Recently, Amul was caught up in a controversy, facing backlash on social media for sponsoring Sudarshan TV, which is accused of showing biased and controversial content. Nevertheless, with its unique business model, Amul has helped millions of farmers. Let us understand the ‘Amul cooperative’ model.
Crux of the Matter
Amul – A Cooperative Society
Amul is a Cooperative society. In a Cooperative organization, people come together and pool their resources. Therefore, making every person its member. Moreover, members manage its resources, finances, as well as operations. Such organizations can be competitive in nature, producing products at cheaper rates like Amul does.
How Amul’s Business Model Is Different?
Amul has a three-tier business model. Farmer organizations directly sell products through the state milk federation. So farmers get direct benefits from the sale and the absence of a third party in sales ensures a good quality product at a competitive price. Quality products with large scale production ensure a regular income for farmers throughout the year.
Breif History Of Amul
- 1942 – Farmers in Anand district formed Kaira District Co-operative Milk Producers’ Union Limited.
- 1946 – Amul is formed under Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF).
- 1948 – Started pasteurizing milk.
- 1949 – Dr Verghese Kurien, called the Milkman of India joined the union to scale it up.
- October 1955 – For the first time in the world buffalo milk was processed to make products at new dairy plant.
- 1966 – Hired Sylvester da Cunha to market the brand.
- 1973 – GCMMF marketed milk and all milk products produced by six district cooperative unions in Gujarat.
Other Cooperative Models In India
Kanan Devan Hills Plantation
- Located in Munnar in Idukki district of Kerala.
- Total Area of tea plantation – 23,786 hectares.
- Number of Tea Estates – 7.
- Annual Output – 24 million kilograms of tea.
- Number of employees – 10,000.
- 60% of the subscribed share capital of the company is held by its employees.
- Rest of it is owned combined by Tata, Kanan Devan Hills Plantation Trust Welfare, and individuals and business associates.
Mumbai Dabbawala Association
- The dabbawala system was first initiated in 1890 by Mahadeo Havaji Bacche.
- More than 5,000 dabbawalas are employed and all dabbawalas are equal shareholders in the Dabbawalla Trust.
Indian Farmers Fertiliser Cooperative
- Founded in November 1967, IFFCO is India’s largest fertilizer manufacturer.
- It has 36,000 members, who get regular dividend on their investments.
- They reach to over 55 million Indian farmers.
- The Amul girl was created as a response to Amul’s rival brand Polson’s butter-girl. Polson is the name of a dairy products brand that was started in India by Pestonjee Eduljee in 1915.
- Amul was spearheaded by Tribhuvandas Patel under the guidance of Sardar Vallabhbhai Patel. As a result, Kaira District Milk Union Limited was born in 1946 (later renamed to Amul).
- In 1966, Amul hired Sylvester da Cunha to design an ad campaign for Amul Butter. DaCunha designed a campaign as a series of hoardings with topical ads, relating to day-to-day issues. It earned Amul a Guinness World Record for the longest-running ad campaign in the world.