TAD NewsDesk, New Delhi: Southern Indian states have been dominated by legacy dairy co-operatives for decades. Amul, the largest Indian dairy brand, is now making a push to enter the southern region, which would challenge the business symmetry in five concerning states.
Amul, the propeller behind India’s white revolution, making India the largest producer of milk, had been offering cheese and butter and few other dairy products in southern states. Now, they plan to make Andhra Pradesh as the hub and sell around 3-4 lakh litres of milk in these five states.
R.S Sodhi, managing director of Gujarat co-operative milk marketing federation, which sells milk under Amul brand said, “We started with the west and then went to north and east but somehow we had not gone to south.”
He further added with an air of clarity that, few private players have entered the market who, are not offering competitive prices to market, in a decade or so. Thus, this is the best time to enter the market or else we will be left behind.
Sodhi told about investment plans of around 200-300 crores in the next 2-3 years and, the aim is to take the business to around 10,000 crores.
A report published by livemint.com suggests that the south’s dairy business would see collision between the regional players and Amul, a giant cooperative which has annual sales of around 52,000 crores.
Ironically all the big dairy names of south – Karnataka’s Nandini, Kerala’s Milma and, Tamil Nadu’s Aavin – all started out as Farmers co-operative following the path of Amul.
Rajesh Nair, marketing manager at Milma, spoke about their preparation as the news of surveys in southern states by Amul is out. He believes that when it comes to dairy products, right kind of marketing is the key, as the products are not very distinguishable.
He further added that the news of entry of Amul in the market has forced them to rethink their marketing strategies and spending, which have increased to 10-15crores from 2-3crores and, the plans are to empanel a national agency for advertising.
There is a political connotation to this market space fight, as Jaganmohan reddy, the CM of Andhra, has joined hands with Amul to expand its business in the state. The rival opponent of Mr. Reddy, Chandrababu naidu’s family owns the largest dairy brand of the region – Heritage foods.
Andhra is one of the largest milk producing state with estimate of around 40million litres each day.
“Geographically, Andhra Pradesh is a large market, which is connected to various good markets like Chennai, Hyderabad, Vizag. So, we thought we can make Andhra a hub and enter fresh markets of the south,” spoke Sodhi.
Karnataka cooperative owned Nandini is expanding aggressively with opening milk-based cafes to attract youngsters and highway riders, said a person associated with the brand.
Sodhi, however, staunchly disagreed about the suffering of local cooperatives, as the trend has been that, wherever Amul has entered the locals have also flourished simultaneously.
