Vino KMF Project

MARKET POTENTIALITY OF NANDINI SET CURDS
RNSIT Dept of MBA Page 1

EXECUTIVE SUMMARY
Set curds and milks are a basic food in many societies where cattle and other animals
form an important part of the agricultural production system. If you review the history of
dairying in most the European and North American countries, one sees the share of liquid
milk and set curds in the dairy industry changing over of economic and technological
development in their societies.
In developing countries like India depending on the level of the dairy industry,
products range from a few indigenous dairy products and raw milk to pasteurized liquid milk
and set curds and a small proportion of other "LUXURY" products. Thus liquid milk is still
the most important base f
or developing the dairy industry in developing countries.
India has become the worlds No. 1 milk producing country, so it is also rich in set
curds with output in the year 1999-2000 (marketing year ending March 2000) forecasted at
78 million tonnes. In the India context of poverty and malnutrition, milk has a special role to
play for its many nutritional advantages as well as providing supplementary income to some
70 million farmers in over 500,000 remote villages.
After liberalization Indian market is open to wide competition in both consumer
market as well as industrial market. Industrial buying process is influenced by so many
factors. Before purchasing raw materials they conduct an intense discussion and buying
process passes through different stages and finally adopt suitable one.
Consumers consider many factors like quality service, price availability of
materials etc while purchasing the raw materials.
The main objective of this study is to know the Market potentiality of Nandini
set curds in Bangalore City.
The methodology of this study was collection of data through structured
questionnaire and personal interview with consumer in various areas of Bangalore city. The
sample size was 50 at simple random sampling method. Then evaluation of collected data is


taken place. Most of the people using ordinary curds and know people buying set curds
because it has good quality and freshness.
This study has that the quality of the set curds should be improved. A certain
amount of rebate is being given to huge buyers of Nandini set curds. The company should
facilitate credit transaction to customers. The advertisement of Nandini set curds to be
expressed regularly and should be very creative and effective to the fullest extent.
It can be concluded that Nandini is one such a brand, which has entered the
daily life of the customers. It has the monopolistic market in Nandini set curds and can be
utilized fully. KMF is one such organization where, it is striving hard for its customer
satisfaction. This project report at the end gives some suggestion, if adopted can lead to
much higher development in sales.



1. INDUSTRY PROFILE
Dairy is a place where handling of milk and milk products is done and technology refers to the
application of scientific knowledge for practical purposes.
Dairy technology has been defined as that branch of dairy science, which deals with the
processing of milk and the manufacture of milk products on an industrial scale.
In developed dairying countries such as the USA, the year 1850 is seen as the dividing line
between farm and factory scale production. Various factors contributed to the change in these
countries viz., concentration of population in cities where jobs were plentiful, rapid
industrialization, improvement of transportation facilities, development of machines etc.,
whereas the rural areas were identified for milk production, the urban centers were selected for
the location of milk processing plants and product manufacturing factories.
These plants and factories were rapidly expanded and modernized with improved
machinery and equipment to secure the various advantages of large-scale production. Nearly all
the milk in the USA before 1900 was delivered as raw (nature) milk. Once pasteurization was
introduced, it developed rapidly. Mechanical refrigeration helped in the rapid development of the
factory system of market distribution.
Milk
Milk may be defined as whole, fresh, clear lacteal secretion obtained by the complete
milking of healthier milk animals. It represents the perfect food for man nearly than any other
natural food. An adequate consumption of milk can correct dieting deficiencies for most people
strong, healthy bodies. It is delicious and appetizing food as well as being healthful.
The major constituents of milk are water, fat, protein, lactose and mineral water. The minor
constituents are phospholipids, sterols, vitamins, enzymes, pigments etc. The true constraints are
milk fat, casein and lactose.
Milk is absolutely essential for the welfare of the human race. The cow has been rightly called,
The Foster Mother of Human Race and she is found in most of the civilized countries of the
earth.



Asian Dairy Scene
With 60% of the world population, Asia accounts for only 20% of the global milk production.
The total world production of more than 500 million tons for a population of about 4 billion
amounts to an average annual per capita availability of 100kg. The corresponding figure for Asia
is only about 27 kg and the consumption is about 30kg. Some 10% of milk consumed in Asia is
imported. In several Asian countries, imports of dairy products, both as finished products in
consumer packs and in bulk for recombination in to milk have helped create a dairy market and a
milk processing industry.
The Asian countries have been producing over 96% of the worlds buffalo milk output,
estimated at 48 million tones, India accounts for more than 30% of it. The recent formation of
the Asian Buffalo Association will help overcome the neglect that the buffalo has suffered for
decades.
Dairy in India
In India, dairying has been practiced as a rural cottage industry since the remote part.
Semi-commercial dairying started with the establishment of military dairy farms and co-
operative milk unions throughout the country towards the end of nineteenth century.
During the earlier year, each household in those countries maintained its family cow or secured
milk from its neighbor who supplied those living close by. As the urban population increased,
fewer households could keep a cow for private use.
The high cost of milk production, problems of sanitation etc., restricted the practice, and
gradually the family row in the city was eliminated and city cattle were all sent back to the rural
areas.
The Indian dairy industry has made rapid progress since independence. A large number of
modern milk plants and product factories have since been established. These organized dairies
have been successfully engaged in the routine commercial production of pasteurized bottled milk
and various western and Indian dairy products. With modern knowledge of the protection of milk
during transportation, it become possible to locate dairies where land was less expensive and
crops could be grown more economically.


In India, the market milk technology may be considered to have commenced in 1950 with the
functioning of the Central Dairy of Aare milk colony, and milk product technology in 1956 with
the establishment of AMUL dairy, Anand. The industry is still in its infancy and barely 10% of
our milk productions under goes organized handling.

History of Indian Milk Industry
Organized milk handling was made in India with the establishment of
Military Dairy Farms.
Handling of milk in co-operative milk unions established all over the
country on a small scale in early stages.
Long distance refrigerated rail-transport of milk from Anand to
Bombay since 1945.
Pasteurization and bottling of milk on a large scale for organized
distributed was started at

Aarey 1950
Calcutta(Haringhata) 1958
Delhi 1959
Worli 1961
Madras 1963

Establishment of milk plants under the 3- year plans for dairy
development all over India. They were taken up with the dual object of
increasing the national level of milk consumption and ensuring better
returns to the primary milk producer. These main aims were to
produce more, better and cheaper milk.
In terms of percentages we have 51% of the Asian population.



Amul
A situation prevailed in the case of milk about 30 years ago; when the exploitation by middlemen
had forced the milk producers to sell milk at throw prices. The answer to such a situation was
found in developing a system that enables milk producers to own and operate not only their
processing facility, but also the inputs, delivery machinery, and the marketing of finished
products.
The integrated approach first proved very successful in Kaira-the AMUL organization
and through the Operation Flood Program, aimed to establish similar farmers organizations in
18 districts in the country. The Program when implemented did face some preliminary problems,
but these were overcome, so much so that when the IBRD and World Bank came forward to
finance dairy projects in Karnataka, Rajasthan and Madhya Pradesh.
The results were that 12 milk producers co-operative unions were established. Based on
the success of these 30 unions, bodies owned by the farmers themselves, the other phase of dairy
development, Operation Flood II, being implemented to bring the total number of such district
unions to 155, and cover some 10 million farmers.
The success of these 30 unions have further demonstrated that problems can best solved if the
agency implementing the program is owned and operated by the producers themselves, who
employ the best professionals that the responsibility of such an organization is not only to
guarantee a remunerative market for the rurally produced commodity by its member producers,
but also guarantees a package of input for enhancing production (milk) and ploughs back the
profit for further development. Again, in the case of milk, since marketing of the product was
largely controlled by middlemen/trade/cattle keepers/etc., the organized dairy was not in a
position to pay a better price to the milk producers. Market intervention was therefore required to
enable these dairies to supply milk to the consumers at reasonable prices. This was the first time
that food aid skimmed milk powder, and butter oil in this case-was used to prime the pump of the
modern dairies in four metropolitan cities (Calcutta, Bombay, Delhi and Madras), and permit
them to demand on all much large scale. The funds generated through the sale of skimmed milk
powder and butter oil were used to build up farmers organizations in the milk sheds those
supplies to these metropolitan cities.


2. COMPANY PROFILE
2.1 BACKGROUND OF THE COMPANY
Karnataka Milk Federation which is most popular as KMF evolved itself as a premier and most
profitable dairy farmers' organization in the State of Karnataka.
As an agency in 1975 to implement the World Bank Aided Dairy Development Projects,
Karnataka Dairy Development Corporation (KDDC) was formed, the company grew itself fast
and as it spreads the wings of new found rural economic activity - Dairying all over the State, the
genesis of apex cooperative body took the shape of KMF in 1983 encompassing entire State with
13 District Co-operative Milk Unions executing the various parameters of Dairy activity -
organization of Dairy Co-operatives, Milk Routes, Veterinary Services, Procurement of milk in
two shifts of the day, Chilling, Processing of milk, distribution of milk and also establishment of
Cattle Feed Plants, Nandini Sperm Station, Liquid Nitrogen Supply, Training Centers - as its
main stay.
The entire system was reconstructed on the model of now well-known `ANAND' pattern dairy
cooperative societies. Eight southern districts of Karnataka was considered initially with a target
of organizing 1800 Dairy Co-operative Societies, four Milk Unions and processing facilities
were set up to the tune of 6.5 lakhs per day by 1984.
Under Operation Flood - II &III, project which started in 1984 & 1987 covered the remaining
parts of Karnataka. Thirteen milk unions are organized in 175 taluks of all 20 districts then and
the field work was extended by organizing more dairy cooperative societies. The processing
facilities i.e. chilling centers, milk dairies and powder plants were transferred in phases to the
administrative control of respective cooperative milk unions and the activities continued to be
implemented by these District Organizations. Additional processing facilities were created &
existing facilities augmented every decade with the help of Govt. / ZillaPanchayat and NDDB to
handle ever increasing milk procurement without declaring milk holidays. The processing
facility as exists at 32.25 lakh liters/day is further strengthened.


2.2 NATURE OF BUSINESS CARRIED
Karnataka Cooperative Milk Producers' Federation Limited (KMF) is the Apex Body in
Karnataka representing Dairy Farmers' Co-operatives. It is the second largest dairy co-operative
amongst the dairy cooperatives in the country. In South India it stands first in terms of
procurement as well as sales. One of the core functions of the Federation is marketing of Milk
and Milk Products. The Brand "NANDINI" is the household name for Pure and Fresh milk and
milk products.
KMF has 13 Milk Unions throughout the State which procure milk from Primary Dairy
Cooperative Societies (DCS) and distribute milk to the consumers in various Towns/Cities/Rural
markets in Karnataka.
The first ever World Bank funded Dairy Development Program in the country started in
Karnataka with the organization of Village Level Dairy Co-operatives in 1974. The AMUL
pattern of dairy co-operatives started functioning in Karnataka from 1974-75 with the financial
assistance from World Bank, Operation Flood II & III. The dairy co-operatives were established
under the ANAND pattern in a three tier structure with the Village Level Dairy Co-operatives
forming the base level, the District Level Milk Unions at the middle level to take care of the
procurement, processing and marketing of milk and the Karnataka Milk Federation as the Apex
Body to co-ordinate the growth of the sector at the State level.
Coordination of activities among the Unions and developing market for Milk and Milk products
is the responsibility of KMF. Marketing Milk in the respective jurisdiction is organized by the
respective Milk Unions. Surplus/deficit of liquid milk among the member Milk Unions is
monitored by the Federation. While the marketing of all the Milk Products is organized by KMF,
both within and outside the State, all the Milk and Milk products are sold under a common brand
name NANDINI.



2.3 VISION MISSION AND QUALITY POLICY
VISION:
To march forward with a missionary zeal which will make KMF a trailblazer of exemplary
performance and achievements beckoning other Milk Federations in the country in pursuit of
total emulation of its good deeds
To ensure prosperity of the rural Milk producers who are ultimate owners of the Federation.
To promote producer oriented viable cooperative society to impart an impetus to the rural
income, dairy productivity and rural employment.
To bridge the gap between price of milk procurement and sale price.
To develop business acumen in marketing and trading disciplines so as to serve consumers with
quality milk, give a fillip to the income of milk producers.
To compete with MNCs and Private Dairies with better quality of milk and milk products and in
the process sustain invincibility of cooperatives.
MISSION:
Heralding economic, social and cultural prosperity in the lives of our milk producer members by
promoting vibrant, self-sustaining and holistic cooperative dairy development in Karnataka State.
QUALITY POLICY:
To ensure pure, hygienic milk and milk products through continuous improvement of quality
standards.
VALUES:
Cleanliness
Total quality maitenance
Discipline, Co-operation
Transparency
Honesty

OBJECTIVES


KMF is a Cooperative Apex Body in the State of Karnataka representing organizations of
milk producers' and implementing all-round dairy development activities to achieve the
following objectives:
To build & develop village level institutions as cooperative model units to manage the
dairy activities.
To make available quality milk and other premier dairy products to urban consumers.
To ensure provision of inputs for milk production, processing facilities and dissemination
of know how.
To facilitate rural development by providing opportunities for self-employment at village
level, preventing migration to urban areas, introducing cash economy and opportunity for
a sustained income.
Human Resource Development
There are at present 20.35 Lakh dairy farmers as primary members including 3.5 Lakhs of SC/ST
and 6.6 Lakh woman members.
Dairy Co-operatives employ more than 32000 people and 5200 are permanent KMF Units and
Unions employees.
Indirect employment thro' veterinary services, milk transportation, milk sales etc. activities is to
the tune of 52000 people.
This sector has also created demand and employment in manufacturers of equipments required
by DCS, Dairies, printing and the like.

Quality and Food Safety



During the last ten years, the Federation is giving greater emphasis on procuring quality milk
from DCSs under the concept of Quality Excellence from Cow to Consumer. Many Clean
Milk Production (CMP) initiatives have been implemented at all the stages of procurement,
processing and marketing. Among these CMP initiatives, noteworthy initiative is the setting up
of Community Milking Parlours in villages.
The KMF is forerunner to introduce this innovative technological initiative for bringing about
revolutionary improvement in quality of milk collected in DCSs. This system has several
advantages such as elimination of mastitis in milch animals and improvement of productivity.
The milk from milking machines, collected through Automatic Computerized Milk Collection
Units is chilled directly in Bulk Milk Coolers. This chilled raw milk, untouched and
unadulterated by human hands, has very high microbiological quality, comparable to
international standards. This high quality milk is being utilized for manufacturing high quality
value added milk products, for both domestic as well as international markets.
Other Clean Milk Production (CMP) Initiatives include: -
Training of milk producers on modern dairy husbandry practices and CMP.
Providing SS utensils, antiseptic solutions for udder cleaning on pre and post milking,
etc. to producers.
Training to DCS staff and officers of the Unions on CMP.
Replacing Aluminium milk cans and collection vessels with SS 304.
Posters, documentary films and booklets on Clean Milk Production.


"NANDINI" invites export inquiries
"Nandini" has, over the years, grown to have now become the 2nd largest brand in the co-
operative dairy industry in India and the undisputed leader in the South India. Karnataka Milk
Federation (KMF) and the milk Unions affiliated to it are handling, on an average, over 5.2
million kgs. of milk PER DAY. A very wide range of milk products- of short and long life- are
made in well-equipped hygienic manufacturing facilities (ISO certified/HACCP compliant)
staffed by highly qualified and experienced professionals and skilled workmen.
Within the framework of the export policy laid down by Government of India from time to time,
KMF has resolved to undertake export of its products after the completion of all the required
export formalities. KMF is planning to export the following products, they are.
Butter (Salted and Unsalted).
Ghee (Clarified Butter).
UHT Milk in Tetrapak containers.
Ethnic Indian Sweets with long self-life in frozen format.
Milk Powders.

2.4 PRODUCTS/SERVICES:


The following are Milk and Milk Products of KMF:
TONED MILK:
Nandini toned fresh and pure milk containing 3.0% fat and 8.5SNF, available
in 500ml and 1ltr packs.

SHUBHAM:
Buffalos milk, 100% pure pasteurized processed and packed hygienically,
this milk has 5% fat and 9% SNF. Available in 500ml and 1litres packs. It is
also available in 5 litres packs for marriages and other functions.

FULL CREAM MILK:
Full cream milk, containing 6% FAT and 9% SNF. Rich, creamier tastier
milk, ideal for preparing home-made sweet. Available in 500ml and 1ltrs
packs.

HOMOGENIZED TONED MILK:
Nandini homogenized milk is pure milk. Which is homogenized and
pasteurized, consistent right through, it gives you more cups of tea or coffee
and is easily digestible. Available in 500ml packs.

CURD:


Nandini curd made from pure milk, its thick delicious goodness of homemade
curds.
MILK POWDER:
Skimmed Milk Powder made from pure milk, processed and packed
hygienically. Available in 100 gms, 200 gms, 500 gms, 1kg & 25 kg pack.

BUTTER:
Rich, smooth, delicious, Nandini butter is made out of fresh pasteurized
cream, rich taste, smooth texture and the rich purity of cows milk makes
any preparation a delicious treat. Available in 100 gms (salted), 200 gms and
500 gms.
PEDA:
Made from pure milk, Nandinipeda is a delicious treat for the family. It will
be store at room temperature approximately 7 days. Available in 250
gmspack containing 10 pieces each.
GHEE:
Nandini ghee made from pure butter. It is fresh and pure with a delicious
flavour, hygienically manufactured and packed in a special pack to retain
the goodness of pure ghee. Life of ghee is 6 months at ambient temperature.
Available in 200 ml, 500 ml, 1000 ml sachets, 5 litres tins and 15 kgs tins.

2.5 AREAS OF OPERATION


Regional and national.

2.6 OWNERSHIP PATTERN
Karnataka Cooperative Milk Producers' Federation Limited (KMF) is the Apex Body in
Karnataka representing Dairy Farmers' Co-operatives.
Co-operative firm which is undertaken by Govt of Karnataka builds and runs under the co-
operative institutions such as
District Co-operative Society. (DCS)
National Dairy Development Board. (NDDB)

DISTRICT CO-OPERATIVE SOCIETY:
It is basic organization unit, functioning at a village level, by training local people to
organize and manage the activities village level institution building and development of local
leadership is promoted.

FUNCTIONS:
It functions daily and acts as a marketing outset for the milk produced in the village
Input facilities are also canalized to the dairy formers through these societies and include
veterinary first aid, sale of cattle feed, supply of fodder seeds, seedling and provisions of
mobile veterinary health care etc..
Payment for milk is done through society.
NATIONAL DAIRY DEVELOPMENT BOARD
The NDDB was established in 1965; the board is registered under the societies Registration Act
and the public Trust Act, fulfilling the desire of the Prime Minister of India - the late Lal
Bahaddur Shastri to extend the success of the Kaira Co-operative Milk producers union (AMUL)
TO OTHER PARTS OF India. Dr Vergese Kurien was the founder chairman.



Services rendered by NDDB:
NDDB provide the following services.

Planning dairy and rural development projects.

Organization of farmer co-operative societies.

Setting up of dairy and cattle feed plants.

Manpower planning and training.

Applied research and development.

Implementation of milk production enhancement programme.

2.7 COMPETITORS
Amul: the largest player in Indian dairy industry and leading
brand is major competitor in this category with good market
share , loyal customers , great brand image, and is known for its
high quality standards and premium range of milk and milk
products and following high quality manufacturing, packing and distribution practices.

Heritage: Heritage is recognized as one of India's largest and
most successful Dairy for the last 18 years. Based in
Hyderabad with an existing brand presence in Andhra
Pradesh, Tamilnadu, Karnataka, Kerala and Maharastra.


Heritage is known for its high quality standards and premium range of milk and milk
products and following high quality manufacturing, packing and distribution practices.
Heritage is now become the ISO 22000 certified company

BRITANNIA: Britannia Industries Limited is an Indian
food-products corporation based in kolkota India. Dairy
products contribute close to 10 per cent to Britannia's
revenue. Britannia trades and markets dairy products, and its
dairy portfolio grew to 47% in 2000-01 and by 30% in 2001-
02. Britannia holds an equity stake in dynamix dairy and outsources the bulk of its dairy
products from its associate.

DANONE: Group Danone is a French food-products
multinational corporation based in the 9th arrondissement of
Paris, Danone India, a group involved in businesses Fresh
Dairy Products, Baby Nutrition, Bottled Water, and Medical Nutrition has roped in
Karishma Kapoor as its new brand ambassador.

NESTLE: it is a Swiss based food-products multinational
corporation. leading brand is major competitor in this category
with good market share , loyal customers , great brand image,
and is known for its high quality standards



2.8 INFRASTRUCTURAL FACILITIES:

Statutory Facilities:
Canteen facilities,
Provision of toilets, restroom sittings,
Uniform are provided,
Provision of wash basins,
Security facilities
Shifts facilities-3 shifts per day
Payment of PF,
Leave facilities,
- Casual leave 15 days,
- Sick leave 10 days
- Earned leave 30 days
Medical benefits,
- In patient Rs. 5000
- Out patient Rs. 3000
Non-statutory facilities:
Celebration of kannada rajyothsva.
Training programme for employee development.
Factory arranges cultural programs at the time of Ganesh Chaturthi,
workers day, Deepavali.
Factory often conducts demonstration through social workers in respect of
family planning, AIDS awareness, etc.
Staff members children will be provided with gift for scoring in SSLC,
PUC



2.9 ACHIEVEMENT/AWARDS
Organization of dairy cooperative socities-1192, DCS functional-1112, Membership
(nos.) - 172113, Average Milk Procurement (TKGPD) - 340269, DCS under IB programme-45,
Number of first centers-370, Women Memberships (nos.)-55708, Number of AI done- 25219,
Number of cluster AI centers-80, Fodder seed sales - 96, Fodder slips supply 25 lakhs, DCS
under CMP - 700, Average Milk Sales LPD-121858, Average curd Sales/day - 10850

KMF has got to 4 awards
National Energy Conservation Award -2004
Received on 14
th
Dec from Dr. Manamohan Singh, Prime Minister of India.

National Energy Conservation Award-2005.
Received on 14
th
Dec from Dr. A.P.J. Abdul Kalam, President of India.
National Energy Conservation award-2006.
Received on 14
th
Dec from Honorable Power Minister ,Sushilkumar

National Energy Conservation award-2007.
Received on 14
th
Dec from PratibhaPatil, President of India.

ISO-9001:2000 certification



2.10 WORK FLOW MODEL
Production process has the following work flow model

2.11 THE GROWTH


PROCESS
The growth over the years and activities undertaken by KMF is summarized briefly hereunder:
KEY ITEMS

1976
-77
2011-2012(Up to
Mar'12)
2012-13(Upto
FEB'13)
Dairy Co-operatives Nos 416
13006 REGED / 11568
Funct
13553 REGED /12036
Funct
Membership Nos
3700
0
21.51 Lacs 22.16 Lacs
Avg. Milk Procurement Kgs/day
5000
0
Avg.42.85
Peak Proc.46.49(Nov
'11) LKPD
Avg.49.55
Peak Proc.54.56(Nov'12L
KPD)
Milk Sales Lts/day
9505
0
28.90 LLPD /
Curd:2.74 LKPD /
Good life 2.19 LLPD
29.94 LLPD / Curd:3.01
LKPD / Good life 2.33
LLPD
Cattle Feed Consumed
Kgs/DC
S
220 2958 2608
Daily Payment to Farmers
Rs.Lakh
s
0.90 785 968
Turnover
Rs.Cror
es
5823.69 ----------
World Bank Study - Observations
The World Bank, in its study on the effect of Co-operative dairying in Karnataka, has pointed out
that :
The villages with Dairy Co-operative Societies are much better off than those without.
The families with dairy cattle are economically better than those without dairy cattle.
Women who had no control on the household income have better control in terms of Milk
Money.
A single commodity MILKhas acted as a catalyst in the change in the Socio-Economic
impact of the rural economy.


There is a positive impact on those at the lower end of the economic ladder both in terms
of landholding and caste.

PERSPECTIVE PLAN 2010
After the closure of OF-III project. Government of Karnataka and NDDB signed an MOU during
February 2000, for further strengthening the Dairy Development Activities in Karnataka with an
outlay of Rs.250 Crores. Consequent to the announcement of new lending terms and conditions
by NDDB through an evolution of an action plan - Perspective 2010 to enable the dairy
cooperatives to face the challenges of the increased demand for milk and milk products by
focusing efforts in the four major thrust areas of Strengthening the Cooperatives. Enhancing
Productivity, Managing Quality and building a National Information Network, plans are under
implementation.
FUTURE VISION

To consolidate the gains of Dairying achieved in the state of Karnataka and with a view to
efficiently chill, process and market ever developing and increasing milk procurement with an
utmost emphasis on the Quality and in the process conserve the socio-economic interests of rural
milk producers, the Govt. of Karnataka through KMF has proposed to undertake several projects
with financial and technical support of NDDB for which an MOU was signed between Govt. of
Karnataka and NDDB on 10th Nov. 2004.



I Projects undertaken by KMF / Union budget: Value
1.1 UHT Plant godown at Channarayapatna plant 140 lakh
1.2 Dharwad CFP expansion from 150 to 200 MTPD 75 lakh
1.3 CFP Raw material godown of capacity 5000 MT at Dharwad 425 lakh
1.4 CFP Raw material godown of capacity 2000 MT at Gubbi 230 lakh
1.5 Ice cream plant at Bellary 10000 Ltr per day capacity 1000 lakh
1.6 Nandini Milk product plant expansion civil construction 175 lakh
1.7 Pouch film plant admin and canteen building construction 33 lakh
1.8 UHT Plant establishment at Kumbalgodu for Mandya milk union 310 lakh
II Projects undertaken by KMF Under GOK/GOI Grant

3.1 Fodder densification Plant Civil building at Chamarajnagar 102 lakh
3.2 Fodder densification Plant at Haveri (12 MTPD) 103 lakh
3.3 CFP Establishment at Shikaripura 300 MTPD (GOK grant) 4500 lakh
III Projects undertaken by NDDB Under PERSPECTIVE PLAN

4.1 CFP Hassan 300 MTPD 4000 lakh
4.2 Mysore Dairy Expansion 150 to 300 TLPD capacity 927 lakh
4.3 Hassan Dairy Expansion - 120 to 300 TLPD 1739 lakh
4.4 Cattle Feed Plant 300 MTPD at Hassan 1800 lakh
4.5 Tumkur Dairy Expansion 100 to 325 TLPD 3635 lakh
4.6 Hoskote Dairy for Bangalore Milk Union 200 TLPD 2032 lakh
4.7 Mandya Dairy Expansion 250 to 400 TLPD 1535 lakh



OTHER GOK FINANCIAL SUPPORT:
To support Milk Producers of DCS members GOK is providing an amount of Rs.2.00
per litre as incentive to the milk producer from 2008-09 onwards.
GOK is providing financial assistance for strengthening Dairy Development
infrastructure facilities at Northern Karnataka milk unions jurisdiction which will also
redress regional imbalance as per Dr. Nanjundappa's report.
UNITS OF KMF
KMF has the following Units functioning directly under its control:
Mother Dairy, Yelahanka,Bangalore.
Nandini Hi-Tech Product Plant, Channarayapatna.
Nandini Milk Products, KMF Complex, Bangalore.
Cattle Feed Plants at Rajanukunte/Gubbi/Dharwad/Hassan.
Nandini Sperm Station (formerly known as Bull Breeding Farm & Frozen Semen Bank)
at Hessaraghatta.
Nandini Packaging Film Plant at Munnekolalu, Marathhalli.
Central Training Institute,Bangalore&Training Institutes at Mysore/Dharwad.
Gulbarga Dairy, Gulbarga.
Functions of KMF:
Co-ordination of activities between the unions.
Developing he market for the increasing in the milk production.
To make the brand Nandini as a house hold name.
Excellence in quality is to be maintained to lay a solid foundation for wide spread
acceptance of Nandini products.
To increase the market share of Nandini.


3.0 MCKENSEYS 7-S FRAMEWORK
The 7-S framework was developed by the consultants at the McKinney Company, a very
well known management consultancy firm in United States towards the end of the 1970
to diagnose the causes of organizational problem and to formulated programs for
improvement.

7-S model a systematic approach in improving organizations
The 7-s diagram illustrates the multiplicity-interconnectedness of elements that define the
organization ability to change. It looks as the seven key elements that make the organizations
successful, or not, strategy, structure, systems, styles, skills, staff, and shared values.
.



1. STRUCTURE:
Structure of a company includes the basic organization of the company, its departments, reporting
lines, areas of expertise and responsibility and how they inter relate.
The way the organization's units relate to each other: centralized, functional divisions (top-down);
decentralized (the trend in larger organizations); matrix, network, holding, etc.

Organization Structure:





DEPARTMENTS OF THE COMPANY
PROCUREMENT & INPUT DEPARTMENT.
PRODUCTION DEPARTMENT.
QUALITY CONTROL DEPARTMENT.
FINISHED GOODS DEPARTMENT.
PURCHASING DEPARTMENT.
STORES DEPARTMENT.
MARKETING DEPARTMENT.
ADMINISTRATION DEPARTMENT.
FINANCE DEPARTMENT.
ENGINEERING DEPARTMENT.



PROCUREMENT & INPUT DEPARTMENT
The Union carries on procurement by setting up operative societies at village level. Later milk is
collected in the chilling centre. Milk collected from the milk centres is first tested. There are milk
testing equipments for this purpose. Then a survey on availability of transportation facilities &
productive capacity of villages are conducted. If the marketable surplus is more than 150 liters per
day, promoters are selected form the village & are given the responsibility of collecting the capital
for the society twice a day & payment is made on the basis of percentage of the content & SNF in
the milk. After this, milk is sent to Union else chilling centre, wherever near. At the chilling centre,
milk is chilled up to 4 degree Celsius. Later this chilled milk is sent to union in Insulated Tanks for
further processing.
The main function of this department is to procure milk different areas throughout the year. The
main function of P&I Department is to organize, supervise & operate village dairy co-operative
societies & to procure more milk from village societies other services provided are:

Veterinary services to keep up the good health of cattle through
Regular health camps.
Emergency service round the clock.
First aid, vaccination, infertility camp, fodder.
Artificial insemination facility for improvement of cattle breeds.
Facilitating training programs regarding management of cattle.
Supply of fodder to cattle.

PRODUCTION DEPARTMENT:
The main objective of the department is to follow up production schedule as per plan & to
maintain close & co-ordinate relation with other dept & ensure to upgrade the technical efficiency of
production. Milk, as it is highly perishable product has to process immediately to avoid spoilage
milk with respect to its flavour, texture & taste.
Production dept is well equipped & has various types of highly sophisticated machines
imported from Sweden & Denmark. Once the milk is received form P&I dept, it is first weighted


with the help of weighing bowl. Sample testing is made through lactometer reading & other tests.
The fat & SNF content of each sample of milk is accessed the cow & sent to the production section
separately through two different stainless steel pipes.
Later the raw milk is passed through plate chillers of variable capacity where it is cooled up
to 4-5 degree Celsius. This cooled raw material is further stored in a silo of 30000 litres capacity.

MILK RECEPTION:

Milk from tanks

Milk in Cans

Milk is procured cans from centre which are within 45 km radius of the dairy. The cans
are transported to dairy in vehicles which are not equipped with cold storage. The reception unit
has two inlet points as indicated in the figure.
In one inlet point, the cans are placed on the conveyor belt and then the milk is poured in
the collection tank as shown. Samples of milk taken in 25 ml bottles and are tested in the
Plate
heat
exchange
r

Raw
milk
I

Raw
milk
II
To processing unit


laboratory milk from the collection tank is pumped to the plate heat exchange where it is cooled
to around 5
0
c with the help of cold water.
When the collection centres are farther than 45 km they have been provided with chilling
centre at appropriate places. Hear milk is procured from neighbouring villages and is stored at 5
0
C
from here the milk is transported to dairy in cold storage vehicles. In the second inlet as shown
milk from the tanks is pumped to the plate heat exchanger. The milk cans and tanks are sterilized
by N
a
OH scrubbing and washing.
Milk is received twice a day at an average rate of 4500 litres of cow milk and 2200 litres of
buffalo milk. The received milk should be containing at least 3.5% fat and 8.5% SNF otherwise the
milk is treated as substandard.
There are various sampling tests of the raw which determine its fat content:

GURBER TEST:

10 ml H2So4 is mixed with 10.75 ml of milk and of Amyl alcohol is added to the previous
mixture and rotated in a centrifuge for nearly 10 minutes. Fat will separated from the milk and
stands above the mixture its value being read by the scale attached to the test tube.

MILKOMETER:

This instrument directly displays the fat of the milk. Milk from plate heat exchanger is
pumped to the 2 raw milk silos each of 30,000 litres capacity. The silos are steel insulated to
facilitate cold storage. Milk from these silos is pumped to the pasteurizer for processing.



MILK PROCESSING:

From the pasteurization

Cream Milk

To butter unit

Raw milk has to be pasteurized to get rid of harmful bacteria to increase its shelf life. This
is done by firs heating it till 72
0
c and then cooling it to 4
0
c .The pasteurized milk is then treated
so that its fat content is reduced to required level and then sent to the processed milk silos. The
dairy has 3 milk varieties on fat percentage:

Crea
m
separ
ator I

Milk
pasteu
rizer
II

Butt
er
silo
I

Butt
er
silo
II

Butt
er
silo
III

Cre
am
pas
teu
rize
r

Milk
pasteu
rizer I

Crea
m
separ
ator
II
Pasteurized milk for packaging



TYPES OF MILK FAT SNF
Toned milk- 3.0% 8.5%
H. Cow milk 3.5% 8.5%
Standard milk- 5.0% 9.0%
Shubham milk - 6.0% 9.0%

The processed milk from the silos is then packed and dispatched in polyethylene bag of
Litre and 1 litre capacity.
Milk from raw milk silos is pumped to pasteurize and pasteurizer 2 each of 18,000 litres
per hour capacity. Pasteurized milk from the pasteurizer is then fed to cream separator 1 and cream
separator 2 each of capacity 12,000 litre per hour. It also has mechanism for standardization where
in cream and skimmed milk is recombined to get specific fat content which can be manipulated by
a throttle valve. The milk is pumped and stored in the processed milk silos each of capacity 30,000
litres. The cream is taken to a cream pasteurizer of capacity 4,000 litres per hour. Pasteurized
cream is then pumped and stored in cream solos cream which are 3 in number each of capacity
6,000 litres.

PASTEURIZER:


The pasteurizer consists of 3 parts-

Hot region:- Hear the milk is heated to around 71
0
C using condensate which is at
around 100
0
C .Milk is passed through regenerative at the other side of the plate
.The milk is then sent to holding section
Regenerative region: - Hear their heat transfer taking place between pasteurized hot
milk and cold raw milk. Hot milk moves towards cold region and cold milk moves
towards the hot region as indicated in the figure.
Cold region and Holding region in cold region pasteurized is cooled around 5
0
C by
means of cold water which is at 0
0
.V .The hot pasteurized milk spends around 15
seconds in the holding region so that the pathogens are killed.

CREAM SEPARATOR:


The portion of milk which contains more than 25%milk fat is called cream .The milk free
from is called skimmed milk .The skimmed milk contain around 0.5% milk fat. This separation
can be brought about by use of centrifugal separator. Through the cream time, when subjects to
centrifugal action. Skimmed is taken out from milk line.
Clarification: The denser particles are separated out from milk in this stage. The
heavier particles are thrown out to the periphery when subject to centrifugal force and
hence speared from milk.
Standardization: Milk of a specific fat is produced by recombining cream and milk
taken in proper proportion. This can be attained by manipulating the throttle valve of
the cream outlet.

Purpose of chilling:
This is done to avoid micro organisms, which are responsible for spoilage of mike & bitter
taste. The milk, which is stored in silos, is pumped through pipelines to the balance tank, which
helps to maintain the steady speed flow of milk in the pasteurization machine. In DMU, there are 2
pasteurization machines & 1 Cream Pasteurization machine.
Purpose of Pasteurization:
Pasteurization is a process where milk is heated to high temperature & cooled instantly, to
destroy any microorganism. The pasteurized milk will stored in pasteurized milk silos & then sent
to pre-packing section. Packing is done in 500ml & 1000ml & stored in cold storage.

Pasteurization of Cream:
The milk in bulk is taken to the cream separator. Here the cream is separated. The cream is
passed through cream pasteurization unit. This cream is sent to butter section. The milk with no fat
is skimmed milk. This skim milk is pumped back to pasteurization unit & heated to 72
0
C using
steam & chilled to 4
0
C using chilled water & stored in silos. This skimmed milk is sent to powder
section, the pasteurization cream is mixed in portion to pasteurized milk.

CURDS SECTION:


Raw milk is heated to 90
0
C & allowed to cool to 3
0
C. later culture is added to it & packed.
The curd is formed in the packet itself. It is stored & packed in 200 gms & 500gms.

QUALITY CONTROL DEPARTMENT:

In KMF, at every stage, care is taken to ensure that the customer gets the products, which
have a high quality, where the quality testing is done. There is a separate laboratory for this. Quality
control is very essential as to maintain the freshness of the milk. All the containers, pipes & other
equipments are washed with hot water before starting of with new production. There are many tests
are conducted here. The packed milk we get from chilling centre next before standardization & the
last test before packing. The other tests conducted are:

The activities of Q.C dept:

Tanker milk: Fat, SNF, temperature, acidity, adulterants.
Can milk: Fat, SNF, society sample in doubtful cases.
Raw milk silo: stock check at beginning & end of shift. Temperature, fat, SNF, acidity.
Pasteurized milk silo: fat, SNF, phosphates, temperature& keeping quality.
Butter: fat, curd, moisture, salt.
Ghee: moisture & free fatty acid.
Peda: moisture & total solids.

FINISHED GOODS DEPARTMENT:


This department acts as an interface between production & marketing department. It is
concerned with maintenance of finished goods connected records. It receives all the finished goods
& issues the goods are maintained properly with respect of quality.
Accounts are maintained and daily and monthly report is submitted to the production,
Marketing& Finance Depts. As the products are perishable First in First out method & inventory is
followed.

PURCHASING DEPARTMENT:
The main work of this department is to purchase various materials required by different
departments. After ascertaining the stock position by stores department & indent is sent by different
department duly approved by the managing director. This department act to purchase materials.
It also maintains the records of all the suppliers calls for tenders, quotations etc. quotations
with lowest rate are sectioned. Purchase up to 50000 then the approval of Managing Director.

STORES DEPARTMENT:
The stores department in KMF follows the Comdex System (Coded Control System). A card
is maintained for each item & a number is allotted. The card attached to each article consists of
amount balance, date of issue, purchase etc. this is later recorded in separated ledger book. The
inventories are of different kind ranging from mechanical, spares, purchasing items to animal drugs,
stationary & veterinary drugs. There are at least 4000 different inventories.

The department has the following services:
It tries to maintain maximum & minimum level of inventory. So as to avoid blockage
of capital & storage.
Ordinary & local available commodities are maintained at minimum possible level.
Items of urgent & not easily available are stored sufficiently for further demand.

MARKETING DEPARTMENT:


Types of business:
Agency
Transporter Com Dealer
Parlour
All Time Milk centres
Day counter

Agencies are working for the KMF. KMF is having 10 -12 Transporter Com Dealer (TCD).
These people will take the both responsibility of transportation and also dealings. It is also having
15-16 parlours. These are spotted in the centre of market, bus stand, hospitals etc. All Time Milk
centres are 15-16. Here consumers can get the Nandini milk at any time. Day counters are as
retailers, they sell all types of milk, which is also not a product of KMF. No restrictions on him.

Strategies of marketing Department:
Regular contact with retail outlets to promote sales.
Agent motivation programs.
Identifying and establishing NANDINI parlours where Demand is there.
Innovative sales and promotional activities.
Women entrepreneurship programs.
Exploring local market with the help of local organisations or associations.

Strategies Implementation system:
sales promotional & advertisement activities of KMF are as follows:
Press advertisements.
Hoardings.
Wall paintings.
Rental for KSRTC Buses.


Banners.
Vehicle paintings & own hoarding paintings.
Calendar & Greetings.
Exhibition, Drawing & consumer mela.
Sponsoring of events.
Television.

ADMINISTRATION DEPARTMENT

The administration department controls the overall functioning of the organization. The
organization consists of the following 3 levels.

Managerial cadre includes M.D, Deputy Manager & assistant manager.
Supervisory level included technical officers and supervisors.
Worker level includes labours, Helpers.

The department also handles Canteen, Security, & time keeping machine.

Canteen:
There is a canteen in the premise itself. The employees are provided lunch, tea etc at
reasonable rates. The canteen is handled by the canteen in charge.

Time keeper:
The department records the working hours of employ. The time machine shows the entry
time and exit time of each employee. The workers divided into different shifts control the working of
the department. Each employee is given a Punch Card.

SECURITY DEPARTMENT:


Belgaum milk occupies 28 acres of land. The whole premise is been guarded by security
personnel. The security people work in three shifts. All the vehicles checked before entering the
premise. The department is also maintains separate registers like store-in register, attendance register
etc
FINANCE DEPARTMENT:

The department is responsible for keeping all the inward and outward flow of money of
union. It prepares budget every year and financial values for receipts all payments are framed. The
functions of this department are:

To prepare monthly accounts (receipts & payments P&I A/C & balance sheet).
To prepare quarterly finance statements.
To prepare integrated business plan.
To prepare year ending financial statements.
To get accounts audited from statutory books of A/Cs.

KMF follows two types of steps auditing:

Pre-audit system-done by finance and account department every year.
Statutory system-done by private Charted Accountant every year.

Functions of finance department:

Preparation of financial reports.
Preparation of annual reports.
Budgetary control.
Scrutinizing of purchase bills and proposals.
Passing of all payment bills.


Maintenance of sales ledger.
Maintenance of subsidiary books under the co-operative societies acts like cash
book, debtors & salary registers.
Preparing of cost sheets.
Directing to the internal auditing.

ENGINEERING DEPARTMENT:

The plant operates at a contract demand of 650 KWA at a power factor of 0.95 achieved by
capacitor action. The section is equipped with two diesel generators of 400KVA capacity. They have
12 cylinders each. One engine is battery started where as the other is compressed air started. Both
the engines are provided with alternators of 400 with 558.5A, 415v and power factor 0.8. Generator
output is connected to bus bar from where it is supplied to different loads.

2. STRATEGY
Strategy is plans an organization formulates to reach identified goals, and a set of decisions and
actions aimed at gaining a sustainable advantage over the competition.

Development of intermediates and bulk milk products order using a variety of procurement
technologies of milk.
Developed of cattle field plants of 100 TPD capacities, each and one plant of 200 TPD
capacities with mineral and mixture production facility in one unit.
Providing assured and remunerative maker for the milk product by the farmers.
Improving the quality status of milk and their derivatives to urban consumers.
Milk and milk products should undergo various tests conducted by the quality control
departments.

Mission strategy


The organization core competence include the entire dairy products chains, namely
packed sweet products like peda, kova and Nandini ice creams and their food products must
undergo biotechnology and quality control tests.

3. SYSTEM

Systems define the flow of activities involved in the daily operation of business, including its core
processes and its support systems. They refer to the procedures, processes and routines that are
used to manage the organization and characterize how important work is to be done. Systems
include:
Business System
Business Process Management System (BPMS)
Management information system
Innovation system
Performance management system
Financial system/capital allocation system
Compensation system/reward system
Customer satisfaction monitoring system

Online computer transaction system at KMF

Presently KMF is having a system of all major transaction being carried on through its online
computer system. The major areas covered are:

All milk distributors to retailers/factories/institutions.
All incoming milk weightiest, billing and its accounting.
All financial accounts, books maintenance, employee payroll, sales transactions.
Maintaining database of all above said transaction.
4. STAFF:


"Staff" refers to the number and types of personnel within the organization and how companies
develop employees and shape basic values.
Total staff strength, permanent, contract laborers and security

Sl.No. TYPES NUMBERS SALARY PER
MONTH
1. Permanent 341 2525876.00
2. Contract laborers 350 1575000.00
3. Security 41 106371.00

5. SKILL:

"Skills" refer to the dominant distinctive capabilities and competencies of the personnel or of the
organization as a whole.

As the milk and milk products are perishable in nature so they handled carefully. So it
required skilled manpower for handling, and skill in the sense testing of content, microorganism,
humidity, and moisture. It needs training.

Training will be conducted at centre training institute, KMF newly recruited employees
will be at central training for about a month, training for junior technical officer about machines
for a month, training for technical officer about a month they will be sent to Gujarat to know
about various activities related to dairy. Training will be given to know about cattle field plant,
insemination.
This expertise enables the group to provide high quality end cost effectives milk products
to domestic markets.
6. STYLE:


"Style" refers to the cultural style of the organization, how key managers behave in achieving the
organization's goals, how managers collectively spend their time and attention, and how they use
symbolic behavior. How management acts is more important that what management says.

There is no differentiation, but the superiors and the subordinates with the various
degrees of responsibilities.
To achieve the common goals so called as to make collaboration within and across
organization boundaries.
By taking new ideas and views on procurement of milk from different source and
decision making.
Try to solve and balance conflicts between the employees and milk unions.
Share the information in decentralized manner.
Involvement of managers with their associative by sharing the views and take initiative to
support various functional strategies.

7. SHARED VALUES:
Shared values are commonly held beliefs, mindsets, and assumptions that shape how an
organization behaves its corporate culture. Shared values are what engender trust. They are
an interconnecting center of the 7Ss model. Values are the identity by which a company is
known throughout its business areas, what the organization stands for and what it believes in, it
central beliefs and attitudes. These values must be explicitly stated as both corporate objectives
and individual values.

It is been serving the state from last 30 decades.
State entirely covered by dairy development.
High capacity utilization of cattle feed plants.
Bulk supplier of SMP, WMP to army
Low price spread between procurement and sales price.


In the last ten years for milk produced Rs. 3,055 crores has been paid to the dairy from
house.
Wide spread dispersal of crores breed cattle.
Milk supply to Calcutta KMF through railway tankers from Bangalore KMF.
Successful implementation of state government aided dairy development programs
through SC/ST development and backward class development.



4.0 SWOT ANALYSIS

With the help of this analysis we analyze Internal and External environment of an organisation.

STRENGTHS
Nandini Brand: Nandini products are well branded in the market because of their quality
Man Power: There are well experienced, professionally trained technical employees
working in the company with minimum experience of 15 years. It helps organization to
maintain the quality of the product.
Location: Hassan milk union is located in industrial estate beside NH-48 where people
can easily find the company. It reduces the cost of transportation and leads to publicity of
company name.
Government Support :It is supported by government of Karnataka with grants and loans


WEAKNESS
Decision making and control rules by K.M.F & Karnataka government.
All major policies and terms are directed by KMF, which is constituted by various unions
.Hence major decisions and constructive works are delayed.
Bad condition of roads makes milk procurement and also distribution problematic.
OPPORTUNITIES

There is demand for Nandini Products in other states viz Kerala, Goa. So it can sell its
product to those states along with Tamilnadu and Andhra Pradesh
New Product Innovation: It can innovate new products dairy Sweets in the same product
line.
Diversification: Organization has the potential to diversify into various related business.
Employment: It provides more employment opportunity to the people. Young,
enthusiastic employees put their best efforts, which results in the growth of organization.
THREATS
Market uncertainty: There is a price fluctuation in the market, it may leads to decrease the
demand and there by reduction in profit
Competition: Competitors are coming up with similar product, this is the main threat
posed by the external environment



5.0 ANALYSYS OF FINANCIAL STATEMENT
BALANCE SHEET AS ON 31 MARCH 2011 AND 31 MARCH 2012

CAPITAL AND LIABILITIES 31.3.2009 31.3.2008
Paid up share capital 60814000.00 42273000.00
Share suspense 1654456.01 870182.51
Depreciation and other funds 156268990.15 107274621.80
Profit and loss account 11699086.86 20264268.38
Loans 25225155.98 23979297.00
Grants and subsidies 6479027.59 7753935.23
Current Liabilities 175479156.43 191194156.82
Provisions 18054340.07 19854317.14
Bank over draft 0.00 0.00
TOTAL 455674213.09 413463778.88
ASSETS 31.3.2009 31.3.2008
Cash in hand 881835.65 783063.90
Cash at bank 46344999.70 47494052.04
Investment 41820936.33 59626895.33
Fixed Assets 210331884.63 152729790.68
Current Assets 89158355.64 103534763.35
Loans, Advances and Deposits 15801.96 31601.49
Sundry Debtors 22231916.27 21952659.63
Audit Objection 3734352.67 3734352.67
Stock on Hand 41154130.24 23576599.79
TOTAL 455674213.09 413463778.88



6.0 LEARNIN EXPIERENCE

It is a very good opportunity to correct or evaluate our self how capable we are to adopt new
changes or interested to learn the things in real or actual working conditions. When we enter the
organization the atmosphere itself teaches what we have to do and what are all the duties and
responsibilities.

In KMF the co-ordination between the employees will create a unity among employers which is
very helpful in decision making and building a good future to the organization & carry out the
business in a right way. Uniformity which is very essential elements that management should
maintain among their employees & outlook of an employee will also create a impression on the
minds of other about their taste, preference, values & principles.

Time keeping is another important thing that one learnt in the organization. Doing duty in time
punctual, honesty, attractive, &innovative. If it does it in a right way with right choice it will vie
you success. Within that short span of gap over all progress is carried out, if are miss the
opportunity they will not get it back.
Another important feature is about motivation if the encouragement is there to come up their
weakness and support them to come out their ideologies it will be more effective. The work
culture & the environment condition which is provided to the employee are very good which
motive the employees work comfortably



1.0 General Introduction Of The Study
Introduction to marketing
Marketing is the performance of business activities that direct the flow of goods and services
from the producer to customer.
-American Marketing Association
Many organizations have involved in marketing activities to satisfy the needs and wants of a
group of customers. Now a days marketing is not considered as a mere physical process or set of
activities connected with the exchange of goods. It is regarded as a philosophy of business. It is
concerned with creation of customers.
It includes all those activities connected with identifying the need of the consumable and then,
organizing the according to meet the needs of the consumers.
Importance of marketing management:
Marketing management is the most important function in the business organization.
It looks after the marketing system of the firm
It plans and develops the product on the basis of know demand.
It has to prepare appropriate marketing plans or marketing mix to achieve the
business goals.

Function of marketing management
The function of marketing management is summarized as follows:
Determination of marketing goals


Formulation marketing plans, procedures, policies etc
Designing marketing strategies and marketing mix
Planning marketing programmers
Marketing is a comprehensive term and it includes all resource and a set of activities necessary
to direct and facilities the flow of goods and services from producer to consumer in the process
of distribution. Business man regards marketing as a management function to plan, promote and
deliver products to the clients or customers. Human efforts finance and management constitute
the primary resources in marketing.
Main view point's management is as follows:
Analyzing, planning, implantation and Control programs.
Mutual and personal gain
Achieving effective response.
Modern marketing concept:
The marketing concepts evolved over a century starting from onset of industrial
revolution, production concept and selling concept, social marketing concept right uo to
date.
Consumer
The term "consumer" refers to a person who buys goods or services for his personal or
household use and not resale. Consumer behavior is the process whereby individual decide,
what, when, where, how and whom to purchase goods and services"
Consumer behavior has been gaining importance since 1960. the growth of consumerism
and enactment of consumer legislations emphasizes the importance of consumer behavior study.
Today the consumer behavior is the central topic in modern marketing. Since the ultimate aim of
marketing is consumer satisfaction and profit earning.


Importance
In olden days marketing was seller oriented and there was seller market. The consumer
had to purchase whatever was offered to him. They had no choice. So the study of consumer
behavior was not important to marketers. Now things have changed modern marketing has
become consumer oriented and there is a buyer market, if the choices, performance, tastes and
attitudes of the consumer are neglected.
No marketing efforts can be successful. Therefore the study of consumer behavior is very
much essential success in business.
The study of consumer behavior is important for the following purposes:
Production policies
Price policies
Distribution policies
Sales promotion policies exploiting marketing opportunities.

Plan for customer service:
Understand customer expectations
Establish customer priority
Define service goals
Get external commitment from top to bottom
Establish service infrastructure
Develop employee through training and compensations
Measure customer satisfaction
Set customer expectation
Search for complainers.


Factors influencing consumer behavior:
Consumers do not make purchase decision simply. Their buying behavior is influenced
by culture, social, personal, and psychological determinants or factors. All these factors are
controllable and beyond the hands of a marketer. They are considered in understanding buyer
behavior.
Determinants of consumer behavior:

The "satisfaction of the customer "can be easily canalized studying the behavior of the
customers. Customer Behavior can be said to be the study of how individuals make decision on
how spend their available resources (time, money and effort) on the various consumption related
items. This simple definition of customer behavior tells marketers to resolve every activity
around the ultimate customer and gauge their behavior.



The behavior of the customer helps the marketing to study, what factors influence the
decision making process of the customers. The decision making process identifies the number of
people who are involved in this process and ascribe a role of them.
All the firms have started considering "COSTUMER AS THE KING "or "QUEEN". The
market place is flooded with many new players including the host of MNC's resulting is
available of more number of brands in every segment of the market, On account of this customer
stated being choosy about what to buy.

2.0 DESIGN OF THE STUDY
Title of the study:
The title of the study is to understand "THE MARKET POTENTIALITY OF NANDINI
SET CURDS IN BANGALORE CITY".

2.1 STATEMENT OF THE PROBLEM:
The topic selected for the study is to know the market potentiality of Nandini set
curds. And also in order to obtain response from the users to identify the impact created by
the marketer in KMF.
Now days in the market we can find number of entrants into the industry, hence the brand loyalty
in this is lacking. Therefore KMF being a govt sector as undertaken the study on market potential
of the set curds to know whether the potentially is satisfactory or not.



2.2 OBJECTIVES OF THE STUDY
The Study covers the following:
1) To study the market potentiality of Nandini set curds.
2) In order to identify the improvements in the marketing activities conducted in KMF
3) To identify the techniques used to improve the set curds in the Market.
4) To identify the level of awareness about the set curds.

2.3 SCOPE OF THE STUDY:
The study covers that the company is going to improve the present products. The
marketing department has a challenging task to attract the customers towards their products. The
scope of the study also includes that further improvements as expressed by the consumer through
the survey.

2.4 RESEARCH METHODOLOGY
a) Type of Research:

The type of research used in this study is exploratory research.
b) Method of Research:
The collection of primary data through the use of questionnaire and secondary
data through the use of discussions, interactions with the concerned persons who are trying
to promote the set curds.
c) Sampling Used:
The sampling used for the study is respondents situated in different locations
at Bangalore City mainly in apartments.

d) Sample Size:


The respondents used for survey and for certain conclusion, we used 100
respondents spread over Bangalore City. Even though the sample size is very less, but the
feedback given by they can be extended for larger survey.
e) Tools Used:
For conducting a survey study is structured questionnaire is used, which
consists of the questions with well designed manner. A few questions have possible answer
and some other questions have options in order to express their view. In additions to this
interviews have also been adopted for data collection from the concerned person in the
company.
f) Collection of data:
Survey has been done in data collection from the respondents. Data collection
also been made from marketing department with regard to advertising, publicity, sales
promotion, export and import. Company profile has been collected from booklet given by
the Company.
g) Method of Analysis:

From the above data we can analyses by the use of graphs for each question. The analysis
also include that the respondents feedback have been included in findings chapter-7. The
analysis also include that the company must improve by further creating interesting
advertisement in T.V., Radio, news papers.



2.5 LIMITATION OF THE STUDY:
1. Survey covers feedback from users and non users of set curds.
2. The study is done on survey method and suffers from this method.
3. The non users although they know the product but still they are not
buying the products because of non proper packing.
4. Time is the major constraint
5. Some respondents did not co-operate
6. Many respondents did not provide proper information due to bias

Because of these limitations, it may not be possible to draw any major conclusions.
However the conclusion that is drawn in this study can be considered as indicative or suggestive
in nature.

Basic Assumptions:
Through the survey the assumptions made include that the respondents have given f rank
opinion to various questions. That means they are well aware of the products and also their
feedback are accurate. The company must give importance to the suggestions made by the
customers and will implement them to enlarge their marketing activity.

Market Potential
A market potential is an estimate of the maximum possible sales opportunities
present in a particular market segment and open to all sellers of a goods and service during a
stated period.
This study finds that the KMF has many sales opportunities present in
market to expand its business and increase its sale of Nandini set curds so that it can make more
profits. It can be concluded that Nandini is one such a brand, which has entered the daily life of
the customer. It has the monopolistic market in Nandini set curds and can be utilized fully. KMF
is one such organization where, it is striving hard for its customer satisfaction.



The key success factor of KMF in becoming a market leader is :
Narrow price spread maintained between purchase & sales, marketing higher volumes of
Nandini set curds. The volume of sales plays a critical role in determining costs. Hence, the
market strategy of Bangalore milk Union is to regard selling of market set curds as its core
marketing.
Although KMF sets high standards for its products and customer serve, its prior
reliance on manual operations made it impossible to keep with surging demand. In designing
mega dairy, KMF looked towards an automated system that would allow it to achieve consistent
quality parameters for each product. Energy and manpower would also be more effectively
optimized and controlled and all plant equipment would be integrated. In addition, employees
would be trained in how to use the new automated systems and valuable management
information would be collected at the main server and used for marketing and evaluations.
Nandini set curds quality is immediately checked for quality parameters upon arrival at
the plant's main gate. From this point onward, each operation is automated with controls for
chilling, milk pasteurization, standardization and cleaning-in-place (CIP). The system also
gathers and distributes data for production, quality and energy management. At the heart of the
system is a reputed Allen-Bradley PLC- 5/80C platform, which communicates to analog and
digital I/O on control Net a producer-consumer communication network. Customers are also
seeking significant benefits. Milk now reaches market faster, at a better quality and with a
longer shelf life.



3.0 ANALYSIS AND INTERPRETATION OF DATA

TABLE-1
AGE OF THE RESPONDENTS
An effort was made to know the age of the respondents. The following table
highlights the above facts.

DATA ANALYSIS:
The above table shows that 16% respondents are below 15 years of age. 30% respondents are
between 15-25 years of age and 28% respondents are between 25-35 years of age. 26%
respondents above 35 year age for better understanding the table is represented in the form of a
graph in figure.
INFERENCE: The above graph indicates that majority of the respondents were middle age
group and most of them were working employees they prefer Nandini set curds because of its
easy availability and better quality.
TABLE-2
SL NO AGE No OF RESPONSE PERCENTAGE
1 BELOW 15 16 16%
2 15-25 30 30%
3 25-35 28 28%
4 ABOVE&35 26 26%
TOTAL 100 100%
58%
23%
10%
9%
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr


Table showing gender of the respondents
SL NO GENDER No OF RESPONSE PERCENTAGE
1 MALE 80 80
2 FEMALE 20 20
TOTAL 100 100%

DATA ANALYSIS:
The above table shows that 20% respondents are female and 80% respondents are male.
For better understanding the table is represented in the form of a graph in figure.

INFERENCE:
Majority of the respondents are male. So the company should target male respondents for their
set curds.

TABLE - 3:

80%
20%
MALE
FEMALE


Analysis regarding the occupation of the respondents

DATA ANALYSIS:
The table 3 presents the no of respondent's nature of work. It is evident from table 2 that 14% of
respondents are in student, 16% of respondents are Govt. Employees and 56% and 14% are in
business and other occupation respectively.
INFERENCE:
Majority of the respondents were business people and these respondents are more concerned
with the quality of the nandini set curds. Many of govt employees prefer nandini set curds
because of its good brand name in market.

16%
18%
64%
2%
Students
Employees
Business
Others
Nature of work
No of Respondents Percentag
e
Students 14 14%
Employees 16 16%
Business 56 56%
Others 14 14%
Total 100 100%


TABLE-4
Table showing how many people like Nandini set curd

SL NO RESPONSE NO OF
RESPONSEDENTS
PERCENTAGE
1 LIKE 90 90
2 DISLIKE 10 10
TOTAL 100 100%

DATA ANALYSIS:

The table 4 presents the how many respondent's like or dislike nandini set curds and 90% of
respondent's like nandini set curds and only 10% respondent's dislike nandini set curds.

INFERENCE:
The majority of the respondents like nandini set curds and few respondents dislike nandini
set curds. These figures say most of the people like nandini set curds.

90%
10%
LIKE
DISLIKE


TABLE-5
Table showing when the respondents buy the set curds

SL NO PARTICULARS NO OF
RESPONSEDENTS
PERCENTAGE
1 MORNING 50 50
2 AFTER NOON 30 30
3 EVENING 20 20
TOTAL 100 100%

DATA ANALYSIS:
The above table shows when the respondents buy the set curds. From the above table it
shows more number of respondents buy set curds in the morning. And 32% of respondents buy
the milk in the afternoon and 32% of respondents buy the set curds in the evening.

INFERENCE: The majority of the respondents buy the set curds in the morning because of
their needs and freshness of set curd and most of the respondents are working employees they
have to go to their jobs early in morning so they will prefer to buy the set curd in the morning.

50%
30%
20%
MORNING
NOON
EVENING


TABLE-6
Table showing how many grams cup Nandini set curds respondents buy every day

RESPONSEDENTS
PERCENTAGE
1 200 gms 44 44
2 400 gms 56 56
TOTAL 100 100%

DATA ANALYSIS:
The above graph shows that 44% of respondents buy 200 gm cups set curds, 56% of
respondents buy 400 gm cups set curds.

INFERENCE:
The majority of the respondents buy 400gm cups every day because Nandini set curds are
nonperishable they can store it for longer time.

44%
56%
200gms
400gms


TABLE-7
Table showing by whom they aware of NANDINI set curds.

RESPONSEDENTS
PERCENTAGE
1 ADVERTISEMENT 42 42
2 FRIENDS 20 20
3 FAMILY 0 0
4 RETAILERS 38 38
TOTAL 100 100%

DATA ANALYSIS:
Of the 100 respondents 42% got awareness of Nandini by advertisement, 38% of the
respondents were cause to know about Nandini set curds through Retailers and 20% were from
friends.
INFERENCE:
Both advertisements and agents played equal role in achieving the brand awareness of
Nandini.

66%
32%
0%
2%
ADVERTISEMENT
FRIENDS
FAMILY
RETAILERS


TABLE-8
Table showing how respondents feel about Nandini milk and milk products.

DATA ANALYSIS
The above table shows perception of respondents. 50% of respondents feel it is excellent
and 24% feel it is good and 16% and 12% of respondents feel it is satisfactory and poor
respectively.
INFERENCE:
The number of respondents rated the Nandini set curd is good and excellent because of its
freshness, vitamin content and quality. Very few of them feel that it is satisfactory so that the
KMF should look out these groups with a suitable strategy.
50%
22%
18%
10%
Excellent
Good
Satisfactory
Poor
Options No of
respondents
Percentage
Excellent 50 50%
Good 22 22%
Satisfactory 18 18%
Poor 10 10%
Total 100 100%


TABLE 9
Table Showing Major Factor consider by the Respondents while Purchasing Nandini set
curds

DATA ANALYSIS:
About 80% of the 100 respondents said that they gave major importance to quality while buying
Nandini Products and 4% price considered the most, 16% considered service given to them.

INFERENCE:
Most of the respondents feel that quality has to be above par while buying Nandini set curds.
Compared to any other factor including price and service.
94%
5%
0%
1%
QUALITY
PRICE
AVAILABILTY
SERVICE
SL NO FACTORS No of
respondents
Percentage
1 QUALITY 80 80
2 PRICE 4 4
3 AVAILABILTY 00 00
4 SERVICE 16 16
Total 100 100%


TABLE-10
Table showing from where do the respondents were purchase Nandini Products.

DATA ANALYSIS:
40% of the 100 respondents said that they buy Nandini set curds from the open market
itself whereas 19% of the respondents bought them by the agents. 22% of the respondents bought
them by dealers.

INFERENCE:
Open market and agent played dominant role in the distribution and sales of Nandini set curds.

38%
22%
40%
0%
AGENTS
DEALERS
OPEN MARKETS
OTHER
SL NO PARTICULARS No of
respondents
Percentage(%)
1 AGENTS 38 38
2 DEALERS 22 22
3 OPEN MARKETS 40 40
4 OTHER 0 0
Total 100 100%


TABLE-11
Table showing the mode of payment

DATA ANALYSIS:
All the 100 respondents carry out their transaction in cash and carry basis.

INFERENCE:
As the milk company's do not support any other mode of payments, so the respondents
will have to pay only cash on the spot for the purchase of milk, either it may be from the agent or
from the open market or from the dealer.

SL NO MODE OF
PAYMENTS
No of
respondents
Percentage(%)
1 CASH AND CARRY 100 100
2 WEEKLY BILLING 00 00
3 MONTHLY BILLING 00 00
4 OTHERS 00 00
Total 100 100%
100%
0%
0% 0%
CASH AND CARRY
WEEKLY BILLING
MONTHLY BILLING
OTHERS


TABLE-12
Table showing the factors that satisfies Nandini set curds.

DATA ANALYSIS:
80% of 100 respondents were satisfied with quality of Nandini set curds and 10% of
respondents were satisfied with service and 10% were satisfied with price.

INFERENCE:
Quality is most considerable factor by the respondents.
80%
10%
10%
0%
QUALITY
PRICE
SERVICE
OTHERS
SL NO PARTICULARS No of
respondents
Percentage(%)
1 QUALITY 80 80
2 PRICE 10 10
3 SERVICE 10 10
4 OTHERS 00 00
Total 100 100%


TABLE-13
Table showing opinion of respondents about the price of Nandini set curds

RESPONSEDENTS
PERCENTAGE
1 REASONABLE 68 68
2 COSTLS 32 32
TOTAL 100 100%

DATA ANALYSIS:
68% of 100 respondents said that the price of Nandini se curds is reasonable and 32% of them
said that it is costly

INFERENCE:
Most of respondents feel that prices are reasonable, comparing other company set curd.

68%
32%
Sales
RESONABLE
COSTLY


TABLE-14
Table showing whether respondents were satisfied with advertisement of
Nandini set curds

RESPONSEDENTS
PERCENTAGE
1 SATISFIED 40 40
2 UNSATISFIED 60 60
TOTAL 100 100%

DATA ANALYSIS:
The above table depicts that only 40% of the 100 respondents said they were satisfied with
advertisement of Nandini set curds and 6o% were unsatisfied.

INFERENCE:
As most number of respondents was unsatisfied with advertisement of Nandini set curds. So
there is an urgent need for a proper promotional activity is carried down to satisfy the customers.
40%
60%
SATISFIED
UNSATISFIED


SUMMARY OF FINDINGS
The following findings are drawn by the respondents in Bangalore City.
The age group of respondents was seen to be, below 15 years, 16% of respondents, 15-25
years, 30% of respondents, and 25-35 28% of respondents, above 35 years, 26% of
respondents
The occupation of the respondents was seen to be as 24% respondents in students; 16%
were in government employees, 56% were in business, 14% were in other sectors.
The classification of respondents were as follows: Male-80%
respondents
Female-20% respondents
The brand name Nandini has awareness to the fullest extent and all the respondents knew
very well about it. As it was the oldest brand of milk and ghee available in Karnataka, all
these respondents know about it through advertisement and through the retailer.
Most of the respondents were buying set curds through open markets only a very few
percentage of respondents bought them from retailers. Open markets play a dominant
role when it comes to distribution and sales of set curds and they are major influences in
the buying of a particular brand of set curds. That is what has been portrayed in this
study.
. Almost every respondent's deals through cash and carry mode of payment with the
sellers. This is because of none of the companies in the market do not support any credit
transactions.


About 40% of the respondents were satisfied with the advertisement released by KMF
about NANDINI brand. This means that the advertisement effectiveness is only 40% but
has a 100% reach.
Nandini is seen to b e a very eminent brand since all the 100% of respondents haves
given a positive response regarding its awareness.
3/4
th
of the respondents said that quality of NANDINI products is the thing that they
admit the most and few others said that they admired competitive price of nandini. While
some of others also admired its availability and its agent's service. This means that
NANDINI has maintained its quality since it inception 37 years age.
Recommendations for improvements of Nandini set curds are seen as follows:
1. Improvement in availability.
2. Improvement in service.
3. Improvement in packaging.
The respondents were using more of NANDINI set curds when compared to any others
products.
Most of the respondents were using 400gm nandini set curds.



4.0 SUGGESTIONS AND RECOMMENDATION

Quality, this word has been very well kept up by KMF all these have done a great job by
maintaining quality which has helped them to build a strong brand name called
NANDINI. But there were a very few complaints from some of the respondents about its
packaging so the standards of the set curds has to be increased and thereby satisfying
even those small no of unsatisfied respondents.
There were complaints regarding quantity of ghee as there was sometimes increase or
reduction in the quantity. So company has to take proper measures.
The company KMF needs to have at its pricing strategy. To make it much more
competitive with any other brands the company should make a certain arrangement so
that the certain percentage of rebate is given to the customer who buys in huge quantities.
This one will make the customers to stick on to the NANDINI brand itself
The agents of NANDINI are playing a dominate role in bringing nandini products and
set curds to the respondents and there by being significant I bringing sales and even in
building a huge brand in Karnataka called NANDINI so considerable amount of interest
should also be shown towards these agents.
The company should also look in to consumer's relationship management. A growing
trend by which the company can succeed in winning customers confidence and
satisfaction.
The company needs to have a constant touch and communication with the consumers and
continuously needs. To get feedback from them and make necessary arrangements and
corrections to cater the needs of customers.
In many areas there are no Nandini parlors, or dairy. Counters etc., it is better to open the
counters or parlors, in order to provide set curds to the consumers to provide for
availability of Nandini products, in all areas.


The KMF must undertake the promotional activities like advertisement of its products, so
that the customers are made aware of set curds, and develop an interest about Nandini set
curds.
The KMF must take interest about packaging, because many respondent not satisfying of
set curds packaging.



5.0 CONCLUSION
The future of any business is tense. The future cannot be predicated; all you can
do is that systematically predict about it. There are professional practitioners who look ahead to
the longer term and who believe that this skill can be achieved. By looking ahead, confronting
the future and watching the trends unfold, the world becomes less random, patterns emerge, new
threats are foreseen and avoided and new opportunities are identified and exploited. This study
was done to analyze the consumer behavior towards the Nandini set curds in Bangalore City.
Primary and secondary data collected were analyzed in the light of objectives set for the study
from the survey reports; it was found that Nandini set curds was being rated the best with regard
to the satisfactory levels among the customers.
It can be concluded that Nandini is one such brand which has entered the daily
life of the consumers. It has the monopolistic market in Nandini set curds and can be utilized
fully KMF is one such organization where it is striving hard for its customer satisfaction. The
taste and quality of the Nandini set curds and milk products is an important aspect, which has to
be improved and this should be made known to the consumer through advertisements.



6.0 ANNEXURE
Dear sir/madam
I am VINODH M doing 4
th
sem M.B.A in RNS Institute Of Technology, Bangalore. To undergo
the project work on "A STUDY ON MARKET POTENTIALITY OF NANDINI SET
CURDS IN BANGALORE CITY" Hence please kindly cooperate by providing valuable
information by filling up the following questionnaire.

1) Name:

2) Age:
a) 20-25 [ ]
b) 25-30 [ ]
c) Above 30 [ ]
d )
3) Gender
a) Male [ ]
b) Female [ ]
c )
4) Address:

5) Phone no:

6) Occupation:
a) Student [ ]
b) Employee [ ]
c) Business [ ]
d) Others [ ]
7) Are you aware of Nandini set curds?
a) Yes [ ]
b) No [ ]
8) If yes from whom?
a) Advertisement [ ]
b) Friends [ ]


c) Family [ ]
d) Retailers [ ]
9) When do you buy Nandini set curds?
a) Morning [ ]
b) Afternoon [ ]
c) Evening [ ]
10) How many grams cup Nandini set curds respondents buy every day?
a) 200gm cups [ ]
b) 400gm cups [ ]
11) How you feel about the Nandini set curds?
a) Excellent [ ]
b) Good [ ]
c) Satisfactory [ ]
d) Poor [ ]
12) Which factor you consider while purchasing Nandini set curds?
a) Quality [ ]
b) Price [ ]
c) Service [ ]
d) Others [ ]
13) Where do you purchase Nandini set curds?
a) Agents [ ]
b) Dealers [ ]
c) Open markets [ ]
d) Others [ ]
14) What is the mode of payment of Nandini set curds?
a) Cash & carry [ ]
b) Weekly billing [ ]
c) Monthly billing [ ]
d) Others [ ]


15) Which are the factors you are satisfied with Nandini set curds?
a) Price [ ]
b) Quality [ ]
c) Service [ ]
d) Availability [ ]
16) What is your opinion about price of Nandini set curds?
a) Reasonable [ ]
b) Costly [ ]
17) Are you satisfied with advertising given by Nandini set curds?
a) Yes [ ]
b) No [ ]
18) Are there any suggestions to improve sales of Nandini set curds?



BIBLIOGRAPHY

REFERENCE BOOKS

Marketing Research-Donald S. Tull

Principles of Marketing-Philip Kotler and Gary Armstrong (page no, 142 to 144)

Marketing Management 12
ft
edition-Philip Kotler (page no, 185 to 187)

Research Methodology 2
nd
revised edition, new age international publication-C R
Kothari(page no,2 to 4, 55 to 67, 95 to 105)

WEBSITES

WWW.GOOGLE.COM

WWW.KMFNANDINI.COOP

WWW.INDIANDAIRY.COM

MAGZINES

BUSINESS TODAY
BUSINESS WORLD

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