CHAPTER – I

INTRODUCTION

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 INTRODUCTION

Today the world economy has undergone a radical transformation in the last
two decades. The companies are emerging at the faster level. The technology and
advances have permitted companies to widen substantially both the Markets and
suppliers sources. Now as companies are emerging with their new products,
marketing has become exuberant activity in expanding the market globally.

Marketing starts with human need and wants. It is a human activity directed at
satisfying needs and wants through exchange process.

Marketing management deals with identifying and meeting human and social
needs. It is basically a meeting needs profitability.

In other words we can say that “It is the process of planning and executing
conception, pricing, promotion and distribution of ideas, goods and services to create
exchanges that satisfy individual and organizational goals”. The aim of marketing is
to know and understand the customer so well, that the product or service fits him and
sells itself.

It acts as an instrument to lift up the standard and life style of the economy
with the help of marketing; we are able to get the products at our doorstep at our
choice and needs. The whole economy would be sluggish if marketing did not exist.
Marketing is of critical importance because it maintains stability in the economic
condition.

Marketing is an existing, dynamic and contemporary field. It is recognized as

the most significant activity in the society.

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 Marketing has a widest connection which includes in its fold selling, buying,
Transportation, warehousing, pricing and packaging. All these activities geared up
together to reach strong preferences for particulars ​“Customer Satisfaction”​. As
such today’s companies are facing the toughest competition everywhere marketing is
playing a very important role.

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Definition
Introduction to Marketing Good Marketing is not an accident but the result of
careful planning and execution

A societal process by which individuals and groups obtain what they need and
want through creating, offering and freely exchanging products and services of value
with others

- Social definition

It is the process of planning and executing the conception, pricing, promotion

and distribution of ideas, goods and services to create exchanges that satisfy
individual and organizational goals.

- Management definition

Customer Satisfaction
The buyer forms a judgment of volume and acts. Whether the buyer is
satisfied after purchase depends upon the offer's performance in relation to the buyer's
expectations. According to PHILIP KOTLER, the definition of customer satisfaction
is the level of a person's felt state resulting from comparing a product's perceived
performance (or outcome) in relation to the person's expectations}

Thus the satisfaction level is a function of the difference between perceived

performance and expectations. A customer could experience may be three broad
levels of satisfaction. If the performance fans short of expectations. If the performance
matches the expectations, the, customer is satisfied. If the performance exceeds
expectations, the customer is highly satisfied, pleased or delighted.

Companies are aiming high because who are just satisfied will still find it easy
to switch supplies when a better offer comes along. The fact is that high satisfaction
or delight creates an emotional affinity with the brand not, just a rational preference,
and they creates high customer loyalty. The change is to create a company culture
such that everyone within the company aims to delight the customer. Companies
seeking to win in today's markets must track their Customers expectations perceived

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company performance and consumable satisfaction that need to monitor this for their
competitors as well.
For customer centered companies, customer satisfaction is both a goal and a
marketing tool. Companies that achieve high customer satisfaction ratings make sure
that their customer satisfaction ratings make sure that their target market knows it.
Although the customer centered firm seeks to create high customer satisfaction, it is
not ail to maximum customer satisfaction. First, the company can increase customer
satisfaction by reducing its price or increasing its services, but his "nay result in lower
profits. Second, the company might be able to increase it profitability in other ways,
such as by improving its manufacturing or invest in more in R & D. Third, the
company has many stake holders including employees, dealers, suppliers and
stockholders. Spending more to increase customer satisfaction of other "Partners".
Ultimately the company must operate on the philosophy that it is trying to deliver a
high level of customer satisfaction subject to delivering at least acceptable levels of
satisfaction to other stock holders within the constraints of its total resources. A
company's tools for tracking and measuring customer satisfaction range from the
primitive to the sophisticated. Companies use the following methods to measure how
much customer satisfaction they are creating.

Complaint and Suggestions System

A customer centered organization would make it easy for its customer to
deliver suggestions and companies with many good ideas and enable them to act more
rapidly to resolve problems

Consumer Satisfaction Survey

A Company must not conclude that it can get a full picture of customer
satisfaction and dissatisfaction by simply running a complaint and suggestion system,
customers may feel stupid, or that no remedy win be offered. Most customers win buy
less or switch rather than complain. The result is that the company has needlessly lost
customers.

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 Therefore, companies cannot lose complaint levels as a measure of customer
satisfaction. Responsive companies obtain as direct measure of customer satisfaction
by conducting periodic surveys. They send questionnaires or make telephone calls to
random Sample to their recent customers to find all how they feel about various
aspects of the company performance. They win also solicit buyer's views on their
competitor's performances.
Customer's satisfaction can be measured in a number of ways. It can be
measured directly by asking: "Indicate how satisfied you are with service X on the
following scale; highly dissatisfied, dissatisfied, indifferent, satisfied, highly satisfied,
(directly reported satisfaction) Respondents can be asked as well to rate how much
they expected of a certain attribute and also how much they experienced (derived
dissatisfaction). Still another method is to ask respondents to list any problems they
have had with the offer 'and to list any improvements they could suggest (problem
analysis) Finally, companies could ask respondents to rate various elements of; the
offer in terms of the importance of each element and how well the organization
performed each element (importance/performance ratings). This last method helps the
company to know it is under performing on relatively unimportant elements. While
connecting customer's satisfaction data, it would also be useful to ask additional
questions to measure customers repurchase intention. This win normally be high, if
the customer satisfaction is high.”
- John Young.

"Fully nine out of 10 customers in our surveys who rank themselves as highly
satisfied say they would definitely or probably buy from HP again. This satisfaction
translates into profitability because it cost five items more to gain a new customer
than it does to keep an existing one."It would also be useful to. Measure the
customer's likelihood or willingness to recommend the company and brand to other
persons. A highly positive word-of-month score indicates that the company is
producing high customer satisfaction.

Ghost Shopping

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 Another useful way to gather a picture of customer satisfaction is to hire
persons to pose as potential buyers to report their findings on strong and weak points
they experienced in buying the companies and competitors products. These ghost
shoppers can even pose certain problem to test whether the company's stiles personnel
handle the situation well.

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Lost Consumer Analysis
Companies should contact customers who have stopped buying or two have
switched to another supplier to learn why this happened. They mount a thorough
effort to learn where they failed - is their price too high, their service deficient, their
products unreliable and so on.

Some Cautions in Measuring Consumer Satisfaction

When customers rate their satisfaction with an element of the company's
performances say delivery, we need to recognize that customers win vary in how they
define good delivery; it could mean early delivery, on-time delivery, order
completeness and so on yet if the company had to spend out every element in detail,
customers would force a huge question noise. We must also recognize that two
customers can report being highly satisfied for different reasons. One may be easily
satisfied most of the time and other might be hard to please but "vas pleased on this
occasion.

Companies should also note that managers and sales persons can manipulate
their rating on customer satisfaction. They can also try to exclude unhappy customers
from being included in the survey One danger is that if customers know that the
company win go out of its way to please customers, some customers may want to
express high dissatisfaction (even if satisfied) in order to receive more concessions.

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Observations on Consumer Satisfaction

The measured value of industrial output is not necessarily a measure of

customer satisfaction with that output. Here are some of Professor Farmer's findings
on the industry level.

▪ Customer satisfaction win be lower in industries where the industry offers a

homogeneous product to a heterogeneous market. On the -I other hand,
industries that supply high quality homogeneous product to a heterogeneous
is market win register high satisfaction.

▪ Customer satisfaction is lower in industries where repeat buyers force high

switching costs. They have to buy from the Supplier even though their
satisfaction is low.

▪ Industries, which depend upon repeat business generally, create a higher I

eve! of customer satisfaction.

♦ As a company increases its market share, customer satisfaction can fan. This
is because more customers with heterogeneous demands are drawn into
buying a fairly homogeneous product.

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NEED FOR THE STUDY
In the present global business environment, there is a saying that “​Customer is
the King​” and “​survival” ​is the mantra of each and every organization. This is
achieved only when the customers of its products and services are satisfied. Retaining
the customers’ of a company and make them loyal towards it, depends upon the
degree of satisfaction of them towards the products and services which it offers for
them for meeting their needs and wants. Customer needs, wants and expectations are
changing from time-to-time. The company, which is able to meet these diversified
aspirations of the customers, is the only one to survive in this competitive market.
Thus it is said that, the Survival of a company in this competition business
environment depends upon satisfying its customers with its products and services to
an optimum extent.

Customer satisfaction is the means to determine the survival, growth and

prosperity of an organization and whether to be in the competition or to withdraw
from it.

In this context, the researcher undertook this study to know the degree of
Customer Satisfaction and preferences towards the Sangam brand and to find out any
discrepancies, in the minds of customers, and to suggest management measures to
minimize them.

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IMPORTANCE OF THE STUDY
Customer Satisfaction Survey
We all know customer satisfaction is essential to the survival of our
businesses. How do we find out whether our customers are satisfied? The best way to
find out whether the customers are satisfied is to ask them.

When you conduct a customer satisfaction survey, what you ask the customers
is important. How, when and how often you ask these questions are also important.
However, the most important thing about conducting a customer satisfaction survey is
what you do with their answers.

How You Ask Whether Customers Are Satisfied

There are many ways to ask your customers whether or not they are satisfied
with your company, your products, and the service they received.
You can ask them through:
● Face to face
● Call them on the phone
● Mail them a Questionnaire

When to conduct a Customer Satisfaction Survey

The best time to conduct a customer satisfaction survey is when the experience
is fresh in their minds. If you wait to conduct a survey, the customer's response may
be less accurate. He may have forgotten some of the details. He may answer about a
later event. He may colour his answers because of confusion with other visits. He may
confuse you with some other company.

What to ask in a Customer Satisfaction Survey

There is a school of thought that you only need to ask a single question in a
customer satisfaction survey. That question is, "will you buy from me again?" While
it is tempting to reduce your customer satisfaction survey to this supposed "essence",
you miss a lot of valuable information and you can be easily misled.

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 It is too easy for a customer to answer yes to the "will you buy from me
again?", whether they mean it or not. You want to ask other questions in a customer
satisfaction survey to get closer to the expected behavior and to collect information
about what to change and what to keep doing.

By all means ask the basic customer satisfaction questions:

● How satisfied are you with the purchase you made (of a product or service)
● How satisfied are you with the service you received?
● How satisfied are you with our company overall?

And ask the customer loyalty questions"

● How likely are you to buy from us again?
● How likely are you to recommend our product/service to others
● How likely are you to recommend our company to others? Etc.

Also ask what the customer liked and didn't like about the product, your
service, and your company.

How Often Should You Conduct a Customer Satisfaction Survey?

The best answer is "often enough to get the most information, but not so often
as to upset the customer". In real terms, the frequency with which you conduct a
customer satisfaction survey depends on the frequency with which you interact with
your customers. My state renews driver’s licenses for five-year periods. It would be
silly for them to ask me each year what I thought of my last renewal experience.
Conversely, if I survey the commuters on my rapid transit system once a year, I will
miss important changes in their attitudes that may be driven by seasonal events.

What to do with answers from a Customer Satisfaction Survey

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 Regardless of how I ask my customers for their feedback, what I ask them in
the customer satisfaction survey, and when I survey them, the most important part of
the customer satisfaction survey is what I do with their answers.

Yes, I need to compile the answers from different customers. I need to look for
trends. I should look for differences by region and/or product. However, I most need
to act on the information I get from my customers though the survey. I need to fix the
things the customers have complained about. I need to investigate their suggestions. I
need to improve my company and product in those areas the mean the most to the
most of my customers. I need to not change those things that they like. Most
importantly I need to give them feedback that their answers were appreciated and are
being acted upon. That feedback can be individual responses to the customers if
appropriate, or it can simply be fixing the things that they tell you need to be fixed.

What's Next in Customer Satisfaction Surveys?

So how do you know what's important? How do you know what really matters
to them? More importantly, how do you know which things to focus your limited
resources on first in order to have the biggest impact on improving customer
satisfaction?

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SCOPE OF THE STUDY

The study is limited to Customers satisfaction towards satisfying the needs

and requirements in getting appropriate dairy products as per specifications at
SAngam Dairy in Guntur.

The study aims at assessing the levels of satisfaction among customers

while visiting the shops to the delivery of the dairy products and the servicing in
dairy products and response towards them by the company personnel if they met
with any problem with the products organized across the Guntur city.

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OBJECTIVES OF THE STUDY

The main objectives of establishing and implementing the customer Satisfaction are:

To analyses the factors influencing the Purchase of Sangam Dairy Products.

To assess the Customer Satisfaction with reference to Sangam Dairy.

To study Customer Satisfaction towards services given by Sangam Dairy.

To know whether the company is meeting the expectations of the customers.

To know overall experience of the customer regarding dairy products.

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METHODOLOGY OF THE STUDY

Research methodology is a way of systematically solving the research

problem it may be understood as a science of studying how research is done
scientifically the researchers study the various steps that are generally adopted in
studying the research problem along with the logic behind it

Collection of Data
Fact expressed in quantitative from can be termed as "data". Data may be
classified either as "primary data" or "Secondary ".

Primary Data
The primary data is the data gathered by the researcher for the specific purpose
of research situation at hand it is the first hand information that researchers gets from
various sources like respondents, analogues case situation and research experiments
or the primary data has been collected from the distribution by supplying them the
questioning from the customer.

Secondary Data
Secondary data are already published data collected from some purpose other
than one confronting the researcher at a given point of time the secondary data can be
gathered from various sources like books journal, news papers reports of the
company, websites etc..,

Source of Data
After the objective has been stated clearly ,the next task was to collect
relevant data regarding the research study the data regarding the Indian and
international diary scenario were collected from the internet and other relevant data
were also collected from internet all through there were some data from newspaper
and magazines but the major portion was given by the company i.e. the assistant
manager of the respective departments .So the primary data involved data collected

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from milk booth and from few consumers.

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DATA​ COLLECTION INSTRUMENT
The basic instrument used in collecting the data in this survey is the
questionnaire. Apart from that we had also gone through the record of the company
the data collection from the above includes
Data regarding Sangam Dairy.
Data regarding the highest selling product.
Data regarding the contribution of each product towards sales.
Data regarding total sales and market shares of Sangam Dairy.
Data regarding the distribution system of the Sangam Dairy​.
Sample size: 100 members

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LIMITATIONS OF THE STUDY

▪ The time of the study was constrained to 45 days only.

▪ The whole research study was carried out in Vijayawada only therefore the
result may not be same in zonal basis.

▪ It was very difficult to generalize the main findings as the sample size was
very small.

▪ Some of the findings has been taken in the research are based on the opinion,
attitudes, feelings and perception of few respondents, but the respondents were
not willing to share their opinion and presumption, due to their busy schedule.

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 CHAPTER – II
INDUSTRY PROFILES

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 INDUSTRY PROFILE

Dairying has been of life in India since the ancient times. The modern diary
industry took roots in 1950 with the sale of bottled milk in Bombay from Array milk
colony. The first large scale milk products factory was started in 1945 at
Co-operative venture, with the assistance of UNICEF, for the production of milk
powder, table butter and ghee. These products were making from the buffalo milk.

The world’s largest development program over undertaken, the operation

flood undertook and gigantic task of upgrading and modernizing with production,
procurement, processing and marketing with the assistance provided by the world
bank and other external agencies, designed and implemented by the National Diary
Development Board (NDDB) and the Indian Diary Corporation. The project was
launched in July, 1970. Its basic concept compromises the establishment of co-
operative structure

Operation flood​ – 1

Operation flood also referred to as `white revolution is a gigantic project,

propounded by the Government of India for developing dairy industry in the country.
The Operation Flood-2 originally mean to be completed in 1975 actually took the
period of about 9 years from 1970 to 79 for its completion at a total cost of about a
Rs. 116 Cores. The operation flood-I was wholly finance any selling in India free gifts
of 1, 26,000 Metric tons at skin milk powder and 42,000 Metric Tons of Buffer Oil
donated out of the surplus of European economic community.

Anand pattern​ – 1

Under the operation Flood -1 the program for increasing milk production was
taken up in ice hinter lands of various breading tracks on Anand pattern and loudly
proclaimed with a trample. The Co – operative were started originally in 18 of Indian
Milk shed districts and later on mine more milk shed areas were added to make a total
of 27 in 10 states of the country viz., Maharashtra Tamilnadu, Andhra Pradesh, West
Bengal, Bihar, Haryana, Punjab, Uttar Pradesh and Rajasthan.

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 Those dairy Co – operatives are based on the model known as Anand pattern
of dairy Co – operative. Under Anand Pattern concept rural Co – operative
infrastructure was to be built in the village, the milk products were to form their
animals. In each participating village, the milk products were to form their own
village diary Co – operative. Thus Anand pattern diary co – operative union organizes
mobile veterinary and artificial insemination counters.

In the sphere of Co – operativisation the No. of Anand pattern organized

societies under operation flood was 63121 on April 1​st 1991 as age INST 60753 a year
ago indicate one that years as many as 2368 new diary co – operatives were found.

Operation flood​– 2

The operation flood-2 that started that in July 1978 is scheduled to be

completed in 1985 at a cost Rs. 483 cores. A humble attempt has been made to
present a general appraisal of the achievements made in same sufficient fields during
Operation Flood-I. These achievements if at as all made particularly the Anand
Pattern Dairy Co-operative unions are to serve now as bedrock of operation flood-2.
These unions are to act as the starting nuclear for Co-operative charter federation, the
main instrument for the gigantic project flood-2. The average nuclear charter
federation world in 6 Districts Unions registered and unregistered.

The Indian Dairy corporation, National Dairy Development Board being

autonomy National Institutional probable are not required to indicate the basis on
which state with allocations were made in Operation Flood-I up to end of the 1979,
Gujarat State alone Government the lines shares of 1666.5 lakhs against 5 states
Haryana, Bihar, Rajasthan and Andhra Pradesh put together the total disbursement in
their case was 1732 lakhs only. This trend is going to be nationalized in Operation
Flood-2.

Operation flood​ – 3

The Indian Dairy Industry is growing rapidly and may become a strong
competitor to World Dairy powder. The milk sector is the second largest contribution

22
to the agricultural economy in terms of produce. The Phenomenal growth is a result of
the National Dairy Development Board through Operation Flood Programme.

Operation Flood-3 now in this closing position consolidated the procurement

efforts to boost production. The projection for milk output for 2000 A.D., is nearly 90
million tone at a 5% growth rate. It is now 5 to 8 percent Dairy Factories established
under Operation Flood, which covers 170 milk Co-operative societies. They have a
milk drying component of about 697 Tones powder. In 1990-91 the Co-operatives
collectively nearly 10 million Liters and marketed 8 million Liters of Liquid milk
per day.

The operation flood being implemented by the National Dairy development

Board aims to enhance the average milk procurement to 13.7 Million Kilograms per
day by the year 1996 the concluding year of the operation flood 3 program. The peak
procurement level curing the period is expected to means 18.3 Million Kilograms
packed. The compulsive line figure for both during 1987 the base year of the
Operation flood program to was respectively 8.5 and 11.2 mkg-pd efforts are also
being made to increase capabilities of milk and production of milk powder.

Under the operation flood improving Animal Health case and good breeding
natural making available quality fodder under and incurring area and farm fertilization
under Co-operatives and processing were added. Inventory and animals has broadly
and Dairying from 1950 to 90 was 2.864 Cores achieve of all occasion to the
Operation Flood. The rapid growth in milk production did away with import of milk
powder except for a small quality (26.400 tones) during the drought years.

Current dairying scene in India

The dairy industry in India made rapid progress, particularly during the last two
decades. Today, India occupies first position in milk production in the world,
surpassing the US. The credit, not doubt, goes to operation Flood, which has played a
key role in the development of Dairying. India is a milk consuming nation. This,
couples with our large population ensured steady increase in demand for milk.

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 The employment potential of Indian dairy sector is substantial. This sector
provides additional income and generates job opportunities for 80 million farmer
families. More than 70 per cent of marginal farmers and landless laborers maintain
dairy animals to supplement their incomes.

In India, there are 10.1 million farmers who are members of 77,000 village dairy
Co-operative societies, each of which is affiliated to one of 170 district and regional
Co-operative unions which in turn are part of a state Co-operative marketing
federation. There are 22 of these federations, which offer dairy and other products in
the market successfully while competing among themselves. At present, dairy farms
are owned by individuals, investors and multinationals.

The Co-operative sector has contributed significantly for the success of white
revolution in India. There are Co-operative more than 97,000 milk Co-operative
societies in 264 districts. This sector grows at the rate of 6.5 per cent annum.

Advantages of Indian dairy industry

In terms of total bovine population, India occupies the first position on the
world, with 176.7 million cattle and buffaloes. (World’s total bovine population is
1,420 million). A large bovine population, strong procurement infrastructure,
presence of highly skilled manpower, cheaper labor, and a large number of processing
and allied facilities are some of the advantages that the India dairy business has.

Production trends
Production of milk rose from 20.7 million tons in 2006-07 to 8.3 million tons
in 2007-08. However, 45 per cent of the total milk is still handled by the traditional
sector. In 2006, 77 million buffaloes produced about 50 percent of the total milk
production in the country. In the same year, about 200 million cows produced about
45 per cent of the total milk production. (Nearly 156 million goats, sheep etc produce
only about 5 per cent of the total milk output.)

Export potential
India is not fully utilizing its export potential in respect of dairy products. The
cost of milk production in India is the lowest. And the dairy industry is not getting

24
any subsidy. There is an urgent need to pay special attention to quality of India has to
compete with other countries. At present, the country is exporting malted milk foods,
ghee, butter and cheese to countries like Bangladesh, UAE, Nepal, Sri Lanka, Oman
and Bahrain. Of course world milk prices are subject to dramatic fluctuations. Export
earnings from the live stock sector and related products rose to Rs.19, 250 million in
2007-2008 from Rs. 7,920 million in 2006-07.

Disappointing facts

Milk availability in India is still low at 212 grams/day per person. Of course,
the per capita availability of milk in the rural areas is barely 121 grams/day as
compared to 400 grams/day in urban areas.

Animal productivity remain low, as the national average is only 1.5 lit/day.
Productivity of Indian cattle is 10 per cent of the productivity of cattle in Israel and 30
per cent of the level achieved by the developed countries. Unless milk productivity is
raised, it is difficult to compete with Europe, America and Occeania.

What is more, only 10 per cent of the milk produced is in the organized sector,
leaving the remaining portion in the hands of milkmen thus providing chances for
adulteration and exploitation. Also, our cattle and buffaloes are slow maturing, show
irregular cycling behavior, produce fewer claves in their life-time, and suffer from
physical and physiological anomalies in reproduction.

There is a serious shortage of conventional feeds for feeding livestock. Both

quantitatively and qualitatively, there exists a wide gap in demand and availability of
fodder resources in India. During the last two decades, there has been no change in
the cultivated area devoted to fodder. It still stands at 4.4 per cent of the total cropped
area. It is estimated that 10 to 15 per cent increases can be recorded in the existing
milk production through adequate feeding of bovine population. In order to solve feed
shortage problem, we have to rely on cheap alternative feed to growing calves.

Steps taken so far

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 The problem of low productivity of animals can be solved by ensuring availability
of feed and fodder. Concrete efforts are needed to improve the productivity of fodder
crops, develop grazing land, and promote agro-forestry systems like silvipasture and
research on low-cost feed items. Extensive research has been carried out to find out
the utility of items like apple ground nut hulls, milk cake, neem cake, salad meal,
soya pulp, rice bran and brewery waste.

On June 9, 1992, the Govt., of India issued an order under section 3 of the
essential commodities Act, 1955. According to this order, known as Milk and Milk
Products Order (MMPO) 1992, milk does not have to mean just cow or buffalo milk,
it could also be goat milk or even a mixture of the three. The various objectives of
MMPO include:

Facilitating supply or availability of milk by balancing uneven supplies in

different regions.
Maintenance and increase of milk production and supplies and ensuring
equitable distribution.
Establishment of proper standards and norms for control in handling milk and
milk products.
Establishment, promotion or registration of any industry related to milk or
milk products.
Such other objectives incidental to the effective implementation of the
MMPO.

The milk unions are urging the government to either ban OGL imports of
skimmed milk powder (SMP) or impose duty on the same. They argue that prices of
imported powder should be at par with those of the domestic products.

The price of skimmed milk powder is coming down under pressure from
imports. It is said that levying of minimum import duty of 35 per cent of SMP would
provide a level playing field to the producers. (India gets about 5,000 tons of imported
milk powder annually).

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Latest development in the dairy sector

Formation of new dairy Co-operatives in Operation flood areas to bring 3.5

million members under the Co-operative fold in addition to the 9 million
members now being served by dairy Co-operatives.
Providing vocational opportunities and fostering entrepreneurship among
dairy-science student trainees to equip them with knowledge and experience
so that they may take up dairying as a profession.

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Top most priority
In the livestock sector, productivity holds the key. The major thrust should be
on genetic up gradation to improve productivity and production. Of course, priority
should be given to infrastructure development, feed management and better health
care services

Current scenario
Of the total milk output, the organized sector still handles an estimated output
of 12% only despite vigorous dairy development activities. At present there are 25.2
dairy plants in the public and Co-operative sectors including pilot dairies with an
average output of 12.2 million liters. The milk market covers 528 major towns, 4
metros and 149 class one and 375 smaller towns.

About 300 million supply every day. The milk production enhancement units
are being adequately strengthened. The Indian of Agriculture Research and the
“National Dairy Development Board” are mounting massive efforts to integrate dairy
science research, education, extension and development.

Federation that was guided by “National Co-operative Dairy Federation of

India”. The apex body of milk Co-operative societies. A national wide network
system of “Multi tier producers Co-operative” which are domestic in structural and
are professionally managed has been established. At present this program is providing
a joint additional income of Rs. 1200 cores from milk. It is heartening to note that the
Dairy equipment industry has grown to such an extent that most of Dairy Industry
needs are met indigenously.

Technology mission
The operation flood program prepared the ground for launching another
massive program at the national level called “Technology Mission on Dairy
Development (TMDD) on June 11, 1988. The main objective is to accelerate the pace
of growth of dairy industry in India. To achieve this end, the operation flood programs
such as the dairy research programs processing technology and product manufacturing
etc. the mission operation areas has covered approximately 60% of the country by

28
1995. The mission will functions through the adoption of locating specific strategies
such as people’s participation, demonstration of excellence, better land management
cost effective handling and processing system and intensive marketing.

Dairy procession technology

Research studies in dairy technology in NDRI Karnal have led to the

development of purely vegetarian processed cheese, a synthetic ghee flavor and Ghee
making plant on the principle of Hydrodynamics and Heat transfer in horizontal thin
scalped surface heat exchanges with a capacity to handle 500-600 kg an hour of
creamy butter. A two-fold increase in shelf life in cheese was attained. The methods
of manufacturing griehand cheese spreads of various flavors etc., have been
successfully developed by NDDB.

Growth in co-oparative

In order to build a viable and self sustaining National Dairy Industry on

Co-operative lined NDDB launched a project christened “Operation Flood” in 1970.
Funds mobilized from sale of products based on foreign food with its development
program It spurred Indian Dairy industry launch a “White revolution”.

In sphere of Co-operatives the number of Anand pattern organized societies

under operation flood were 63,121 till date and in next year, as many as produced and
sold by these Co-operative fetched approximately up to 1000 cores per year.

Beside the studies in milk the “operation flood” program has achieved success
on other fronts also. Import of milk solids has been already ended and India recently
exported 30,000 tons of milk powder. India is in the way of attaining total
self-reliance and next self sufficiency in milk production.

29
Major dairy products and brands

Company Brands Major products

Nestle Milk – Maid, Sweet Condensed Milk
powder, Malted food,
Cerelac Lactogen, milk powder & dairy
whitener, Ghee & Ice
Milo & Everyday Cream.

Mild Foods Limited Milk Food Ghee & Ice Cream

Cadbury Bourn Vita Infant Milk Food,

Malted Milk Food.

National dairy development board

At the time of Industrialization at cattle feed factory at Kajarie in October

1964 the late Sri LALBAHADUR SASTRY, the prime Minister of India paid
unscheduled visits producers co – operative societies and stated there overnight. He
was impressed by the social economic changes brought milk co – operatives in
Krishna district and desired to have a national level organization to milk producers co
– operative societies replicate anansin other part of the country.

Thus the National Dairy Development Board was sent up under the
empowerment of Ministry of Agriculture and Irrigation. Govt. of India in September
1965 under the society Regulation act 1860 and the Bombay trusts act 1950. The
president of India nominates the Board of Directors including Chairman, Secretary,
and National Dairy Development Board in the chief of the organization.

30
 Anand pattern dairy development

The information Anand pattern of milk co – operative was launched with the
organization of Krishna District Co – operative Milk Producers Union Limited. In this
pattern the function of dairy is milk procurement, processing and marketing are
controlled by the milk products themselves.

Installed processing capacities

Name of the Milk Butter Ghee

S. No. Powder Mfg U. H. T.
dairy Processing Mfg Mfg

1 Visakha Dairy 300 13 - 8 50

2 Rajahmundry 150 - - 4 -

3 Vijayawada 250 22 12 25 -

4 Ongole Dairy 300 30 8 10 -

5 Nellore Dairy 75 - - 4 -

6 Chittor MPF 200 14 - 8 -

7 Nandhyal MPF 150 10 - 4 -

8 Hyderabad 250 12 - 8 30

Mother Dairy
9 200 - 4 4 -
Hayatnagar

10 Other Dairies 249 - - - -

31
DAIRY INDUSTRY IN ANDHRA PRADESH

The program Dairy Industry was mooted with commendable help of the
United National International Children’s Emergency Fund, Food and Agriculture
Organization and Freedom from Hunger Company Campaign Organization of the
U.K. these organization insisted a lot of the establishment of the dairy units at Hydria
and Vijayawada in 1967 and 1969 respectively, which lead to pioneer dairy
development in Andhra Pradesh later to set cooling and chilling centers have been
setup to feed these two gigantic units.

The Government of Andhra Pradesh started dairy development corporation to

interest of milk producers and ensuring adequate supply of fresh milk at reasonable
price to the urban consumers as A. P. D. D. C., come in to the existence on 2​nd April
1974. A. P. D. D. C., providing employment to nearly 20 employees and organism
easy many as 87 dairy units including seven milk factories, 13 district dairies, 22
chilling centers, 18 cooling centre and 15 mini cooling centers.

In addition to that the private units have been contributing their little mite in
the development of dairy industry M/s. Hindustan milk foods that has started a malted
milk product factory in Rajahmundry. Further to enhance working efficiency and to
increase the turnover, the Government has constituted on autonomous dairy
development. Corporation on the recommendation measure the dairy industry
improving towards massive milk production and milk collections.

Dairy development

In 1960 pilot milk supply scheme was started in the state for the dairy
development, its initial capacity was 100 liters a day in the time of starting. Now its
daily collection increased to 11 lakhs liters per day. It is also working as alien
between milk producers of the towns by providing reasonable price to the producers
to maintain stable market.

32
33
 A. P. dairy development co-operative federation (A. P. D. D. C. F.)

A. P. D. D. C. F. was formed in October, 1981 to implement Operation Flood

– 2 programs through active involvement of producers in organization milk
production, procurements, processing and marketing on “three – tier”, Co – operative
structure as per the National Government of India. The three –tier system consists of
primary dairy co – operatives societies 13 village level, co – operative unions at
district level and federation at state level.

Operation flood

​In our state operation flood was divided in three types “Anand Level”.

1. Village Level – D. C. S. 2. District Level – 13

Operation flood programme

Indian dairy Development Corporation own the responsibility of

implementation of operation flood programs, which provides money assistance, put
70% towards loans and 30% as subsidy. National Dairy Development Corporation
selected district of the State for implementation of operation fold.

Districts selected under operations

District Milk sheds / unions

Krishna Krishna
Srikakulam Vishaka
Vijayanagaram Vishaka
Vishakapatnam Vishaka
East Godavari Godavari
West Godavari Godavari
Chitoor Chitoor
Kurnool Kurnool
Cuddapah Cuddapah
Nalgonda Nalgonda
Rangareddy Rangareddy

34
35
SELECTING THE ANIMAL TO FARM WITH – COWS V/S. BUFFALOES

Cows Buffaloes
Good quality cows are available in the In India, we have good buffalo breeds
market and it cost around Rs. 1200 to like Murrah and Mehsana, which are
Rs. 1500 per liter of milk production per suitable for commercial dairy farm.
day. (e.g. Cost of a cow producing 10
liter of Milk per day will be between Rs.
12,000 to Rs. 15,000).
if proper care is given, cows breed Buffalo milk has more demand for
regularly giving one calf every 13 – 14 making butter and butter oil (Ghee), as
month interval. fat percentage in milk is higher then
cow. Buffalo milk is also preferred for
making tea, a welcoming drink in
common Indian household.
They are more docile and can be Buffaloes can be maintained on more
handled easily. Good milk yielding fibrous crop residues, hence scope for
cross breeds (Holsteing and Jersey reducing feed cost.
crosses) has well adapted to Indian
climate.
The fat percentage of cow’s milk varies Buffaloes largely mature late and give
from 3-5.5%and is lower then birth to calves at 16 to 18 months
buiffaloes. interval. Male calves fetch little value.
Buffaloes need cooling facility e.g.
wallowing tank or showers / foggers
with fan.

36
 Middle class health – conscious Indian families prefer low fat milk for
consumption as liquid milk. We suggest you to go for a commercial farm of mixed
type. (Cross breed, cows and buffaloes kept in separate rows under one shed).
Conduct a thorough study of the immediate market where you are planning to market
your milk you can mix milk from both type of animals and sold as per need of the
market. Hotels and some general customers (can be around 30%) prefer pure buffalo
milk. Hospitals, sanitariums prefer cow’s milk

The space required per animal should be 40sq.ft in shed and 80sq.ft open space.
Besides, you will also need:

1. One room 10”x 10” for keeping implements.

2. One room 10”x 12” for milk storage
3. Office cum living room of suitable size.
4. Water tank capable of storing minimum 2000 liters
5. Bore well with capacity to fill water tank in 1 hr

Total land requirement for a unit of 20 animals can be sited as 3000sq.ft.

There should be space for expansion. Ideal space requirement for 100 animals is
13,000 to 15,000sq.ft (120”x 125”). For 20 animals initially, you can make
contractual arrangements for getting an assured supply of 300kgs, of Lucerne and 400
kgs. Of maize fodders per day.

However, in long run, as the strength of you farm will go up to 100 animals, it
is advisable that you should go for a lease land of 15 to 20 acres with irrigation
facility to cultivate green fodder for your animals. (one acre of green fodder
cultivation for every five animals is required as a thumb rule.) The economics of
whole dairy animal management depends upon its economic feeding. By making
fodder’s like Lucerne or Berseem available for your animals you can reduced cost on
feeding concentrate feed.

37
 The strength of labourers in your farm can vary with number of animals
usually the thumb rule is one labour for every 10 animals on milk or 20 dry animals or
20 young stock.

Why do Dairy Farming?

Dairying is an important source of subsidiary income to small/marginal

farmers and agricultural labourers. The manure from animals provides a good source
of organic matter for improving soil fertility and crop yields. The gober gas from the
dung is used as fuel for domestic purposes as also for running engines for drawing
water from well. The surplus fodder and agricultural by – products are gainfully
utilized for feeding the animals. Almost all draught power for farm operations and
transportation is supplied by bullocks. Since agriculture is mostly seasonal, there is a
possibility of finding employment throughout the year for many persons through dairy
farming. Thus, dairy also provides employment throughout the year. The main
beneficiaries of dairy programmes are small/marginal farmers and landless laborers.
A farmer can earn a gross surplus of about Rs. 12,000 per year from a unit consisting
of 2 miliking buffaloes.

The capital investment required for purchase of 2 buffaloes is Rs. 18,223/-.

Even after paying a sum of Rs.4294/- per annum towards repayment of the loan and
interest the frmer can earn a net surplus of Rs. 6000 – 9000/- approximately per year.
(For details see model scheme enclosed). Even more profits can be earned depending
upon the breed of animal, managerial skills and marketing potential.

According to World Bank estimates about 75 percent of India’s 940 million

people are in 5.87 million villages, cultivating over 145 million hectares of ropland.
Average farm size is about 1.66 hectares. Among 70 million rural households, 42
percent operate upto 2 hectares and 37 percent are landless households. These
landless and small farmers have in their possessions 53 percent of the animals and
produce 51 percent of the milk. Tus, small/marginal farmers and land less agricultural
labourers paly a very important role in milk production of the country. Dairy farming

38
can also be taken up as a main occupation around big urban centres where the demand
for milk is high.

Scope for Dairy Farming and its National Importance

The total milk production in the country for the year 2001-02 was estimated at
84.6 million metric tonnes. At this production the per capita availability was to be 226
grams per day against the minimum requirement of 250 grams per day as
recommended by ICMR. Thus, there is a tremendous scope/potential for increasing
the milk production.

The population of breeding cows and buffaloes in milk over 3 years of age
was 62.6 million and 42.4 million, respectively (1992 census)

Central and State governments are giving considerable financial assistance for
creating infrastructure facilities for milk production. The nineth plan outlay on
Animal Husbandry and Dairying was Rs. 2345 crores.

Financial Assistance Available From Banks/ Nabard For

Dairy Farming

NABARD is an apex institution for all matters relating to policy, planning and
operation in the field of agricultural credit. It promotes development through
formulation and appraisal of projects through a well organized t\Technical Services
Department at the Head Office and Technical Cells at each of the Regional offices.

Loan from banks with refinance facility from NABARD is available for
starting dairy farming. For obtaining bank loan, the farmers should apply to the
nearest branch of a commercial or co-operative Bank in their area in the prescribed
application for which is available in the branches of financing banks. The Technical

39
Officer attached to or the Manager of the bank can help/give guidance to the farmers
in preparing the project report to obtain bank loan.

For dairy schemes with very large outlays, detailed reports will have to be
prepared. The items of finance would include capital asset items such as purchase of
milk animals, construction of sheds, purchase of equipments etc. the feeding cost
during the initial period of one/two months is capitalized and given as term loan.

Facilities such as cost of land development, fencing, and digging of well,

commissioning of diesel engine/pump set, electricity connections, essential servants’
quarters, godown, transports vehicle, milk processing facilities etc. can be considered
for loan. Cost of land is no considered for loan. However, if land is purchased for
setting up a dairy farm, its cost can be treated as party’s margin up to 10% of the total
cost of project.

Scheme Formulation for Bank Loan

A Scheme can be prepared by a beneficiary after consulting local technical

persons of State animal husbandry department, DRADA, SLPP etc., dairy
co-operative society/union/federation/commercial dairy farmers. If possible, the
beneficiaries should also visit progressive dairy farmers and
government/military/agricultural university dairy farm in the vicinity and discuss the
profitability of dairy farming. A good practical training and experience in dairy
farming will be highly desirable.

The dairy co-operative societies established in the villages as result of efforts

by the Dairy Development Department of State Government and National Dairy
Development Board would provide all supporting facilities particularly marketing of
fluid milk. Nearness of dairy farm to such a society, veterinary aid centre, artificial
insemination centre should be ensured. There is a good demand for milk, if the dairy
farm is located near urban centre.

40
 The scheme should include information on land, livestock markets,
availability of water, feeds, fodders, veterinary aid, breeding facilities, marketing
aspects, training facilities, experience of the farmer and the type of assistance
available from State Government, dairy society/union/federation.

The scheme should also include information on the number of and types of
animals to purchased their breeds, production performance, cost and other relevant
input and output costs with their description. Based on this, the total cost of the
project, margin money to be provided by the beneficiary, requirement of bank loan,
estimated annual expenditure, income, profit and loss statement, repayment period,
etc. can be worked out and shown in the project report.

A format developed for formulation of dairy development schemes is given as

annexure I.

Level of predevelopment Beneficiary’s

S.No Category of Farmer
return to resources Contribution
(a) Small Farmers Up to Rs.11000 5%
(b) Medium Farmers Rs.11001 – Rs. 19250 10%
(c) Large Farmers Above Rs. 19251 15%

Interest Rate

As per the RBI guidelines the present rate of interest to the ultimate beneficiary
financed by various agencies are as under:

No. Loan Amount CB’s and RRB’s SLDB/SCB

(a) Up to and 12% As determined by
inclusive of Rs. SCB/SLDB
25000 subject to
minimum 12%
(b) Over Rs. 25000 13.5% -do-
and up to Rs. 2
Lakhs

41
 (c) Over Rs. 2.0 As determined by -do-
Lakhs the banks

Production Preference Growth

The average birth wt.(Indian buffaloes) low 21 kg High 41 kg higher in male

calves than in females. Average daily gain of 548 gm between 3 – 6 months 404 gm
between births to 36 months. Body weight at first calving ranges from 367 kg
(Dharwati) 531kg (Nili Ravi) Higher growth rate in reveries breeds than swamp.

42
Dial-A-Market…To India

Today, India is ‘The Oyster’ of the global dairy industry. It offers

opportunities galore to entrepreneurs worldwide, who wish to capitalize on one of the
world’s largest and fastest growing markets for milk and milk products. A bagful of
‘pearls’ awaits the international dairy processor in India. The Indian dairy industry is
rapidly growing, trying to keep pace with the galloping progress around the world. As
he expands his overseas operations to India many profitable options await him. He
may transfer technology, sign joint ventures or use India as a sourcing center for
regional exports. The liberalization of the Indian economy beckons to MNC’s and
foreign investors alike.

Advantages

Light in weight, easy to handle and no danger of breakage.

Distribution costs lower (occupies less space, lower pay-load due to light weight,
no collection of empties).
Bottle – washing costs eliminated (saving in equipment, detergents, steam, etc.).
Tamper – proof,
Effective sales message can be printed.
Less Noisy (during filling, sealing and transportation).
No exposure to sunlight.
Filling machinery compact and occupied much less space.
No container deposit needed.

Disadvantages

Costing higher per unit milk distributed.

Product not visible.
Difficult to remove cream.
Inspection of milk (for sediment) not possible.
Regular supply of special paper/film essential.
Not so easy to open
Some cases of leakage may occur.

43
44
Dairy Plants

India’s modern milk supply goes back to December 15, 1950, when the Aarey
Milk Plant in Bombay launched the supply of pasteurized and bottled milk on
large-scale for the first time in India. Subsequently, over the years, the share of the
organized sector increased after the launching of Operation Flood in 1970.

Promotion the Sales

These include (for both wholesale and retail sales) the following:

a) Home delivery.
b) Milk booths or distribution depots/bars.
c) Stores.
d) Soda fountains
e) Coin vending machines
f) Automatic dispensers
g) Factories, hospitals, jails, restaurants, schools, etc.

Utilization of Returned Milk

Unsold milk presents a problem of economic disposal. Under tropical

conditions, as in India, the returned milk should not be send again for sale as liquid
milk since exposure to high temperatures during its inward and outward journeys
subject it to quality deterioration and hence may cause consumer complaints. The
unsold milk can be given for separation or utilized for preparation of dahi, etc.

Milk Production in World

India is the largest animal milk producing country in the world followed by
USA. It is estimated that the milk production would cross 50million tones by the end
of 1995 and target to 250 million tons by 2020AD.

1990 - 17 million tones

2000 - 70.8 million tones

45
2010 – 74.3mT

(Projected) 2020 -240mT

Expected to reach – 220 to 250mT – 2020

India contributes to world milk production rise from 12 -15% & it will increase up to
30-35% (year 2020)

What does the Indian dairy has to offer to foreign investor?

India is a land of opportunity for investor looking for new and expanding
markets. Dairy food processing holds immense potential for high returns. Growths
prospective in the dairy food sector are termed healthy, According to various studies
on the subject. The basic infrastructural elements for a successful enterprise are in
place

Key elements for marketing system

Raw material (milk) availability
An established infrastructure of technology
Supporting man power

Dairy Organization

Dairy is an important source of subsidiary income to small/marginal farmers

and agricultural labors. The manures from animals provide a good source of organic
matter for improving soil fertility and crop yields. The goober gas from the dung is
used as a fuel for domestic purposes as also for running engines for drawing water
from well. The surplus fodder and agricultural by products are gainfully utilized for
feeding the animals. Almost all draught power for farm operations and transportation
is supplied by bullocks. Since agriculture is mostly seasonal, there is a possibility of
finding the employment throughout the year for many persons through dairy farming.
A farmer can earn a gross surplus of about Rs.12, 000 per year from a unit consisting
of 2 milking buffaloes, the capital investment required for purchase two buffalo is Rs.
18,223. Even after paying a sum of Rs. 429 towards repayment of the loan and

46
interest the farmer can earn a net surplus of Rs. 6,000 to 9,000 approximately per
year.

Package of Common Management Practices Recommended For Dairy Farmer

Some of the major norms and recommended practices are as follows.

Housing

a. Construct shed on dry, properly raised ground.

b. Void water-logging, marshy and heavy rainfall areas.

c. The walls of the shade should be 1.5 to 2mts high.

d. The walls should be plastered to make them damp proof.

e. The cattle shade should be well ventilated.

f. The floor should be pucca/hard, even non-slippery impervious, well sloped (3m

per meter) and properly drained to remain dry and clean.

g. Provide 0.25 meter road, pucca drain at the rear of the standing space.

h. Provide 5-10sq, meter loaf space for each animal.

i. Provide proper shade and cool drinking water in summer.

j. In winter keep animals indoor during night and rain.

k. Provide individual bedding daily.

l. Maintain sanitary condition around shed.

m. Give adequate space for the animals.

Feeding of Milch Animals

a. Feed the animals with best feeds and fodders.

b. Cut the fodder at the right stage of their growth.

c. Chaff roughage before feeding

47
d. Moisten the concentrate mixture before feeding.

e. To estimate the daily feed requirement remembers that the animals consume

about 2.5 to 3.0 per cent of their body weight on dry matter basis.

48
Milking If Animals

a. Milk the animals two to three times a day.

b. Wash the udder and teat with antiseptic lotions. Luke-warm water and dry

before milking.

c. Milk should be free from any contagious diseases and should wash his hands

Protection against Diseases

a) Be on the alert for signs of illness such as reduced feed intake, fever, abnormal

discharge or unusual behavior.

b) In case of outbreak of contagious disease, immediately segregate the sick,

in-contact and the healthy animals and take necessary disease control

measures.

Breeding Care

a. Observe the animal closely and keep specific record of its coming in heat,

duration of heat, insemination, conception and calving.

b. Breed the animals in time.

Care of Calves

a. Take care of new born calf.

b. Treat/disinfect the navel cord with tincture of iodine soon as it is cut with a

sharp knife.

c. Keep the calf separately from birth till two months of age in a dry clean and

well-ventilated place. Dehorn the calves around 4 to 5 days of age easy

management when they grow.

49
50
Will Dairy Dare To Automate

India is ​the largest producer of milk in the world and dairy farming in the
single largest contributor to India’s GDP a part from being the biggest source of
employment. Dairy farming is a critical part of the Indian economy as it’s importance
stems from three important stems from three important factors .First of all it provides
income for small and marginalized farmers: second ,milk and its products are a
critical part of our diet and third dairy farming complements other forms of
agricultural activity.

India has been largest milk producer in the world since 1988 and milk
production has consistently improved over the past two decades. The production milk
in 2010 was estimated to be 117 million tones and increased approximately 4% to a
record 121.5 million tons in 2011.

World Production

The world’s milk produce comprises cow’s milk, buffalo milk and milk from
sheep, goat and other animals. The worlds total milk production from all these sources
in 2009 was 703.350 million tones which was a considerable jump from 697.573
million tons in 2008 As far as cow’s milk production is concerned use ranks first
followed by India , china the Russian federation brazil and Germany respectively. The
worlds cow milk output in 2009 was 85.86 million tones of which use’s share was
85.86 million tones and India’s share was 45.14 million tones.

On the other hand regarding the worlds buffalo milk output, India ranks first
with a production of 59.87 million tons in 2009 followed by Pakistan, china, Egypt,
and Iran respectively. The worlds total output of buffalo milk in 2009 was 89.86
million tones.

Worlds Milk Output By Animal

Out of worlds combined milk output cow’s milk represented 84% in 2009
followed by 13%taken up by buffalo milk 2.2% by goat milk 1.3% by sheep and 0.2%
by camel.

51
 In recent years cow’s milk production has been declined in many parts of the
world like the European union, USA, Australia, Japan, and china. On the other hand
buffalo milk has kept increasing. Of the total buffalo milk output, more than 90% is
produced by India and Pakistan. As far as milk from other animals is concerned
according to fao data for 2010 goat milk was mainly produced in Asia, 21% in Africa
and 15% in Europe. Regarding sheep milk production Asias share is 46% and Europe
share is 34% while for camel milk Africas share is 89% of the world countries.

The following tables will give the milk production by animal.

TOP 10 COW MILK PRODUCING COUNTRIES IN 2018

PRODUCTION(TONNES)
COUNTRY

USA 85859400

INDIA 45140000

CHINA 35509831

BRAZIL 29112000

GERMANY 27938000

FRANCE 23341000

NEW ZEALAND 15400000

UK 13236500

POLAND 12447200

52
53
​WORLD BUFFALO MILK PRODUCTION IN 2018

COUNTRY PRODUCTION(TONNES)

INDIA 59874

PAKISTAN 22279

CHINA 3000

IRAN 240

Milk Production in India

Dairy farming alleviates poverty and un employment, especially in rural areas

.According it has

Worlds Milk Production by Animal

ANIMAL
Type of milk 2017 2018 GROWTH(2011-2
012)
COW MILK 584.164 58.464 +0.6%
BUFFALO MILK 87.291 89.960 +3.1%
GOAT MILK 15.412 15.333 -0.5%
SHEEP MILK 9.070 8.975 -1.0%
OTHER 1.636 1.636 +0.0%
WORLD
697.573 703.350 +0.8%
PRODUCTION

Been growing over the years. The total volume of milk produced grew more
than seven times from 17million tones in 1950-51 to 11603 million tons in 2017-18 .
This tremendous rise in production is primarily the result of the dairy farming policy
that was implemented in operation flood. The major milk producing states are Uttar
Pradesh, Andhra Pradesh, Rajasthan, and Madhya Pradesh.

54
55
STATE WISE MIL PRODUCTION IN 2017-2018

STATES COW BUFFALO GOAT TOTAL

MILK MILK MILK
UTTAR PRADESH 3575 13902 1159 20203
ANDHRA PRADESH 1029 7601 0.1 10429
RAJASTHAN 2320 5840 1007 9548
PUNJAB 273 6323 44 9389
GUJARAT 1912 5285 231 8844
MAHARASTRA 1155 3355 282 7679
MADHYAPRADESH 2548 3758 417 7167
BIHAR 2023 2807 219 6124
HARYANA 376 5020 61 6006
TAMILNADU 789 761 --- 5778
TOTAL 22467 59201 3910 112540

Per Capital Availability of Milk

Per capita availability of milk in India 2017-2018 was 263gm per day . This
per capita availability as 130 gm per day during 1950-51. It has been increasing
gradually over the past decades though it is still lower than the worlds average of 29.4
gm per day.

In the marketing of milk and its products dairy cooperatives account for a
major share of processed milk. Milk is processed and marketed by 177 milk
producer’s cooperative milk marketing federations.

In 2017-18 the average daily cooperative milk marketing output stood at 21.12
million liters with an annual growth of about 6.2% over the previous five years . This
organized sector currently handles this volume in over 400 dairy plants.

Mother dairy one of the world largest liquid milk plants is located in Delhi
and handles over 800000 liters of milk every day.

56
 Over the years brands created by cooperation’s have become synonymous
with quality and value AMUL, VIJAYA, VERKA, SARAS, NANDHINI, MILMA
AND GOKUL are among those that have earned the customers trust across India.

Exports

India exports skimmed milk powder whole milk powder, ghee, butter, cheese,
condensed milk, milk food for babies, milk and cream in powder, butter milk, etc.
This export of dairy products are shown in below table for the year 2010-2012.

PRODUCT QUANTITY(MILLION VALUE(MILLIONS)

TONNES)
SKIMMEDMILK 12173.50 1370.515
POWDER
OTHER GHEE 3084.23 721.886
BUTTER 1275.52 199.899
MILK&CREAM OF A 5176.45 150.940
FAT CONTENT BY
WEIGHT 1%
WHOLE MILK 679.10 107.106
OTHER CHEESE 450.89 78.729
OTHER MILK FOR 172.88 47.590
BABIES
OTHER BUTTER OIL 214.18 35945

Imports

​Even though India ranks first in the world in the production of milk it imports
some milk products like skimmed milk powder, milk and cream, buttermilk, whey,
cheese and curd.

57
58
 CHAPTER – III
COMPANY PROFILES

59
 COMPANY PROFILE

Milk and Milk products are the most important food items in promotion the
health of children are elders. It is well known as “the wholesome food”. Prior to 1970,
the entire population in Guntur District used to depend on vendors for milk. Since, the
vendors were monopolies. They win an intention of making profits, adulterated the
milk extracted the cream out of it.

Sell the milk at the favorable prices to them. They used to sell the milk of
inferior quality are unreasonable price, which failed to serve the very purpose. So the
Government with a view to protect health and to supply good quality of milk at
reasonable price, set up dairies at some important places and Sangam Dairy is one of
them.

Under the Operation Flood-I Programme, Guntur District was selected to

develop dairy activities on Amul pattern keeping in view the three tier system of
village dairy Co-Operation (V.D.C) societies, The District Milk producers
Co-Operative and Co-Operative federation at state level which is an apex body.

NOMENCCLATURE OF SANGAM DAIRY:

The name of the Sangam ‘Dairy is due to the presence of Sangameswara
Temple at the village Sangam Jagarlamudi near vicinity of the dairy the dairy is
located between Guntur — Tenali highway about 15 kms from Guntur and 10 kms
from Tenali having a very good architectural view attracting the visitors.

60
 SANGAM DAIRY
ORGANIZATIONAL CHART

BOARDOFDIRECTORS

CHAIRMEN

MANAGING
DIRECTOR

61
62
TECHNICAL INPUTS AND MILK ENHANCEMENT PROGRAMME
Various technical inputs offered to the milk producers are classified as
follows.

Artificial Insemination Services

The dairy has a separate production centre. It is maintaining 150 Murrah Bulls
for semen production purpose producing 60,000 doses of semen every year, the dairy
runs 120 Artificial Insemination centers.

Animal health
The union gives veterinary aid to milk producers through 6 routes with head
quarter at sangam Dairy. The routes include Repalle, Baptia, and Sattenaplli,
Narasaraopeta and Gurazala and one route at Vinukonda. Each veterinary route covers
68 M.P.C. societies. The animals suffering from infertility problems illness are
treated.

Fodder development program

The union has raised in its campus nearly 15 Acers of perennial crops like
Para, Hy. Napier, Co-1 and Co-2. The union supplies certain varielties of fodder seeds
to the milk producers at 30% subsidy.

Fodder Seed multiplication Programme

The union has taken up seed multiplication programme for the past 7 years by
supplying good varieties of seed to the producers, rising in farmer’s field and
encouraging seeds multiplication.

Silvipasture Scheme
Under kissan van this union has taken up growing in farmer’s fields.

Distribution of chaff cutters

63
 The union purchased 140 chaff cutters from Ludhiana and supplied to the milk
producers with 50% subsidy for better utilization of grass fodder.
Enrichment of paddy straw with urea the union provides necessary
infrastructure and area required for the programme on free of cost to the producers.

Cattle feed
The cattle feed plant with an installed capacity of 100 Mts per day was
constructed by N.D.D.B. The feed is produced by semi automatic pro weighing with a
provision of mechanical devices to separate and take the uneven and unwanted
harmful particles from the raw materials.

By-Pass protein food

The union is providing a special feed called by-pass protein feed. This union is
the only union by-pass protein fee in Andhra Pradesh. By pass protein feed is of
superior Quality of conventional type of concentrated feed. Distribution of mineral
mixture Mineral Mixture was distributed to the milk producers on 50% subsidy basis.

Cattle Insurance
The union is insuring the milk cattle of the producers with a confessional
premium of 3.4% rate. Of the premium, 1/3 is born by the union: 1/3 by the society;
1/3 by the producer. The union is insuring 5,000 to 6,000 milk animals every year.
The union is contributing to the newly constructed society buildings
a. If the total vatic of the building is above Rs.60,000 union subsidy is
Rs.15,000.
b. If the total building value is above Rs.30,000 but less than Rs.60,000 subsidy
will be Rs.10,000.
c. If the value of the building is below Rs.30,000 subsidy is Rs.5,000. The union
is also extending Rs.5,000 to the society building towards repair work, if the
financial position of the society is not sound.

Cross breed heifer’s subsidy scheme

64
 To encourage cow milk production the union distributing 900 cross breeds
heifers to the milk products on subsidy rate in the year 1992- 1993. One bag feed per
a heifer for a month will be supplied by the union.

Training Program
Training will be imparted to the society workers for 90 days in veterinary first
aid Al services; 30 days to paid secretaries and 5 days to testers in clean milk
products, milk testing etc. Training will also be provided to the managing committee
members of V.D.C societies and milk producers regarding for 90 days in procurement
and technical input program.

Other Activities
The union supplies testing equipment’s to the M.P.C Societies and milk
collection centers in no profit on loss basis. A monthly news bulletin “Sangam
Samacher” in being circulated to all the societies on free of cost. The union is
publishing information on statutory aspects of Cooperative Act.

Sangam Dairy is no longer controlled by the A.P.D.D.C.F the G.D.M.P.C.U.

Limited which has been named as sangam dairy is the first dairy to be brought under
the A.P. Mutually Aided Co-operative Societies Act to February 2 1997. As a result,
Sangam Dairy got the right to market its products which iere carried out by the
A.P.D.D.C.F earlier and the commission payable to the A.P.D.D.C.F for marketing
which is about Rs.50 lakhs could be saved.

ASEPTIC PACKAGEING STATION

Aseptic milk or Sterilized milk long shelf milk is a unique way of milk
preservation, where the milk is packed in disposable, laminated paper cartoons with
three months shelf life.

The essential feature of this pack is to provide milk paced as a grocery item,
with ease and convenience to the consumer, the consumer can purchase his sleekly

65
requirement and store it for us aged as and when it is convenient Tetra pack is
breakthrough in milk preservation technology, which offers effective convenience
pack to the consumer.

Market identification now the product is making a smooth sailing in the cities
of Hyderabad, Vizag and Calcutta. Besides, the tetra-pack milk has been popularized
in the milk deficit coal belt area of Bhadhrachalam, Khammam and Kotthagudem etc.
There are plans for further market expansion in Calcutta and Bangalore cities. Trails
are under process for the introduction of these new products.

The given table gives brief details of the milk packed in 500m1 packs from
2000-2007 year wise (in lakhs packets).

PACKAGING
The Product is packed in different size according to the weight
Table Butter : 10g, 100gm, 200gm and 500gm — packed in
Aluminum Foil
White Butter : 70Kg cartons — oil proof papers
Ghee : 1/2 Kg & 1 Kg Aluminums foils & 15 Kg tins
Whole milk Powder : 1 Kg Polythene covers 25 kg bags — Husse in
Laminated craft paper with Polythene covers inner side
Doodah Peda : Each brick 25 Kg packed in oil proof paper
Lassi : 200m1 sachet
Flavored milk : 180 ml bottles
Fluid milk : ½ Liter Sachets — Polythene Cover aluminum
Foils packing pack the self is 60 days

EXISTING CAPACITIES
● Milk handling capacity - 2.5 lakhs liter per day

66
 ● Milk powder capacity (Two Powder Plants, L&T make and stain co) - 22
M.Ts Per day
● Table Butter (4 Packing Machine /CBMM And butter chaplets Machine) -8
M.Ts Per day
● Ghee - 10 M.Ts per day
● Storage of butter in deep Freeze - 700 M.Ts per day
● Boiler Section - 2 oil fires boilers, 2 coal fixed , Refrigeration - 350 M.Ts

Milk chilling Centers

(a). M.C.C. Narasaraopet - 50,000 LPD (Liters per day)
(b) M.C.C. Gurazala - 30,000 LPD
(c) M.C.C. Vinukoncia - 30,000 LPD
(d) M.C.C. BattiprOlu - 30,000 LPD

SANGAM DAIRY AIMS & OBJECTIVES

● Sangam reaffirms with new millennium.
● To enhance the present procurement to 4.0 lakhs liters / day in the next 5 years.
● To enhance the liquid milk market to 1 .5 lakh liters/days in the next
5 years.
● To enhance the business turnover to 250 crores by 2005.
● To bring all societies in the district under electronic milk testing.
● Increasing milk production enhancement activities inducing cross breading cows
and up gradation of buffaloes.
● Uphold co-principles and be model co-operative principles and be a model co-op
for others.

Sangam at the Farmers Service:

● Animal vaccines at subsidy rates
● Fodder seeds
● Sitvia pasture scheme
● Distribution of chaff cutters
● Enrichment of paddy straw with urea

67
● Distribution of cattle feed on subsidy rates
● Supply of bypass protein feed
● Distribution of mineral mixture
● Cattle insurance on 2/3 subsidy
● Aid to society building
● Distribution of cross breed cows and heifers
● Training programs to all farmers and paid secretaries
● Formers induction program through CD programs Accident insurance to all
member products.

Sangam - Facts & Figures that Speak​:

● Sangam is strength of 1.33 .lakh member products & procures around 665 lakh
liters per annum.
● Sangam pimps lack around Rs.200 Iakh into the rural economy, every 10 days
towards payment to the milk producers.
● Sangam co-operative have been spread over and interwoven with 643 villages
of Guntur Dist.
● Cream rich Sangam milk and toned milk is sold I 8 towns in Guntur District,
and Sangam is the ‘brand leader. Guntur Dist. Sangam milk is also in
Hyderabad and Madras.
● Sangam paid one of the highest returns to the member producers amongst the
South Indian dairies during 1998-99, 76% of the turnover was paid as
purchase price to farmers.
● Sangam Dairy products sell at premium price on account of its quality. Butter
is one of the leading brands in all metro table butter is in 500 g, 100 g and
chaplets (10 C) manufactured and Sangam Dairy.
● Sangam besides giving remunerative price to the farmers has been consistently
paying price difference to all its milk producers during the last four years from
its enterprises.
● Sangam Dairy commands a business turnover of approx. 115 crores it is
projected to double in the next five years.

68
AWARDS OF EXCELLENCE​:
Sangam the recipient of excellence Award and udyog Ratna awarded during
the year 1997 from the Institute of Economic studies — New Delhi. Sangam is the
recipient of Gold Star Award from the council of Economic V studies — New Delhi
India 1998.

Sangam is the recipient of Sri Mulukunuru Viswantha Reddy Awarded for co

excellence by the co-op Development foundation, Hyderabad in 1998.

SANGAM RE-AFFIRMS:
● Sangam reaffirms with new target for the new millennium.
● To enhance the present procurement to 5.0 lakh liters/day.
● To enhance the business turnover to 250 crores by 2005.
● To make puce buildings for all the mils societies India villages.
● To bring all the societies India the district to electronic milk testing.
● To achieved total computerization with LAN/wan net work.

FEATURES:
● Marketing of Sangam Milk in Hyderabad (June 1997) and Chennai (Sept.
1999)
● Currently around 25,000 per day is being sold in Hycierabad 28,000 Ltrs. And
in Channel and 9,000 liters per day in Tirupathi.
● Marketing of mango drink (1 liter and 200 ml) and “Vijay a Sangam” Mineral
Water.
● Curd in 200 gms poly pouches and 125 ml cups and Kalakh and in 250 gms’
destic books.
● Entire quantity of Skim Milk Powder manufactured (approx 1200 MT) being
sold boy in retail 1 kg packs.
● SangamGhee in poly pouches.

69
 ● Future 500 ml and 200 ml launched in November, 2000.
● We are supplying cattle feed to meet the requirement of Producers at Rs. 5.50
per kg.
● Hybrid fodder seeds, vaccines at subsidized, prices to farmers.

Chaff cutters were being given to producers at 25% cost.

The area of operation flood under programmed has been identified into
9 milk sheds/unions as presented in annexure — 1.

S.No. District Milk Sheds ​I ​Union

1 Srikakulam Visakha

2 Vijayanagaram Visakha

3 Visakhapatnam Visakha

4 East Godavari Godavari

5 West Godavari. Godavari

6 Krishna Krishna

7 Guntur Guntur

8 Prakasam Prakasam

9 Chittor Chotoor

70
10 Kurnool Kurnool

11 Nalgonda Nalgonda

12 Ranga Reddy RangaReddy

13 Medak. Medak

14 Nizamabad Naziabad

New Interventions​:
● Marketing of sangam milk in Hyderabad (in June 1997) and Chennai
(September 1999). Currently around 25000 Lts per day in being sold in
Hyderabad, 28000 its in Chennai and 9000 lts per day in tirupathi.
● Curds in 200gms poly pouches and 125ml cups and kalakhanda 250gms
plastic boxes.
● Entire quantity of skin milk powder manufactured (approx 1200 MT) being
sold only in retail 1Kg packs.
● Sangam ghee in poly pouches (1 liter, and 200ml) launched in November
2000.
● We are supplying cattle feed to meet the requirement of producers at Rs.5.50
per kg.
● Hybrid fodder seeds, vaccines at subsidized prices to farmers.
● Insurance coverage (J.P.A.) for 1,00,000 members milk producers for an
amount of Rs.50,000.

71
● Subsidy for purchase of animals from Haryana is to the tune of Rs.2,500/- per
animal.
● Animal insurance 12. building subsidy for societies to an extent of Rs.
20,000/-
● An amount of Rs.5,000 per head for natural death coverage all milk producers
as per the milk procurement guide lines.

72
 CHAPTER – I
THEORETICAL FRAME
WORK

73
 THEORETICAL FRAMEWORK

Customer satisfaction is a customer’s feelings of pleasure of disappointment

resulting from comparing a product perceived performance in resulting to his or her
expectations. Today, more and more companies are recognizing the importance of
satisfying and retaining their current customers. Many companies are aiming for high
satisfaction level because customers who are just satisfied offer come along. Those
who are highly satisfied are much less ready to switch, high satisfied or delight
creates an emotional bond with the brand, not just a rational preference. This result is
high customer loyalty. How so buyers from their expectations? From past buying
experience Friends and associates, advice, and marketers and competitors information
and promises. If marketer raise expectations to high, there buyers is likely to be
disappointed. Some of tow day’s most successful companies are raising expectations
and delivering customer satisfaction. For example, Nissan invites potential infinity
buyers to drop in for a “guest drive” (not a “test drive”, because the Japanese word for
customer is “Honored Quest”).

In addition to tracing customer value expectations and satisfaction, companies

need to monitor their competitor’s performance in these years. For customer
centered companies, customer satisfaction is both a goal and marketing tool.
Companies that achieve high customer satisfaction ratings make sure that their market
knows it.

Although the customer centered firm seeks to create high customer

satisfaction, its main goal is not to maximize customer satisfaction. If the company
increased customer satisfaction by lowering its price or increasing its services, the
results may lower profits. The companies might to able to increase its profitability by
means other increase satisfaction.

Ultimately, the company must operates on the philosophy that it is trying to

delivery a high level of customer satisfaction subject to delivering acceptable level of
satisfaction to the stake holders with in the constrains of its total resources.

74
 And also quality is the totality of features and characteristics of products or
service that bare on its ability to satisfy stated or implied needs. Today companies
have no choice but to implement total quality management programs if they are
remain solvent and profitable. Total quality is the key to value creation and customer
satisfaction.

The best sales of company are its satisfied customers as the value of publicity
and sales they generates for exceeds the value of advertisings and promotion under
taken the company.

When rate their satisfaction with an element of the company’s performance

say delivery the company needs to recognize that customers vary in how they define
good delivery. It could mean early delivery, on time delivery, order completeness and
so on. Yet if the company had to spell out every element in detail, customers could
face a huge questionnaire. The company must also realize that two customers can
report being “Highly Satisfied” for different reasons one may be easily satisfied must
of time and the other might be hard to please but was pleased on this occasion.

Listening is not enough however. The company must respond quickly and
constructively to the complaints. Because loyal customer account for substantial
amount of company profits, the company should not risk losing a customers by
ignoring a grievance of quarreling over a small amount. Winning back lost customers
is an important marketing activity and often cost less than attraction first time
customers.

Some companies navigate all these pit falls to research their customer value
and satisfaction goals. We call the companies high performance business. Finally, a
highly satisfied customer is

● Stays loyal longer

● Buys more as the companies introduce new products and upgrades existing
products
● Talks favorably about their company and its products/services.

75
● Pays less attention to competing brands and advertising is less sensitive to
price.
● Cost less to serve than new customers because transaction are reutilized

Customer satisfaction is the extent to which a product perceived performance

marches buyer’s expectations. Customer satisfaction with a purchase depends on how
well the product performance lives up to the expectation. It is the key influence on
future buying behavior. Dissatisfied customers often switch to competitors and
disparage the product to others.

If performance exceeds expectations the customers are highly satisfied or

delighted. Smart companies aim to delight customers by promising only what they
can deliver, then delivering more than they promise.

Thus, consumers form judgements about the value of marketing offers and
make their buying decisions based upon these judgements. Customer satisfaction with
a purchase depends on the product’s performance relative to a buyer’s expectations. A
customer might experience various degrees of satisfaction. If the produt’s
performance falls short of expectations, the customer is dissatisfied. If performance
matches expectations, the customer is satisfied. If performance exceeds expectations,
the customer is highly satisfied or delighted.

But how do the buyer’s form their expectations? Expectations are based on the
customer’s past buying experiences, the opinions of friends and associates, and
marketer and competitor information and promises. Marketers must be careful to set
the right level of expectations. If they set expectations too low, they may satisfy those
who buy but fail to attract enough buyers. In contrast, if they raise expectations too
high, buyers are likely to be disappointed. For example, Holiday Inn ran a campaign a
few years ago called “No Surprises”, which promised consistently trouble-free
accommodations and service.

Still, some of today’s most successful companies are raising expectations and
delivering performance to match. These companies embrace total customer
satisfaction. For example, Honda claims “One reason our customers are so satisfied is

76
that we aren’t”. And Cigna vows “We’ll never be 100 percent satisfied until you are,
too”. These companies aim high because they know that customers who are only
satisfied will still find it easy to switch suppliers when a better offer comes along. For
example, a study by AT&T showed that 70 percent of customers who say they are
satisfied with a product or service would still be willing to switch to a competitor. In
contrast, customers who are highly satisfied are much less ready to switch. One study
showed that 75 percent of Toyota buyers were highly satisfied and about 75 percent
said they intended to buy a Toyota again. Thus , customer delight creates an
emotional affinity for a product or service, not just a rational preference, and this
creates high customer loyalty.

Today’s winning companies track their customers expectations, perceived

company performance, and customer satisfaction. However, customer satisfaction
measures are meaningful only in a competitive context. For example, a company
might be pleased to find that 80 percent of its customers say they are satisfied with its
products. However, if a competitor is attaining 90 percent customer satisfaction and
aiming for 100 percent, the company may find that it is losing customers to the
competitor. Thus, companies must monitor both their own and competitors customer
satisfaction performance. Marketing Highlight 18-1 describes the ways in which
companies can track customer satisfaction.

77
 For customer-centered companies, customer satisfaction is both a goal and a
major factor in company success. These and other companies realize that highly
satisfied customers produce several benefits for the company. They are less price
sensitive and they remain customers for a longer period. They buy additional products
over time as the company introduces related products or improvements. And they talk
favorably to others about the company and its products.

Although the customer-centered firm seeks to deliever high customer

satisfaction relative to competitors, if does not attempt to maximize customer
satisfaction.

A company can always increase customer satisfaction by lowering its price or

increasing its services, but this may result in lower profits. In addition to customers,
the company has many stakeholders, including employees, dealers, suppliers, and
stock holders. Spending more to increase customer satisfaction might divert funds
from increasing the satisfaction of these other “partners”. Thus, the purpose of
marketing is to generate customer value profitably. Ultimately, the company must
deliver a high level of customer satisfaction while at the same time delivering at least
acceptable levels of satisfaction to the firm’s other stakeholders. This requires a very
delicate balance: the marketer must continue to generate more customer value and
satisfaction but not “give away the house”.

78
Value Chain

Michael Porter proposed the value chain as the major tool for identifying ways
to create more customer value. Every firm consists of a collection of activities
performed to design, produce, market, deliver, and support the firm’s products. The
value chain breaks the firm into nine value-creating activities in an effort to
understand the behavior of costs in the specific business and the potential sources of
competitive differentiation. The nine value- creating activities include five primary
activities and four support activities.

The primary activities involve the sequence of bringing materials into the
business(inbound logistics), operating on them (operations), sending them out(out
bound logistics), marketing them( marketing and sales), and servicing them(services).
The support activities occur within each of these primary activities. For example,
procurement involves obtaining the various inputs for each primary activity- only a
fraction of procurement is done by the purchasing department. Technology
development and human resource management also occur in all departments. The
firm’s infrastructure covers the overhead of general management, planning, finance,
accounting, and legal and government affairs borne by all the primary and support
activities.

Under the value-chain concept, the firm should examine its costs and
performance in each value creating activity to look for improvements. It also should

79
estimate its competitors costs and performances as benchmarks. To the extent that
firm can perform certain activities better than its competitors, it can achieve a
competitive advantage.

The firm’s success depends not only on how well each department performs
its work, but also on how well the activities of various departments are coordinated.
Too often, individual departments maximize their own interests rather than those of
the total company and the customer. For example, a credit department might decide to
save money by shipping goods by rail; meanwhile, the customer waits. In each case,
individual departments have erected walls that impede the deliver of quality customer
service.

To overcome this problem, companies should place more emphasis on the

smooth management of core business processes, most of which involve inputs and
cooperation from many functional departments. Among other things, these core
business processes include the following:

1. Product development process: All the activities in identifying, researching,

anddeveloping new products with speed, high quality, and reasonable cost.
2. Inventory management process: All the activities involved in developing and
managing the right inventory levels of raw materials, semi finished materials,
and finished goods so that adequate supplies are available while avoiding the
costs of high overstocks.
3. Order-to-payment process: All the activities involved in receiving orders,
approving them, shipping the goods on time, and collecting payment.
4. Customer service process: All the activities involved in receiving to reach the
right parties within the company to obtain service, answers, and resolutions of
problems.

Successful companies develop superior capabilities in managing these and

other core processes. In turn, mastering core business processes gives these
companies a substantial competitive edge. For example, one of Wal-Mart’s great
strengths is its superiority in handling the inventory management and order flow

80
process. As individual Wal-Mart stores sell their goods, sales information flows not
only to Wal-Mart’s head quarters but to Wal-Mart’s suppliers, who ship placement
goods to Wal-Mart stores almost as far as the products move off the shelf.

Measuring customer satisfaction

Organizations are increasingly interested in retaining existing customers while

targeting non-customers; measuring customer satisfaction provides an indication of
how successful the organization is at providing products and/or services to the
marketplace.

C ustomer satisfaction is an ambiguous and abstract concept and the actual

manifestation of the state of satisfaction will vary from person to person and
product/service to product/service. The state of satisfaction depends on a number of
both psychological and physical variables which correlate with satisfaction behaviors
such as return and recommend rate. The level of satisfaction can also vary depending
on other options the customer may have and other products against which the
customer can compare the organization's products.

Because ​satisfaction is basically a psychological state, care should be taken in

the effort of quantitative measurement, although a large quantity of research in this
area has recently been developed. Work done by Berry (Bart Allen) and Brodeur
between 1990 and 1998 defined ten 'Quality Values' which influence satisfaction
behavior, further expanded by Berry in 2002 and known as the ten domains of
satisfaction. These ten domains of satisfaction include: Quality, Value, Timeliness,
Efficiency, Ease of Access, Environment, Inter-departmental Teamwork, Front line
Service Behaviors, Commitment to the Customer and Innovation. These factors are
emphasized for continuous improvement and organizational change measurement and
are most often utilized to develop the architecture for satisfaction measurement as an
integrated model.

Work done by Parasuraman, Zeithaml and Berry (Leonard L) between 1985

and 1988 provides the basis for the measurement of customer satisfaction with a
service by using the gap between the customer's expectation of performance and their

81
perceived experience of performance. This provides the measurer with a satisfaction
"gap" which is objective and quantitative in nature. Work done by Cronin and Taylor
propose the "confirmation/disconfirmation" theory of combining the "gap" described
by Parasuraman, Zeithaml and Berry as two different measures (perception and
expectation of performance) into a single measurement of performance according to
expectation. According to Garbrand, customer satisfaction equals perception of
performance divided by expectation of performance.

The usual measures of customer satisfaction involve a ​survey with a set of

statements using a ​Likert Technique or scale. The customer is asked to evaluate each
statement and in term of their perception and expectation of performance of the
organization being measured.

82
83
 CHAPTER – V
DATA ANALYSIS
AND
INTERPRETATION

84
 DATA ANALYSIS AND INTERPRETATION

1. How do you come to know that About Sangam Diary products?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Electronic Media 64 64

Print media 28 28

Road shows 5 5

Hoardings 3 3

TOTAL 100 100

INTERPRETATION

The above study show that 64% of Sangam dairy customers through electronic
media, 28% from print media , 5% from Road shows , 3% from hoardings.

85
86
 2. Since how many months have you been using Sangam Milk?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

0-6 months 12 12

6-12 months 24 24

1-2 years 24 24

more than 2 years 40 40

TOTAL 100 100

INTERPRETATION

It is observed that majority of the customers are above 2 years, as 24% of the
customers are utilizing the products from about one year and between 1 to 2 years,
remaining 12% of the customers lies between 6 months.

87
88
 3. What is the reason for choosing the Sangam Milk?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

rice 48 48

y service 32 32

image 8 8

s 12 12

AL 100 100

INTERPRETATION

89
 It is mentioned that 48% of the customers prefer because of less price, 32% of
the customers because of its quality, 8% of the customers because of its brand image,
12% of the customers for other reasons.

90
4. Why you use Sangam Dairy milk?

ONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

38 38

uality 24 24

of door delivery 18 18

s 20 20

AL 100 100

INTERPRETATION

In the above study 38% of customer’s prefer for purity, 24&% for Good
quality, 18% for facility of door delivery and 20% for others.

91
92
 5. Are you satisfied with the quality of Milk being provided?

ESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Yes 44 44

No 26 26

To some extent 18 18

can’t say 12 12

TOTAL 100 100

INTERPRETATION

It is observed that majority of the customers felt that the quality is being
maintained by Sangam dairy business women, 26% of the respondents feel that the
quality is not being maintained as per the requirements of the customers.

93
94
 6. Have you faced any problem at the time of usage?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Yes 86 86

No 14 14

TOTAL 100 100

INTERPRETATION

86% of the respondents mentioned that there is no sought of problem

maintained with the levels of quality and other aspects, just a few 14% of the
respondents felt some sought of problems retained with Sangam dairy.

95
96
 7. What are the products you know apart from Sangam Dairy Milk?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Ghee 54 54

Milk powder. Butter 32 32

Mineral water 12 12

All of the above 2 2

TOTAL 100 100

INTERPRETATION

In the above study 54 % of customer’s mentioned ghee, 32% of customer’s

mentioned milk powder & butter, 12% of customer’s opted mineral water and 2% of
customer’s said all of the above.

97
 8. Which brand of Ghee you are using?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Durga 56 56

Nandini 22 22

Madura 10 10

uying in market and boiling 12 12

TOTAL 100 100

INTERPRETATION

98
 It is observed that 56% of the customers opting durga brand, 22% of the
customers preferring nandini brand, where as 10% of them giving importance for
madhura and rest of them preferred to go for traditional methodology.

99
 9. What is the reason behind using other brands of Ghee but not Sangam?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Taste is good 38 38

Good smell 22 22

Good boiling 12 12

naware of Sangam products 28 28

TOTAL 100 100

INTERPRETATION

38% of the customers prefer because of its taste, 28% of them because of its
loyalty, 12% of the customers as it is of good boiling, 22% of its good smell.

100
101
 10. How do you like about Basundi of Sangam Dairy?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Yes 74 74

No 26 26

TOTAL 100 100

INTERPRETATION

74% of the respondents prefer basundi of Sangam as the rest of them are not
able to give an importance among the basundi for Sangam dairy.

102
 11. Your opinion on Sangam Dairy products?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Good 69 69

Not well 2 2

Average 29 29

TOTAL 100 100

INTERPRETATION

In the above study 69% of customer’s opinion felt good, 29% of customer’s
opinion felt average and 2% of customer’s opinion not well.

103
104
 12. Do you know Sangam Dairy is an “ISO” certified company?

ESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Yes 86 86

No 14 14

TOTAL 100 100

INTERPRETATION

In the above study 86% of customer’s said Sangam Dairy is tend to be an

“ISO” certified company, as 14% of customer’s felt the standards may not be properly
applied.

105
 13. Are you aware of full range products of Sangam Dairy?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Yes 74 74

No 26 26

TOTAL 100 100

INTERPRETATION

The above study showcases that 74% of customers felt that the Sangam dairy
products are aware, where as 26% of the customers felt that there is no such kind of
awareness.

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 14. Which Type of milk you are using?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Dairy milk packet 96 96

Vendor milk 4 4

TOTAL 100 100

INTERPRETATION

It is observed that 96% of the respondents are using dairy business women
milk packets, where as 4% of the other respondents utilizing the milk from vendors.

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 15. What is the reason for buying from vendors?

RESPONSE FROM THE OF RESPONDENTS PERCENTAGE

CUSTOMERS

Free door delivery 56 56

Taste 24 24

Fresh 15 15

Debt facility 5 5

TOTAL 100 100

INTERPRETATION

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 It is observed that majority of the customers purchasing products because of
its free door facility, 24% because of taste, 15% of them because of its freshness, 5%
because of its debt facility.

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 CHAPTER – VI
FINDINGS, SUGGESTIONS
AND CONCLUSION

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FINDINGS

The following are some of the findings observed during the course of study

It is observed that the brand image of Sangam dairy is not able to cope up the
competition levels compared to other dairy products available in the coastal
region.

It is found that lack of proper promotional activities also one of the underlying
factors in lack of awareness among some of the customers.

Maintaining very important aspects such as quality, timely delivery is missing in

some of the regions.

Maintaining fat content rate is also one of the factor to be considered.

Making the customers know regarding the other dairy products available with
Sangam dairy.

Few of the customers are unaware about the milk and milk products provided by
Sangam dairy.

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SUGGESTIONS

On careful observation of Sangam Dairy during the training period I have the
following suggestions for Sangam Dairy which on proper implementation may
provide a big boost to it​.

● As the advertisement plays a major role in creating awareness. The company

should release ads in TV​.
● The company should re-design the packing so that it is easy to recognizable by the
customer.
● The company can have an opportunity to tie-up with the retail shopping malls to
provide milk products in the mall as the retail business is growing very highly in
India.
● Implementation of effective marketing strategies because new competitors are
entering into the market.
● Advertising should be made in more number of channels about products.
● All information regarding Sangam Dairy and its product should be available on
internet.
● Motivation programs for booth and parlor owners are required to some extent.
● Glow sign boards should be provided to booth and parlor owners​.
● Inspection and frequent check of booths and parlors.
● To popularize one of the milk product, ”BASUNDI” free samples may be
distributed at some public places.

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CONCLUSION

India has been largest milk producer in the world since 1988 and milk
production has consistently improved over the past two decades. The demand for milk
and milk products is being gradually increased but the production is not being
increased to match with that of demand.

When customers rate their satisfaction with an element of the company's

performances say delivery, we need to recognize that customers win vary in how they
define good delivery; it could mean early delivery, on-time delivery, order
completeness and so on yet if the company had to spend out every element in detail,
customers would force a huge question noise. We must also recognize that two
customers can report being highly satisfied for different reasons. One may be easily
satisfied most of the time and other might be hard to please but "vas pleased on this
occasion

Listening is not enough however. The company must respond quickly and
constructively to the complaints. Because loyal customer account for substantial
amount of company profits, the company should not risk losing a customers by
ignoring a grievance of quarreling over a small amount. Winning back lost customers
is an important marketing activity and often cost less than attracting customers for the
first time..

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QUESTIONNAIRE

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 APPENDIX

QUESTIONNAIRE ON CUSTOMER SATISFACTION OF SANGAM

DAIRY PRODUCTS

Name of customer :

Profession :

Address :

1. Which Type of milk you are using?

A)Dairy milk packet B)Vendor milk

2. Why you buy on vendor?

A) change in weight B) Not getting of dairy milk
C) Free door delivery D) Debt facility
E) Taste F) Fresh

3. Which dairy milk you are using?

A) sangam B) Tirumala
C) Sangam D) Dodla
E) Reliance

4. Why you use Sangam Dairy milk?

A) Purity B)Doing faschurization
C) Not getting any where D) Booth is near to my home
E) Good quality G) Facility of door delivery

5. What are the reasons for not using Sangam Dairy milk?
A) Quality is less B) Not store for long time

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 C) High price D) Less stability of curd
E) Far of milk booth F) Not getting pre determined weightage
6) How many liters you are using per day?
A) ½ liter B) 1 liter C) 1 ½ liter D) Less than ½ liter E) More than 1liter

7) Where did you find the symbol except Sangam milk packet?
A) E.TV B) Gemini. TV C) wall D) Hoardings E) No where

8. What are the products you know apart from Sangam Dairy Milk?
A) Ghee B) Flavored milk
C) Milk powder. Butter D) Butter milk. Curd
E) Basundi.doodhpeda F) Mineral water
G) All of the above

9. Which brand of Ghee you are using?

A) Durga B) Sangam C) Nandini D)Madura E) Buying in market and boiling

10) Why you are using other brands of Ghee ! Not Sangam
A) Taste is good B) Good smell
C) Good boiling D) Less price
E) Not knowing to Sangam product

11. Did you eat Sangam Dairy product “BASUNDI”​ ​?

A) Yes B) No C) Not known

12. Your opinion on Sangam Dairy products?

A) Good B) Not good C) Average

13.Do you know Sangam Dairy is an “ISO” certified company?

A) Yes B) No

14. Are you aware of full range products of Sangam Dairy?

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A) Yes B) No

BIBLIOGRAPHY

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 BIBLIOGRAPHY

● Www.Nddb.Com
● Www.Indiadairy.Com
● Www.Wikipedia.Com
● Www.Mymba.Com
● Www.Management​ Paradise.Com
● www.sangamdairy.com

TEXT BOOKS

● Principles of marketing-Philip Kotler

● Marketing management-V.S Rama Swamy

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