in advance payment
(c) Not getting discount (d) Any other reason……………………………
19) Any suggestions on card system ……………………………………………...
11.2 QUESTIONNAIRE FOR AGENTS
Q.1 Are you aware of cards system?
If yes q2
Q2. According to me card system is
e) Making advance payment to the company and getting a discount on per liter purchase.
f) Making advance payment to the company and getting a discount on per liter purchase and passing that benefit to the consumer by taking advance payment from them.
g) Using cards to note down the milk purchases and collect money at the end of the month without any discounts from consumers.
Q3. How do you procure the Cards?
a) Provided by the company after paying an advance amount to the company
b) I print the cards myself without any help from the company.
Q.4 How much liters of each brand of milk you sale daily?
On Card- counter sale
On Card- Home delivery
Discount from company
Discount given to consumers
Q.6 What is the status of card holder customers?
(a)Increasing (b) Decreasing (c) Constant
Q.7 How do you make your consumer aware of the card system
a) I communicate it myself
b) Communicated by the company through different promotional activities.
Q.8 Please rate the challenges you are facing on card system on a 5 point scale
a) Customer resistance to pay in advance---1 2 3 4 5
b) Maintaining records ---1 2 3 4 5
c) Lack of awareness ---1234 5
d) Competitors card pricing policy---1 2 3 4 5
e) Absence or vacation of customers for milk purchase specially during summers--- 1 2 3 4 5
e) Other (___________) - 12345
Q.9 What are the benefits you are getting through card system?
(a) Customer retention and surety
(b) More margin on sales
(c) More sales and brand loyalty
(d) Other benefits……
Q.10 How much you charge to customer for home delivery of milk through card system? .....................