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Organisational Study of KMF. Karnataka Milk factory, Dharwad.
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52
KARNATAKA MILK FEDERATION JSS SMI UG AND PG STUDIES DHARWAD 1 ACKNOWLEDGEMENT This gives me a heavenly delighted pleasure to write an acknowledgement to this project report Because this report is an Contribution of large number of people. Firstly I would like to Thank our Principal Dr.Ajith Prasad sir for giving us this opportunity to do the project work. I am also Thankful to our HOD Prof. Sharad Desai for his encouragement and guidance. I am also thankful to Prof. N.L Guddin for provinding us the Guidelines and constant support throughout the project. I would also like to Thank Prof.Vibha Mogali for her guidance. I am Thankful to KMF for giving me this opportunity.I specially Thank Mr.Raghuram.R for teaching me about the working of all Plants and Products. Finally I am Thankful to my Parents and Friends for their moral support throught the project work.
Transcript
Page 1: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

1

ACKNOWLEDGEMENT

This gives me a heavenly delighted pleasure to

write an acknowledgement to this project report

Because this report is an Contribution of large

number of people

Firstly I would like to Thank our Principal DrAjith

Prasad sir for giving us this opportunity to do the

project work

I am also Thankful to our HOD Prof Sharad

Desai for his encouragement and guidance I am

also thankful to Prof NL Guddin for provinding us

the Guidelines and constant support throughout

the project I would also like to Thank ProfVibha

Mogali for her guidance

I am Thankful to KMF for giving me this

opportunityI specially Thank MrRaghuramR for

teaching me about the working of all Plants and

Products

Finally I am Thankful to my Parents and Friends

for their moral support throught the project work

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

2

mdash

INDEX

SLNO PARTICULARS PAGE NO

01 Introduction 01

02 Company profile 04

03 Introduction of DMU 05

04 History 08

05 Vision and mission 09

06 Function of DMU 10

07 Scope of objectives 11

08 Organization chart 13

09 Production profile 16

10 Department 19

11 SWOT annalysis 48

12 Suggestion 51

13 Conclusion 52

14 Bibliography 53

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

3

I) EXECUTIVE SUMMARY

In todayrsquos competition world no business is spared from the competition even

the basis need industries like milk industries are facing the problems so the

companies should look at the consumerrsquos attitude towards their products and if

anything goes wrong they should suddenly rectify it

We got an insight observation about the different departments and products of

Nandini Milk Our external Guide Mr Raghuram R Was kind enough to show each

and every process of production of different production and patiently explained it to

us

We had a very Enlightening Experience

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

4

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

5

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

6

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

7

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

8

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

9

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 2: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

2

mdash

INDEX

SLNO PARTICULARS PAGE NO

01 Introduction 01

02 Company profile 04

03 Introduction of DMU 05

04 History 08

05 Vision and mission 09

06 Function of DMU 10

07 Scope of objectives 11

08 Organization chart 13

09 Production profile 16

10 Department 19

11 SWOT annalysis 48

12 Suggestion 51

13 Conclusion 52

14 Bibliography 53

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

3

I) EXECUTIVE SUMMARY

In todayrsquos competition world no business is spared from the competition even

the basis need industries like milk industries are facing the problems so the

companies should look at the consumerrsquos attitude towards their products and if

anything goes wrong they should suddenly rectify it

We got an insight observation about the different departments and products of

Nandini Milk Our external Guide Mr Raghuram R Was kind enough to show each

and every process of production of different production and patiently explained it to

us

We had a very Enlightening Experience

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

4

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

5

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

6

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

7

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

8

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

9

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 3: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

3

I) EXECUTIVE SUMMARY

In todayrsquos competition world no business is spared from the competition even

the basis need industries like milk industries are facing the problems so the

companies should look at the consumerrsquos attitude towards their products and if

anything goes wrong they should suddenly rectify it

We got an insight observation about the different departments and products of

Nandini Milk Our external Guide Mr Raghuram R Was kind enough to show each

and every process of production of different production and patiently explained it to

us

We had a very Enlightening Experience

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

4

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

5

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

6

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

7

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

8

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

9

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 4: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

4

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

5

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

6

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

7

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

8

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

9

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 5: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

5

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

6

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

7

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

8

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

9

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 6: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

6

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

7

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

8

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

9

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 7: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

7

General information About Diaries

A dairy is a business enterprise established for the harvesting of animal

milk ndash mostly from cows or goats but also from buffalo sheep horses or

camels ndash for human consumption A dairy is typically located on a

dedicated dairy farm or section of a multi-purpose farm that is concerned

with the harvesting of milk

Terminology differs between countries For example in the United

States a farm building where milk is harvested is often called a milking

parlor In New Zealand such a building is historically known as a

milking shed or milking parlour (note the different spelling)

Sometimes milking sheds are referred to by their type such as herring

bone shed or pit parlour In some countries especially those with

small numbers of animals being milked as well as harvesting the milk

from an animal the dairy may also process the milk into butter cheese

and yogurt for example This is a traditional method of producing

specialist milk products especially in Europe In the United States a dairy

can also be a place that processes distributes and sells dairy products or

a room building or establishment where milk is stored and processed into

milk products such as butter or cheese In New Zealand English the

singular use of the word dairy almost exclusively refers to a corner shop

or superette This usage is historical as such shops were a common place

for the public to buy milk products

As an attributive the word dairy refers to milk-based products veil

derivatives and processes and the animals and workers involved in their

production for example dairy cattle dairy goat A dairy farm produces

milk and a dairy factory processes it into a variety of dairy products

These establishments constitute the dairy industry a component of the

food industry

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

8

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

9

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 8: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

8

Operation of the dairy farm

When it became necessary to milk larger cows the cows would be

brought to a shed or barn that was set up with bails (stalls) where the

cows could be confined while they were milked One person could milk

more cows this way as many as 20 for a skilled worker But having cows

standing about in the yard and shed waiting to be milked is not good for

the cow as she needs as much time in the paddock grazing as is possible

It is usual to restrict the twice-daily milking to a maximum of an hour and

a half each time It makes no difference whether one milks 10 or 1000

cows the milking time should not exceed a total of about three hours

each day for any cow

As herd sizes increased there was more need to have efficient milking

machines sheds milk-storage facilities (vats) bulk-milk transport and

shed cleaning capabilities and the means of getting cows from paddock to

shed and back

Farmers found that cows would abandon their grazing area and walk

towards the milking area when the time came for milking This is not

surprising as in the flush of the milking season cows presumably get

very uncomfortable with udders engorged with milk and the place of

relief for them is the milking shed

As herd numbers increased so did the problems of animal health In New

Zealand two approaches to this problem have been used The first was

improved veterinary medicines (and the government regulation of the

medicines) that the farmer could use The other was the creation of

veterinary clubs where groups of farmers would employ a veterinarian

(vet) full-time and share those services throughout the year It was in the

vets interest to keep the animals healthy and reduce the number of calls

from farmers rather than to ensure that the farmer needed to call for

service and pay regularly

Most dairy farmers milk their cows with absolute regularity at a

minimum of twice a day with some high-producing herds milking up to

four times a day to lessen the weight of large volumes of milk in the

udder of the cow This daily milking routine goes on for about 300 to 320

days per year that the cow stays in milk Some small herds are milked

once a day for about the last 20 days of the production cycle but this is

not usual for large herds If a cow is left unmilked just once she is likely

to reduce milk-production almost immediately and the rest of the season

may see her dried off (giving no milk) and still consuming feed for no

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

9

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 9: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

9

production However once-a-day milking is now being practised more

widely in New Zealand for profit and lifestyle reasons This is effective

because the fall in milk yield is at least partially offset by labour and cost

savings from milking once per day This compares to some intensive farm

systems in the United States that milk three or more times per day due to

higher milk yields per cow and lower marginal labor costs

Farmers who are contracted to supply liquid milk for human consumption

(as opposed to milk for processing into butter cheese and so onmdashsee

milk) often have to manage their herd so that the contracted number of

cows are in milk the year round or the required minimum milk output is

maintained This is done by mating cows outside their natural mating

time so that the period when each cow in the herd is giving maximum

production is in rotation throughout the year

Northern hemisphere farmers who keep cows in barns almost all the year

usually manage their herds to give continuous production of milk so that

they get paid all year round In the southern hemisphere the cooperative

dairying systems allow for two months on no productivity because their

systems are designed to take advantage of maximum grass and milk

production in the spring and because the milk processing plants pay

bonuses in the dry (winter) season to carry the farmers through the mid-

winter break from milking It also means that cows have a rest from milk

production when they are most heavily pregnant Some year-round milk

farms are penalised financially for over-production at any time in the year

by being unable to sell their overproduction at current prices

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 10: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

10

II) KARNATAKA MILK FEDERATION

The first dairy in Karnataka was started in Kudige in Kodagu district in 1955

Further in June 1974 an integrated project was launched in Karnataka to restructure

and reorganize the dairy industry on the co-operative principle and to lay foundation

for a new direction in dairy development

In 1975 the World Bank aided dairy development was initiated The present

Karnataka Milk Federation (KMF) came into existence in 1984-as a result of merging

of Karnataka Dairy Development Co-operation small co-operatives and Karnataka

Milk Production Development and loose vendors

At the end of the March 1998 the network of 8023 Diary Co-operative

Societies (DCS) have been established which are spread over 166 taluks of the total

175 taluks in all 27 districts of Karnataka There are 13 Milk Unions and Dharwad

Milk Union (DMU) is one among them

There are 35 Chilling centers 3 Farm coolers 15 Liquid milk plants and 2

Product dairies for chilling processing conservation and marketing of milk To

supply cattle feed there are 4 cattle feed plants To ensure supply of quality germ

plasma bull breeding farm and frozen semen bank are also available

Karnataka Cooperative Milk Producers Federation Limited (KMF) is the apex

Body in Karnataka representing Dairy Cooperatives It is the third largest dairy co-

operative amongst the dairy cooperatives in the country

To impart training institutes at Bangalore and regional training institutes at

Dharwad and Gulbarga are functioning Three nitrogen plants (2 plants of 25 CPM

and 1 plant of 5 CPM) are been set-up to supply nitrogen which is used for

refrigeration purpose Three diagnostic centers have been set-up for monitoring

diseases three fodder farms at Rajkunte Kuttanahalli and Kodagu have been set-up to

supply good quality of fodder and seed production farm at Shahpur has been set-up

The federation giving details of the latest technology in dairy industry etc is

published Ksheer Sagar magazine monthly

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 11: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

11

III) Company profile

Name of the company Dharwad co-operative Milk (A unit Of KMF)

Producerrsquos societies union LTD

Constitution Limited

Phone 2467603 2468268

Fax (0836) 2468268

E-mail wwwkmfnandinicom

Registered office Bangalore

Company registration No 1959

Date of incorporation

amp date of establishment 3-3-1986

Board of directors elected members-8

Ex-office-5

By govermant-3

Area of operation Dharwad haveri gadag uttarkannad district

Location lakamanahalli industrial Area dharwad

Department 9

Brand name Nandini

Products Milk-Toned milk Standard milk shubham Milk

Milk-products-Butter Ghee Curd Ladu

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 12: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

12

INTRODUCTION TO DMU (DHARWAD MILK UNION)

Dharwad Milk Union (DMU) came into existence on 3-3-1986 DMU was

established under co-operative act on 3-3-1986 at Dharwad and Gadag Haveri Uttar

Canara and Dharwad come under its operation

Further in 1988 the Raipur Dairy and Chilling Center setup in 1968 also

came under the union In 1989 the training center which was controlled by KMF

came under Dharwad Milk Union

DMU was Rs7 crore Projects of which Government has Rs2Crore of share

capital and authorized capital of DMU is Rs5crore

DMU formed 551 milk producers co-operative societies in Dharwad Gadag

Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lack littres of milk per day and also has

the capacity to produce 12tones of milk powder 10tones of butter and 6tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

Establishment

The Dharwad Milk Union is Co-operative society among the 13

establishments under KMF The Dharwad Milk Union (DMU) is one of the most

modern plants in the country It is located in the spacious 25 acres of land located in

Lakamanahalli Industrial Area adjacent to the National Highway-4 It is patterned

the AMUL Milk Dairy Anand Gujarat

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 13: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

13

NATURE AND BUSINESS CARRIED

The Nature of Dharwad Milk Union is that procuring the Milk from societies

And that milk will be bringing through tankers for various chilling centers those

which are near and convenient to various societies

The Union processes the milk and market in urban area through by various

agents The Union providing service to milk producers technical inputs like

veterinary services seeds fodder etc and also by giving training to farmer and also

induction program The Union strengthening of milk cooperative movement

organization of extension activities and the rural development services

The Union also owns and operates the dairy plant cattle feed plant fodder and bull

mother forms semen collection station and herd quarter center for animal husbandry

activities

The Union also takes research development and also other promotional activities for

the overall benefit of the farmer

The Union providing various product to market like toned milk standard milk full

creamed milk double toned milk homogeneous standard milk along with cheese

curd ghee peda also providing This is the nature and business carried of the

Shivmoga milk Union

INFRASTRUCTURE FACILITIES

Infrastructure facilities in DMU they have these won chilling center and they

can distribute milk with the capacity of covering the 11 routes and the capacity is 1

00000 LPD

Other facilities like

Security facilities

Canteen facilities

Shift Three shift per day

Manual punching card and computer entries will be there

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 14: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

14

HISTORY

A group of experienced officers appointed by the Karnataka Milk Federation

surveyed the whole of Dharwad districts (includes two newly formed district Gadag

and Haveri) and Uttara Karnataka Further they found out there as a need for a Milk

Dairy They traveled the surrounding villages educated the villagers about Milk and

Milk Products and the benefits they would get from the Milk Dairy

Seeing the overwhelming response and untapped resources and the huge

market the Federation decided to setup the Milk Union in 1984 known as the

DHARW AD DISTRICT CO-OPERATIVE MILK

PRODUCERS SOCIETIES UNION LIMITED Further in 1988 the Raipur

Dairy and Chilling Center setup in 1968 also came under the union In 1989 the

training center which was controlled by KMF came under Dharwad Milk Union

DMU was a Rs7 crore project of which Government has Rs2 crore of share

capital and authorized capital of DMU is Rs5 crore

DMU formed 55 I-milk producers co-operative societies in Dharwad Gadag

and Haveri and Uttar Kannada districts

The production capacity of DMU is 2 lakh liters of milk per day and also has

the capacity to produce 12 tones of milk powder 10 tones of butter 6 tones of ghee

per day

DMU is collecting 70 thousand liters of milk per day from its societies and

sells 60 thousand liters of milk per day and the remaining milk is used for producing

milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 15: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

15

VISION STATEMENT OF DMU( As stated by DMU)

Total quality

Honesty

Discipline

Cleanliness

Transparency

Sincerity and dedication

Co-operation free of politics

Sovereignty

Respecting each others opinions ideas amp feelings

MISSION STATEMENT OF DMU(In their Words)

Dharwad Milk Union is committed to provide maximum possible price for the

milk supplied by its members and provide necessary inputs to enhance milk

production while ensuring economic viability of the Union and is also committed to

provide quality milk products to consumers and emerge as one of the top most milk

union of the co-operative dairy industry in the country

Functions of DMU

The main function of DMU is to procure milk from villagers and pay them the right

price

To educate the villagers about milk and its quality

To make Nandini as a part of daily life

To provide good quality of cattle feed fodder veterinary aid seeds etc to the

villagers

To see that the DCSs are carrying out their activities properly and in an efficient

manner

To see that the milk is brought from DCSs to the chilling centers in the prescribed

time

To look the accounts of the DCSs supervise the purchase process and market the

milk and milk products

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 16: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

16

Objectives of DMU

Providing hygienic and good quality of milk to the consumers

To build the economic strength of the milk producers in villagers

To eliminate middlemens in the business so that the milk producers receive their

appropriate share of bread

To educate the villagers about the adulteration of milk and its harmful effect on

the body

To see that every citizen becomes healthy by consuming good quality of milk

To make villagers self-viable and build self image

OBJECTIVES of DMU

To develop the quality consciousness among all the producers or employees of the

union

To implement the cost reduction in each stage of collection processing and

distribution

Make every one aware of the every conservation in dairy

To maximize the customers complaints and achieve customer satisfaction

To set goals or targets at all levels to achieve continuous improvement

To train our workman from time to time for exposure to advanced technology for

efficient operations

To provide adequate infrastructure facility for improving the work environment

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 17: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

17

DHARWAD MILK UNION

Status A co-operative society registered under the Co-operative

act 1959

Nature of Business Procuring and Marketing of Milk Production and Sale of

Milk Products

Share Capital 3 crores Approx

Plant Capacity 2 Lakhs Liters day

Milk Powder 12 MT Day

Butter 6 MT Day

Ghee 6 MT Day

Milk Chilling Centers and

Capacity

Gagad 20000 LPD

Haveri 20000 LPD

Hirekerur 20000 LPD

Ron 10000 LPD

Sirsi 20000 LPD

Present Value of Activity Collection of Milk 180000 HPD

Sale of Milk 80000 HPD

Area of Operation Dharwad Haveri Gadag Uttar Karnataka Goa Parts of

Maharashtra

Board of Directors Elected Member 8

Ex-Officers 5

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 18: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

18

By Govt 3

Total Workers 272 Workers

Location Lakamanahalli Industrial Area Dharwad

Department 9

Brand Name Nandini

Products Milk

Homoginized Toned Milk Standard Milk Shubham Milk

Milk Products

Butter Ghee Pedha Curd Lassi Paneer Milk Powder

Co-operative Societies at

Village Level

960 Societies

s

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 19: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

19

Presidents

Director

(Elected-8)

Director

(Ex-officer-5)

Directors

(Presidents

Director

Ex-officer-5)

Nomi

Directors

Nominated-3)

Managing director

PampI Production Finance Admin Security Marketing

Dy

Manager

Dy

Manager

Dy

Manager

Dy

Manager

Sr

Supervisor

Dy

Manager

Extension

Officer

QC

Officer

Acs

Assistant

Assistant JrSupervis

or

Assistant

Helper

Helper Helper

Assistant Helper

Workers

ORGANIZATION CHART

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 20: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

20

NANDINI PRODUCT DETAILS AND RATE (NMP PRODUCTS)

Sl No Product Name Maximum retail

price

1 Badam Powder 200 gm TinKg 267-86

2 Mysore Pak 250 gmKg 267-86

3 Jamoon Mix 200 gm Kg 223-21

4 Homoginized milk 33-60

5 Shubham milk 33-68

6 Toned milk 29-76

7 Curd bulk 33-12

8 Dharwad pedha 192-00

9 Bulk khova 215-00

10 Bulk paneer 183-93

11 ghee 318-18

12 Milk powder 240-91

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 21: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

21

PRODUCT ndashPROFILES

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 22: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

22

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 23: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

23

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 24: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

24

DEPARTMENTS (DMU has Following Departments)

Procurement and Input Department

Production Department

Purchase Department

Finance and Accounts Department

Administration Department

Marketing Department

Quality Department

Security Department

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 25: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

25

PROCUREMENT DEPARTMENT This Department collects milk The raw

materials from farmers and other such associates

Flow Chart of Procurement Department

Manager

Procurement wing Technical wing

Deputy Manager

Assistant Manager

Extension officer

Deputy Manager

Assistant Manager

Clerks Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 26: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

26

PROCUREMENT AND INPUT DEPARTMENTS

Procurement and input department is concerned with procurement of milk and

input ie technical facilities Once a milk societies established the PampI

department starts functioning and makes other provisions

Milk procurement process done all the 365 days and two times a day and DMU

procuring milk routes will for the purpose of convenience of transportation

DMU making a minimum Rs8 for cow milk and Rs 1050 for buffalo milk Some

times price may vary with quality

Procurement of milk varies from season to during flash season ie from

September to late December the milk productivity will be high During summer it

will come down

Milk collected from the societies is taken to the nearest chilling centers Here the

Quality Ie fat and SNE content is checked and confirmed with that of the

checklist sent by the society

Then milk is loaded into tankers to be taken to the union There are nearly 8

chilling centers under the Dharwad Milk Union and about 513 milk societies

Once milk is brought to the union it is rechecked for the Quality and freshness and

then down loaded and directed to the production department

If the milk is spoiled it is brought to the notice of the society immediately But in

case of far away the driver then the contractor held responsible for the loss if

milk sent by tankers spoils societies due to the delay As per the law of the

society recommended by the union states that the members should supply milk

only to the union and other agency The extension officer at various chilling

centers takes care of this

They keep an eye over the functioning and avoid society milk to any other agency

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 27: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

27

INPUTS

To upgrade the functioning and expand the productive capacity of each society the

union provides many facilities

1 Remunerative price for the milk produced

2 Animal husbandry and veterinary health care programmed for the member

animals

3 Cross breeding programmers

4 Supplying powder seeds for animal development

5 Imparting training to all the members of co-operatives for smooth functioning

of co-operatives

6 Subsidized cattle feed to the members of the society

7 DMU has 13 Doctors to provide door-to-door service

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 28: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

28

PRODUCTION DEPARTMENT This department Handles the production

process

Flow Chart of Production Department

Deputy Manager Production Deputy Manager Production

Technical Officer Powder Plant Technical Officer Processing

Technical Officer Butter amp

Ghee

Operators

Operators

Dairy Workers

Dairy Workers

Helper

Helper

Manager dairy

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 29: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

29

PRODUCTION DEPARTMENT

The production department is nerve of the entire organization

The objectives of the production department

To follow up the production schedule as per the plan

To maintain the close and co-ordinate relationship with other key departments

To upgrade the technical efficiency of production

Production department is well equipped and has various types of highly

sophisticated machines imported from Sweden and Denmark Once the milk is

received from P amp I department it is first weighed with the help of weighing bowl

Later it is poured in dump tank Sample testing is made through lactometer reading

and other tests The fat and SNF content of each sample of milk is accessed the cow

and buffalos milk are separately received and sent to the production section

separately through two different stainless steel pipes

Later the raw milk is passed through plate chiller of variable capacity where it

is cooled up to 4-5 degrees Celsius This cooled raw material is further stored in a silo

of 30000 liters capacity

PURPOSE OF CHILLING

This is done to avoid the growth of microorganisms which are responsible for

spoilage of milk and bitter taste The milk which is stored in silos is pumped through

pipeline to the balance tank which helps to maintain the steady speed flow of milk in

the Pasteurization machine In DMU there are 2 milk Pasteurization machine and 1

Cream Pasteurization machine

PURPOSE OF PASTEURIZATION

Pasteurization is a process where milk is heated to high temperature and

cooled instantly to destroy any microorganism The pasteurized milk will stored in

Pasteurized milk silos and then sent to pre-packing section Packing is done in 500ml

and 1000ml and stored in cold storage at 7deg

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 30: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

30

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 and heated to 72deg using steam and chilled to 4deg using chilled

water and stored silos This skimmed milk is sent to powder section The pasteurize

cream is mixed in portion to pasteurized milk

CURDS

Raw milk is heated to 90deg and allowed to cool to 30deg Later culture is added to

it and packed the curd is formed in the packet itself It is stored and packed in

200gms and 500gms

BUTTER

The cream which is stored in cream refining tank is taken to the churning

section where it is churned Here butler fat and butter milk are separated The vacuum

pump removes excess of moisture and butter comes out of continuous butter making

machine (capacity - 1500 kgshour) Butler is packed in 100 200 and 500 gms and

also in 10 25 gms these are stored in deep freezer room with temperature - 22deg and if

the order of salt butter they mix the salt water with cream and other process is same

GHEE

There are 2 Ghee Boiler of capacity 1500 kgsbatch A Butter of 25 tons is

melted and is brought to Ghee Boiler Here it is heated to 116-117 degree Celsius for

15 minutes so that the residue is allowed to settle down and Ghee is passed to setting

tank through clarifiers Later Ghee is allowed for cooling (at 30deg-40deg) and packed in

Tin of Liter 500 ml and 200 ml of pack and kept in the cold storage

PANEER

If there is excess of milk then Paneer is been made The milk is heated to 900

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 31: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

31

for 15-20 minutes Glacial acetic acid is added to milk and then milk is strained

through fine muslin cloth The solid potion is retained and is put in water and then it is

put in chilled water and left overnight Later it is packed and stored in cold storage

MILK POWDER

When there is excess of milk Milk powder is made The capacity of the

powder plant is 12 tons There are two sections ndash Evaporator and Spray Drier through

which milk is converted to Milk Powder In Evaporator milk is boiled for 55deg at high

vacuum Milk is concentrated to drier 40-45 of milk is solid moisture is removed

and the milk power obtained consists of 4 moisture

PEDHA

Dharwad is famous for its delicious Pedha DMU has separate Pedha section

About 80 Liters (depends upon the demand) is heated continuously for 3 hours till the

milk is semi-solid later sugar and other ingredients are added and stirred continuously

on low flame Later it cooled and it is shaped in small balls and packed

Input per day

1 Milk processed is 70-75 thousand liters

2 5 to 6 lakh littres of water

3 10000 units of electricity

4 5 to 6 tones of coal

5 Generator in case of electricity failure out manpower

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 32: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

32

PURCHASE DEPARTMENT Its responsibility is to look after the purchasing

Process

Flow chart of purchase department

Purchase officer

Asst purchase officer

Helpers

Purchase officer

Purchasing superintendent

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 33: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

33

PURCHASE DEPARTMENT

As usual in any organization this department is engaged with purchasing of goods

ordered by the stores department

Dharwad milk union to maintain smooth functioning of all the departments to meet

the requirements at a right time

FUNCTIONS OF PURCHASE DEPARTMANT

Receiving indent (requirements) from various departments

Purchase material materials

Calling tenders for vehicles and sending quotation

Maintain comparative statements of all suppliers ie terms and

conditions

Sending the items purchased to quality control section for quality

checkup

Returning the defective goods to respective suppliers for replacement

In making purchase decision the opinion of -

1 Finance officers

2 Audit department

3 Audit department will be considered

4 Then finally MD approval will be taken

This department has liberty to purchase goods upto worth Rs 50000- beyond this

board is concerned for instance like machinery which cost lakh of rupees is a major

policy decision hence are left the board of Directors

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 34: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

34

FINANCE DEPARTMENT It handles all the Finance matters

Flow Chart of Finance Department

Deputy Manager

Asst Manager

Asst Accounts Officer

Asst Accountants

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 35: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

35

FINANCE AND ACCOUNTS DEPARTMENT

Accounts department is one of the important departments for healthy and

smooth running of business

Functions of finance department and Accounts department

1 Preparation of financial statements

2 Preparation of procurement and transportation charges bill

3 Payment of water bill electricity bill and miscellaneous

4 Payment of supplierrsquos bill

5 Payment to farmers for procurement of milk

6 Maintaining account of sale of milk and milk products

7 Preparation of Budget

DMU Follows to types of auditing

1 Pre-Audit System - done by Finance and Account Department every year

2 Statutory System - Done by private charted accountants every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 36: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

36

ADMINISTRATION DEPARTMENT It looks after the general

administration of the company

The department has the following structure

The Administration Department controls the overall functioning of the organization

The organization consists of the following three levels

Managerial cadre includes Managing Director Deputy Manager and Asst Manager

Supervisory level included technical officers and supervisors

Workers levels includes labors helpers

The Department also handles Canteen Security and Time Keeping

Deputy Manager

Asst Manager (Board) Asst Manager

(Personnel)

Admn Superintendent Admn Superintendent

Admn Assistant Time Canteen Security

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 37: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

37

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

This Department records the working hours of the employees 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 whenever an employee enters the premise he has to punch the card in the

time machine and before living the premise he has to do the same Based on this

attendance Canteen bills are charged wages are fixed and deduction are made

SECURITY DEPARTMENT

Dharwad Milk Union occupies 25 acres of land the whole premise is been

guarded by the security personnel The security people work in three shifts All the

vehicles are checked before entering the premise The departments is also maintains

separate registers like Store-in Register Attendance register etc

STYLES

The Styles of the organization is said to follow the bureaucratic type that is the

management cadre follow the bureaucratic type of administration The fact is that for

a manufacturing firm like the KMF Dharwad this type of administration is necessary

The Indicators of the Style are

Follows Orders rules and procedure

Is always Reliable Dependable

Watches DetailsPrefers to write out Communications

Is Rational Logical Self-Controlled Fair and Firm

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 38: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

38

STAFF

The staff deals with the various personnel Policies followed by the

Organization Below are given the personnel policies followed by the Organization

PERSONNEL POLICIES

There are around 383 employees working in Dharwad Milk Union There are

various policies followed by the Union The Human Resource Department is the in

Dharwad Milk Union Works as a sub Department of Administration Department

RECRUITMENT amp SELECTION

Due to registration termination retirement and transfers in the concerned

department head will give the manpower requirement along with the job description

according the HR department arranges for recruitment

The manpower sourcing is done through advertisement manpower consultant

employment exchanges and personnel reference and available data bank

PROMOTION AND TRANSFER

Promotion is solely on the basis of sensitivity and experience Transfers are

always accompanied by promotions

INDUCTION

After an employee is employed in DMU heshe has to be made familiar to the

union and also known the objective value functions and the operations This helps

the employee to interact with senior staff members from various departments

TRAINING

The Union emphasizes on training the employees Most of the training given to

the employees here are On-the-Job training and few Off-the-Job Training

Procurement and Technical Input Training (NDDB)

PG Diploma in Rural Management

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 39: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

39

Basic Computer Applications

Data Base Administrator

Finance Training for non-Finance Officer

Co-Operative management Training Programs

Clean Milk Production Training

Maintenance of Record and Auditing

Most of the Off-the-Job Training includes training programs in Anand Erode

etc

SALARIES AND EMPLOYEE BENEFITS

Gross Salary

A regular staff member in the Union will have a gross salary consisting of

Basic salary Dearness Allowance CCA House Rent Allowance and Conveyance

Allowance There are special benefits given to few employees like

Shift Allowance

There are separate allowances given to employees working in different shift

like

First shift Allowance

Second shift Allowance

Third shift Allowance

Heat Allowance

Separate allowance is given to those workers working near boilers and other

equipments

Cold Allowance

Separate allowance is given to workers working in Defreeze or cold

storage Further there is Uniform code for every employee The Union provides 2 pair

of uniforms to the employees every year

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 40: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

40

House Interest

The employee working in the union can take a loan from other external

sources and the Union will pay half the interest on the capital per month

Other benefits

Canteen subsidy Festival Advance medical Allowance surrender Leave

Skills

The skills here refers too the various skills the workers have here the workers

are further divided into three categories This first category contains the people who

are in the top-management level the second category consists of the supervisors office

assistants etc The third category consists of the supervisors office assistants etc The

third category consists of the workers at the operational

The first category consist of the people who are in the decision making

process in lO1F these people are highly qualified few Deputy Managers are to

industries like IRMA Anand dairy for Training

The second category is related to office work and fieldwork These people are also

trained in computer Applications secretarial skills accounting skills etc

The third level people consist of the workers who are actually into the operation

these people are also trained into fields like checking the quality of milk processing

packing etc

Shared Values

These shared values include the mission and vision of the organization It also

includes objective values Environment Policies etc KMF Dharwad has the mission

to provide a lucrative market for farmers to sell their milk and to provide best milk to

urban customers

Its Vision is to produce more milk and milk Products in the forthcoming years

KMF Dharwad also follows environment Policies The plant doesnt pollute the

environment The organization has its own Effluent Treatment Plant in its own

Premises

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 41: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

41

MARKETING DEPARTMENT It looks after the Marketing of the Products

Flow Chart of Marketing Department

Marketing Manager

Deputy marketing manager Technical Officer

Marketing Superintendent Development Officer

Development Officer Vanshroff

Marketing Assistant

Vanshroff

Marketing Assistant

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 42: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

42

MARKETING DEPARTMENT

The marketing department of DMU is considerably extensive which covers an

Area viz North Goa Uttar Kannada district Haveri Gadag Hubli and

Dharwad

Marketing of milk and products is done under brand name ldquoNandinirdquo Except

loose milk other products are marketed by KMF the marketing agency

Due to perishable nature of products the greatest responsibility is over

marketing department to all the products before losing its quality

Before pre-liberalization (July 21st 1991) the DMU enjoyed a monopoly due to

co-operative organization and other benefits received from the state government But

after July 21st 1991 the scenario totally changed new private diaries started grounding

like mushrooms with entrance of private diaries the DMU facing a tough competition

resulting into major loss of market share gradually over the years Today DMU has

only 23 of total market share DMU operates in 17 cities towns having a total

population of 105 million

The closest competitors with regard to market share quality of milk price and

goodwill are

Local vendor

Arogya

Sphurti

Datta

Sri Krishna

Gopal

Local brand milk like Navalur dairy milk

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 43: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

43

PRINCIPAL FUNCTIONS OF MARKETING DEPARTMENT AT DMU

1 To prepare the marketing plan at the beginning of every year taking into

consideration the demand sales production capacity and customer

performance

2 To promote milk and milk products through medices

3 To study competitors products and their strategies

CHANNEL OF DITRIBUTION OF DMU

Channel of distribution adopted by the organization plays a very significant

role in improving the market efficiency to promote the product and to meet demand

The DMU has required agents and own sales counter in 4 districts (ie Dharwad

Haveri Uttar Kannada and Gadag)

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 44: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

44

Dairy Cycle

MAIN DAIRY

AGENTS OWN SALES PERSONS

CONSUMERS CONSUMER

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 45: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

45

MEDIA OF MARKETING

1 News Papers

2 Magazines

3 Radio

4 Wall paint

5 Hoardings

6 Pamphlets

SALES PROMOTION

Sales promotions plans are done to

increase volume of sales within a short time

by providing discount incentives eat This is a promotional tool designed to generate

a demand for a produce

DMU have practiced promotional tools for agentrsquos promotion by providing

provision and facilities to increase sales

PRODUCTS OF DMU

1 Milk

a Nandini Toned Milk

b Nandini Standard Milk

c Nandini Shubam Milk

2 Milk Products

a Curd

b Lassie (Sweet and Masala)

c Paneer

d Peda

e Khova

f Ghee

g Butter

h Mysore pack

3 Milk Powder

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 46: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

46

SALES ACCOUNTING

This section of sales department is concerned is concerned with the accounting

work of the sales They keep a daily record of the collection default by the agents

other records related to sales When demanded quantity is delivered in the morning a

bank Chelan is sent to the agents The agents should remit the amount by evening to

any of the nearest bank to the ledger in case of his default the amount is entered into

the ledger against him The daily turnover of milk and milk products are around 5

lacks Out of the remaining 2 bank chellans one is sent to the bank and the other to

the finance department The consolidate records for each product is sent to the

financial department Weekly DMU has certain restriction with regard to pursue an

independent pricing policy marketing strategies to suit the local environment and

conditions

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 47: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

47

QUALITY DEPARTMENT It responsibility is to keep a check on the quality of the

Product

Flow Chart of Quality Control Department

Deputy Manager (QC)

Assistant Manager

Chemist Grade 2 amp 3

Dairy Workers

Helpers

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 48: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

48

QUALITY CONTROL DEPARTMENT

A qualified QC officer is in charge of this section which works in all the three

shifts The main of this department is to see and check the quality of milk and milk

products produced in the plant The activities of this section in brief are as listed

below

1 Tanker milk- fat snf temperature acidity cob and adulterants

2 Can milk- organoleptic fat amp snf of society samples and cob Of doubtful cases

3 Raw milk silo - stock check at beginning and end of shift temperature fat snf

clr and acidity

4 pasteurized milk silo- fat snf mbrt phosphates temperature and keeping quality

5 Butter-fat curd moisture salt yeast amp mould coli form count

6 ghee- moisture and free fatty acid

7 peda- moisture and total solids

8 Powder- SNF Moisture Burnt Particles etc

9 material testing- chemicals and packing materials

10 Water- hardness ph alkalinity total dissolved solids of raw soft and boiler blow

down water

There are various tests conducted by the officer in charge as well as the

assistants to meet this requirement If any product does not pass through the quality

standard then the product is rejected Even before dispatching Products undergo

testing and it is only after the approval of the quality department that the goods are

dispatched

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 49: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

49

Test conducted at DMU

When the milk arrives at DMU at the reception center a panel of well-

qualified persons in a laboratory tests the quality and quantity of milk There are

number of tests carried some of them are as follows

1 Clot on boiling (COB) test

2 Alcohol test

3 Taste

4 Flavor

5 Acidity

6 Corrected lactometer reading (CLR)

7 Gerber method for fat test

8 Milk-tested method

9 Moisture test

10 Solid not fat (SNF) test

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 50: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

50

SWOT ANALYSIS

Strengths

1 Nandini enjoys good brand image

2 Large procurement base

3 Huge infrastructure for processing

4 Competitive prices

5 Product dairies range of product

6 Wide distribution network leads to regular and timely supply

7 Milk processed is local milk which reduces the transportation cost

8 It enjoys highest market shares in the packed milk segment

Weaknesses

1 Perishable commodity

2 Lack of professional manpower

3 Bureaucratic method of functions

4 Lacking quality consistency

5 Less buffalo milk

6 Inadequate sales promotional activity Due to bad smell that persists causes

low sales

Opportunities

1 Huge market demand

2 There is scope for developing in new area

3 Availability of buffalo milk-improves market milk quality

4 Predominant of loose milk segment-divide appropriate strategies

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 51: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

51

Threats

1 Increase of competitors milk vendors unorganized sector

2 Flexibility in commission structure

3 No entry barriers for private players

4 Low level of consumer awareness

5 Persuade benefits of competing brand

6 Findings

Nandini products have a good brand image

Pricing strategies of Nandini is appreciated by its customers

Proper training programs are going on from few days past

Trade unions are inactive

Nandini is started with customers contact programs in order to get first hand feed

back from its customers and also to its product

SUGGESTIONS

1 More advertisements can be given to the products especially for newly

introduced products in print media which can attract more consumers

2 DMU should hike the commission of its agents or provide clarification for

providing same commission even after hike in price

3 They should provide clear clarification to the consumers that the hike in price

is fair by using tele media

4 Increase the quality of package so that it also clears agentsrsquo complaint and also

reduces damages loss

5 More security is required within the organization

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom

Page 52: Organisational Study of KMF

KARNATAKA MILK FEDERATION

JSS SMI UG AND PG STUDIES DHARWAD

52

BIBLIOGRAPHY

Marketing Management

Philip Kotler Person Publications 14th Edition

Financial Management

S CKuchal Arjun Publications 5th Edition

Human Resource Management

GBBaligar Ashok Prakashan 3rd Edition

Marketing Fundamentals

Kevin Lane Keller Pedia Publishers 7th Edition

Annual reports of KMF

WEBITES

wwwKMFNANADINIcom

wwwFMCGCoin

KMF Intranet

wwwMilkindustryorgcom


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