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A study and analysis of customers perception on nandini milk and it’s products at hassan city
In my Management Thesis, I am going to make “A study and analysis of
customer’s perception on the dairy products of KMF (Karnataka Milk Federation) at
This KMF is serving since 33 years in Hassan city. The products have got their
own brand image and also the customers. Though the service which they are providing to
their costumers we can know how the organization is serving the customers with its
A study on customer’s perception of milk and its milk products with reference to
Nandini and is undertaken for assessing the customer’s behavior towards Nandini milk
and its milk products and to understand the expectations of the customers towards milk
and its milk products which will in turn help to take appropriate action by the
management for removing the short falls. For this purpose the following parameters were
taken in to consideration and questionnaire was prepared to elicit the information.
• MONTHLY INCOME
• SIZE OF THE FAMILY
To interrogate customer’s area-sampling system was adopted, since the population
is undefined a total of 100 respondents were considered to elicit the information, which
are analyzed, interpreted and placed under with comments, charts and findings.
The idea that customers prefer one product or one service over another is not new. The
ability to identify and measure the elements of such preference decisions with any
accuracy and reliability has only recently become available. Research into this area of
consumer behavior has brought understanding to some of the major issues with standard
customer satisfaction research. Most importantly, we have come to realize that high
customer satisfaction does not assure continued customer preference. Satisfaction
research over the past fifteen years demonstrates that high satisfaction scores, while a
measure of organization performance on a set of important criteria, do not adequately
H.R.Institute of Higher Education, Hassan Page 1
explain the composition of preference formation and therefore often serve as insufficient
predictors of sustained preference or what is normally referred to as customer loyalty.
Loyalty as a concept has also shown itself to be difficult to define. Like beauty, loyalty is
truly in the eye of the beholder. We understand there are different types and degrees of
loyalty and some of these are not appropriate in describing the relationship between a
consumer and a company. However, preference (defined as the power or ability to choose
one thing over another with the anticipation that the choice will result in greater
satisfaction, greater capability or improved performance) has demonstrated the ability to
be effectively measured and to provide meaningful insight into the choices consumers
make when selecting one provider over another and when determining to continue a
relationship over time. Preference is formed when the customer is bonded to your
company through the establishment of a mutual benefit. Successful companies therefore
go beyond delivery of a commodity or service; they pursue the development of a
relationship with their customers. This bonded relationship will be more likely to survive
competitive attacks than the mere purveying of goods or services or an over reliance on
aggressive pricing models.
We evaluate the performance in light of how well the milk Products, service meets
our preference expectations.
H.R.Institute of Higher Education, Hassan Page 2
Statement of the problem
At present in this competitive business world the milk industry has more than 60
brands in the battle field facing stiff competition in every segment’s targeted. Even
Nandini milk is also facing stiff competition even its 35 years of heritage. In this juncture
it has to identify its competitors in this market by bringing brand awareness in minds of
consumers also it has to cope up with the consumer behavior and customer perception.
Through this study, the main problem that it studies during this project work is to find out
the customer preference and customer perception towards Nandini Milk and its milk
products and the awareness of brand among the consumers of Hassan district.
Need for the study
Management needs to know the customer preference information in order to take
sound decisions. Surveys on customer preference can produce favorable or unfavorable
result, but bringing a number of benefits to management. A study on customer preference
helps to understand the performance of the organization and the behavior of the
customers. The study of customer preference indicates the expectations of the customers.
Customer preference helps to understand the loyalty of the customer towards the
products. The management finds a possible way to fulfill the expectations of customers
and attracts new customers
Scope of the Study
The study aims to find the customers preference of milk products with reference
to Nandini. The study is restricted to information regarding the customer’s likes and
dislikes, their, personal decisions and family decisions and loyalty of the customers. The
study has been carried out for period of 3 months and has focused on all type of
Objectives of the study
To study the customer perception on Nandini milk.
To study the brand awareness of Nandini milk and its milk products by survey.
H.R.Institute of Higher Education, Hassan Page 3
The main purpose of the study is to identify the awareness of branding system and
customer perception in specific relation to Nandini products.
To study the customer perception over the Nandini products among the consumers
of Hassan district.
A Research design is the arrangement of conditions for collection and analysis of
data in a manner that aims to combine relevance to the research purpose with economy in
A Research is purely and simply the framework and plan for the study that guides
the collection and analysis of data. It is a blue print that is followed in completing a study.
• Research is an art of scientific investigation.
• Research is a process of systemic study.
• Research is a search of knowledge.
• Research is an area of investigation which includes collection, analysis and
interpretation of data.
• Research has to proceed systematically in the already planned direction with the
help of a number of steps in sequence. To make the research systemized the
researcher has to adopt certain methods. The method adopted by the researcher for
completing the project is called Research Methodology.
Types of Research Design
1. Exploratory research design.
2. Descriptive research design
3. Experimental research design.
Data Collection Method
Data refers to information or facts. It is not only refers numerical figures but also
includes descriptive facts. The method of data collection includes two types for the study,
such as primary data and secondary data.
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Primary Data Collection Method
It was collected directly from executives and customers. The information
collected from executives through personal and direct interview to collect primary data a
detail and structured questionnaire was formed to suit the objectives of the study which
contain definite and predetermined questions, containing information relating to Nandini
milk and its milk products.
Primary data is the data that is collected for the first time by the researcher. The
Primary data are collected with specific set of objective to assess the current status of any
variable studied. Primary data is useful only for particular period.
Methods of Primary Data Collection
The Main four methods used in primary data collection are:
In this study questionnaire method have been used
In this method, pre printed list of questions arrange in a sequence which is used by
the researcher for collecting data.
The questionnaire is filled by the respondents. The questionnaire is considered as
the heart of the survey.
It was used mainly to support the primary data. Secondary data was collected
through books, annual reports, significant, literature from the organization and previous
reports, magazines, vouchers etc.
Research Design Tool:-
H.R.Institute of Higher Education, Hassan Page 5
To make research various surveys are conducted they are as follows:
The various data are collected from primary and secondary source through the
questionnaires; books, journals, old reports and annual report were used.
A sample is a portion of the whole on which the study is based. Hear a sample size
of 100 respondents were chosen from different areas of Hassan district, and the
questionnaires were duly filled data relating to the objectives of the study is obtained by
meeting customers/consumers in area like Hassan town.
A Sample design is a definite plan for obtaining a sample from a given population.
It refers to the technique or the procedure that the researcher would adopt in selecting
items for the sample. Sample design may as well lay down the number of items to be
including in the sample. i.e., the size of the sample. Sample design is determined before
data are collected. There are many sample designs from which a researcher can choose.
Some designs are relatively more precise and easier to apply than others.
Sampling is a procedure by which the respondents are selected. There are
basically two types of sampling methods are:
1. Probability sampling methods.
2. Non-Probability sampling methods.
In this study area sampling method was adopted (Probability Sampling) the required
number of customers were not selected according to area sampling procedure but the
required number of sample (sample size 100) were selected.
The response from the customer may be biased.
Since the sample size is limited, it may lead to the partial true factor about the
The information obtained or the collection of data is limited.
H.R.Institute of Higher Education, Hassan Page 6
Due to time constraints the study is restrict to Hassan only.
2.1 Industry Profile
Dairy is a place where handling of milk and milk products is done and technology refers
to the application of scientific knowledge for practical purposes. Dairy technology has
been defined as that branch of dairy science, which deals with the processing of milk and
the manufacture of milk products on an industrial scale.
In developed dairying countries such as the USA, the year 1850 is seen as the dividing
line between farm and factory scale production. Various factors contributed to the change
in these countries viz., concentration of population in cities where jobs were plentiful,
rapid industrialization, improvement of transportation facilities, development of machines
etc., where as the rural areas were identified for milk production, the urban centers were
selected for the location of milk processing plants and product manufacturing factories.
These plants and factories were rapidly expanded and modernized with improved
machinery and equipment to secure the various advantages of large-scale production.
Nearly all the milk in the USA before 1900 was delivered as raw (nature) milk. Once
pasteurization was introduced, it developed rapidly. Mechanical refrigeration helped in
the rapid development of the factory system of market distribution.
Milk may be defined as whole, fresh, clear lacteal suretion obtained by the complete
milking of healthier milk animals. It represents the perfect food for man nearly than any
other natural food. An adequate consumption of milk can correct dieting deficiencies for
most people strong, healthy bodies. It is delicious and appetizing food as well as being
H.R.Institute of Higher Education, Hassan Page 7
The major constituents of milk are water, fat, protein, lactose and mineral water. The
major constituents are phospholipids, sterols, vitamins, enzymes, pigments etc. The true
constraints are milk fat, casein and lactose. Milk is absolutely essential for the welfare of
the human race. The cow has been rightly called, “The Foster Mother of Human Race”
and she is found in most of the civilized countries of the earth.
2.1.1Asian Dairy Scene
With 60% of the world population, Asia accounts for only 20% of the global milk
production. The total world production of more than 500 million tonnes for a population
of about 4 billion amounts to and average annual per capita availability of 100kg. The
corresponding figure for Asia is only about 27 kg and the consumption is about 30kg.
Some 10% of milk consumed in Asia is imported. In several Asian countries, imports of
dairy products, both as finished products in consumer packs and in bulk for
recombination in to milk have helped create a dairy market and a milk processing
The Asian countries have been producing over 96% of the world’s buffalo milk output,
estimated at 48 million tones, India accounts for more than 30% of it. The recent
formation of the Asian Buffalo Association will help overcome the neglect that the
buffalo has suffered for decades.
2.1.2 Dairy in India
In India, dairying has been practiced as a rural cottage industry since the remote part.
Semi-commercial dairying started with the establishment of military dairy farms and co-
operative milk unions throughout the country towards the end of nineteenth century.
During the earlier year, each household in those countries maintained its family cow or
secured milk from its neighbor who supplied those living close by. As the urban
population increase, fewer households could keep a cow for private use. The high cost of
milk production, problems of sanitation etc., restricted the practice, and gradually the
family row in the city was eliminated and city cattle were all sent back to the rural areas.
The Indian dairy industry has made rapid progress since independence. A large number of
modern milk plants and product factories have since been established. These organized
dairies have been successfully engaged in the routine commercial production of
H.R.Institute of Higher Education, Hassan Page 8
pasteurized bottled milk and various western and Indian dairy products. With modern
knowledge of the protection of milk during transportation, it become possible to locate
dairies where land was less expensive and crops could be grown more economically.
In India, the market milk technology may be considered to have commenced in 1950 with
the functioning of the Central Dairy of Aarey milk colony, and milk product technology
in 1956 with the establishment of AMUL dairy, Anand. The industry is still in its infancy
and barely 10% of our milk productions under goes organized handling.
2.1.3 History of Indian Market Milk Industry
• Organized milk handling was made in India with the establishment of Military
• Handling of milk in co-operative milk unions established all over the country on a
small scale in early stages.
• Long distance refrigerated rail-transport of milk from Anand to Bombay since
• Pasteurization and bottling of milk on a large scale for organized distributed was
Aarey - 1950
Calcutta(Haringhata) - 1958
Delhi - 1959
Worli - 1961
Madras - 1963
• Establishment of milk plants under the 3- year plans for dairy development all
over India. They were taken up with the dual object of increasing the national
level of milk consumption and ensuring better returns to the primary milk
producer. These main aims were to produce more, better and cheaper milk.
In terms of percentages we have 51% of the Asian population.
A situation prevailed in the case of milk about 30 years ago; when the exploitation by
middlemen had forced the milk producers to sell milk at throw prices. The answer to such
a situation was found in developing a system that enables milk producers to own and
H.R.Institute of Higher Education, Hassan Page 9
operate, not only their processing facility, but also the inputs, delivery machinery, and the
marketing of finished products.
The integrated approach first proved very successful in Kaira-the AMUL organization
and through the Operation Flood Programme, aimed to establish similar farmer’s
organizations in 18 districts in the country. The Programme when implemented did face
some preliminary problems, but these were overcome, so much so that when the IBRD
and World Bank came forward to finance dairy projects in Karnataka, Rajasthan and
Madhya Pradesh. The results were that 12 milk producers’ co-operative unions were
established. Based on the success of these 30 unions, bodies owned by the farmers
themselves. The other phase of dairy development, Operation Flood II, being
implemented to bring the total number of such district unions to 155, and cover some 10
million farmers. The success of these 30 unions have further demonstrated that problems
can best solved if the agency implementing the programme is owned and operated by the
producers themselves, who employ the best professionals that the responsibility of such
an organization is not only to guarantee a remunerative market for the rurally produced
commodity by its member producers, but also guarantees a package of input for
enhancing production (milk) and ploughs back the profit for further development. Again,
in the case of milk, since marketing of the product was largely controlled by
middlemen/trade/cattle keepers/etc., the organized dairy was not in a position to pay a
better price to the milk producers. Market intervention was therefore required to enable
these dairies to supply milk to the consumers at reasonable prices. This was the first time
that food aid skimmed milk powder, and butter oil in this case-was used to prime the
pump of the modern dairies in four metropolitan cities (Calcutta, Bombay, Delhi and
Madras), and permit them to demand on all much large scale. The funds generated
through the sale of skimmed milk powder and butter oil were used to build up farmer’s
organizations in the milk sheds those supplies to these metropolitan cities.
2.1.4 Achievements of Dairy co-operatives in India
Dairy co-operative society is a basic organization unit functioning at the village level.
The Dairy Co-operative network
• Includes 170 milk unions.
• Operates in over 285 districts.
H.R.Institute of Higher Education, Hassan Page 10
• Covers nearly 1, 01,000 village level societies.
• Is owned by nearly 11 million farmer members.
2.1.5 Milk Production
• India’s milk production increased from 21.2 million MT in 1968 to 84.6 million
MT in 2001-02.
• Per capita availability of milk presently is 226 grams per day, up from 112 grams
per day in 1968-69.
• India’s 4% annual growth of milk production surpasses the 2% growth in
population; the net increase in availability is around 2% per year.
• In 2001-02, average daily co-operative milk marketing stood at 134.23 lakh litres;
annual growth has averaged about 5% compounded over the last 5 years.
• Dairy co-operative now market milk in about 200 cities including metros and
some 550 smaller towns.
• During the last decade, the dairy milk supply to each 100 urban consumers has
increased from 175 to 473 liters.
• Bulk-vending-saving money and the environment.
• Milk travels as far 2200 kilometers to deficit areas, carried by innovative rail and
road milk tankers.
• Ninety five percent of dairy equipment is produced in India, saving valuable
H.R.Institute of Higher Education, Hassan Page 11
2.2 Company Profile
HASSAN CO-OPERATIVE MILK PRODUCERS SOCIETIES UNION LTD, was
established with an aim to support small, marginal farmers and agricultural labourers
through dairy development. As the farmers are not sure of receiving a remunerative price
for their agricultural produce more and more farmers are taking up dairying as their main
occupation rather than subsidiary occupation for their livelihood. The milk union is
committed to accept all the milk offered by the milk producers in the milk shed area and
hence there is a considerable increase in milk procurement during 2004-05, 2005-06 &
2006-07. We at Hassan Milk Union believe that it is a social obligation on part of the
union to pay remunerative price to the farmers and hence we have entered new and far off
markets like ,Pune and kolhapur in Maharastra, Trivendrum and Kollam in Kerala.
2.2.1 Background and Inspection of The Company:
The Hassan Unit started its Dairy development activity during 1975 with the World Bank
Financial assistance under the guidance of Karnataka Dairy Development Corporation.
During 1975 an integrated project was launched in Karnataka to restructure and recognize
the dairy industry on the co-operative principles and to lay foundation for new direction
in dairy development. Work on the first ever the World Bank aided dairy development
project was initiated in 1975. Initially it covered 8 districts of Karnataka such as Mysore,
Hassan, Tumkur, Dharwada, Belgaum, Shivamoga, Chikkmagalore, and Kodagu.
Hassan Co-operative milk producer’s society union ltd. was set up to implement the
project by Karnataka dairy development co-operation (KDDC) in 1975. It was registered
on 30th March 1977and the operational jurisdiction of the union extended to 3 districts
namely Hassan, Chikkamagalore and Kodagu.
H.R.Institute of Higher Education, Hassan Page 12
ISO 9001:2000 certifications have been obtained for Quality, And HAMUL are in the
process of obtaining HACCP quality certification at on early date.
2.2.2 Nature of Business Carried
Hassan milk union carried on the business of producing and marketing milk and milk
Products, such as Peda, curd, Ghee, Buttermilk.
Hassan milk union procuring surplus milk in the rural area and provide input activities to
dairy co-operative societies like artificial insemination, supply cattle feed, animal health
care programs for the upliftment of the producers. It purchased some products from KMF
viz Nandini milk-toned bottle, Badam powder, Jamoon mix, Nandini bite, Skimmed milk
powder (SKM), Mysore pak etc. All purchased and produced products were sold by its
2.2.3 Vision and Mission
The Union thrives hard to adopt the modern & eco friendly technologies to produce
milk & milk products of international standards to make our presence prominent in
the global market.
KARNATAKA MILK FEDERATION CO-OPERATIVE SOCIETY wants to
develop their milk union like AMUL CO-OPERATIVE SOCIETY.
Hassan Milk Union aims to render the best service at nominal cost to its members to
increase milk production and produce good quality milk by paying remuneration price
H.R.Institute of Higher Education, Hassan Page 13
throughout the year, thereby improving their economic and social condition while
ensuring high quality milk & milk products to the delighted level of the consumers at
To increase their sales from 60000-80000 liters per day by next five years
To increase quality of milk and fulfill the needs of the customers.
2.2.4 Goals & Objectives:
The milk union was started on 4th June 1975; they want to develop their milk union like
AMUL CO-OPERATIVE SOCIETY.
To increase quality of milk.
To increase their sales from 70,000-80,000 liters per day by next 5 years.
Increase the milk dealers parlours from 23-40.
Increase the sales by conducting many programs like consumer information programs,
consumer dairy visiting programs, hotel owner information program etc.,
To increase the members of the union to 49,000.to regularly supply the toned, double
toned NANDINI milk to all the cities according to customer needs
2.2.5 Ownership Pattern
The Co-operative society members are eligible for electing the President and other
governing members. The President heads the elected body. The elected body controls the
societies and they keep a close watch on the working of the Co-operative societies and
Selected & Administration Department
The employees working in the organization under HAMUL constitute the selected body. The
qualified candidates are selected to the organization. This involves both Elected and Selected bodies.
The administration department decides all the technical, production, procurement etc. it also involves
the pricing and accounting section. They are allotted with specific work on their qualification
H.R.Institute of Higher Education, Hassan Page 14
likewise, Technical Officers, Marketing officers, managing directors etc. There are around 415
employees working in all the sectors of organization.
• The head of the selected body is the Managing Director; at present Ranganath
• Elected body is in the administration till its fixed tenure whereas the selected
body is till the retirement age fixed by the Govt.
H.R.Institute of Higher Education, Hassan Page 15
2.4 Product Profile
The main product of HAMUL is milk that is processed in number of different categories
based on their fat division is
H.R.Institute of Higher Education, Hassan Page 16
Sl.No. Products Qty. of Fat & SNF Quantity Price(Rs)
1. Toned Milk 3.5% & 8.5% 500Ml- 1ltr 09.50
2 Standardized Homogenized 500Ml- 1ltr 11.50
Milk 4.5% & 8.5%
2.4.1 Nandini Toned Milk:
It is a pure milk and most selling milk in Karnataka. It contain 3.0% Fat And 8.5%SNF. It
is available in 500 ml and 1000 ml packs.
Karnataka's most favorite milk. Nandini Toned Fresh
and Pure milk containing 3.0% fat and 8.5% SNF.
Available in 500ml and 1ltr packs.
Available in 500ml and 1ltr packs
2.4.2 Nandini Homogenized Standard Milk (Shubham) :
This pure milk contains 6.0% fat and 9.0% SNF. It is available in 500 ml and 1000 ml
packs. This milk is rich creamier and tastier. It is ideal for preparing home mode sweets
H.R.Institute of Higher Education, Hassan Page 17
Nandini Homogenized Standard Milk Containing 4.5% Fat
and 8.5% SNF.A rich, creamier and tastier milk, Ideal for
preparing home-made sweets & savouries.
Available in 500ml. and 1 ltr packs.
It is thick and delicious. It is available in 200 grams, 500 grams and 1000 grams sachet
etc.The price list of Curd: At the end of April 30,2010
Sl No Particular Packing Quantity Price in Rs
1 Nandini Curd Sachet 200 grams 06 -00
2 Nandini Curd Sachet 500 grams 12 -00
Nandini Curd made from pure milk. It's thick and
delicious. Giving you all the goodness of homemade
Available in 200gms and 500gms sachet.
H.R.Institute of Higher Education, Hassan Page 18
2.4.4 Butter Milk:
Butter Milk is a refreshing health drink. It is made from quality curds and is blended with fresh green
chilies, green coriander leaves, asafetida and fresh ginger. Buttermilk is packaged in 250ml packet.
Nandini spiced Butter Milk is a refreshing
health drink. It is made from quality curds and
is blended with fresh green chillies, green
coriander leaves, asafoetida and fresh ginger.
Nandini spiced butter promotes health and
It is available in 200 ml packs and is priced at
most competitive rates, so that it is affordable
to all sections of people.
2.4.5 Nandini Ghee:
Ghee is made from butter. It is fresh and pure with a
delicious flavour. Hygienically manufactured and
packed in the goodness of pure ghee. It has a got a
shelf life of 6 months at ambient temperatures. It is
available in 200 ml, 500 ml, 1000 ml sachet, 5 liter
tins and 15 kg tins
Particular Packing Quantity Price in Rs
1 Nandini Ghee Sachet 200 ml 0062 - 00
2 Nandini Ghee Sachet 500 ml 0152 - 50
3 Nandini Ghee Sachet 1000ml 0300 - 00
4 H.R.Institute of Higher Education, Hassan 15 kgs
Nandini Ghee Bulk Tin Page
4695 - 00 19
Peda is very delicious made from pure milk. It can be stored for 7 days and available in
250 grams containing 10 pieces each
Price list of Peda: At the end of April 30, 2010
Particular Packing Quantity Price in Rs
1 Nandini Peda 100 grams Box 100 grams 26 -00
2 Nandini Peda 250 grams Box 250 grams 60 -00
3 Nandini Peda (single) Single 25 grams 06-00
No matter what you are celebrating! Made from
pure milk, Nandini Peda is a delicious treat for the
Store at room temperature approximately 7days.
Available in 250gms pack containing 10 pieces
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Achievements and Awards
HCMPSUL has got to 4 awards
Energy Conservation Award
Received on 14th Dec 2004 from Dr. Manamohan Singh, Prime Minister of India.
Energy Conservation Award
Received on 14th Dec 2005 from Dr. A.P.J. Abdul Kalam, President of India.
Energy Conservation Award
Received second prize in the year 2006
Energy Conservation Award
Received third prize in the year 2007
H.R.Institute of Higher Education, Hassan Page 21
2.6 SWOT Analysis of HAMUL
• Huge Demand
There is a huge demand for Nandini milk and milk products in the market. Milk is very
much needed for the children and the people to get good calories, vitamin and nutritional.
There is increased population in India, hence there is increased demand for milk products.
• Availability of Milk
Union can easily get required milk with less cost from the rural area according to the
need. Most of the farmers in Hassan district are having at least 2 or 3 cows or buffaloes in
their home. Hence there is a good availability of milk for HCMPSUL.
• Brand Nandini
Nandini milk, Nandini ghee, Nandini curd etc Nandini products are well branded in the
market because of their quality.
• Man Power
There is well experienced, professionally trained technical employees are working in the
company with minimum experience of 15 years. It helps organization to maintain the
quality of the product.
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Hassan milk union is located in industrial estate beside NH-48 where people can easily
found the company. It reduces the cost of transportation and leads to publicity of
Good quality control
On time delivery
Easy access to loans from National Dairy Development Board
Adaptability to changing technology
• Inadequate Transportation
Bad condition of roads and inadequate transportation facilities makes milk procurement
• No Cattle Form
HCMPSUL has no cattle form in its own, it becomes one of the major weakness of the
It focused more only on rural segment and very less concentration on urban area.
New employee has less social security eg: accommodation is not provided to new
employees where in it restricts their stay for a long period.
• Limited advertisements
No credit business
There is demand for Nandini Products in other states viz Kerala, Goa. So it can export its
product to those states along with Thamilnadu and Andrapradesh.
• New Product Innovation
H.R.Institute of Higher Education, Hassan Page 23
It can innovate new products like Khoa, Ice cream, Pannier and dairy Sweets in the same
It provides more employment opportunity to the people. Currently there are 500
employees are working in the organization.
Young, enthusiastic employees put their best efforts, which results in the growth of
The brand , image of the firm helps it to enter new areas quickly.
• Market uncertainty
There is a price fluctuation in the market, it may leads to decrease the demand and there
by reduction in profit.
Competitors are coming up with similar product, this is the main threat posed by the
Many private firms have entered into
Manufacturing of dairy products, there
Is a tough competition for Nandini
Like AROKYA, JERSY, JENUKAL and many more.
H.R.Institute of Higher Education, Hassan Page 24
2.7 Functional Areas
The procurement and input department is concerned with collection of milk from various
• To follow up daily procure schedule as per the plan.
• To collect quality of milk by checking fat content.
• To maintain good relationship with DCS.
• To send procured milk to production unit.
Milk Procurement Procedure
H.R.Institute of Higher Education, Hassan Page 25
The production department is responsible for procurement of raw milk. It consists of two
wings called purchase and stores. Purchase wing is processing of raw milk and stores
wing is receiving and issuing the same to the user department.
Indent is raised by the user department and is registered at stores after verifying the
availability of stock at stores. After registration, the indent is forwarded to purchase wing
for procurement. At the time of registration of indent if stock is available, it is issued to
the user department and the indent is cancelled.
On receipt of indent the purchase wing lends enquires to various suppliers who normally
supply the milk and milk products. Then these suppliers submit their offers. After
receiving the offers, a comparative statement is made and forwarded to the general
manager for recommendations. The General Manager chooses a most suitable offer for
placement of purchase order.
On receipt of purchase order, the supplier lends the milk and milk products along with the
bills. The products are received at receipt section of the stores and are verified against the
specification laid in purchase order.
Then products/goods inspection note is prepared and forwarded to the GM department for
inspection of the milk & milk products supplied. Then the GM inspects the
material with quality experts at stores and accepts the same on reject depends upon the
quality of products.
If the material is accepted, produce/goods receipt note is prepared and forwarded to
account section and the material is stored in specified location. If the product/goods
rejected then product/goods receipt note as well as reject note prepared and forwarded to
for making payment to give information to the supplier about the rejection whenever
GRN is prepared the stock of the particular items gets update in computer.
The rejected producers/goods are returned to the suppliers.
Whenever the union required milk and milk products or any materials they approach
stores along with issue voucher against which product/goods issued and consumed.
Periodic stock verification is conducted at stores to check the inventory.
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MILK CANS RURAL SOCIETIES COLLECTING MILK
2.8 Product Production Process
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Raw chilled Milk Raw Milk Returned Milk
Separation Skim Milk Toned Milk Homogenization
Packing Cold Storage
2.9 Production Department
Duties and Responsibilities of Production Manager
1. He shall be overall in charge of production plant section.
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2. To allot, monitor and supervise the work of the subordinates.
3. To make correspondence and maintain all files/documents of products.
4. To recommend the leave of his subordinates and make alternate arrangements
during their absence on leave period.
5. He shall ensure and implement cost service measures to production section.
6. To plan and implement the disposal of excess milk in bulk sales and if shortage,
arrangement to get milk from inter dairy as per requirements.
7. He shall plan well in advance requirements of chemicals/detergents on any other
material of the production section.
8. He shall take care of entire plant and machinery.
Processing Of Milk:
Procuring & Can Washer Machine
The cans from the trucks are introduced to procuring & can washer machine, during this process the
machine automatically opens the lid of the milk can and milk is collected in a chilling tank. Then the
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raw milk is pre chilled at 6-8% to arrest the growth of microorganisms. The milk cans are
automatically washed and placed outside. Again the trucks are weighed to get the exact value of the
raw milk obtained.
The chilled & tested milk is been further sent for processing. Generally, milk is boiled &
cooled in the houses to preserve it from spoiling, this method is known as Pasteurization.
The same is introduced in HAMUL, there are two pasteuriser, which work for 24 hours
and 365 days. The raw milk brought in, is heated up to 72.5 degree Celsius, for 15
minutes and immediately it is cooled to 4 degree Celsius. This method will kill the
pathogenic to microorganisms, which would spoil the milk but retains the Lacto Bacillus
(bacteria which converts milk to curds) and the pasteurised milk is further sterilized by
boiling up to 140 degree
Celsius other essentials like proteins, fats, vitamins, carbohydrates etc are remained. That
makes it a complete food.
In pasteurization, the raw milk is brought in through pipes, milk is heated through steam and it is
cooled using ammonia as a cooling agent.
The fat in the pasteurized milk is 4.1%; it is separated in a machine called Cream Separator. The
division of fat is done for the preparation of varieties of milk based on fat content.
Packaging & Storing:
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The processed milk and the byproducts manufactured are hygienically packed. Milk of different
varieties and quantities based on the fat content is pre set in the auto-packaging machine. The pouch
used for packaging is manufactured by KMF at Pouch Film Plant at Munnekolalu, Marathhalli in
Bangalore. The pouches used are poly based and are re-cycle able. It prevents milk from spoiling.
The packaged milk is bacteria free and is ready to use.
The packed milk and its by-products are stored in 8 degree Celsius in refrigerating room
using ammonia compressor. The unpacked extra milk is condensed to SNF
(Solid Not Fat) that is SKIMMED MILK. The balance milk is sent to Dairies in
Bangalore, Mangalore and Thrivendrum.
2.10 Area of Operation
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Companies are always looking to carry business, where the required resources
are easily available. Area of operation plays a vital role while fixing price,
there by development of the company. Because if the area has suitable
environment, raw materials, skilled labors for less wages, then it will reduces
the cost of production.
Hassan milk union carries out business at regional level that includes 3 districts
viz Hassan, Chikmagalore, and Coorg.
Hassan districts cover eight taluks namely Channarayapatna, Hassan, Arasikere,
Sakaleshpur, Belur, Alur, Arakalagudu, and Holenarasipur. It collects the milk
from various villages of these eight taluks.
Chikmagalore district covers Chikmagalore, Kuduremuka and Tarekere. Kodagu
districts cover Somavarpete, Virajpete and Madikeri. In Kudige dairy totally
5000 LPD is renovated at the cost of 251 lakhs with assistant of national dairy
Totally Hassan milk union covers 2583 villages, 3 districts, 65 milk
procurement routes with average procurement 2, 68,417 kgs/day at present. The
total local sales are 90,000LPD, and about 2, 50,000 LPD to other states.
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2.11 Activities of Hassan Milk Union:
Organization of Dairy Co-Operative Societies
As at the end of June 2009, 1085 societies have been registered of which 1009 are
functional. Out of functional societies 268 are women societies, 124 step women
societies are functioning which results in enhancing the socioeconomic development
As on 30th June 2009 1, 61,385 members have been enrolled of which 67,102 are
small farmer, 44,264 are marginal farmers, 20,384 are agriculture labourers, and
28,294 are other big farmers. Out of the total 10,587 belongs to SC members,
3,984 belongs to ST members. 48,302 members belong to women members.
Milk Procurement Activities
The present average milk procurement from 1009 milk societies is around
4,39,921 kgs/day. During the month of June the average procurement /DCS/day
is 435 kgs and the average transportation cost per kg of milk procurement is 30
paisa. The average fat is 4.06% and average SNF is8.50%.
2.11.1 Input Activities:
Covered 638 societies under veterinary route, 6 mobile veterinary routes treating
an average of 4,500 cases per month. There are 5 emergency routes in operation
and treating around 400 to 450 cases per months. There are 340 first aid centres
are also working. Union is providing SAF kit to the animals for the prevention.
(Or) de-warming. Foot and mouth vaccination is also providing for controlling
foot and mouth diseases.
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To improve the breeding facility there are 16 single AI centres and 77 Cluster AI
centres are working in the union area. These centres are covered around 90% of
the DCS. Averages of 20,000 inseminations are carrying out every month. 3815
male cows and 4315 female total 8130 cross breed cows have been born during
Feeds and Fodder
The union is uncovering the farmers and the producers at the village level in
growing modernized fodder. Ex. union is suppling CO1, CO2 and Napier roots
and SSG seeds , cow pea seeds and seasonal seeds to the producers. The union is
also arranging straw treatment demonstration, silage demos at village levels. The
union is supplying around 3200 metric tones of cattle feeds and an average 6000
kgs of mineral mixtures to the society members. Nearly 98% of the functional
societies have been covered under cattle feed sales.
Training will be given to the milk society secretaries, testers and management
committee members. DAM (dairy animal management) is given to the producers.
This training is given in central training institutes, Mysore, owned and managed
by KMF Bangalore.
2.11.2 Other programmes:
With the co-ordination of the general insurance company by paying premium to
the insurance company. The DCS providing insurance coverage.
Under this, women members have been enlightened with education, nutrition,
legal matters. SHG (self help group) the main purpose of step programme is to
provide better socio-economic status to the women members
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Yashaswini health programme:-
Under this scheme, those who have become members of this scheme well get
medical benefits like operation charges.
Total Quality Management (TQM);-
The union has encouraged clean milk production programme at village level. The
union has obtained ISO 9001:2000 certifications. There are 13 bulk milk coolers
and 43 automatic milk collection centres which are functioning in the milk
societies. Union activities have been computerized partially and during
2008-2009, it is spending around 64-70 lakhs towards computerization.
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2.12 Marketing Department
Duties and Responsibilities of Marketing Officers
1. To fix necessary targets to the retailers, wholesalers, depots, day counter and milk
2. To take necessary actions to appoint retailers/DS/MP in the new extension.
3. To adopt necessary extension programmes for consumer awareness.
4. To arrange for consumers meet/fairs/exhibitions and to take participation in such
programmes to improve nandini milk sales.
5. To collect information about private competitors milk sales and to take necessary
action to curtail the private dairy milk sales.
6. To arrange for the retailers meeting at least once in 6 months and to discuss about
7. To inspect the milk parlours regularly and to keep watch on sale of other products.
8. If the parlors contractors are found to sell products other than Nandini products,
action should be taken.
9. To keep close watch on the milk distribution vehicles movement of routes and to
check that the milk and milk products reach the retailers with in the described
10. To conduct distance survey of milk distribution route and to certify them
11. To take necessary action to make recoveries if any due from the retailers.
To collect the information pertaining to the choultaries, hostels, public institutions, sweet
stalls, Bakeries, Ice cream parlours, hotels, and conduct necessary extension programme
to increase the sales.
Marketing department plays a vital role in determining the future abilities of the
company. Its main objective is to distribute goods from producers to the customers. It
distributes milk to consumers and also provides consumer education through ad
campaigns and participating in various exhibitions.
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• To plan marketing programmes.
• To analyze marketing opportunities.
• To develop marketing strategies.
• To connect the consumer with the products.
2.13 Major Competitors Profile
There are many competitors viz., Milky Wave, Arokya, Jersy, Jenukal, Kaveri,
JT Milk, etc are producing similar product in same area with similar strategy.
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2.14 Future Growth and Prospects
• Envisaged to establish total of 900 DCS by the end of 2010.
• Planned to establish artificial Insemination centers. [AI]
Single AI centers 40
Cluster AI centers 80
For this they are expected expenses of Rs 16800 for single AI centers, and Rs
201600 for cluster centers
• The expected maize seed productions are 90 metric ton.
• Cowpea production 1.5 metric tons, 2500000 of route slips.
• The procurement is expected to increase to 34450 kegs’. Per day.
• The local sales are expected to 108610 LPD and bulk sales are 41410 LPD.
• Cattle food sales will also be increased to 96 metric ton.
• In addition to strengthening of market, network quality assurance programme and
milk enhancement activities will be underta
2.15 ANNUAL MARKET PLAN FOR DEVELOPMENT ACTIVITIES
FOR THE YEAR 2009-10
Hassan milk union Ltd establish in the year 1977 has been catering efficiently to the
needs of the urban and semi urban consumers by supplying pasteurized and assured
quality “Nandini” milk and milk products in the jurisdiction covering Hassan,
chikmangalure and Kodagu districts.
Over the years, the union has been taking many steps to meet the changing needs of
consumers, the availability of milk variants and new milk products have been produced
for customer requirement.
Priority areas for the development of liquid milk market in the union area are identified
and necessary action plans have been drawn for implementation during the year
2009-10.The key strategies planned for 2009-10 are as follows
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INCREASING THE AVAILIBILITY OF NANDINI MILK THROUGH OUT THE
DAY IN THE MARKET:
ENHANSING EFFECTIVENESS OF CONSUMER AWARENESS PROGRAMME.
TEAM CONCEPT FOR MARKET DEVELOPMENT.
CREATION OF GRIVANCE REDRESSAL CELL.
CONSTITUTING EFFECTIVE REPLACEMENT/LEAKAGE POLICY.
CONSTITUTING A CORE GROUP FOR SOLVING DAY TO DAY PROBLEMS.
PROMOTING CHANNEL MEMBERS.
ELICITING CONSUMER FEED BACK FOR QUALITY ASSURANCE.
SALES PROMOTION ACTIVITIES.
INCREASING THE AVAILABILITY OF NANDINI MILK THROUGH OUT
THE DAY IN THE MARKET
a) By expanding the retail market in the union Area.
Introduction of an adhoc milk distribution route to Hassan city from morning 6.00
A.M to 4.00 P.M. at regular intervals to cater to the retailer needs after normal
Supply of loose milk in 40Lts cans to hotels, choulteries, and institution at
Identifying the uncovered areas of distribution and appointing new retailers in such
areas to expand the local market.
Introduction of Adhoc day route exclusily for Milk products distribution in the union
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b) Strengthening the existing milk parlour, depots and day co
There are totally 548 retailers, 18 milk parlours, 14-day counters and 16 depots
operating in the union area. It is decided it strengthen providing Bottle coolers to
retailers at the rate of 50% cost and free supply of insulated boxes and introduction of
insulated Transport vehicles to door step of retailers and extended hours of milk
c) Introduction of Full cream m Milk (500Ml)Sachet in the Market during first
quarter in 2009-10.
ENHANCING EFFECTIVENESS OF CONSUMER AWARENESS
To persuade consumers, who are purchasing loose milk, or Competitors milk to purchase
“Nandini” milk. This objective is most suitable for our union since their market share is
To create awareness among existing and prospective consumers about:
a) The organization.
b) Quality products and Services available.
c) Dairy plant activities-hygienic milk handling practices of nandini vis a vis loose milk
d) Health hazards of consuming adulterated milk.
e) Quality and hygienic aspects of sachet milk and milk products .
f) Dairy visit by school children, consumers and mahila mandal’s
g) Education programmes on “Milk and Health” at schools and public places.
TEAM CONCEPT FOR MARKET DEVELOPMENT:
In ordered to achieve highest sales target, it has been decided to constitute functional
This team will conduct the following activities.
a) Visit the market along with marketing staff for market development and to increase sales.
b) Organize door to door campaign
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c) Arrange quality testing at selling point/Public.
d) Organize dairy visit to school children, housewife’s, mahila mandals & consumers.
CREATION OF GRIEVANCE REDRESSAL CELL:
This system to be implemented with the help of following activities.
a. A decided Toll free telephone to the marketing section of Hassan and Kudige Dairy
would be provided for benefiting channel members.
b. Further, the telephone numbers and contact person’s name to be published in leading
local daily News papers and circulated to all the agents’ day counters.
c. The complaints to be addressed immediately and would be rectified within 24 hours.
EFFECTIVE REPLACEMENT / LEAKAGE POLICY:
The fallowing measures are planned to overcome the leakage problem.
- Film quality testing programmes
- Focus on discussions
- Segregating leaky pouches at dairy dock before dispatch
- Proper Monitoring of Packing Machines
- Storing in required temperature before dispatch
- Taking proper care during transport to avoid damage.
CONSTITUTING A CORE GROUP FOR SOLVING DAY TO DAY
A core team constituting of officers from plant, quality control, marketing and accounts
have been formed to implement the strategies of SMP for implementation. This team
would sit every day for 15 minutes with Manager (dairy) and thrash out problems faced
by the marketing staff.
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Problems noticed and action initiates are to be recorded every day. And appraise the M.D
in week and conduct review meeting once in a month
MOTIVATING THE CHANNEL MEMBERS:
A system to motivating and educate the channel members has been proposed for
increasing the milk sales. A systematic awareness campaign would be organized and all
the Nandini retailers will be contacted. This is planned by meeting them regularly and
inviting suggestion from them on a regular basis. Retailers meeting will be conducted
once in 6 months. Higher milk sale retailers in a particular districts route will be
ELICITING CONSUMERS FEEDBACK FOR QUALITY ASSURANCE:
By preparing a set of questionnaire and eliciting the fees back from the customers, will
get us information about customers’ perception on Nandini milk and milk products,
Quality, Packaging, and pricing etc.
By conducting this will get the results from the customers, in case if these are any
problems we can rectify it. We can do this by putting few questions to the customers
asking about the quality, price shelf life packing, satisfaction etc. By this we can also
create awareness about the brand. And get the feedback about competitor brands also in
SALES PROMOTION ACTIVITIES:
Sales promotion is a marketing activity that provide extra value or incentive to sales force
, distributors, and the ultimate consumers can stimulate immediate sales .
a) Group Insurance Scheme Extended to Retailers:
The proposal of providing Group Insurance facility to retailers which is in
existence during 2004-05 for a period of 3 years is continued during the present
b) Loose Milk Sales to Hotels /Choulteries / retailers:
It is proposed to introduce loose milk sales (toned milk and curds) Rs15/- and Rs
19/-/lLtr. Through aluminium milk cans of 40 liter. And 20 ltr. Capacity only to
hoteliers and other directly
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c) Brand Advertisement, Vehicle and Wall painting, Radio programmes and
Awareness programmes will be continued during 2008-09 also .
d) Supplying posters , flex boards glow sign boards, tarpaulin bags organizing
retailers tour programme etc.
Review of Literature
Consumer is a broad label for any individuals or households that use goods and
services generated within the economy.
Consumer theory is a theory of microeconomics that relates preferences to
consumer demand curves. The link between personal preferences, consumption, and the
demand curve is one of the most complex relations in economics.
Preferences are the desires by each individual for the consumption of goods and
services, and ultimately translate into employment choices based on abilities and the use
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of the income from employment for purchases of goods and services to be combined with
the consumer's time to define consumption activities.
Consumption is separated from production, logically, because two different
consumers are involved. In the first case consumption is by the primary individual; in the
second case, a producer might make something that he would not consume himself.
Therefore, different motivations and abilities are involved.
Perception is a process by which individual organize and interpret their sensory
impressions to give meaning to their environment.
3.1 Factors influencing Perception
Factors in the perciever
Factors in the situation
Factors in the target
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Income effect and price effect deal with how the change in price of a commodity changes
the consumption of the good. The theory of consumer choice examines the trade-offs and
decisions people make in their role as consumers as prices and their income changes.
3.2 Understanding of perception
• Perception is the psychological process
• Perception is the intellectual process by which a person acquires the information,
organize, and obtain meaning from it.
• Peoples actions, emotions, thoughts and feelings are triggered.
• It takes place after the information is received.
Perceptual Mechanism. Steps in perception
Individuals collect bits and pieces of information, not randomly, but selectively
depending on interests, background and experience.
• Selective perception involves two psychological principles
• Figure ground principle
• Grouping- on the basis of similarity
• Closure- Tendency of filling the gaps themselves.
• Simplification: Try to simplify to make more meaningful and understandable.
Interpretation: Is subjective and judgmental process.
• Halo effect- Using a single personality trait of an individual and drawing a general
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• Stereotyping- Judging people on the basis of the characteristics of the group to which
• Attribution- Attaching cause and effect explanation to their behavior.
• Impression_ Impression of others on first sight.
3.2.1 Factors influencing Perception
• Needs and desires – People at different levels of needs and desires perceive the same
• Expectancy, motives and interests affect people perception
• Personality – individual personality has a profound influence on perceived behavior.
• Experience – Experience & knowledge have a constant bearing on perception.
• Successful experiences enhance and boost the perceptive ability & lead to accuracy.
- Size – Size establishes dominance and over rides other things and enhances
- Intensity – Loud, bright, strong, will be noticed easily .
- Frequency – A repeated external stimulus is more attention-getting than single.
- Status – High status people can exert influence on perception than low status
- Contrast – contrast with the surrounding likely to be selected for attention.
3.3 Black box model
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ENVIRONMENTAL FACTORS BUYER'S BLACK BOX
Environmental Decision RESPONSE
Marketing Stimuli Characteristic
Economic Attitudes choice
Product Technological Motivation Brand choice
Price Political Perceptions Dealer choice
Place Cultural Personality Purchase
Promotion Demographic Lifestyle timing
Natural Knowledge Purchase
The black box model shows the interaction of stimuli, consumer characteristics, and
decision process and consumer responses. It can be distinguished between interpersonal
stimuli (between people) or intrapersonal stimuli (within people) The black box model is
related to the black box theory of behaviorism, where the focus is not set on the processes
inside a consumer, but the relation between the stimuli and the response of the consumer.
The marketing stimuli are planned and processed by the companies, whereas the
environmental stimulus is given by social factors, based on the economical, political and
cultural circumstances of a society. The buyer’s black box contains the buyer
characteristics and the decision process, which determines the buyer’s response.
The black box model considers the buyers response as a result of a conscious,
rational decision process, in which it is assumed that the buyer has recognized the
problem. However, in reality many decisions are not made in awareness of a determined
problem by the consumer.
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3.3.1 Information search
Once the consumer has recognized a problem, they search for information on
products and services that can solve that problem. Belch and Belch (2007) explain that
consumers undertake both an internal (memory) and an external search.
Sources of information include:
• Personal sources
• Commercial sources
• Public sources
• Personal experience
The relevant internal psychological process that is associated with information
search is perception. Perception is defined as 'the process by which an individual receives,
selects, organizes, and interprets information to create a meaningful picture of the world'.
3.3.2 The selective perception process
- Selective exposure consumers select which promotional messages they will expose
- Selective attention consumers select which promotional messages they will pay
- Selective comprehension consumer interpret messages in line with their beliefs,
attitudes, motives and experiences
- Selective retention consumers remember messages that are more meaningful or
important to them
The implications of this process help develop an effective promotional strategy,
and select which sources of information are more effective for the brand.
3.3.3 Information evaluation
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At this time the consumer compares the brands and products that are in their
evoked set. How can the marketing organization increase the likelihood that their brand is
part of the consumer's evoked (consideration) set? Consumers evaluate alternatives in
terms of the functional and psychological benefits that they offer. The marketing
organization needs to understand what benefits consumers are seeking and therefore
which attributes are most important in terms of making a decision.
3.3.4 Purchase decision
Once the alternatives have been evaluated, the consumer is ready to make a
purchase decision. Sometimes purchase intention does not result in an actual purchase.
The marketing organization must facilitate the consumer to act on their purchase
intention. The provision of credit or payment terms may encourage purchase, or a sales
promotion such as the opportunity to receive a premium or enter a competition may
provide an incentive to buy now. The relevant internal psychological process that is
associated with purchase decision is integration.
3.3.5 Post purchase evaluation
It is common for customers to experience concerns after making a purchase
decision. This arises from a concept that is known as “cognitive dissonance”. The
customer, having bought a product, may feel that an alternative would have been
preferable. In these circumstances that customer will not repurchase immediately, but is
likely to switch brands next time.
To manage the post-purchase stage, it is the job of the marketing team to persuade
the potential customer that the product will satisfy his or her needs. Then after having
made a purchase, the customer should be encouraged that he or she has made the right
decision. It is not effected by advertisement.
3.3.6 Internal influences
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Consumer behaviour is influenced by: demographics, psychographics (lifestyle),
personality, motivation, knowledge, attitudes, beliefs, and feelings. consumer behaviour
concern with consumer need consumer actions in the direction of satisfying needs leads to
his behaviour behavior of every individuals depend on thinking process.
3.3.7 External influences
Consumer behaviour is influenced by: culture, sub-culture, locality, royalty,
ethnicity, family, social class, reference groups, lifestyle, and market mix factors.
Customer perception is an important component of our relationship with our
customers. Given that 90% plus of our orders at some point involve the phone, how we
handle the telephone is essential to creating a perception for our customer that aligns with
the company mission of service. The following is a great way of handling the phone.
3.4 The Application of the Theory of Reasoned Action Model
The theory of reasoned action represents a comprehensive integration of the attitude
components that ultimately are the building blocks of preference. The model is designed
to provide a better understanding of how consumer preference is formed and,
correspondingly, to provide the means to accurately predict consumer preference
In order to understand preference we need to determine the functional or
performance demands involved in the purchase, the desired emotive outcomes, and the
subjective norms consumers use to determine their desire for one product or service over
another. The primary assumption of the model is that individuals make considered
purchases. In some cases the consideration may be minimal and the purchase behavior
almost habitual (as when deciding to buy a new comb while standing in line at Target).
In another the period of consideration (incubation) may be extensive and each element of
the consideration process carefully examined (as when deciding to purchases a new
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Attitude toward the
Conviction that the product
behavior leads to certain
Evaluation of the outcomes
Conviction that the
choice leads to certain Intention
Conviction that the
choice is considered
correct by others
Motivation to comply
with the opinion of
The important contribution of the reasoned action model is the realization that consumers
utilize the model in all purchase experiences to a lesser or greater extent. Of equal
importance is the realization that the components used to make a preference decision are
also the ones employed by a consumer to evaluate the performance success of the product
or service purchased and the company responsible for them. Therefore, as the
components of preference change, the elements influencing satisfaction change
accordingly. The relationship is dynamic and fluid therefore static or predetermined
satisfaction analytic packages often miss the most important elements of preference and
can create a false sense of security on the part of companies who think that since their
customer satisfaction scores are high they must in turn have relatively loyal customers.
The theory of reasoned action assumes a consequence for the action taken. We
prefer some product, someone, or some service because we determined the object was
best aligned with our performance and emotive requirements as judged through our
comparative norms. We evaluate the performance in light of how well the product,
person or service meets our preference expectations. Here is the problem with most
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“preordained” customer satisfaction programs. Companies tend to ask their customers
about corporate performance on a predetermined set of behavioral topics which may or
may not align to the preference expectations of those customers. This mistake is
amplified when companies treat their customers monolithically and assume that the
preference drivers for one group of customers are the same as that for another. It is
essential, especially for companies attempting to serve highly competitive markets with
many product/service offerings, to differentiate preference formation components and
preference expectations within “naturally forming” or emergent customer segments.
3.5 With-In Segment Deployment of Customer Preference
Customer preference analysis is really a call to action. By understanding the
preference formation components and the preference expectation evaluations by group or
segment of customers, companies can design response strategies that are truly responsive
to vital customer expectations and that differentiate in the marketplace.
Figure Two – Delivering Performance at the Intersection of Preference and Expectation
Within the framework customer satisfaction can begin to play a very important role
as a measure of a company’s ability to deliver and execute against preference evaluation
elements of a given customer segment. These expectations can now be differentiated into
expectants - basic, cost-of-entry preference expectations, satisfiers - preference
expectations that help to constrain abandonment or churn and attractors - preference
enhancements (often focused on the emotive components) that attract new customers.
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4.1 Type of Research:
Descriptive method has been used in this research for the collection of data .As
the research is related to the study of consumer behaviour, which can more effectively be
studied through direct question, experimental research will not be much effective. Also,
considering the constraint, descriptive research is the most suitable design for this
4.1.1 Qualitative research:
Qualitative research allows you to explore perceptions, attitudes and motivations
and to understand how they are formed. It provides depth of information which can be
used in its own right or to determine what attributes will subsequently be measured in
quantitative studies. Verbatim quotes are used in reports to illustrate points and this brings
the subject to life for the reader. However, it relies heavily on the skills of the moderator,
is inevitably subjective and samples are small. Techniques include group
discussions/workshop sessions, paired interviews, individual in-depth interviews and
mystery shopping (where the researcher plays the role of a potential student, etc in order
to replicate the overall experience).
4.1.2 Quantitative research:
Quantitative research is descriptive and provides hard data on the numbers of
people exhibiting certain behaviors’, attitudes, etc. It provides information in breadth and
allows you to sample large numbers of the population.
4.1.3 Descriptive research:
Descriptive research is used to obtain information concerning the current status of
the phenomena to describe "what exists" with respect to variables or conditions in a
situation. The methods involved range from the survey which describes the status quo, the
correlation study which investigates the relationship between variables, to developmental
studies which seek to determine changes over time.
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Statement of the problem.
Identification of information needed to solve the problem.
Selection or development of instruments for gathering the information.
Identification of target population and determination of sampling procedure.
Design of procedure for information collection.
Collection of information.
Analysis of information.
Generalizations and/or predictions.
4.2 Source of Data:
Data which is collected for the first time is called primary data. In the study
primary data includes the data which is collected from the customer directly with
interaction. The study includes data got with personal interaction.
4.3 Primary and secondary data:
The appraiser or market analyst must know what they are and what affects them.
All data used in appraisals and market studies should be current, relevant, reliable,
accurate, and conceptually correct. This article presents a discussion of each of these
terms and their significance in the context of the data and in the analysis. The article then
discusses the nature of potential errors that can affect primary and secondary data. Several
categories of errors can exist. The analyst needs to be able to recognize the error,
understand its significance and evaluate the applicability of that data in the analysis.
Secondary data--Information from secondary sources, i.e., not directly compiled
by the analyst; may include published or unpublished work based on research that relies
on primary sources of any material other than primary sources used to prepare a written
Secondary data has been gathered by others for their own purposes, but the data
could be useful in the analysis of a wide range of real property. In general, secondary data
exists in published sources.
H.R.Institute of Higher Education, Hassan Page 54
Primary and secondary data are used in appraisals, highest and best use studies,
market analysis sections of appraisals, and full-scale market studies. A conceptual link
between these two types of data and their use appears in the "Levels of Study" discussion
presented in the Appraisal Institute's Course 520, "Highest and Best Use and Market
Analysis" and in Chapter 2 of Market Analysis for Valuation Appraisals, which is
published by the Appraisal Institute. A detailed discussion of this relationship appears
later in this paper.
4.4 Methods for Obtaining Primary Data:
The analyst can obtain primary data through the process of direct observation or by
explicit questioning of people.
Observation as a data gathering technique focuses attention on an observable fact
or inanimate entity such as a building or on an observable action or behaviour by an
animate entity such as a homeowner or shopper. Observation of an inanimate object is the
easier of the two activities, but it is not free from error or misinterpretation.
Sampling is a process of learning about the population on the basis of which
sample is drawn. A sample is a subset of a population unit.
4.5 Sample Design:
Sampling is a practice a researcher uses to draw data on people, places, or things to
study. Sampling allows statisticians to draw conclusions about a whole by examining a
part. It enables us to estimates characteristics of a population by openly observing a
portion of the entire population. The whole that the researcher wants to know something
about is the population is called a sample.
4.6 Sampling Technique:
The sampling technique used in the study includes both simple random sampling as well
as judgment sampling.
H.R.Institute of Higher Education, Hassan Page 55
Respondent Size: 100
Tool for data collection: Structured questionnaire
Geographical area: Hassan city.
4.7 Data collection instrument
The primary data collection instrument for the survey is self administrated and
structured questionnaire which consists of preference and scaling questions. This method
of data collection is quite popular, particularly in case of big enquires. The questionnaire
consists of close-ended and open ended questionnaire.
The study includes questionnaire of 18 questions to determine the customer
perception over Nandini milk and its milk products.
4.8 The modes of data collection:
• Interviewing face-to-face
• Interviewing by telephone
• Remote self-completion e.g. postal, internet.
• Face-to-face and telephone interviewing are often computer-assisted (CASIC).
• The amount
• The complexity
• The quality of the data they can collect
• Interviewing is the most powerful mode in all these respects.
• But interviewing, particularly in the field, is also by far the most expensive.
• Choosing modes of data collection is a fundamental survey design decision.
• When survey aims are being defined in detail, strengths and limitations of modes
must be kept in mind.
H.R.Institute of Higher Education, Hassan Page 56
Data Analysis and Interpretation
In this study I have taken the sample size of 100. I have collected the data with the
help of questionnaire. In order to get the results I have shown the analyzed data in the
form of graph with the help of bar chart.
Graph and Data Interpretation:
This survey is conducted in KMF Hassan unit. The outcome of the survey is,
Respondent Male Female
100 75 25
Respondent Male Female
H.R.Institute of Higher Education, Hassan Page 57
In the survey I have conducted, out of 100 respondents 75% are Male and 25% are
Respondent < 18 Years 18-30 Years 30-50 Years >50 Years
100 07 44 41 08
Respondent < 18 Years 18-30 Years 30-50 Years >50 Years
H.R.Institute of Higher Education, Hassan Page 58
In the survey I have conducted 100 respondents and their age groups are,7% are
less than 18 years, 44% are 18-30 years, 41% are 30-50 years and 8% are more than 50
Respondents Professional House wife Student
100 35 25 40
H.R.Institute of Higher Education, Hassan Page 59
Respondents Professional House wife Student
In the survey I have conducted, out of 100 respondents 40% are students, 25% are
housewife and remaining respondents belongs to professionals.
(4) Number of Members in Family:
Respondent Less than3 3-4 4-5 More than
Members Members Members 5 Members
100 18 20 32 30
H.R.Institute of Higher Education, Hassan Page 60
Less than 3 3-4 4-5 More than 5
Respondent Members Members Members Members
In the survey I have conducted 100 respondents and the number of member in
their family are,18% are less than 3 member,20% are 3-4 members,32% are 4-5 members
and 30% are more than 5 members.
(5) Name the brand of milk and its milk products that you consume?
H.R.Institute of Higher Education, Hassan Page 61
Respondent Nandini other
100 60 40
In the survey I have conducted 100 respondents, 60% consume Nandini milk and
40% consume other milk.
(6) How much quantity of milk do you consume daily?
H.R.Institute of Higher Education, Hassan Page 62
Respondent ½ ltr or Less 1ltr 1-2ltr More than 2 ltr
than ½ ltr
100 20 59 15 06
½ ltr or Less 1ltr 1-2 ltr More than 2
Respondent than ½ ltr ltr
Out of 100 respondents, 20% consume ½ ltr or less than ½ ltr, 59% consume 1
ltr,15% consume 1-2 ltr and 6% consume more than 2ltr.
(7) Do you think Nandini Milk and its milk products are easily
H.R.Institute of Higher Education, Hassan Page 63
Respondent Yes No
100 90 10
Respondent Yes No
H.R.Institute of Higher Education, Hassan Page 64
Out of 100 respondents, 90% opinions are easily available and remaining 10% are
not easily available.
(8) Are you aware of the various types of Nandini Milk and its Milk
Respondent Yes No
100 75 25
H.R.Institute of Higher Education, Hassan Page 65
Out of 100 respondents, 75% aware of Nandini Milk and its milk products and
25% are unaware of Nandini Milk and Milk products.
(9) Which type of Milk do you prefer?
Respondent Toned milk Standardized milk
100 10 90
Respondent Toned milk Standardized
Out of 100 respondents, 10% customer prefer Toned milk and 90% customer
prefer standardized milk.
H.R.Institute of Higher Education, Hassan Page 66
Out of 100 respondents,35% customer prefer ,25% customer prefer Ice-cream and
40% customer prefer Buttermilk,Curd,Ghee,Kova etc.
(11).Are you satisfied with the packaging of Nandini Milk and its Milk
Respondent Highly satisfied Satisfied Neutral
100 35 40 25
Highly satisfied Satisfied Neutral
H.R.Institute of Higher Education, Hassan Page 68
As according to the survey,35% of the respondents are highly satisfied,40% are
satisfied and 25%of the respondents are neutral.
(12).Do you feel Nandini Milk and its milk products fulfills all your
Respondent Yes No
100 90 10
According to the survey 90% of the consumers of the KMF’s products are
satisfied with their products.
H.R.Institute of Higher Education, Hassan Page 69
(13).If no, what changes do you expect?
Respondent Quality Price Availability Variety
100 10 56 24 10
H.R.Institute of Higher Education, Hassan Page 70
Respondent Quality Price Availability Variety
According to the survey,10% expect to change the quality,56% expect to
change the price,24% expect to change the availability and 10% expect to change the
(14).Do you think Nandini products are more hygienic than others?
Respondent Yes No
100 50 50
H.R.Institute of Higher Education, Hassan Page 71
According to the survey 50% of the respondents have agreed that the hygiene they
maintain is good. Few have given the reason they have visited the plant and seen
personally, production process area is maintained very neatly.
(15).Where do you buy Nandini milk and milk products?
Respondent Nandini outlets Retail outlets Getting door delivery
100 70 25 05
H.R.Institute of Higher Education, Hassan Page 72
Nandini Retail Getting door
Respondent outlets outlets delivery
According to the survey, 70% buy Nandini Milk and its milk products in nandini
outlets,25% buy in Retail Outlets and remaining 5% buy in getting door delivery.
Findings and Suggestions
• The growth rate of Indian diary industry is 2% per annum.
• In the survey I carried out 40% were students and 25% were housewives.
H.R.Institute of Higher Education, Hassan Page 73
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