REPORT ON INDUSTRIAL VISIT TO

M/s Mother Dairy Ltd.

Patparganj, New Delhi.

1.Overview of the Company

2.Product Profile
3.Financial Status
4.Supply Chain Management
5. Processing
6.Quality Control
7.Market
8.Product Promotion Strategy
9.HR Practices
10.Important Observations

OVERVIEW OF THE COMPANY

Mother Dairy – Delhi was set up in 1974 under the Operation Flood Programme, a
wholly owned subsidy of the National Dairy Development Board (NDDB), whose current
chairman is Dr. Amrita Patel. Currently, it is one of the largest milk (liquid/unprocessed)
plants in Asia selling more than 25 lakh litres of milk per day, thereby enjoying a market
share of 66% of the branded milk sales in Delhi. Other important markets include
Mumbai, Saurashtra and Hyderabad. Mother dairy ice- cream was launched in the year
1995 and has shown continuous growth over the years, and today it boasts approximately
62% market share in Delhi and NCR.

It is Mother Dairy’s constant Endeavour to:

(a)Ensure that milk producers and farmers regularly and continually receive market
prices by offering quality milk, milk products and other food products to consumers at
competitive prices. To ensure this Mother Dairy operates such that the farmer gets 85%
of the total cost of sales.

(b) Uphold institutional structures that empower milk producers and farmers through
processes that are equitable.

Mother Dairy is an IS/ISO 9002, IS 15000 HACCP and IS 14001 EMS certified
organization. Moreover, its Quality Assurance Laboratory is certified by National
Accreditation Board for Testing and Calibration Laboratory (NABL)-Department of
Science and Technology, Government of India.
Milk Products:

Various milk products of Mother Dairy are:

1. Mother Dairy Ghee

2. Mother Dairy Butter

3. Mother Dairy Cheese

4. Mother Dairy Dahi (Curd)

5. Mother Dairy Lassi

Except all these milk products Mother dairy also manufactures Ice Cream under
two categories namely CHILLZ and Mother Dairy Ice Cream.

PROBIOTIC:

It is the latest product range launched by Mother Dairy. It mainly contains BB-12
friendly Bacteria which results in better digestion and absorption of nutrients. It also
contains probiotic fibre which also results in better digestion. The various products in this
category are:

1. b-Activ Probiotic Dahi 2. b-Activ Probiotic Lassi 3. b-Activ Curd 4. Nutrifit

(Strawberry & Mango)

SAFAL: Range of fresh foods & vegetables, frozen vegetables, fruit pulps and fruit
Juices etc.

FINANCIAL STATUS

Mother Dairy Foods Processing Ltd, also known as Mother Dairy Fruit & Vegetable
Private Limited, Patparganj, Delhi, has a turnover of about $500 million. Mother Dairy’s
turnover has been growing at the rate of 20% (CAGR) over the last 3 years and has
crossed the Rs.2700 crores mark in the fiscal 2007-08. Mother Dairy plans to achieve a
turnover of $1 billion USD by end of 2009.
SUPPLY CHAIN MANAGEMENT

1)Milk Procurement: - Mother Dairy sources its requirement of liquid milk from dairy
co-operatives and producer institutions. Milk is received from farmer cooperatives
through insulated road/rail tankers at very low temperature in order to retain its freshness.

2)Milk distribution: -79 tankers in the morning and 75 tankers in the evening bring in
milk from the regional collection centres. After collection the same tankers are utilized
for the delivery of the processed milk to the vendors and outlets. Mother Dairy has over
820 Milk Distribution Outlets in the National Capital Region. Each of these outlets place
their demand by raising an invoice one day in advance. The demand is also calculated
using the ‘Calendar’ Scheme, in this depending on the pre-calculated seasonal demands
the outlets place their orders accordingly. In order to satisfy immediate demand, 20 to 25
tankers are provided with a buffer stock of 500 litres each day so that they can be
mobilized to cater the demand in an area. To coordinate its operations all the tankers are
equipped with HAM radios.

Distribution Channels:

a)Token Distribution: Also, termed as “Lohe ki bhains” (metal buffalo), is an

automated milk vending machine.

b)COW: Container on Wheels or COW is a manual milk distribution program in

which cycle-rickshaws are employed for milk distribution

c)Retailers: The packaged milk is distributed via the retailer network throughout the
city

MARKET:

i. Mother Dairy markets approximately 2.8 million litres of milk daily in the markets of
Delhi, Mumbai, Saurashtra and Hyderabad.

ii.It sells 2.3 million litres of milk daily and undertakes its marketing operations through
around 14,000 retail outlets and 845 exclusive outlets of Mother Dairy.

iii.The company’s derives significant competitive advantage from its unique distribution
network of bulk vending booths, retail outlets and mobile units.

iv. The company markets an array of fresh and frozen fruit and vegetable products under
the brand name SAFAL through a chain of 400+ own Fruit and Vegetable shops and
more than 20,000 retail outlets in various parts of the country.

v. Fresh produce from the producers is handled at the Company’s modern distribution
facility in Delhi with an annual capacity of 200,000 MT.
vi. An IQF facility with capacity of around 75 MT per day is also operational in Delhi.

vii. A state-of-the-art fruit processing plant of fruit handling capacity of 120 MT per day,
a 100 percent EOU, setup in 1996 at Mumbai supplies quality products in the
international market.

viii. With increasing demand another state-of-the-art fruit processing plant has been set
up at Bangalore with fruit handling capacity of around 250 MT per day.

Product Promotion Strategy

Mother Dairy believes in direct contact with the customer. It organises various
seminars for children from different schools, students from various colleges and even
housewives to educate and increase awareness about milk and its products. All this is
done by the Customer Information Department wherein consumers are made aware about
goodness of milk, various stages of its processing, Q.A. practices and possible
adulterants.

Consumers can themselves see how impurities and adulterants can be easily detected in
the laboratories. The company also has a Mobile Lab that tests milk in residential
colonies.

As far as the sales are concerned, in order to increase their reach, Mother Dairy sells its
milk both in bulk vended and sachet forms. Various advertisements both in print and
electronic media are flowed time to time on a regular basis.

HR Practices

Mother Dairy is a unique set up which has the best of both the worlds. Like any other
private sector entity, it enjoys the freedom to appoint the requisite professional talent in
key positions and to take decisions with the flexibility and speed that is required in an
increasingly competitive market. It also gives employees the satisfaction that their work
touches the lives of millions of farmers and aims to enhance the economic status of our
rural population.

Mother Dairy has a diverse and welcoming workplace where in values of trust,
transparency, unquestionable commitment to quality, single-minded focus on excellence
and respect for the individual are simply a way of life. It is forging ahead in the market to
tap the limitless potential that lies there. To achieve the vision, they are always looking
out for dynamic talented professionals who have:

• The ability to take initiatives and drive things.

• Are ambitious and self starters.
• Love challenges and have a passion to excel
• The capability to initiate, lead and manage change in a highly diverse and
challenging environment.

1) The Company strictly follows the guidelines laid in by Quality Control Programmes
like KAIZEN, TPM etc. As a result, all the employees are well aware of their rights and
responsibilities. Also, it is amongst the only companies to follow TPM in not only
production but also in case of Human Resources.

2)The Company has just become ERP enabled by adopting “SAMAVESH” from 1st
August, 2008.

3) The Company is also environment conscious as it employs Solar Panels, Rainwater

Harvesting, Effluent Treatment Plants, etc.

4) Strict health and sanitation measures are employed so as to maintain high quality of
product quality and avoid any product contamination.

Management System Policy

•Apply state of the art technology and processes to enhance productivity that ensures
quality at competitive price.

• Apply processes for clean production, pollution prevention and optimize resource
utilization in all operations

• Follow food safety management system and apply HACCP (Hazard Analysis Critical
Control Points) principles to provide safe products to customers

• Comply with applicable regulations and legislations.

• Mother Dairy pledge to provide quality and safe products under clean and hygienic
Environment

The following steps are taken and ongoing efforts are continuously made as per
"Management Systems Policy"-
•Minimize Waste generation
•Conservation of resources
•Use of renewable energy
•Recycling & re-use

As far as the environment management is concerned it has the following arrangements-

• Solar Panels- In an effort to conserve fuel, Mother Dairy utilizes the solar enegy to
preheat the water going into the boilers. This also minimizes the pollution caused by
burning of fuels like coal.oil etc.
• Rainwater Harvesting- for maintaining groundwater level it has installed the plant in the
premises.
Effluent Treatment Plant- The water used for cleaning the equipment and tankers is
treated at the effluent plant in the dairy before being discharged into the sewage system

AWARDS:

Mother Dairy has its own list of achievements as it has been given awards for various
reasons from time to time. It has got ‘Best Productivity Award’ two times for three
consecutive years starting from 1987-88 to 1989-90 and again from 1995-96 to 1997-
1998. It was also awarded ‘Energy Conservation Award’ in 2005-2006 and has also got
‘Innovation Award’.

IMPORTANT OBSERVATION:

The most important observation during the visit was the hygiene factor present there. The
premises and the plant area was clean, the employees have the orders not to touch milk
with bare hands and they get their machines and silos cleaned every weekend to ensure
that the milk produced is safe for the customers.

Moreover, they have a specific TPM (Total Productive Maintenance) policy for
everything like for distribution, energy conservation, environment etc. and KAIZEN
policy for all the employees which they have to follow.

They have these policies as strict code of conduct as they are manufacturing milk which
requires purity and hygiene and to give the best to the customers the company needs to do
this. That is why their policies can be seen at most of the places in the premises.

The various departments in Mother Dairy Patparganj milk plant were:

1. Manufacturing Department
2. Production Department
3. MIS Department
4. Utility Department
5. Safety, Health & Environment Department
6. Thermal Department
7. Electrical Department
8. Automation Department
9. Procurement Department
10. Consumer Information Department