Fmcg mother dairy

Summer internship

PROJECT As partial fulfilment of requirements for the award of

Post Graduate Diploma in Business Management

Report on Identifying factors behind decreasing

market share and study of consumer behaviour

Submitted to :-

Prof. R.J.Masilamani

Submitted by :-

Arpita Gupta

PGDM

09DM024

Summer Internship Report, PGDM 09-11 | 1

CERTIFICATE

This is to certify that Miss. Arpita Gupta, has completed her summer internship

at Mother Dairy, and has submitted this project report entitled Identifying

factors behind decreasing market share and a study of consumer behaviour

towards partial fulfilment of the requirements for the award of the Post

Graduate Diploma in Business Management .

This Report is the result of her own work and to the best of my knowledge no

part of it has earlier comprised any other report, monograph, dissertation or

book. This project was carried out under my overall supervision.

Date:

Place:

----------------------------------

Internal Faculty Guide

aditi

Highlight


ACKNOWLEDGEMENT

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 would like to take the opportunity to thank and express my deep sense of

gratitude to my corporate mentor Mr. Dhiman Sen and my faculty mentor Prof.

R.J. Masilamani. I am greatly indebted to both of them for providing their

valuable guidance at all stages of the study, their advice, constructive

suggestions, positive and supportive attitude and continuous encouragement,

without which it would have not been possible to complete the project.

I would also like to thank Mr. Amar Majumdar (Senior Marketing asst.) who in

spite of busy schedule has co-operated with me continuously and indeed, his

valuable contribution and guidance have been certainly indispensable for my

project work..

I am thankful to Mr.K.P.Boral for giving me the opportunity to work with

Mother dairy and learn.

I owe my wholehearted thanks and appreciation to the entire staff of the

company for their cooperation and assistance during the course of my project.

I hope that I can build upon the experience and knowledge that I have gained

and make a valuable contribution towards this industry in coming future.


TABLE OF CONTENT

Sl No. Topic Pg No.

1 Executive summary 4

2 Introduction :

Need of the study

Objective of the study

5

3 Organisational Background 7

4

Literature Review :

Current scenario

Supply chain management

Distribution channels

Processing

Quality control

14

5 Competitor Analysis 19

6 Study of distributors and retailers 23

7 Research methodology 35

8 Conclusion 43

9 Limitations 44

10 Recommendations 45

11 References 47

12 Annexure 48


EXECUTIVE SUMMARY

The project was started on 8th of April after knowing all the relevant

information about the different milk varieties available, under the guidance of

Mr.Dhiman Sen (E.O.Officer).The first part of my project involves the study of

distributors allocated to me Identification of their problem areas and helping

them in order to increase sale. For this I used the method of personal interviews

and questionnaires. At the same time , they were being made aware of the

incremental scheme of Mother dairy for the distributors. Along with the

distributors a study of retailers was conducted to better understand the

grievances and identify the gaps. For this I visited around 50 outlets in the area

,ie, North and East Kolkata and spoke to them. I was also supposed to find out

new retail outlets and convince them to sell Mother dairy milk by showing them

the opportunity of getting attached with a big FMCG brand like Mother dairy

and increase the customer base. Despite of summer and low demand I was

successful in persuading people and a number of new retail sale points were

developed and the sale was increased. The second part of my internship was the

study of consumer attitude towards Mother dairy milk or more specifically the

factors affecting the decision of purchase of milk. For this a sample of 200

consumers was taken and a factor analysis was carried on to find the decision

making factors.


INTRODUCTION

Need of the study

The project was an attempt to know the reasons behind low sale of milk of

Mother dairy in Kolkata. Despite of being the first in the industry,and having

the first mover advantage and the brand name, the sale has fallen down

incredibly due to competitors like Amul ,Metro dairy , Red Cow and others.

There is a need to revamp the company and position it all over again in the mind

of the consumers. In doing so firstly the grievances of the distributors and the

retailers were required to be solved in order to encourage them for push sales.

Secondly a study of consumers decision making factors is required in order to

understand their priorities which can be worked upon. For this purpose a

research is to undertaken to find out the market scenario.

With the help of the responses given by the consumers and data analysis, the

company will be able to understand its strengths, weakness , opportunities and

threats. The survey report submitted by me will assist the company to take right

decisions to increase the turnover and market share.

Objective of the study

The objectives of the study are the following :-

1. The main objective of this project is to probe the reasons for decreasing

market share of Mother Dairy and to find out the measures that can be

adopted to increase the sales

2. To study the distribution channel in the retail chain of Mother Dairy

3. To identify the issues related to Mother Dairy retailers and distributors

4. To get the retailers feedback from specific regions

5. To add up new retailers in the area


6. To study Mother Dairy positioning in the mind of the consumers vis-à-

vis competitors

7. To find out the factors that affect consumers decision to purchase milk

8. To find out short term problem in every sub-region that can be sorted out

9. Suggesting viable recommendations to be implemented in the area


ORGANISATIONAL BACKGROUND

Mother Dairy was set up in 1974. Mother dairy Kolkata is a government of

West Bengal project, was started under Operation Flood II of National Dairy

Development Board . It was set up initially to cater to the demand of the

Kolkata urban agglomeration spread over the Kolkata Metropolitan area, later it

reached out to the consumers of other districts also. The commissioning of the

Dairy started in July 1978. Initially, the management of Mother Dairy was

looked after by the National Dairy Development Board . On 24th March 1982 ,

the then Honourable Chief Minister Shri Jyoti Basu dedicated Mother Dairy

Calcutta to the rural milk producers and urban milk consumers of West Bengal.

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.

At Mother dairy milk is produced by mixing raw milk, white butter and skim

milk powder. Skim milk powder is made by mixing cow and buffalo milk

obtained during breeding seasons through various co-operatives in West Bengal

and converting them into powder in order to store for a longer period. Raw milk

is obtained on a daily basis from the co-operatives. It is then stored in chilling

plants and transferred to the Mother dairy factory through insulated tanks.

While raw milk is stored in the cold chain at 2°C skim milk powder and white

butter is stored under normal temperature. This milk is then pasteurised at 78° C

in order to make it free from germs and then it is homogenised.

Mother dairy is presently selling Milk & Milk Products like Khatta Doi ,

Flavoured Yoghurt, Plain yoghurt, Paneer, Ice cream and Packaged Drinking

Water. The entire product mix is shown below :


Each of the product is further discussed in details :-

MILK

Varieties in Milk :

Sl.No Product Fat

content

Solid not Fat

(SNF)

Water

1 Doble Toned Milk 1.5% 9.0% 89.5%

2 Toned Milk 3.0% 8.5% 88.5%

3 Full Cream Milk 6% 9% 75%

4 Cow Milk 3.5% 8.5% 88%

5 Skimmed Milk 0.5% 9.5% 90%


Double toned Milk

It‟s fresh it‟s pure it‟s co-operative milk with assurance of Mother dairy. Mother

dairy double toned milk - tasty and nutritious with low fat content. A dream

come true , especially for all the calorie conscious people who love the taste of

milk but are worried of its cream content. Mother dairy double toned milk

complements your daily workout perfectly. So , to maintain complete harmony

between your body and soul you‟ve got to “fresh and pure”.

Toned Milk

Mother dairy bulk vended token milk – healthy and tasty to the last drop.

Homogenised to evenly distribute the cream content , it‟s thicker and a lot easier

to digest. It‟s the magic of homogenisation that makes your kheer thicker and

shake frothier. Fortified with Vitamin A , which not only is good for your

complexion but also helps prevent night blindness. What‟s more , it gives your

children the energy to stay active through work and play

Full Cream Milk


Mother dairy full cream milk - wholesome and healthy. Packed with energy and

nutrition thats essential for growing kids. It makes them stronger from within

and keeps them active and healthy. So before they go to bed , and after they rise

give them Mother dairy full cream milk to keep them healthy and wise and to

see them „grow faster‟.

Cow Milk

Mother dairy‟s cow milk has a yellowish tinge due to presence of an element

called carotene and is a good source of Vitamin –A,B-12 and Vitamin D. Cow

milk is considered to be easily digestible. Whether poured on breakfast cereal or

enjoyed alone as a cold glass of milk, this can be enjoyed year around.

Skimmed Milk

In skimmed milk , as much of the fat as is possible is removed , yet it continues

to supply all the nutrients that full cream milk does. The young at heart would

particularly find it a tempting option. So its the best option to remain energetic

and young.

Margin (per ltrs) :

Sl.No Product Distributor’s

Price

Retailer’s

Price

MRP

1 Doble Toned Milk 19.65 20.00 21.00

2 Toned Milk 20.75 21.10 22.00

3 Full Cream Milk 25.45 25.80 27.00

4 Cow Milk 22.65 23.00 24.00

5 Skimmed Milk 17.65 18.00 19.00

Shelf Life : 2 days under 4°C

Average Daily Sales (in ltrs) : 335000 lakh


Pattern of sale :

Distribution Network :


OTHER PRODUCTS

Sl.No Product

1 Mishti Doi

2 Plain Yoghurt

3 Favoured Yoghurt

a) Vanilla

b) Green Mango

c) Chocolate

d) Pineapple

4 Paneer

5 Ice-cream

6 Packaged Drinking

Water

Mishti Doi Plain Yoghurt Flavoured Yoghurt

Paneer Drinking Water


Margin (per 100 gms) :

Sl.No Product Distributor’s

Price

Retailer’s

Price

MRP

1 Mishti Doi 6.50 7.20 8.00

2 Plain Yoghurt 6.50 7.20 8.00

3 Favoured Yoghurt

a) Vanilla

b) Green Mango

c) Chocolate

d) Pineapple

6.50

7.20

8.00

4 Paneer 17.50 18.50 20.00

Shelf Life :

Yoghurt : 8 days under 4°C

Ice-cream : 1 year under -18°C

Drinking Water : 9 months under normal conditions

Average Daily Sales :

Yoghurt : 3600 Kgs

Paneer : 800 Kgs

Ice-cream : 1200 kgs


Distribution Network :


LITERATURE REVIEW

CURRENT SCENARIO

Mother dairy has a market share of around 33 % in the branded sector in West

Bengal where it sells 3.4 lakh litres of milk daily on an average and undertakes

its marketing operations through around 51 distributors and around 600 retailers

in Kolkata itself. It has a huge advantage over its competitors as it is the only

player when it comes to sale of loose milk through token. Before the entrance of

competitors like Amul ,sale of loose milk through Mother Dairy booths was

around 35 % of the entire sale in branded segment , when Mother dairy was the

only player in the market. However since last five years the sale is continuously

declining and presently it is just 8-9 %.



Supply Chain Management

1) Milk Procurement: - Mother Dairy sources its requirement of liquid milk

from dairy co-operatives and producer institutions. Milk is received from farmer

cooperatives through insulated tankers at 2°C temperature in order to retain its

freshness.

2) Milk distribution: -Tankers in the morning and in the evening bring in milk

from the regional collection centres. After collection the same tankers are

utilized for the delivery of the processed milk to the distributors. Mother Dairy

has about 51 Distributors in the city of Kolkata. Each of these LAD‟s(Local

area distributor ) place their demand by raising an invoice one day in advance.

The demand is also calculated using the „Calendar‟ Scheme, in this depending

on the pre-calculated seasonal demands the outlets place their orders

accordingly. In order to satisfy immediate demand, 20 to 25 tankers are

provided with a buffer stock of 500 litres each day so that they can be mobilized

to cater the demand in an area. To coordinate its operations all the tankers are

equipped with HAM radios.


Distribution Channels:

a) Token Distribution: Also, termed as “Lohe ki bhains” (metal buffalo), is an

automated milk vending machine.

b) Distributors: The packaged milk is distributed via the distributor network

throughout the city.

Processing

At mother dairy, the processing of milk is done by process automation whereby

state of the art microprocessor technology is adopted to integrate and

completely automate all functions of the milk processing areas to ensure high

product quality/reliability and safety. There are four ways of milk processing –

Firstly, Clarification, in which milk is spun at very high speed, removing all

dust particles that are invisible to the naked eye.

Secondly, Standardisation which help to maintain uniformity by raising or

lowering its fat and SNF (solid not fat) percentage to a desired levels, so as to

deliver milk to consumers as per prescribed PFA norms.

Thirdly, it is Homogenization which improves palatability of milk and


Finally, Pasteurization, which kills all pathogenic bacteria present in the milk

and thus making it safe for consumption.

Quality Control

Stringent quality control methodologies are employed in Mother Dairy.

a) The milk is tested for adulterations and quality at the time of collection from

the farmers.

b) The Milk that comes from the collection points to the Mother Dairy plant is

ensured to have a temperature of not more than 4°C and is subjected to 15

product and quality checks.

c) The Milk quality is checked repeatedly after each processing phase and the

temperature is judiciously maintained less than 4°C always.

d) Before the milk leaves the plant for the delivery/distribution outlets the milk

is tested again.

e) The temperature of milk in the delivery trucks is always maintained less than

4°C.

f) All the trucks that deliver milk have specified guidelines to bring back 100

litres of milk after distribution. This is done in order to test the delivered milk

and to ensure that the tankers are not adulterated during distribution.

g) Since all the employed processing procedures are automated, no

contamination by human hands takes place.

h) To ensure milk freshness the collection and distribution points are always

chosen such that the travel time between them is always less than 36 hours.

Out of the total production about 9% goes directly to the institutions ,23% is the

loose token milk and the rest is distributed through LAD‟s.


COMPETITOR ANALYSIS

AMUL

Amul is the acronym for Anand Milk Union Limited, a dairy cooperative

company in Gujarat, India that markets a wide range of products including milk

powders, milk, butter, ghee, cheese, chocolate, Shrikhand, Gulab Jamun, ice

cream, cream, and others making it the largest food brand in India. Amul has

spurred the White Revolution of India, which has made India the largest

producer of milk and milk products in the world. It is one of the best examples

of co-operative achievement in the developing economy. Amul entered the

pouched milk market in Kolkata in 2005 and then onwards giving a tough

competition to Mother dairy .Presently Amul has a 40 % market share in the

branded milk segment.

Product

http://en.wikipedia.org/wiki/Amul

http://en.wikipedia.org/wiki/Gujarat

http://en.wikipedia.org/wiki/India

http://en.wikipedia.org/wiki/White_Revolution_(India)


The varieties of Amul milk available in Kolkata are :

Amul Taaza Toned Milk 3% fat

Amul Gold Full Cream Milk 6% fat

Amul Slim & Trim Double Toned Milk 1.5% fat

Amul Tea Special

At Amul skim milk powder is procured from the cooperatives of Gujarat which

is much superior in quality when compared to the cooperatives of West Bengal

leading to better quality of products.

Price

When compared to Mother dairy , the distributors margin of Amul is .50p/ltr

whereas Mother dairy gives .30p/ltr .In case of retailers Mother dairy has fixed

margin in every part of West Bengal .However Amul gives different margins

depending upon the location and sale of the retailer which becomes a great

incentive to sale. The price of the milk to the end consumer is however similar

to Mother Dairy.


Place

The availability of milk is a major concern among the consumers. Amul with its

vast distribution network has enhanced the market and is responsible for its

growth. Amul has made pouched milk available in almost all suburbs of West

Bengal where we cannot find Mother dairy even today. Mother dairy is not able

to cater to those markets because their size is comparatively small and with the

current retailers and distributors margin there is hardly any profit left to them

because the expenditure is much more.

Promotion

Amul has a great brand image in the mind of the customer .Their expert

marketing and advertising strategies add all the more to the sales.

METRO DAIRY

Metro Dairy was founded in the year 1994 as a new venture of Keventer Agro

Ltd. It was India's first dairy project in public private partnership. A three-way

joint venture was signed between West Bengal Milk Federation, Keventer and

NDDB, forming 'Benmilk Keventer Limited' to enhance milk supply in Kolkata.

The initiative had a strong backbone of:

An ultra-modern, state-of-the-art plant - the most modern plant in Asia.

Fully equipped with complete automation and very high level quality and

state-of-the-art control systems.


The fully automated plant restricts any hand touch right from the time

milk is brought out from tankers till the point milk is finally packed.

World Bank funded the project under Operation Flood, Phase III with the

objective of providing fair treatment to farmers and eliminating middle

men.

Having earned laurels in the milk industry, the Keventer Group extended to the

ice-cream category in 1998. In a handful of years, established itself as one of the

major competitor in the milk and ice-cream industry. Currently 20,000 litres of

ice cream is produced per day.


STUDY OF DISTRIBUTORS AND RETAILERS

The study of distributors and retailers was conducted on a part of North

Kolkata ,ie,Maniktala , Shyambazar , Ahmerst street , Raja Bazar , Malik

Bazar, New Market , Dalhousie , Minto Park , Esplanade , Dharamtala ,

A.J.C.Road . The 3 major distributors in the area were interviewed. They are :

Five Star Distributor

40A, W C Banerjee Street

Kolkata-700006

Ph : 9831012141

A.S.Milk

2A , Scotland Lane

Kolkata-700009

Ph : 9831016732

Jyoti Gupta

133/C , Raja Ram Mohan Sarani

Kolkata-700009

Ph : 98319-50986

The method of personal interview and questionnaire was adopted to get the

insights. The following mode of operation was found out through interviews :

An agreement is done by the company with the LAD for payment of a

security deposit

The LAD will receive the delivery of poly pouch milk at the scheduled

place mutually agreed upon and to sell the same to the third party retailers

in the area specified by the dairy

The milk shall be sold by the LAD to the retailer already existing in that

area and further outlets to be developed by the LAD

The agreement made at the beginning of the contract with the LAD shall

remain valid for a specified period of time and shall be terminated on the


expiry of the period unless it is extended or renewed for any further

period by mutual agreement

The LAD will take the delivery of the exact quantity of packaged milk

supplied by the dairy in its place against the indent placed by the LAD the

previous day. The Lad shall pay the cost of milk against the delivery of

milk by an account payee cheque or banker‟s cheque

The operational area of LAD shall be decided by mutual consent and may

be increased or decreased as per the decision of dairy from time to time

The LAD shall increase the sales by at least 10% over and above the

present sales within 3 months

The LAD shall be responsible for delivery of milk in good condition and

in time to various outlets by his own arrangements of transport and

manpower

If at any time the milk is found unfit for human consumption due to

mishandling or bad storage by the LAD , strict action will be taken

The LAD is solely responsible for maintaining the sealing , quality ,

packaging , etc. of the milk packets received from the dairy

The milk once delivered to the LAD shall not be returned to the dairy at

anytime and under any circumstances

The LAD shall also be responsible to leverage out the benefits given to

the retailers by the company from time to time

The results of the questionnaires filled by Lad are given below :-


Findings :



Interpretations :

Earlier Mother dairy itself used to distribute milk directly to the local retailers,

the distribution of milk through LAD‟s started only last year. Since the

distributors are new they hardly have any complain regarding retailers drop out

within the year of work. However sales were largely affected due to competition

from other local brands which are coming up daily with new schemes.

According to the distributors, the margin was not sufficient to meet their

expenses. Their profit remains negligible. Among the competitors also Mother

dairy‟s margin is the lowest. Again there is no incentive to work hard. The

targets given by the company were not realistic and hence were not achieved.

Their view about the quality of milk is also not satisfactory. According to them

there is no consistency in the quality, which becomes a major reason of low

consumer demand. When it comes to competitiveness Mother dairy lacks

behind many brands and especially Amul which has captured the market with

its mass advertisements and fine quality of product.


Apart from the survey with the three LADs ,others were also contacted in order

to solve their grievances .The report prepared is shown below :

FEEDBACK REPORT OF LOCAL AREA DISTRIBUTORS OF

MOTHER DAIRY CALCUTTA

SL

NO. NATURE OF FEEDBACK LAD NO.

1 Commission is less in comparison to other

competitors brand 99102,99003,99406

2 Leakage/Packing/Packaging problem 99102,99002,99105,99404,99104,99211,9921

9,99307,99203

3

Transport Problem (Vehicles are not reaching

in time/Single vehicle supply is wanted by

LAD)

99201,99307,99223,99207,99219,99403

4 DTM quality is very bad /thinner as compared

to other companies 99003,99102,99219

5 Market visit required jointly with MDC

officials for effective outcome 99201,99216,99215,99307

6 Other LADs are infiltrating into the area 99102,99301,99103,99307,99201,99207

7 Lifespan of the product is small compared to

other brands 99203,99105

8 Short supply than indented quality on regular

interval 99307,99408,99411,99004

9 Interested to distribute other product of MDC

but not getting 99203,99101,

10

No free gift products are supplied by MDC on

certain amount of sale to LADs as given by

other competitor companies

99003

11 No advertisement material given by the

company 99404,99102,99405,99201,99402,99305

12 Incentive scheme circular required 99411

13 Banking problem 99409

14 Curdling problem 99211,99002

15 Better incentive plans should be implemented 99104

16 Milk comes in Horizontal position 99211,99218,99219,99408


After the distributors, the retailers were also interviewed in the similar manner.

About 50 representative retailers were chosen for the purpose through

convenience sampling.

Findings:




Interpretations :

During the interview most of the retailers were satisfied by their sales

considering the location and competition in the market , however few who were

not , considered decreasing quality as a reason of loss of sales apart from

competition with other brands. Also it was witnessed that their is no

competition from local dairy owners because they have a fairly differentiated

market.

According to the majorty the major competitor is Amul , with its vast marketing

strategies , immense brand image and enormous quality of products, it has

successfully captured the market.However few of the retailers also believed that

the local brands like Red Cow,Thacker dairy,Amrit Fresh,Delight etc are

emerging as great competitors .These brands are new and are giving huge

margins and incentives , which is leading to push sales.


The margin of amul and Mother dairy is almost same in the area , however

when compared to local brands it is quiet less. When it comes to

competitiveness according to the retailers Mother dairy is not performing upto

the mark.Their strategies does not meet their competitors. Brands like Red Cow

offer huge discounts to their retailers whereas Mother dairy has no such

schemes.

Thus through applying root cause analysis we can come out with the main

problems of distributors and retailers leading to decreasing market share. The

fish bone diagram demonstrating the reasons is shown below:

Competition from local brands was one of the most contributing factor in

decreasing market share. The local brands not only give high margin to the

retailers but they also have great incentive schemes available for them thus

influencing them for higher sales.

Quality is the next major problem. There is no consistency in the colour or

smell of the milk .Milk is judged by its thickness, which again has the same

issue. Many retailers complained that sometimes the milk has a distinguishable


bad smell which annoys customers. Also there is a concern that the milk gets

spoiled very easily compared to Amul.

Mother dairy has an incentive plan according to which the distributors are

supposed to increase sales incrementally by 1% every month. This target if

achieve give the distributors an incentive of .05p/ ltr on their total sales for the

year. In order to fulfil the target and increase the sale, the distributors give the

retailers a part of their incentive,say .03p/ ltr. But even then it becomes very

hard for the retailers to increase sale as the demand in the market is limited.

Thus in these cases the only measure left is to increase sale through opening up

of new retail points.

Here we can see the lack of initiative of the distributors and the company.

During the survey it was found that there were a lot of gaps in the area of the

distributors. There was an unmet demand in the market. The distributors accept

that because of lack of initiative they were unable to meet the requirements.

During my project I identified few of them and thus new retail sale points were

allotted. The details of the sale points generated are :

SL.No Name of the owner Address Quantity of milk

(in ltres)

1 Pal Stores/

Biswajit Pal

177A, A.P.C.Road

Kol-4 20

2 Satkari Ghosal 25,Sahitya Parishad St

Kol-6 20

3 New Bengal Dairy/

J.P.Jain

274,Rabindra Sarani

Kol-7 50

4 Tara Fancy Store/

Sanjay Harsh

242, Rabindra Sarani

Kol-7 20


RESEARCH METHODOLOGY

Purpose

The basic purpose of this research is to find out the factors affecting the

decision of the consumer to purchase milk

Problem

To find out problem is the first stage of the research process. It represents

translating the management problem into research problem. It is rightly said, “A

problem well defined is half – solved.”

Consumers have faith in the brand image of Mother dairy, still its losing share

to Amul and other local brands

Objectives

The objectives of the study are as follows:

1) The objective of the study was to find the actual reason why people are

not buying Mother dairy

SAMPLE

Sampling Frame:

A Sampling frame consists of a list of item from which the sample is to be

drawn.

The sample frame for this research constitutes the customers visiting retail

outlets to purchase milk in North and East Kolkata.

Sample Size:

The sample size of the research was 315 individuals.


Methodology:

Initially 25 factors were identified to carry on the survey through an analysis.

This was further cleaned into a list of questions in a questionnaire (refer

annexure). Once framed and properly fragmented, these were individually filled

for a process of Descriptive Research. A cross-board survey was undertaken

involving consumers of milk in east and north Kolkata. This gave a congregated

set of 314 responses which were then segregated and keyed into SPSS. SPSS

was extensively used to narrow down the factors into components.

KMO AND BARTLETT'S TEST OF SPHERICITY

KMO:

The KMO measures the sampling adequacy which should be greater than 0.5

for a satisfactory factor analysis to proceed. The measure of sampling adequacy

(MSA) is .614 for the variables we initially taken for the consideration

Bartlett test of sphericity:

In accordance with the requirement of the test for principal component analysis,

the value should lie well above the significance level. Here in our experiment

the value (.00) does lie well above the pre-determined level of significance.

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .614

Bartlett's Test of Sphericity Approx. Chi-Square 4228.375

Df 300

Sig. .000


Communalities :

Communalities indicate the amount of variance in each variable that is

accounted for. Initial communalities are estimates of the variance in each

variable accounted for by all components or factors. Extraction communalities

are estimates of the variance in each variable accounted for by the factors (or

components) in the factor solution. Small values (red) indicate variables that do

not fit well with the factor solution, and should possibly be dropped from the

analysis. In a good factor analysis, the expected values of communalities for

each variable should be more than 0.5. As it is observed from the table above

that we have proper values of extraction for all variables and thus we have

accepted all of them.

Communalities

Initial Extraction

1_Decision to purchase milk

depends upon the quality of milk

1.000 .705

2_Price is the most important

decision making factor when it

comes to purchase of milk

1.000 .909

3_Milk purchase is determined by

the availability of milk where

required

1.000 .669

4_Taste of milk does not affect the

purchase decision

1.000 .706

5_Hygiene is an important decision

making factor when it comes to

purchase of milk

1.000 .621

6_Milk containing smell hampers

purchase of milk

1.000 .614


depends upon the ease of storage of

milk

1.000 .528


8_Price is not an important decision


purchase of milk

1.000 .923

9_Purchase of milk is determined

by the availability of milk when

required

1.000 .710

10_Milk containing smell is not at

all preferred

1.000 .603

11_Leakage in milk packets hinder

purchase decision

1.000 .715

12_Faith in the brand image

increases purchase decision of milk

1.000 .782

13_Schemes available on purchase

of a particular brand influence

decision

1.000 .705

14_Awareness about the

availability of milk influences

purchase decision

1.000 .669

15_Heavy advertisement increases

purchase of a particular variety of

milk

1.000 .591

16_Purchase of milk varies with the

percentage of fat content

1.000 .672


depends upon the packaging of milk

1.000 .790

18_Availability of substitute

products does not affect purchase

decision

1.000 .883

19_A little increase in price when

milk delivered at doorstep is not a

major concern

1.000 .763

20_There is a satisfactory no of

retailers in the locality

1.000 .583

21_The colour of the milk affects

the purchase decision

1.000 .747


depends upon the retailer‟s

reputation

1.000 .681



depends upon the inconveniences

occurred while purchasing

1.000 .706

24_Taste of milk affects the

purchase decision

1.000 .756

25_Availability of substitute

products affects purchase decision

1.000 .894

Extraction Method: Principal Component Analysis.


Total Variance Explained:

The eigen value is a measure of the strength of an axis, the amount of variation

along an axis, and ideally the importance of an ecological gradient. The precise

meaning depends on the ordination method used. The eigenvectors are the sample

scores, if the rows and columns of the initial matrix represent samples. Eigen values

are the "characteristic roots" of the principal components solution. There is one

eigen value for each dimension, sometimes labelled the inertia for that dimension.

Each eigen value is the amount of inertia (variance) a given factor explains in the

correspondence table. It is called "Inertia" in SPSS output. Eigen values reflect the

relative importance of the dimensions. The first dimension always explains the

most inertia (variance) and has the largest eigen value, the next the second-most,

and so on. The sum of eigen values is total inertia, discussed above.

The Eigen Analysis for our Analysis is given below :

Total Variance Explained

Com

pone

nt

Initial Eigenvalues

Extraction Sums of Squared

Loadings Rotation Sums of Squared Loadings

Total

% of

Variance

Cumulative

% Total

% of

Variance

Cumulative

% Total

% of

Variance

Cumulative

%

1 4.423 17.691 17.691 4.423 17.691 17.691 3.901 15.604 15.604

2 3.206 12.824 30.515 3.206 12.824 30.515 2.588 10.353 25.958

3 2.472 9.886 40.401 2.472 9.886 40.401 2.290 9.162 35.119

4 2.076 8.304 48.705 2.076 8.304 48.705 2.288 9.153 44.272

5 1.994 7.976 56.681 1.994 7.976 56.681 1.864 7.458 51.730

6 1.478 5.913 62.594 1.478 5.913 62.594 1.800 7.199 58.929

7 1.250 4.998 67.592 1.250 4.998 67.592 1.626 6.502 65.431

8 1.028 4.112 71.704 1.028 4.112 71.704 1.568 6.273 71.704

9 .918 3.673 75.377

10 .763 3.051 78.428

11 .729 2.914 81.342

12 .697 2.787 84.130


13 .584 2.338 86.467

14 .539 2.155 88.622

15 .459 1.836 90.458

16 .406 1.626 92.084

17 .374 1.495 93.579

18 .343 1.372 94.950

19 .305 1.220 96.171

20 .277 1.106 97.277

21 .246 .985 98.262

22 .190 .759 99.021

23 .132 .527 99.548

24 .081 .324 99.872

25 .032 .128 100.000

Extraction Method: Principal Component Analysis.

SCREE PLOT

A Scree Plot is a simple line segment plot that shows the fraction of total variance

in the data as explained or represented by each PC. The PCs are ordered, and by

definition are therefore assigned a number label, by decreasing order of

contribution to total variance. The PC with the largest fraction contribution is

labelled with the label name from the preferences file. Such a plot when read left-

to-right across the abscissa can often show a clear separation in fraction of total

variance where the 'most important' components cease and the 'least important'

components begin. The point of separation is often called the 'elbow'. (In the PCA

literature, the plot is called a 'Scree' Plot because it often looks like a 'scree' slope,

where rocks have fallen down and accumulated on the side of a mountain.)

The Scree plot for the analysis is given below:



CONCLUSION

This project was about the milk segment of Mother Dairy which due to intense

competition from its competitors is continuously losing its market share. So in

this project different parameters on which the sale of Mother Dairy depends are

studied and analysed from the distributor , retailer and consumers perspective.

The final outcome of the project is that the parameters which make decision

regarding the purchase of milk are Price , Quality, Smell , Taste ,

Advertisement and Awareness. Milk market is a totally unpredictable market

and the organisation should be over-cautious of any complaints that come into

milk as it includes the sentiments of a mother for her kid and she would not

prefer to give anything to her kid for which she is not 100% satisfied. So the

company should take every step possible to contain these problems which in

some way or the other affects the sale of Mother Dairy and its retailers.


LIMITATIONS

The limitations of the project is as follows :

1. The study was conducted in North and Central Kolkata only ,so the

limited area of the study may affect the conclusions

2. Some of the respondents could not give their proper response due to lack

of time. They at times tend to get biased and project a rosy picture

which may affect the reliability and relevance of the study

3. It might also be so that some respondents were not motivated enough to

respond properly although full attempt was made to keep it as unbiased as

possible.

4. There was no provision of visiting cards for the summer trainees which

hinder communication at times

5. The duration of the project was short, so the scope of more in-depth

evaluation was not possible


RECOMMENDATIONS

The recommendations for the company for further growth and profit are as

follows:

Mother dairy should come up with schemes for customers along with

retailers as it would be a real boost to the sales and also it will help the

company to get back its lost customers

During the survey it was found that many of the retailers were

uninterested because they were concerned about the storage of milk.

Instead of refrigerators if dry ice boxes can be supplied free of cost, sale

would be increased. Also it would be economical and convenient. Later,

if the retailer drops out , the box can be collected back.

It was seen that the price of the largest selling variety of Mother dairy

which is cow milk is Rs 24/ltr , and the competitor product of Amul is

priced at Rs 25/ltr. Thus the price can be increased and thereby margin of

the retailers can be increased

Also it was seen through the survey that price is not a major concern for

the consumers when it comes to a necessity like milk so the price can be

increased by a rupee or two and the quality can be improved

Mother Dairy is ISO and HACCP certified. The consumers should be

explained about it through advertisements in order to make them aware

The organisation should schedule these kinds of surveys on a more

regular basis as at this point of time Amul is really capturing the market

and the organisation should take viable steps to meet the expectations of

its customers

If MD can do certain promotions as its competitor AMUL does, then it

can attract sales. Promotion with the help of boards, hoardings etc. and

also it can advertise in radio

It was found during survey that Mother dairy milk gets spoiled quickly,

thus a preservative known as costic which is used by Amul can be applied

to produce milk


In order to improve and maintain quality, total quality management

measures should be appointed. It was seen that due to lack of fixed

percentage of raw milk mixed, the quality gets hampered and remain

unsteady. The extra milk procured should be used for production of milk

products which are in short supply and raw milk should be

proportionately used in milk production

The smell in milk is because of the usage of skim milk powder beyond a

certain point of time, this should be looked into by the manufacturing

department and alternative measure should be used

The company should try to adopt a relatively short period incentive

system in order to make it more friendly and achievable

The milk rejected by Mother dairy due to sub-standard is used by other

local dairy owners and hence their quality is much inferior. This should

be advertised

Mother dairy should come up with a scheme for consumers like discount

on Mother dairy Ice cream or any other product on supplying empty

pouch packets of Mother dairy milk

Differential margin should be given by the LADs to the retailers

depending upon the location and sales

LADs should be directed to supply milk to small retailers according to

their preference of time ,sometimes late by 6.30 -7.30

LADs should supply milk through cycle vans and small trolleys also like

competitors to areas where trucks cannot go

Factory visits helped consumers a lot in understanding the product.LAD

should organize the same with the help of MDC officials


REFERENCES

http://www.motherdairycalcutta.com/

http://en.wikipedia.org/wiki/Main_Page

http://www.motherdairycalcutta.com/

http://en.wikipedia.org/wiki/Main_Page


ANNEXURE

Questionnaire

DISTRIBUTOR

1. Name -

2. Address -

3. Phone -

4. Avg daily sales (in lts):-

1500 – 3500

3500 - 5500

5500 – 7500

7500 – 9500

9500+

5. How would you rate your retailers drop out?

Satisfactory

Unsatisfactory

6. Which type of milk sells the most?

DTM

TM

FCM

CM

SM

7. Rate Mother dairy on the scale of 1-5 on the following factors ( 1 as worst

and 5 as best) :-


8. Is there any scope to increase the no of retailers in your area ?

YES

NO

9. Suggestions/Complains :

*---------------------------*

RETAILER

1. Name of shop -

2. Address -

3. Phone -

4. Lad name -

5. Avg daily sales (in lts):-

10 – 50

Particulars 1 2 3 4 5

Margin

Timeliness

Credit limit

Incentives

Demand of

retailers

Quality

Packaging

Hygiene

Competitiveness


50 – 150

150 – 300

300 – 450

450+

6. How would you rate your present sales?

Satisfactory

Unsatisfactory

7. If the answer to the above is unsatisfactory then please choose the reasons

from below:

Competition from other brands

Competition from local dairy owners

Others

8. Which type of milk sells the most?

DTM

TM

FCM

CM

SM

9. Who is the major competitor of Mother dairy?

Amul

Metro Dairy

Red Cow

Others

10. Rate Mother dairy on the scale of 1-5 on the following factors ( 1 as

worst and 5 as best) :-

Particulars 1 2 3 4 5

Margin


11. Suggestions/Complains :-

*---------------------------*

CONSUMER

1. Name -

2. Address -

3. Avg daily consumption (in lts):-

a) .5 - 1 b) 1 – 2 c) 2 – 3 d) 3 +

4. The brand that comes to mind when it comes to purchase of milk –

a) Amul

b) Mother Dairy

c) Red Cow

d) Thacker Dairy

e) Others

5.Do you get delivery of milk at your home ?

a) YES b) NO

Punctuality of

distributors

Competitiveness

Quality

Packaging

Awareness


SL

R

No.

Attributes Strongly

agree

Agree Neither

agree nor

disagree

Disa

gree

Strongly

disagree

1 Decision to purchase milk

depends upon the quality of milk

2 Price is the most important



3 Milk purchase is determined by

the availability of milk where

required

4 Taste of milk does not affect the

purchase decision

5 Hygiene is an important decision


purchase of milk

6 Milk containing smell hampers

purchase of milk


depends upon the ease of storage

of milk

8 Price is not an important



9 Purchase of milk is determined

by the availability of milk when

required

10 Milk containing smell is not at

all preferred

11 Leakage in milk packets hinder

purchase decision

12 Faith in the brand image

increases purchase decision of

milk

13 Schemes available on purchase

of a particular brand influence

decision


14 Awareness about the availability

of milk influences purchase

decision

15 Heavy advertisement increases

purchase of a particular variety

of milk

16 Purchase of milk varies with the

percentage of fat content


depends upon the packaging of

milk

18 Availability of substitute

products does not affect purchase

decision

19 A little increase in price when

milk delivered at doorstep is not

a major concern

20 There is a satisfactory no of

retailers in the locality

21 The colour of the milk affects the

purchase decision


depends upon the retailer‟s

reputation


depends upon the

inconveniences occurred while

purchasing

24 Taste of milk affects the

purchase decision

25 Availability of substitute

products affects purchase

decision

*---------------------------*

Fmcg mother dairy

Documents

project report

mother dairy milk

study of distributors

study of retailers

study of consumers decision

study ofdistributors

survey report

metro dairy