Amul’s entry to South India

0
106

Amul has been the first Indian dairy firm to find its place in the top 20 global list published by Rabobank, a multinational banking and financial services firm in the Netherlands. Amul, the power behind the white revolution, that made India the largest dairy producer, has been exporting other dairy products in South India, including cheese and butter. The aim of Amul is now to sell 3-4 million liters of milk in the country, with Andhra Pradesh as its base.

R.S  Sodhi, Managing Director, Gujarat Cooperative Milk Marketing Federation, which is selling its products under the Amul name, said in an interview that they began with the West, then went north, and east. They hadn’t gone south yet. Over the last 10 years, they have found that a lot of private investors have come in, and some of them do not give reasonable rates in the market. But they felt this was the best possible chance. Now if they don’t reach the South they’re going to lose, and they’re going to owe those players a cakewalk.

Sodhi said the aim is to take the company to around 10,000 crores. Over the next two years, the company will invest around 200-300 crore  Ironically, famous dairy brands in the South among  Karnataka’s Nandini, Kerala’s Milma, and Tamil Nadu’s Aavin were all once established as farmers’ cooperatives, emulating Amul’s booming success.

Amul has 52,000 crores of annual revenue. A clash between a giant cooperative and various regional players may be seen at its entrance into the south.

Rajesh Nair, Milma ‘s marketing manager, managed by the Kerala Cooperative Milk Marketing Federation, said that Amul has recently conducted surveys in southern cities and that Amul has developed its plans. Brands like Milma considers the trick is in the right kind of strategy because there’s no easy way to differentiate oneself in the dairy industry. It has pushed them to find larger and younger means of selling themselves. Presently they are investing ₹110-15 crore on ads. They also have a national advertising agency.

 The entrance of Amul could also lead to wars over ice creams: the company’s surveys indicate high demand for products based on milk such as ice cream. The entry also prefigures a political conflict. The Andhra Pradesh government led by chief minister Jagan Mohan Reddy has recently signed an agreement with Amul, extending support to launch its dairy company. The dominant dairy business in the state, Heritage Foods Ltd, is owned by N Chandrababu Naidu’s family, the principal opponent, and predecessor to Reddy.

LEAVE A REPLY

Please enter your comment!
Please enter your name here