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Amul Research

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Marketing Channels of Amul Milk in Lucknow: Factors Affecting Channel Efficiency Introduction

In India, dairy plants have different systems of milk marketing, namely non-cooperative (or private) and cooperative. The overall dairy industry is classified in two sectors: organized and un-organized. And, the marketing of milk and milk products in India is dominated by the unorganized sector, which handles about 86% of total milk production, while the organized sector handles only about 14 % of the total (GoI, 2004). The dairy cooperatives are considered a vital channel for the improvement of production and the reduction of the cost of procurement, processing, and marketing of dairy products through the economy of scale approach, together with the provision of quality milk to the consumer at the lowest cost. Amul is the brand name that is maintained by Gujarat Cooperative Milk Marketing Federation (GCMMF), India’s largest food product marketing organisation. Amul entrenched and positioned itself as a unique product in the Indian market with its customary way of operation in rural market. Amul had spurred the “White Revolution” in India and transformed India as the largest producer of dairy products in the world. Amul innovated itself in terms of variety, quality, technology in business; established itself over last 67 years and proved as one of the most successful co-operative organizations in the world. As per the official figures, Amul’s annual turnover was INR 13.735 billion during the last financial year, 2012-13 i.e. about 13% of the Indian milk market of over INR 100 billion. It handles a milk capacity of 16.80 million litres per day. Much of the success of the firm can be ascribed to its efficient supply and wider distribution networks. The phenomenal success of this largest food brand of India propelled us to have an insight in the key aspects contributing to its success. To focus on in depth detail and market statistics, we have limited our study and...