IndexSr. No. Particular Page No.

1 Preface2 Acknowledgement3 History and setup4 Company at glance5 Administrative information6 Introduction of organization

Management structureMilk & milk marketingInformation & communication (System Dep.)Dairy husbandryGalbabhai dairy co-operative training centerCompound cattle feed

7 Journey to development8 National productivity awards9 Banas dairy on the passage of progress10 Introduction of project11 Background information12 Significance of project13 Methodology14 Difficulties and limitations of study15 Problem in present distribution system16 Bibliography

Preface

MBA Program is a professional course of require knowledge not only

theoretical but also require practical knowledge as a student of MBA such training is

most help full for increasing the skill ability and also capability of the student today the

world has become more amative so struggle is more for human being to get the job the

theoretical as well as practical knowledge require hence, the study of managerial is very

important.

Industrial training make student enough aware in term of how, where,

when and up to some extent theoretical and practical knowledge can be use to solved

problem in practical life. Industrial training played an important role to develop the

practical view point of student also making then aware about practical problem

opportunity and initial situation of industrial unit.

I am studding in MBA in which I require to prepare project report it was

experience during the summer training and I came to know that there is a big gap

between theoretical and practical knowledge that I learn in practically.

I have prepared the report of BANAS DAIRY, my belief, ideas,

understanding and observation. I have to comprise all the important information in

presently report.

ACKNOWLEDGEMENT

We would like to express deep sense of gratitude to our collages for their advise, constant encouragement and timely help throughout the course of our project.We would like to thank Our H.O.D. for provide us this golden opportunity for preparing report and provide us guideline regarding project. We would like to thank M.D. of Banas Dairy Sangramsinh Chaudhry For give us a wonderful opportunity for the summer training in this organization.We would also like to thank our mentor Mr. Hitesh Yadav and Mr. Viral sir for giving us guideline and support regarding in preparing the summer project report and teach us the practical knowledge about the marketing and sells activity. We would like to thank all the respondents who give their valuable time for filling questionnaire and provide necessary information regarding our project. Last but not the least we thank all the persons who have directly or indirectly support in this project.

Thank you,

HISTORY AND SETUP

COMPANY AT GLANCEName : - BANASKANTHA DISTRICT CO-OPERATIVE MILK PRODUCER’S UNION LIMITED.Address:-Banas dairy,Dairy road,Palanpur,Banaskantha-385001Organization:- Co-operativeMarketing bodyGCMMF(Gujarat Co-operative Milk Marketing Federation)Year of establishment The Banas dairy was registered on 31st January 1969. The plant Banas, it was established on 14th January 1971. The plant Banas II, it was established on 2nd October 1998.Area of landThe dairy occupies 122 area of land. The firm can start one more plant in the dairyNumber of employeesThe dairy is having lost of employees. The production of the product is very high. There are 1300 employees in the dairy. The dairy occupies most of the employees on the basic of constrict in the dairy. ProductsPowder ButtermilkMilk pouch Flavoured milk.Butter GheeIce-cream Powder Ice-cream

ADMINISTRATIVE INFORMATIONChairman:- Shri Parthibhai. G. BhatolVice Chairman:- Shri Balvantsinh. H. BaradManaging Director:- Shri S. R. ChaudharyAuditors:- Special Auditor, Milk audit office, Palanpur.

Bankers:- Shri Banaskantha dist. central co-operative Bank Ltd. Bank of Baroda. (Palanpur) State Bank of India. (Palanpur) Dena Bank. (Palanpur) State bank of Saurastra. (Palanpur) Dena Gujarat Gramin bank. HDFC (Planpur)Apex Decision:- Gujarat co-operative milk marketing federation ltd Anand, (Gujarat)

INTRODUCTION OF ORGANIZATIONBanas Dairy is a well know dairy in Gujarat and is a leading supplier of milk products to Banaskantha district. Banas Dairy Ltd. is large-scale unit.Banas Dairy markets its products under a very powerful brand name “AMUL”. It produces a wide variety of products like Milk, Milk Powder, Ghee, Ice cream, Amul butter and Amul CoolIn Milk it has different Kinds of MilkAmul Shakti Amul Gold 3. Amul Taza 4. Amul Slim & Trim 5. Amul LassiBesides the above said Milk it is going to introduce a special kind of milk called the “UHT” (Ultra Heat Treated) milk.Today Banas Dairy is one of the fully automatic dairy plants with its holding capacity of 25, 00,000 lit/day. The central control room controls the whole process. The controls air-conditioned plant controls the environment.Banas Dairy also has a very good network of milk suppliers. Raw milk is supplied by the village co-operatives by the means of tankers and there tankers can bring around 10000-15000 liters of milk. Banas Dairy has a very strong team of distribution and retailers.Banas Dairy is said to bea leading manufacturer and exporter of Amulya Milk Powder, Butter and Pure Ghee. The Countries where the dairy products exported are Abu-Dhabi, Alziria, Nepal, and Tanzania etc.Banas Dairy does not have the problem of severe competition in milk because it enjoys a share of 60% in headband.Banas Dairy is a part of the “Gujarat Co-operative Milk Marketing Society”.

MANAGEMENT STRUCTUREThe management of Banas dairy is vested with the elected board of directors under the Gujarat Co-operative Society Act. The Board consists of Chairman, Managing Director. One representative of Gujarat Coop. Milk Marketing Federation, one representative of NDDB, one from District Registrar office and other twelve elected member beside three copted women members. The day to day affairs are managed by Managing Director and other professional staff. Milk and milk marketingAs a part of marketing strategy, each year dairy takes up massive program of the customer orientation and education which facilities the symbiosis between customers and manufacturer. Various milk products like Sagar Ghee, Skim milk powder, AMUL butter, White butter, Amulya whole milk powder, Sagar Tea and coffee whitner, mithai maker, whole milk powder, peda-sweet, ice cream, Namkin were manufactured by the Milk Marketing Federation. Add to that, a duality Banas tea was packed and marketed by the milk union. In order to sell various dairy products, we have started 15 AMUL milk parlors which are appreciated by the customer.A prestigious “Dudh Sajivani” scheme has been mooted in collaboration with the State Govt., wherein we have stared supplying fortified flavored milk to 56,000 tribal school children of Danta & Amirgadh talukas which has been acclaimed by the whole country and Government of Gujarat wants to replicate the scheme in order areas of state.

Information and communication (system department)The union has developed a computer networking among various services and product department which has facilitated inter departmental communication and co-ordination.The computer booking services in cases of veterinary visits have been launched effectively that would not only help in timely expediting veterinary visits but also carrying out disease surveillance.Training program on computer operating skill are regularly being oriented and conduct by the computer department.

Dairy husbandry

With a view to provide a sound canopy of good health and sustaining / improving productivity of the animals of producer members, emergence veterinary health care, Artificial Insemination, organizing Infertility camp, vaccination camp and mass de-worming program have been taken up besides providing veterinary first aid services are of great value to the producer members in remote villages. To accomplish this formidable task, a team of qualified veterinarians are engaged in providing said services round the clock. For emergency visits, there are 13 veterinary centers are being operated in taluka level and other place. On an average, 205 lacks of animals are treated every year through these centers. The Milk Union has set up a modernized bull

mother farm, Centralized Semen Collection station along with the state of the art Semen processing laboratory & frozen semen bank at Dama Animal Husbandry complex to cover optimum number of village in breeding services for improving the germ plasm of live stoke and at the same time to expand quality breeding activity like Dairy Herd Improvement Program Actions. And, thus, in turn productivity.

The saying goes “Prevention is better than cure”, the emphasis is thus given on preventive cares of animals against the infectious diseases. On an average 4 lacks animals of total population are vaccinated every year against various diseases. Due to poor nutrition and management care, number of animals remains infertile which brings the productivity curve down. In view of this, regular Fertility Improvement Camp (FPI), demonstration on mineral mixture feeding and de-worming camps are organized in different villages. This has certainly helped raising productivity and in turn, reducing the cost of production.

The Artificial Insemination services are provided through 497 vibrant A.I centers established in villages. It has upgraded genetic make up of the poor yielder animals by significant improvement in milk production. On an average 3 lacks animals are inseminated through quality semen every year. The milk union has also started DIPA (Dairy Herd Improvement Programmers Actions) in 19 villages co-operative for progeny testing and further selecting the superior germ plasm of the bulls for future use. The objective behind this programme is to increase the productivity of animals by using the quality semen.

Banaskantha is a pride abode of Kankrej breed of cow and a fear is fraught of vanishing the breed from the district due to frequent draughts of kankrej, milk union has worked out and implemented a Kankerej Development Project in collaboration with National Dairy Development Board. The union operates 25 kankrej centers in DCS for this purpose.

Keeping in view the management pattern of livestock in the district wherein animals are being kept in the field, a scheme of financial assistance providing. Artificial Insemination crate at the doorstep of farmer is mooted. As high as 40 per cent subsidy is offered by union facilitate out AI but also help in treating animals in the field conveniently.

GALBHABHAI DAIRY CO-OPERATIVE TRAINING CENTERThe Galbhabhai dairy Co-operative Training Center in the memory of late Galbhabhai Nanjibhai Patel, the founder chairman of Banas Milk Union, set up in assistance of National Dairy Development Board under Operation Flood Programmed and started functioning form 8th October, 1984.

The objective of the GDCTC were :To cater primarily to the training needs of farmers involved in management of Primary Dairy Co-operative Societies.To impart knowledge and skill required for Artificial Insmination and other related Animal Husbandry activities for milk Production enhancement.To train village level functionaries in effective operation of Dairy Co-operative Societies.

The training center regularly organizes and conducts residential courses ranging from 2 days to 40 days for Milk union personnel and officials. It is equipped with two classroom and modern gadgets for arranging various courses.

Compound cattle feedBesides offering tangible benefits to the producer member in terms of remunerative price and year around market for their milk, the dairy set up a cattle feed factory of 600 MT per day. The district like Bansakantha where frequent drought is an established phenomenon, provision of balance the nutritional requirement of the milch animals in such situation. At the same time it also helps in maintaining health and productivity of milch animals. Cattle feed is producer under the brand name of BANAS DAN and sold with no profit no loss basic at the doorstep of the milk producer. During the last financial year 1, 60,659 MT (2007-08) compound cattle feed was produce at cattle feed factory owned by Banas dairy.

JOURNEY TO DEVELOPMENT

S.N Events Date/Year1 Registered 8 village level Co-operative societies At Vadgam

and Palanpur taluka and stared Sending milk at Dudh Sagar Mesana.

3rd October, 1966

2 The Banaskantha Distric Co-operative Milk Producers’ Union Limited. (Banas Dairy) got registered under co-operative law.

31st January, 1969

3 Beginning of collecting and sending milk at Dudh Sagar Mehsana throught Banas Union.

1st November, 1969

4 The foundation stone was laid down for Feeder Balancing Dairy by the founder chairman late Galbabhai N. Patel at 122 acre land purchased near Jagana village.

14th January, 1971

5 Banas Dairy (Pilot Chilling Plant) started functioning. 7th May, 19716 Khimana Milk Chilling Celter Commenced Functioning. 17th June,

19727 Dhanera Milk Chilling Center started function. 17th October,

1972

8 Animal Husbandry services started Functioning. 14th April, 1974

9 Commencement of Skim Milk Power Production. 26th January, 1975

10 Production commencement at Feed Milling Plant (100 MT / Day)

5th July, 1977

11 Foundation stone laid down for dairy plant Expansion by Dr. V. Karin, Chairman of GCMMF ltd. Anand

4th February, 1979

12 Feed Milling Plant inaugurated by Shri. Surjit Singh Barnala, Cabinet Minister (GOI) For Agriculture And Irrigation.

4th February, 1979

13 The Statue of founder chairman late shri. Galbabhai N. Patel un-veiled by Shri. Babubhai J. Patel , Chif Minister of Gujarat.

4th February, 1979

14 Tharad Milk Chilling center commenced functioning 14th March, 1979

15 Commenced of dispatching milk to Mother Dairy, Delhi through rail milk tanker.

17th March, 1980

16 Danta Milk Chilling Center commenced functioning. 1st November, 1983

17 Galbabhai Dairy Co-operative Training Center started. 8th October, 1984

18 Radhanpur Milk Chilling center commenced functioning. 1st November, 1984

19 Excellence award for cross bred cow received at 21st IDA conference.

14th

September, 1986

20 Amulya milk powder production commenced. 9th December, 1986

21 Co-operative Development Programmed launched. 1st July, 198922 New powder plant of 30 TDP commenced production. 1st Octomber,

199323 Silver Jubilee function was organized and Inaguration of 30

TPD powder plant done By Hon. Agri. Minister, Shri Balram Jhakhad, Government of India.

7th May, 1994

24 Foundation Stone of Banas- II project was laid by Padmavibhusan Dr. V. Kurien, Ex. Chairman of NDDB and Chairman of GCMMF ltd.

2nd October, 1998

25 Banas Dairy was awarded ISO 9002 & HACCP certification 15th July, 1999

26 First consignment of whole milk powder exported to Oman 13th February, 2001

27 Trial run of dryer of 60 TPD Powder plant in Banas-II 20th

September, 2003

28 Production of ice cream 10th May, 2003

29 Tetra pack milk packing inaugurated by Shri B M Vyas, MD, GCMMF

1st

September, 2003

30 Bhumi pujan at Dama for AH complex 23rd

September, 2004

31 Inauguration of AMUL parlar at Danta by Shri BM Vyas, MD, GCMMF

24th

September, 2004

32 Kanpur Milk packing & Marketing started 21st August, 2005

33 AMUL Kool liquid sterilized flavoured milk Launched 23rd August, 2006

34 Dhudh Sanjeevani Schene dedicated to people by Hon’ble Chief Minister of Gujarat Shri Narendra Modi.

24th March, 2007

35 Inauguration of Banas-II Dairy Complex by Hon’ble Union Agri. Minister Shri Sharad Pawar.

24th March, 2007

36 Unveiling of the statue of Late Galbabhai N. Patel Founder Chairman of Banas Dairy by Hon’ble Chif Minister of Gujarat, Shri Narendra Modi.

24th March, 2007

37 Semen Freezing at Daman Semen production unit started. 1st August, 2007

NATIONAL PRODUCTIVITY AWARDSS.N Particular Year1 The award for the best performance in productivity-Dairy

Development & Production in co-operative sector (Product plant)-conferred upon b Dr. Balram Jakhar, Union Minister of Agriculture at New Delhi.

1992-93

2 The award in recognition of performance in productive-dairy processing industries-Conferred upon by Dr. Shankar Dayal Sharma Hon. President of India at New Delhi.

1993-94

3 The award in recognition of the second Best performance in productivity-dairy Development and Production in coop. and Public Sector (Product Plant)-conferred upon By Dr. Shankar

1993-94

Dayal Sharma, the Hon. President of India at New Delhi. 4 The award in recognition of the best productivity Performance-

dairy processing industries-conferred Upon by Shri Sikandar Bakht , Minister of Industries at New Delhi.

1996-97

5 The award in recognition of the second best productivity performance-dairy processing Industry-conferred upon

1997-98

6 The award in recognition of the second best productivity performance-dairy processing Industry-conferred upon by Shri Arun Jetly, Hon. Cabinet Minister of Commerce and Industry at New Delhi.

1999-00

7 The award in recognition of the best productivity performance -dairy processing industry-conferred upon by Shri Arun Jetly.

2000-01

8 The award in recognition of the best productivity performance -dairy processing industry-conferred upon by Shri Arun Jetly.

2001-02

9 The award in recognition of the best productivity performance-dairy processing Industry (Large Unit)-conferred upon by Shri Subith Kant Sahai, Hon’ble Minister of State fir Food Processing Industry (Independent Charge) on 26th August 2005

2003-04

10 Shri Parthibhai Bhatol honoured as best co-operator 2004 at Rajkot by Hon’ble Union Minister of Agriculture Shri Sharad Pawar

2004-05

11 Life Time Achievement Award to Shri Parthibhai Bhatol, Chairman, Banas Dairy by International Industry Council, New Delhi.

2005-06

12 The award in recognition of the best productivity performance-dairy processing industry (Large Unit) conferred upon by Shri Suboth Kant Sahai, Hon’ble Minister of State for Food processing Industry (Independent Charge) on 19th March 2008.

2004-05

13 The award in recognition of the best productivity performance-dairy processing Industry (Large Unit)-conferred upon by Shri Suboth Kant Sahai, Hon’ble of State for Food Processing Industry(Independent Charge) on 19th March, 2008.

2005-06

It is needless to mention that Banas Dairy is the single major industrial establishment of Bansakantha district and the 55% of economic transaction value is related to thish esteemed organization and hence, the co-operative is rightly called an oasis in the desert by the local rural folk.

BANAS DAIRY ON THE PASSAGE OF PROGRESSSr. No. Particular 2003-04 2004-05 2005-06 2006-07 2007-081 Milk Pouring

DCS1212 1225 1255 1295 1337

2 Registered DCS

1008 1037 1089 1119 1163

3 Milk Procurement (MT)Buffalo Milk 144681 181472 192990 174819 196556Cow Milk 64015 80133 81634 67749 63269Bulk Child Mixed Milk

70966 96677 150814 194458 268629

Total Milk 279662 358282 425439 437026 5284544 Special Visit

cases No.235320 268985 305098 305565 357181

5 No. Of. A I Center

272 359 391 419 497

6 NO. Of A I Cases - Cow

104053 126850 133001 153819 188391

Buffalo 92670 96679 110160 130292 166346Total 196723 223529 243161 284111 354737

7 Vaccination Progremme F&M D (Doses)

423046 184900 284950 363100 460750

H S (Doses) 162300 181550 222000 296600 331500 Rabies (Doses)

9200 9314 8450 9871 13026

8 Study visits of Dairy

- 3070 2240 7500 6900

9 Banas Dan Sales (MT)

96626 127424 139423 139693 160454

10 DCS having own house

523 529 592 652 721

11 No. participants trained in

194 254 971 305 309

GDCTC12 No. of VMS

program- 154 167 165 199

INTRODUCTION OF PROJECTWith the presence of 12.2% of the world population in the villages of India, the Indian rural FMCG market is something no one can overlook. Increased focus on farm sector will boost rural incomes, hence providing better growth prospects to the FMCG companies.At present, urban India accounts for 66% of total FMCG consumption, with rural India accounting for the remaining 34%. However, rural India accounts for more than 40% consumption in major FMCG categories such as personal care, fabric care, and hot beverage.The Indian growth story is now spreading itself to India's hinterlands. Rural India, which accounts for more than 70 per cent of the country's one billion population (according to the Census of India 2001), is not just witnessing an increase in its income but also in consumption and production. The Union Budget for 2010-11 has hiked the allocation under the National Rural Employment Guarantee Act (NREGA) to US$ 8.71 billion in 2010-11, giving a boost to the rural economy.According to a study on the impact of the slowdown on rural markets commissioned by the Rural Marketing Association of India (RMAI) and conducted by MART, the rural economy has not been impacted by the global economic slowdown. Moreover, the rural consumer market, which grew 25 per cent in 2008 when demand in urban areas slowed due to the global recession, is expected to reach US$ 425 billion in 2010-11 with 720-790 million customers, according to a white paper prepared by CII-Technopak. That will be double the 2004-05 market size of US$ 220 billion.According to the study, the rural market is seeing a 15 per cent growth rate. Fast moving consumer goods (FMCG) sales are up 23 per cent and telecom is growing at 13 per cent.

FMCGAccording to figures released by market researcher AC Nielsen, demand for personal care products grew faster in rural areas than urban areas during the period April-September 2009.Several FMCG companies such as Godrej Consumer Products, Dabur, Marico and Hindustan Unilever (HUL) have increased their hiring in rural India and small towns in order to establish a local connect and increase visibility.Leading FMCG companies such as Godrej Consumer Products, Marico and Hindustan Unilever (HUL) have increased their hiring in rural India and small towns, in order to

boost sales and increase connect and visibility. In fact, Dabur sources close to 50 per cent of its sales and marketing personnel from Tier-II and Tier-III cities.

RetailThe rural retail market is currently estimated at US$ 112 billion, or around 40 percent of the US$ 280 billion Indian retail market, according to a study paper, 'The Rise of Rural India', by the Associated Chambers of Commerce and Industry of India (ASSOCHAM).Major domestic retailers like AV Birla, ITC, Godrej, Reliance and many others have already set up farm linkages. Hariyali Kisan Bazaars (DCM) and Aadhars (Pantaloon-Godrej JV), Choupal Sagars (ITC), Kisan Sansars (Tata), Reliance Fresh, Project Shakti (Hindustan Unilever) and Naya Yug Bazaar have established rural retail hubs.DCM Shriram Consolidated (DSCL) has undertaken the process of improving the business model of the rural retail chain of the company, in order to strengthen the company's system of product sourcing.Consumer durable companies, meanwhile, such as LG India and Godrej, have increased their marketing efforts in rural areas. 'Rural melas' are being organised by Godrej in order to access potential rural consumers.Exchange rate used: 1 USD = 46.03 INR (as on February 2010)The growth in rural income has been better than urban income since the minimum support price for crops like wheat and paddy has been substantially hiked. Even prices of pulses, rice, oilseeds and milk have increased dramatically over the last one year. The disposable income with the farmer is higher now,” said Rajesh Gupta, the president of DCM Shriram Consolidated-promoted Hariyali Kisaan Bazaar.The firm runs 180 stores and is present in Uttar Pradesh, Punjab, Haryana, Rajasthan and Maharashtra. These stores saw a 30 to 40 per cent growth in FMCG sales and a three-figure growth in grocery sales during the April-June quarter.“The FMCG growth at 25 per cent in the April-June quarter (over the corresponding period last year) is higher than earlier years. Better prices for farm produce, the increased government spending and remittances from workers in urban areas have contributed to higher income,” said S Sivakumar, chief executive (agri-business), ITC. It has 23 stores in Uttar Pradesh, Madhya Pradesh and Maharashtra.Moreover, farm earnings do not attract income tax. The future is set to see a further improvement in the disposable income from agriculture due to the Rs 71,000-crore farm-loan waiver and increased government spending on raising the farm output through schemes.“When disposable income goes up, a part of it is spent on apparel, FMCG and education. I feel we are going through this phase. At the same time, the farm-loan waiver and debt-relief scheme, which became public about four months ago, has also been factored into by farmers,” Gupta said.Reverse Supply Chain: It is efficient use of distribution network which is already set for procurement of milk. Banas has well set network in 1300 villages of Banaskantha for

procurement of milk. So by using this distribution network Banas wants to provide its members with better quality products at more competitive prices.

BACKGROUND INFORMATIONObjective of launching FMCG productsBanas as a part of its main mission wants not to give better price to its members for milk but also to improve the standard of living of its members. Hence it has launched many non-dairy products which are better than the products available in areas. Using its well set distribution network Banas wants to reach farthest of villages where other products are still not available.

Banas Marketing planFollowing are the points observed by us regarding the marketing strategy followed by the organization:Product Mix: This includes detergent soap, detergent cake, toilet soap (two flavors) and salt. Dairy doesn’t manufacture any product. Instead they have outsourced the manufacturing to private companies which includes Hipolin, Cibaca etc. the tea is procured by the agents in Kolkata.Technically the products are much better than the locally available products.Pricing: The prices of the product are kept competitive, and are significantly lower than their peers.

Price structure I

Particulars 30*650gm pack(primia detergent powder)

108*200gm soap (primia detergent soap)

25*1kg (Banas Iodized salt)

Basic cost 469.56 422.61 99.00Vat 15% 70.44 63.39 00.00

Price to DCS 540.00 486.00 99.00

Employee commission

30.00 27.00 13.00

DCS Commission

30.00 27.00 13.00

Selling price 600.00 540.00 125.00

Selling price per piece

20.00 5.00 5.00

Price structure II

Particular 120*100gm soap (primia plus bathing soap)

120*100gm soap (primia rose beauty soap)

Basic cost 939.13 939.13Vat 12.5% 117.39 117.39Vat 2.5% 23.48 23.48

Price to DCS 1080.00 1080.00

Employee commission 60.00 60.00

DCS Commission 60.00 60.00

Selling price 1200.00 1200.00

Selling price per piece 10.00 10.00

Margin: Dairy gives the total margin of 10%, in which 5% is given to the society and remaining 5% to the one of the employee who is responsible for keeping the accounts.

Distribution: These products are only distributed to Village level Societies. And these are not given to private retailers. Presently Dairy is using the reverse supply chain model to distribute these products. The milk tankers which go to villages for

procurement carry the products and distribute it to these societies. So the cost of distribution is reduced substantially.Advertisement: Dairy has distributed the posters and banners for this purpose in all the village societies. But during the visit of the society I felt it was not efficient because village level society used to put it at such places where the visibility was low.Strategy- Dairy wants to capitalize on the existing network covering all the villages of the Banaskantha district. And they also want to provide the members of the village with the better product at affordable product.At present Banas is trying to create popularity for the newly launched product like detergent soap and cake. And simultaneously they want to introduce new products like edible oil, spices and tooth-paste in coming two months so as to have a product range which satisfies all the needs of the members.Co-operative Member centricFor this Banas sends the notice to the village co-operative and frequently send the supervisor to the selected village societies with certain target. These supervisors compel the secretary to order the product and these societies force the members to use this product. The same strategy was used for Banas Tea in the initial days. But now it has become the most popular product in the rural areas. And in fact in case of Banas tea members demand the product on their own.So it can be said that push strategy is followed in all the products except Banas Tea in which there is pull strategy.Banas Retail plan: As a part of strategy to increase the sales of non-dairy products, Banas dairy is planning to open the retail shop in every village of Banaskantha district which has its own DCS. In this project, Banas wants the DCS to keep a dedicated employee for the sales of non-dairy product and maintaining the accounts. The salary of employee will have two components out of which one will be fixed pay and the other half will be variable (5% margin of the total sales ). The remaining 5% of the margin will go to DCS. So our project also includes to feasibility of this project by discussing this issue with secretary of various DCS.

dec jan feb mar apr may0

20000

40000

60000

80000

100000

120000

140000

160000

180000

57380

152607

108938

58225 5493947895

Month-on-Month Sales

[ Month-on-Month Sales of Detergents ]The sales of Banas non-dairy product has been decreasing in last 5 months. So we are required to study the reasons for decrease in sales and also come up with some strategies to improve market penetration. For this we are required to interview the Secretary and employees of DCS.New product launch: Banas also is planning to launch new products like Edible oil, Spices and tooth-paste. So we are required to conduct market research for these products and find out what is their average demand, buying pattern, preferred SKU (Stock keeping Unit) and brand loyalty for these products.Present distribution: Presently Banas distributes the products as per order placed by DCS. The products are delivered to DCS within two-three days of order depending upon the availability(stock) of products.Policy of Banas has been to sell their products only to members and that through DCS only. And hence because of this policy they don’t give the products to private retailers.

SIGNIFICANCE OF PROJECTBanas wants to widen the present product range and wants to cover all the needs of the members.Based on the results of the survey conducted by us Banas is going to decide the product and its attributes.The problems identified in the survey will be taken into consideration for improving upon total sales by DCS and to design the new strategy for increasing the market penetration.The analysis of sales data will help them to identify the present situation in various Vilages.

OBJECTIVES

The main objectives of our study are as per following:To study the difficulties faced by the DCSs at the village level under the present distribution channel.To know about the possible constraints for Banas Retail’s success.To find the buying pattern for different products and their SKUs.To find the average household consumption of different products.To find the degree of brand loyalty for different products.To check the viability of launching different products.

METHODOLOGYAs our study involved both the qualitative and quantitative study we did include both types of methods. For the first part of our study we relied on conducting Personal Interviews and Focus Group Discussions. While for the second part, we used customer survey and Focus Group Discussions.We selected the 10 DCSs randomly in Palanpur. In each village we conducted personal interviews with the dairy secretary and FGDs with the members of the DCS. Then we conducted the customer survey for the product. The Customers were selected randomly in the village. We surveyed some customers in villages of Palanpur. Although the sample was selected randomly, we tried our level best to cover all the classes of people in the village. All the data collected in survey was collated and analyzed accordingly. FGDs were especially helpful to know the perception of people for the Banas Products and to develop the better insight for knowing the preferences and habits of rural people.Primary SourcesThe main tools applied for this study were:Personal interviewsIn this method we interviewed the Secretary of the DCS individually. We tried to know about their experiences in selling the Banas Non-dairy products. We inquired about the problems they are facing presently and what constraints they see that Banas Retail may have to face whenever it is launched.Group DiscussionsWhile visiting DCSs, we did manage to interact with the group of people present in the DCS at that point of time. The main intention of doing this was to know the problems from other perspective and also to cross check the information provided by the Secretary.Customer SurveyFor getting the information regarding the product, we conducted the customer survey. We had prepared a questionnaire which was used for the survey.Secondary sourcesSales Figures from the Sales DepartmentIt was useful in studying and comparing the sales in different regions of Banaskantha district. And on the basis of the sales, the whole region was divided into various zones.

DIFFICULTIES AND LIMITATIONS OF THE STUDYAs Secretaries and the employees of the DCS, perceived us to be the employee of Banas Dairy, hence it seemed that they replied very cautiously to our questions. So some crucial points may have been missed as they may not have shared with us.While our survey was conducted, the harvesting of Pearl Millet was going on, so villagers always tried to shorten the interview time. We had to work hard to convince them for taking part in survey.The sample selected was random so it may not exactly resemble the rural population.Despite of our hard efforts, there was always small portion of people who took the survey very casually. So this may lead some small errors in estimating exact relative percentage.

PROBLEMS IN PRESENT DISTRIBUTION SYSTEMLargely there were about 12 types of problem reported by the secretaries of the DCS. But for the convenience of analyzing, we have broadly classified these problems into four main problems:

Less m

an-power

No Personal

incentive

Less R

emunera

tion

Credit P

roblem

In Proxim

ity of T

aluka

Less N

o of Mem

bers

Percep

tion of low Q

uality

Earlie

r Poor E

xperi

ence

Still n

ot used

Prices

Many R

etail S

hops

Storag

e

OTHER

S0

2

4

6

8

10

12

14

16

18

20

1314

7

18

7

4

87

13

2

7

4

11

[ Percentage of DCS reporting particular constrain ]

MAN POWER AND REMUNERATION

AND NO PERSONAL IN CENTIVE

STILL NOT USED AND PERCEPTION OF LOW QUALITY

CREDIT IN PROXIMITY OF TALUKA OR MANY

RETAIL SHOPS

0

10

20

30

40

50

6048

35 35

25

PERCENTAGE OF CONSTRAINS AT DCS LEVEL

[ Percentage of constrains at DCS level ] Lack of Man-Power, Remuneration and Personal IncentiveThis factor came out to be the most important one as 48% of total DCSs visited by us reported this problem. Man-powerAlthough the Distribution model for Banas Non-Dairy products is very innovative but still there are some problems related to the employees at DCS level 25% of the total DCS reported this problem. Lack of Man-Power limits the DCS in various ways like operating timings of the society, maintaining additional accounts etc. Remuneration and Personal IncentiveThis was the most talked problem by all the Secretaries of DCSs about 13%. Under the present model there is provision for personal incentive for employees who are involved in sales and keeping the accounts of all these products. But in many villages the working committee at the village level has changed this provision and the entire margin of 10% will go to the society instead of 5% to the involved employee. And in absence of any extra incentive employee generally try to avoid this extra responsibility.DCS should be reconsidered. And the cases in which the margin was (has) been given to the employee (secretary in majority of cases) could create the sense of dissatisfaction among other employees.

TimingsGenerally the societies remain open only for three-four hours in the morning and three-four hours in the evening. Hence all the purchases have to take place in this period. But still if the customer needs the product in between and(then) takes it from the retail shop, the whole link between Society and member weakens.

And with no extra incentive the employees have no reason to keep the society open for whole day. Less/No effort by DCSsThere were many village level societies about 25% which have still not started the selling of the products. The reason which they give is the lack of demand of these Banas products in their villages but they also agree that they have not put in much effort for selling. Credit SellingThis was the most important single factor for less sales of product. About 35% of societies reported this problem.This was also the most commonly encountered problem. During survey we came to know that masses in village are habituated to buy the product on credit. And when it comes to buying it from the Society, they expect that the money will be deducted from their milk income. There are two major problemsSometimes the value of goods purchased exceeds the milk income. As milk income of individual member keeps on fluctuating and Union doesn’t give any credit to the village society, it becomes very difficult job for them to adjust the accounts.And secondly selling goods on credit increases the amount of work of keeping accounts and in some cases it is for very small amount as low as Rs.5. Considering the scarcity of manpower and no personal incentive, the employees don’t want to take extra responsibility.The other important issue involved in selling products on credit was that the monthly milk income of members keeps on fluctuating and especially in summers when the milk produce decreases significantly. So in this period DCSs are not able to recover completely whatever sales are made to the members and have to carry forward the credit. This carry forward of credit has two basic problems as following:It requires extra effort on part of employees to maintain the accounts and that too in absence of any extra incentive.And as Union doesn’t give any credit to DCS, the DCS runs out of cash which is to be paid to the members.On account of these two factors, the secretaries generally avoid this whole business.Due to these factors the employees and management of society in some villages have started insisting on selling goods on cash. As soon as some DCSs have started selling goods on cash, the total sales in those villages have dropped by over 50%. Still not used or Perception of Low QualityThere are still many villages where the DCS have still not sold the product. About 15% of these villages reported that they have still not used. And 40% of the total societies did agree that they have not made enough efforts in selling these products. So it implies that there is still greater scope to increase the total sales by making these DCSs sell the Banas Product.

In all most all the villages, the Banas products are mostly famous among the low income group. People those have limited mobility or those who don’t have any preference. While the people with higher buying power preferred to buy the branded products from the nearby Taluka market or even if they bought it from the village then it was of particular brand.While consumer survey and FGDs conducted in many villages, we did notice that the Banas Products were perceived to be of low cost – low quality products. And the prime reason which I could think of was the positioning of the popular product Banas Tea. The main USP of Banas Tea has been its price which is very competitive and significantly less than its peers. So the positioning of Banas Products has been such that they are low cost-low quality products.Banas has created very good brand value among the rural customers by the excellent quality of ghee and other dairy products. This helps to convenience the people that any product from Banas will be of superior quality and at competitive price. But owing to certain prior poor experiences of certain products like torch and recently launched Detergent cake, the Brand value gets affected.Quality of every product is very important because it directly affects the sales of other products as well. Stiff Competition from retail shops in village and nearby TalukaThere is huge competition from the retail shops present in the village and about 25% of the sample villages reported the same. Due to above mentioned reasons, DCS are insisting to sell the products on cash while the retail shops in the village provide the products on credit for fortnight or month and hence are able to sell more than that what society does.Another important edge enjoyed by the retail shops in the village is their location. They are present everywhere and customer need not do much effort to approach them, while the DCS are situated on the peripheral areas of village.It was clearly observed that the villages near the taluka places had very little sales or demand for the Banas products while the village away from the taluka had good demand for the product. The sales seem to be in direct proportion to the distance between the village and taluka. And the most probable reason for this relationship can be the low penetration of other companies in these villages and less competition for Banas products.The movement of the people to taluka is very frequent in case of nearby villages and hence they prefer to buy the household items from the taluka itself and many of them have their own shops in the taluka.

There were some specific problems in some villages, although such villages were very few in number but looking to their impact of such problems, coming up with their solution is an important issue.

Point of sale display: In the village of Dhandha in Palanpur taluka, there is already an APO which is selling all the non-dairy products. The problem here is that the space is very limited and there is almost nothing the name of Point of Sale Display. So it is not possible to attract the customers coming for purchasing non-dairy products.Same pattern was in every society we visited, there was inappropriate use of dangles by DCS. There was no medium of point of purchase display of products which may remind or compel customers to buy the products.Storage place: In the DCS of village like Jalotra, where the storage space is limited, DCSs have problem in storing the product. As the soap and detergent have strong odor, they cannot be stored with ghee which is prime selling product. This limitation of storage space forces to choose between ghee or other products.

BIBLIOGRAPHYhttp://www.naukrihub.com/india/fmcg/scope/http://www.ibef.org/economy/ruralmarket.aspxhttp://www.business-standard.com/india/news/rural-india-boosts-fmcg-firms`-sales/329974/http://www. banasdairy.coopSALES DATA FROM SALES DEPARTMENT