Nandini is also keeping price points low at Rs 39 a litre for its packet milk, in a bid to protect its market, dairy industry sources said, even as Amul will retail its milk at higher price points in the capital of Karnataka.
Dairy brands Amul and Nandini will compete with each other in Bengaluru, one of the country’s largest milk markets, as the former makes an entry into the same.
Amul announced on Wednesday that it was entering the Bengaluru market, via e-commerce channels. The announcement created a social media storm, with hashtags such as #SaveNandini and #GobackAmul doing the rounds.
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Marketed by the Karnataka Milk Federation (KMF), Nandini is the largest supplier of milk in Bengaluru, at 23 lakh litres per day, which is about 70% of Bengaluru’s milk market, pegged at 33 lakh litres per day, according to dairy industry sources.
Nandini is also keeping price points low at Rs 39 a litre for its packet milk, in a bid to protect its market, dairy industry sources said, even as Amul will retail its milk at higher price points in the capital of Karnataka.
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“Amul Taaza and Amul Gold, our packet milk brands, will be available for Rs 54 a litre and Rs 64 a litre each in Bengaluru,” Jayen Mehta, managing director (MD), Gujarat Co-operative Milk Marketing Federation (GCMMF), which markets Amul, told FE.
“While I am aware of this Twitter storm over our recent announcement, I would like to indicate that we are only looking at e-commerce/quick commerce channels right now. We are not looking at general trade at the moment. For that, we will need to bring down price points. There is no such plan currently. And a modern trade entry of Amul in Bengaluru will happen only six months later,” Mehta said.
Calls and text messages to KMF’s MD BC Satish regarding Amul’s entry into Bengaluru remained unanswered till the time of going to press.
But Nandini, according to dairy industry sources, has had no competition from a rival co-operative milk brand in Bengaluru so far, which could change in the future with Amul’s entry.
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“Though Amul is restricting itself to the online and modern trade channels, there is no stopping it from getting into general trade in the future. Nandini may have to brace itself for competition in the future,” a senior dairy industry executive said.
Harish Bijoor, brand expert and chief executive officer of Bengaluru-based Harish Bijoor Consults, says that Amul may face a challenge from Nandini.
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“I don’t think regional brands such as Nandini will allow Amul to take away its market easily. Most milk co-operatives carve out competence geographies. Milk is a fresh product, best supplied locally. While crisscrossing markets is fine, it may not be the best strategy from a fresh milk perspective. Nandini may play on this aspect,” he says.
Mehta of GCMMF says that Amul is sourcing milk from neighbouring Andhra Pradesh for supply into Bengaluru. “We have three plants in Andhra Pradesh, one unit is around 120 km from Bengaluru, from where we are supplying milk to Bengaluru right now,” Mehta said.
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Heated politics
A political slugfest broke out between the ruling BJP, and opposition Congress and JD (S) on Saturday over the ‘threat’ to Nandini following Amul’s entry to the state. While the opposition parties have charged that the BJP government was out to finish Nandini, chief minister Basavaraj Bommai said the government is clear on the issue of Amul.
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Accusing Congress of politicising Amul’s entry, Bommai said: “We have absolute clarity with regard to Amul. Nandini is a national brand. It’s not restricted to Karnataka. We have popularised Nandini as a brand in other states as well. There is no need to be afraid of Amul. Our Nandini is an established brand. We will take all the steps to give Amul a tough competition.”
