Amul: The Success Story | Verghese Kurien| Role of R.S. Sodhi

Amul: The Success Story

Hey friends! How have you been? Hope you are doing well. Milk is a basic need of human life. It is worth mentioning that India is the largest producer of Milk. In bringing India to this stage, Amul played a significant role. Today we are going to see, that how this milk giant company was established, how it became a saviour for the milkman and how this company made the White revolution successful in India.

So let's begin.

A Brief Look Into Amul

Amul is an Indian dairy cooperative society headquartered in Anand, Gujarat. Founded in 1946 by Tribhuvan Das Patel, this company now holds a total revenue of ₹ 38,550 crores. Formerly named as Kaira District Milk Union Limited, was founded by the efforts of Tribhuvan Das Patel, Verghese Kurien and H.M. Dalaya. The establishment of Amul is known as the beginning of the White Revolution. It is the backbone of the self-reliant quality of India in terms of milk production. Today the company is managed by Rupinder Singh Sodhi. He also played a key role in expanding the business of the company and making the milk sector even stronger.

Beginning from 1946

Let's start from the year 1946. At that time, exploitation of Landless labourers was at its height. These labourers started depending on cows for their income. But this didn't prove much beneficial. Their milk was not bought on the original prices; sometimes they weren't able to sell their milk. As a result, Sardar Vallabhbhai Patel, Tribhuvan Das Patel and Moraji Desai held a meeting in which they found ways to stop this exploitation. They reached to a conclusion that Cooperative Societies are must to save the community from exploitation. As a result, they laid the foundation of Amul.

Revolt against Polson

Polson was a Dairy company in India. It flourished in its trade but still was not able to improve the condition of the farmers. Later, by a monopoly with the government, farmers were not allowed to sell their milk to any vendor except Polson. Then, it was also brought to light that Polson allows their cream to sour for a few days and then was heavily salted to make butter. This was brought to the attention of Sardar Vallabhbhai Patel who has been toying with the idea of a cooperative society. He led a revolt against Polson and its revenue fell drastically. Even it was forced to redirect it's business to tanning and leather production. After this revolt, a cooperative society named Amul was set up in 1946.

Role of Verghese Kurien

The father of White Revolution, Dr. Verghese Kurien was the main hand behind this project. He rejected all his job offers and sacrificed his whole life for the project. For 20 years, he moved from one village to other, studying the circumstances before starting the project. A perfect philosophy is much needed for a perfect company. Dr. Verghese Kurien philosophy was value for many and value for money. The whole Amul company is based on this philosophy. Value for many is for the milkman. This means they get a deserved profit for the milk. And value for money is for the customers. That they can get milk at an affordable price. 

The Co-operative Model of Amul

Every milk industry is based on three stages. They are milk procurement, milk processing and milk packaging. The total cost of these is 15% of the cost of milk. And this is normal. But the game-changing move comes here. Normally for an FMCG (Fast-Moving Consumer Goods) company, the cost of distributors, retailers, wholesalers, transporter, logistics, etc is around 30%. But Amul manages all this cost in just 5%. This is the move which makes it affordable. Furthermore, it is a cooperative society, so 80% of the profit is distributed wholly to the milkman. No mediators come in between. This also ensures that a large no of milkman joins in their family. Approximately, 1 Lakh milkman are joined with Amul. The farmer also knew that the maximum price of their milk can only be paid by Amul. This also resulted in expanding its milk procurement. The company which started with only 300 Litres of milk in 1947, had procured 3 crore Litres in 2017. 

The manufacturing process of Amul

Be it milk, cheese, butter, ice cream Amul has always been ranked number one. There also lies a special model for its manufacturing units. They manufacture at three levels. They are village level, district level and state level. In Village level, they normally procure the milk, pack it, process it and sell it. In district level, the milk is procured and is transferred to a town. There they process the milk, pack it and sell. All the milk of Amul is processed in district level only. At the state level, they only process the by-products of milk. Normal milk is not processed at this level. All the by-products of milk are produced at this level. The whole system of Amul is systematic and automatic. Even when a milkman approach to Amul to sell milk, machines are used. Automatic fat testers are present. The milkman gives their milk to be tested. Fat concentration and quality are tested. Amul not only gives the price for the quantity of the milk. The milkman is paid for also the quality. More the quality of the milk, more the milkman is paid. And this whole system is mechanised. Milkman also gets his payment on the same day and no fuss occurs. Due to this systematic production and because of this satisfaction the milkmen gets, Amul can expand their production. 

Role of R.S. Sodhi

R.S. Sodhi is the next backbone of Amul after Dr. Verghese Kurien. Presently he is working as the Managing Director of the Company. He worked with Dr. Verghese Kurien for many years. When he became the Managing Director of the company, he made outstanding progress in the procurement of the milk. Secondly, he added numerous products in Amul. It is often said that bigger the net more the fishes get in. So he expanded their variety line. He added more than fifty products in just ten years. Due to this variety, the sales also increased. Even if one product fails, it doesn't affect the revenue as there are other products which fill that hole. Since Rupinder Singh Sodhi became the MD, the farmers' income has been risen by 4%, milk procurement rose by 2%, more than 50 new products have been added and the turnover of the company rose by 230%. Just outstanding!!! Moreover, he also improved the distribution network of Amul. The retail counters of Amul have been tripled after the coming of R.S. Sodhi. 

Umbrella Advertising and Amul Girl

R.S. Sodhi created a variety of products and a variety of product segments. To lower their advertising cost, they created a uniform umbrella brand. Be it milk, chocolate, ice cream, curd, ghee there is only a single brand Amul. They only advertised and talked about the brand Amul. And the 50+ products sales have increased on the name of Amul. So by this, they only advertised a single name, but the sales increased of all the products. The product wholesales were low, also started increasing because of this umbrella branding and advertising. This also lowered its advertising cost. Be it in TV ads, social media, Print media they were only supposed to advertise one single name 'Amul'. And how can we forget their famous advertising identity: the Amul girl. This Amul girl has created a world record of longest advertising campaign ever on earth. Do you know why this tAmul girl had still not gone outdated? Why this Amul girl is still prevelant in the society? Because the brand identity Amul girl showcases the reflection of the contemporary society. Means it speaks what the public is speaking in the world. For example, when the song came of Badtameez Dil, which was on the mouth of every individual then, they made an advertisement for Buttermeez Dil. When the famous dialogue of Bahubali came, Bachon Se Badon Tak (बच्चों से बड़ों तक), the Amul girl spoke Bachon Se Belly Tak (बच्चों से Belly तक) and then showed their butter. When the film, Gangs of Wasseypur, came they made an ad of Gangs of Maskeypur. Like this, they always showcased the trend of society. They moulded their advertisement according to the current trend. 

Conclusion

As you saw how Amul is a success story in itself. This company was the main reason for the success of the White Revolution in India. And it was this India which was a milk deficit country in the 1950s. It was this India which imported milk from New Zealand to meet its need. But in present, it is this India which is now the largest producer of milk. It is this India which is now a leading exporter of milk. Amul was the most important hand behind this project. Let me give an example. Biplab Dev, the current chief minister of Tripura, once said that you can also raise cows to make a living. Then, the news anchor of India Today, Rajdeep Sardesai, targeted Biplab Dev through this statement. He tweeted that leftist party was good in Tripura. Biplab Economics is here. But the MD of Amul, Rupinder Singh Sodhi, made an excellent statement. He retweeted to Rajdeep Sardesai, "Very practical and logical suggestion as Tripura is milk deficit state and importing crores of rupees milk. A youth in Tripura can earn 6-7 Lacs per annum with 10 cows. He also stated that raising cows is not a poor business. It is economically viable. He also stated about Kanuben Patel of Banaskantha, Gujarat. She was awarded as the pride of Gujarat because she poured milk worth Rs. 84 Lakhs in a year just by raising cows. It was a good source of livelihood for her. There also lies another example of Navalben Dalsangbhai Chaudhary, who made Rs 1 crore just by selling milk. 

Amul has increased the level of farmers at this level. So, in a nutshell, we can conclude that Amul not only was able to make the White Revolution a successful project but also increased the standard of milkmen drastically.

I hope you would have liked the post. In the end, I would just like to say, ' ENJOY READING'!

-Dibyaansh Pradhan