R.S. Sodhi, Managing Director of Amul, talks to Ajita Shashidhar about what it requires to be a delightful consumer brand and give adequate value to the 3.6 million farmers feeding milk to his organisation.
What is your mantra for running a not-for-profit co-operative brand?
We take decisions keeping in mind only two stakeholders - milk producers (farmers) and consumers. Dealers and distributors are not priority for us. We pay the highest possible rates to farmers for their milk; also help them with nutritious fodder for their cattle and provide veterinary support. This has helped us win their trust, and they, in return, give us the best quality milk. For every litre of milk we sell, 80 per cent goes to the farmer. We partner with them to produce delightful products which we sell at the lowest possible prices. We don't look only at returns. Most food companies spend 10 to 15 per cent of their revenue on advertising; we spend less than 1 per cent, because, otherwise, the 9 per cent will have to come either from the farmer or the consumer.
What is your advice to the Indian dairy industry?
There is a lot of milk for everybody, but one has to invest in the entire value chain; invest in rural India. One needs to go to villages, build collection centres and veterinary facilities. One shouldn't just try to harvest what others have sown. Grow your own crop, harvest, process and market it.
What did you learn from Dr Varghese Kurien, the founder of Amul?
We learnt that in order to build a strong milk economy, one has to invest at the grassroot level. He was particular about consistency and excellence. Shortcuts will never work. We have built in similar values of excellence.