Good to know.
Are anyone aware of how the quality differs if SMP is converted to Liquid Milk, versus the freshly procured liquid Milk? And is it practicable to convert SMP to Butter, Ghee, Cheese etc.?
I can for sure tell that Parag’s ‘Pride of Cows’ milk won’t be affected because they command the premium owing to the ‘Farm to Home’ positioning.
Ideally foreign companies would tie up with local farmers and buy milk from them.
The will create value by marketing, like as been the case of A2 milk. A2 milk from Australia is sold in New Zealand, US, Canada and UK but none of the milk is exported from Australia
They hired local farmers in all these countries, tested the cows have A2 milk and bought milk from them
The rest was advertising and marketing
MacDonald’s in India does not import chicken, they source it from local farmers. What makes people buy from them and not just buy chicken and cook at home ?
Parag wants to position itself as FMCG and not seller of milk commodity. If tomorrow the entire country buys from Parag, they wont take over the entire countries livestock
For things like milk and cheese its very difficult to create a brand.
Warren bought See’s candies because on Valentine’s day a husband wouldnt go home with a cheap box of candies as See’s was seen as premium product
Gillette is a brand because they are really the best.
A brand either has to be the best, difficult for milk, or has to have a prestige (Bullet Bikes) or memory (Thumps up) associated with it
When a guest comes to your home, you dont show them the Parag Milk food cheese wrapper if you make a sandwich for them, neither will the care
There is a long way for Parag to be a brand but as a company its great because there is continuous incremental business. Once you eat cheese it becomes a habit however its relatively easy to replace a Parag Cheese with a Britannia Cheese with advertisement.
Go Cheese has a definite advantage over Britannia, Amul or other brands. Most QSRs use it & they won’t care to switch over to other brands because even a slightest taste change (yes Cheese taste differs noticeably from Brand to Brand) can make them loose customers, and this is not desirable even if the competiting brand offers cost benefits (Cheese cost is a small % of total cost of most foods).
Parag knows that and is brilliantly using it as a leverage to attract consumers (see their latest commercial). I am sure it can make serious effect when the commercial launches nationwide.
For example, my wife (fan of Amul Products) became seriously interested when I showed her the Go Cheese commercial. She prepares Pizza at home but can’t replicate the taste (not possible IMHO) but is having the perception now that possibly the Cheese brand had been the deterrent.
I think this kind of perception is enough for many to switch over to Go Cheese, and they probably have the most variety of cheese in the market, and is available in most Retail Malls and eCommerce Platforms (Spencer’s, Bigbasket, Grofers).
I understand what you are saying
Cheese flavour like wine will change from one batch to another batch
British Airways once took 2 olives from each plate to save a million on food on all flights
A mozzarella marketed directly as coming from the chefs in Italy will probably have the same effect but Parag new advertisement is awesome
Eventually people will realise its not just the cheese, its also the dough, the oven, and the other ingredients that make a difference including the type of tomatoes
In Italy people sprinkle Parmesan on their pizza to add flavours
When SMP converted to liquid milk it is the lowest quality of any milk. Which in turn follows in to poor quality yogurt. SMP is similar to frozen vegetable/meat which India never needs! But still politicians will ahead with such projects to import to loot or make scam.
at present a lot of the milk we get in plastic is made from milk powder. Especially in winter months when milk procurement is low, dehydrated milk powder (SMP) is re-hydrated by various dairies, fat added to it and then sent by trucks for sale.
If one wants fresh milk round the clock, one should have a stable of cows nearby. Even then, the milkmen inject the animals with some steroids to ‘increase’ production.
Interesting, how is amul milk made…the full fat and skimmed? Are they not fresh but made from powder etc? Also do these well known brands like amul’s milkmen use hormones and/or antibiotics on cows? Thanks
same difference! milk from powder is done at the co-operative level. individual milkmen inject their cows with hormones and antibiotics
One of the trends I have observed where I live (in Bangalore) is that there are a lot of smaller companies that are selling specialized organic milk. They also proudly highlight that they are antibiotic free, chemical free etc. What kind of impact do you think these companies will have on the larger more well known brands. People are increasingly conscious about what food they are eating and where they are buying from. Free range eggs for example are a range. In time will we see these niche companies with more organic roots eat away at the margins from the larger more well established companies.
I understand that the organic products are slightly more expensive but I would rather pay 20% more for food than suffer from a dangerous disease later on. On an average niche milk per liter is between 25% to 40% more expensive.
Disc…Invested in Parag
Excuse my ignorance, is Parag’s farm to home brand ‘Pride of Cows’ milk Organic, because these are procured from the farmers? Don’t farmers use antibiotics?
Parag’s ‘Pride of Cows’ milk isn’t procured from farmers but produced from Holstein and Friesian cows in Parag’s own dairy farm.
http://www.prideofcows.com/our-farm/
While Parag’s ‘Pride of Cows’ is supposed to be organic as well, the competition that you’re referring to in Bangalore may be coming from small suppliers who are able to supply A2 (organic) milk. For eg: Swarg, Organic Mandya, Satvic Organic, Malnad milk etc.
@Tolaha…Thank you for elaborating my point and that is what I had in mind.
@sujay85 As the above post by Tolaha mentions I was talking of really small vendors challenging more established companies like Parag. This is also true in smaller cities in the North-East where I am from.
On a side note, the quality of food in the North-East (vegetables, poultry and other fresh produce) are much better than anything available in cities.
Interesting!
I wonder what stops players like Parag from launching their brand of organic A2 milk given that Indian native breeds of cows and buffaloes are of A2 milk type (Amul already has ‘Amul Deshi A2 Cow Milk’). It is also possible for them to acquire some of these small local players! Is this because they consider the fad around A2 milk dissipating off? Scientifically there appears to be little conclusive evidence that A2 milk is more healthier.
Its Cow’s (of specific breed) milk that’s A2 and it doesn’t include buffaloes AFAIK. It does seem intuitive that Indians shouldn’t have any issue getting A2 milk as all our native breeds belong to the specific breed. But as part of ‘Operation flood’, many European breeds were mixed with Indian breeds resulting in much better yield but composition of A1 milk increased. Remember reading somewhere that pure Indian breeds are just 10% of the Indian cow population currently.
I don’t have any scientific studies to share with you as my views on this are purely anecdotal. Check this article for references on how traditional cow rearing families in India and abroad noticed that milk from certain breeds seemed to be ‘better’ for health:
You may be right. My concerns (similar to what I hear from folks interested in buying milk directly from small dairies) is that milk that we get from large dairies is another example of processed food and less healthy.
Yeah, it does make sense.
According to this article “98 per cent of Indian cow breeds and 100 per cent of our buffaloes produce A2 milk.”
https://indianexpress.com/article/india/unnecessary-controversy-decoding-the-truth-and-myths-about-a1-and-a2-milk-types-5143163/
Based on what I read in the investor presentations and management discussion, they are focused on the value add products of milk. These are good for margin improvement and earnings growth. Thus I don’t find it surprising that they are not focused on selling only milk given the high completion and sourcing issues.
Competition yes! But sourcing no! Because for milk derived products too you need to have a good sourcing network (this is the reason Britannia’s Dairy division is suffering). And A2 milk is not only for milk-consumption. The benefits, if anything, should be available in the value-added products too.
I had been noticing the exact trend in Bangalore where askhayakalpa and a local organic producer has taken market share in my neighbourhood which was 5 years ago dominated by Nandini (karnataka milk federation). I chose to ignore to invest in large milk producers because I believe the growth in market share will be taken away by niche organic producers and not large ones. The cheese quality of bulk producers isn’t any where close to commodity cheese available in supermarketers in the west. The only exception I know is is of a christian monastery where monks produce some comparable quality fresh mozzarella that gets sold to top quality Italian restaurants in the city and they can’t even supply to retail customers who are willing to their door step to source it.
