AMUL

Distributor in and around

Delhi/NCR covered in project
Vishnu Milk Product Dairy
Durga Dairy
Anand Mik Agency
R P Traders
Pappi Distributors

DISTRIBUTION CHANNEL OF AMUL

The main objective of distribution channel of Amul is to provide best quality
products to consumers at affordable price while giving maximum possible return
to its suppliers.
This dual objective of satisfying consumers as well as suppliers has led Amul to find
innovative ways to manage its network effectively and make lean and efficient
supply-chain.
Amul has chosen intensive channel to ensure that its product should be available
everywhere even in rural areas. Following are the channel intermediaries of Amul:
Agents, Distributors/Wholesaler and retailers
Amul Parlours
Exclusive Amul Outlets


We are considering two products of AMUL which are milk and ice-cream and we
are also comparing each of the aspect with its closest competitor i.e. Mother
Dairy

Product n Prices
AMUL

Packet milk sold/day = 1.5 millions
Total number of retail outlet = 9,000
Presence in Delhi = 5 years
Strength = Strong brand name.
Amuls Strategy: To increase number of retail
outlets in Delhi to push up sales.

Members
13 district cooperative milk producers' Union
No. of Producer Members
2.79 million
No. of Village Societies
13,328
Total Milk handling capacity
11.22 million litres per day
Milk collection
3.05 billion litres
Milk collection Daily Average
8.4 million litres
Milk Drying Capacity
626 Mts. per day
Cattle feed manufacturing Capacity
3500 Mts per day

Each distributors caters to about 100
retailer in Delhi. This number varies
with region to region. In Gurgaon and
Faridabad, this figure varies from 35 to
80.

AMUL
Delhi 200 approx
Gurgaon 8-10
Faridabad 12
Number of distributors
Channel Members Margin

Distributors: The margin of distributors
depends on the sales volume. Amul
encourages higher sales of milk through
various reward schemes. Generally Rs.1.80
per crate is the margin of distributors. Apart
from this they also get some incentives if they
achieve certain target which distributors term
as Base volume of sales. Amul launches many
schemes for distributors.

Conted
Wholesalers: There are two types of wholesalers: (1) those who
buy milk from company itself. Their margin is similar to the
distributors. (2) Those who buy milk from distributors and sales to
retailers. They get a margin of Rs 3.60 to Rs. 4.80 per crate. For
example, if milk is Rs. 32 per Kg then distributors sells it to retailers
at Rs. 31.20. It means retailers and wholesalers have to share a
margin of 80 paise between them. Now the actual margins of
wholesalers depend upon the environment (like competition, rural
or urban area) and their relationship with retailers.
Retailers and other grocery stores: They get margin of 40 paise to
80 paise per litre of milk depending on either they are buying
directly from distributors or from wholesalers. If they buy directly
from the distributors then they get a margin of 80 paise per litre
but fewer margins in other case.

Payment System

The payment to the company is done by the
distributors through account and the payment
to the distributors is also done through
account.

Infrastructure Requirement

AMUL does not help in any sort of
infrastructure; however, it facilitates the
distributors to gain financial help from the
bank. AMUL acts as a guarantor to help get
loans.

AMUL PARLOURS
Amul Parlours requires some attention here as it is new and successful
channel: They have classified Amul parlours into five categories namely
Centre for Excellence: These Amul parlours are specifically at a place
which is known for centre of excellence on its own. We can find such
parlours at IIMA, Infosys campuses etc.
On the Move: These parlours are at different Railway stations and at state
bus depots across different cities.
Amul Parlours: These parlours can be seen at different gardens across
different cities. These are fully owned by Amul.
Amul Preferred outlets: These are the private shops (Franchises) which
sells entire range of Amul products. They also agree not to keep
competitors brand in the outlet.
Scooping Parlours: These parlours are especially for Amul Ice creams.
There are 4968 approvals for Amul parlours till now.


Channels through which AMUL sells it
products

AMUL
Agents, Distributors/Wholesaler and retailers
Amul Parlours
Exclusive Amul Outlets
Internet ( Amul Cyber stores)

MARKET LOGISTICS AND
TRANSPORTATION
Amul pays Rs. 4.50 per crate Rs. 4. 80 per crate
to the distributors for transportation. The
variation in margin depends on the location. One
distributor sells nearly 400-500 crates per day in
Delhi. (1 crate = 12 litres)
AMUL Margin for transporter

Rs. 4.80 per crate (Delhi)
Rs. 4.50 per crate (Gurgaon)

CAPACITY UTILIZATION:

The capacity of the truck various from 350
crates to 800 crates. This depends on the
number of crates the distributor is able to sell.
A small lorry can carry 350 crates where as a
large lorry can 800 crates. The lorry is owned
by the distributors.

AMUL ICE CREAM
Number of distributors


RP Traders
Haryana Traders

Territory

The whole of the Gurgaon is divided into two
regions
Left to the NH8
Right to the NH8
Conted
Each distributor serves around 170 to 180
retailers under him. That comes out to be
around 350 retailers selling Amul ice-cream in
the Gurgaon region.
The reason for such low number of retailers
selling ice cream is that investment is required
by the retailers in terms of money and space
for holding ice-creams.

Margins provided by the company

The company provides a margin of 17.5 % on the
MRP to the retailers for the ice-cream,
Also the company provides a margin of 8 % to the
distributor.
That means if the MRP of the ice cream is 100
rupees the retailer gets the ice-cream from the
distributor at the price of Rs 82.5
That is the selling price to the distributor. On
which he earns a margin of 8 %
That means the company gives that ice cream to
the distributor at the Price of Rs 75.9

Ordering Ice cream


The distributor orders the required ice cream through an
Email.
Generally the company takes around 24- 48 hours to
deliver the goods.
The distributor takes the order from the retailers through
the telephone.
Transportation of ice cream


The company transports the ice cream to the
distributors without any charge. Similarly, the
distributor charges the ice cream to the retailers
without any charge.
The company uses it own trucks to transport the
ice cream whereas the distributor has his own
trucks to distribute the ice cream to the retailers.


New Distribution strategy-of Amul :
Amul Preferred Outlet



Amul has justified its undisputed leadership in
foods business by creating 5000 Amul
preferred outlets in a record time which
exclusively sell wide range of Amul products.
This has been possible due to strong brand
equity and immense consumer support.

The criteria for selection of APOs
would be
Visibility - How prominent is the location of your shop?
Shop area: 100 - 300 sq. ft.
Good Business potential
Exclusive Amul outlet - no other products are to be sold
Renovation Work of the Shop to give it a standard look - would be done to meet the design and
specifications at your cost. The cost of renovation of a typical shop would normally be between Rs.
60,000 to Rs. 1 lac.
Branding- The cost of the signages fabrication and installation is borne by GCMMF Ltd.
Equipment- You would require the following equipment:
1or 2 deep freezers (Can be purchased through Hamara Apna Deep Freezer Scheme )
1 pizza oven
1 Chest Milk Cooler for Pouch Milk
Security Deposit- You would be required to furnish an interest free refundable security deposit of
Rs. 25,000 to us locked in for one year. The entire amount would be forfeited in case the parlour
closes down within the first year of operation.
Supplies- The delivery of products would be done through our wholesale dealers.
Agreement- An agreement bringing us together would be signed.