CHAPTER 1

Introduction To

The

Organization

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INTRODUCTION TO VERKA

THE PUNJAB STATE COOPERATIVE MILK PRODUCERS FEDRATION LIMITED; The Punjab State Co-operative Milk Producers’ Federation Limited (MILKFED) was established the in 1973 by Punjab Diary Development cooperation under the Punjab Sate Co-operative Act, 1967 to safeguard commercial interest of milk producers farmers to save them from exploitation of middleman, with their participation in its management and to provide quality milk and milk products to consumers at competitive rates.

First, to carry activities for promoting production, procurement and processing of milk for the economic development of milk producers by providing remunerative milk market to them at their door step. Second, provide quality milk and milk products to consumers at reasonable rates.

Although the federation was registered much earlier, but it came to real self in the year 1983 when all the milk plants Punjab Dairy Development corporation Limited were handed over to cooperative sector and the entire State was covered under operation Food programme to give farmers to a better deal and our valued customers better products. Today, when we look back, Verka has fulfilled the promise to great extent. The setup of the organization is a three tier system, Milk Producers Cooperative Societies at the village level, Milk Union at District level and Milk Federation as an apex body at a State level.

Milk production is a very important part of agricultural economy in the State of Punjab. Punjab is one of smallest state in Indian Union with a total area of 50,362 Sq. km. Dairy Farming is an old subsidiary profession in the rural area of Punjab. Punjab is the second largest milk producing state in India, producing 10 % of country’s milk.

Some facts about Verka:-

1. First Milk Plant of the State was setup at Verka near Amritsar.

2. The brand name of Milk and Milk Products was adopted as Verka.

3. The Foundation stone of Milk Plant Ludhiana was laid by Hon. S. Parkash Singh Badal the CM of Punjab in 1970.

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4. Commissioning of the Plant was done by Dairy Development Corporation in 1974.

HISTORY

The Punjab State Verka Milk Producers’ Federation limited popularly

known as MILKFED Punjab came into existence in 1973 with a twin

objective:

To providing remunerative milk market to the Milk Producers in the

State by value addition and marketing of produce on one hand and

To provide technical inputs to the milk producers for enhancement

of milk production on the other hand.

Although the federation was registered much earlier, but it came to real

self in the year 1983 when all the milk plants of the erstwhile Punjab Dairy

Development Corporation Limited were handed over to Cooperative sector and

the entire State was covered under Operation Flood to give the farmers a better

deal and our valued customers better products. Today, when we look back, we

think we have fulfilled the promise to some extent. The setup of the

organization is a three-tier system, Milk Producers Cooperative Societies at the

village level, Milk Unions at District level and Federation as an Apex Body

at State level. MILKFED Punjab has continuously advanced towards its coveted

objectives well defined in its bylaws.

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Name and location of group companies & products

manufacture/offered by MARKFED:-

Milkfed has a strong value addition base addition base though its 12

District cooperative milk producer’s unions and 40 chilling centers capacity of

about 15 Lac liters per day, all of whom have attained self sufficiency or are on

the thresh-old of attaining it.

1. Gurdaspur

2. Amritsar

3. Hoshiarpur

4. Jalandhar

5. Ropar

6. Ludhiana

7. Bathinda

8. Sangrur

8. Patiala

9. Firozpur

10. Faridkot

11. Bassi Pathana

12. Mohali

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MISSION, OBJECTIVE, QUALITY POLICY AND

CORE VALUES

Mission:-

To become the market leader in market of milk and milk

products.

Objective:-

Direct approach to consumer and producer and to avoid

middleman. (By the farmers, of the farmers and for the farmers’

organization.)

Quality Policy:-

On the basis of quality with efficient administration, MILKFED has not

only established new mile stone of providing services to Dairy farmers but

scaled new heights in delighting esteemed customers also. This has resulted into

tremendous achievements in all fields.  

Core Values:-

Selling the highest quality natural and organic products available Satisfying and delighting our customers

Supporting team member happiness and excellence

Creating wealth through profits & growth

Caring about our communities & our environment

Creating ongoing win-win partnerships with our suppliers

Promoting the health of our stakeholders through healthy eating education.

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PRODUCTION RESULTS OF PREVIOUS YEARS

NAME OF THE

PRODUCT

2006-07(in

M.T)

2007-08(in

M.T)

2008-09(in

M.T)

Ghee 356.729 412.933 505.90

Butter 140.550 291.193 83.69

WMP 382.070 195.205 58.05

SMP 245.350 402.175 583.97

Cheese 92.290 85.463 110.42

Curd 693.620 727.845 807.43

Kaju Pinni 559.00 1329.0 1746.00

Liquid Lassi 10999195 11270977 12496497

Lassi 17.189 2136.0 138333.0

Kheer 1262.0 2770.0 5814.0

Total Capacity

Utilized

50.38(%) 52.83(%) 58.77(%)

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TURNOVER:-

The annual turnover of Milkfed which was Rs.585 crores in the year 2003-04

has hit the level of Rs.725 crores in the year 2006-07.

                                     

EQUITY PARTICIPATION:-

The paid-up equity of Milkfed as on 31.3.2007 was to the tune of Rs.47.15

crores which comprises of Rs.29.02 crores from the cooperative members and

balance Rs.18.13 crores from State Government.

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MILKFED GROWTH AT A GLANCE

PARTICULARS UNIT 02-03 03-04 04-05 05-06 06-07

FUNCTIONAL

SOCIETIESCUMMU.NOS. 6643 6445 6104 6101 5989

MEMBERSHIPCUMMU.NOS

IN LACS3.79 3.76 3.56 3.63 3.60

AVG. DAILY MILK PROC LKG SPD 10.01 7.45 7.81 7.82 7.78

PEAK MILK PROC LKG SPD 15.01 10.04 11.64 11.37 11.54

A.I. CLUSTER SOCS. COOMU.NOS. 305 323 341 388 433

FODDER SEED

SUPPLIEDM.Ts. 517.40 444.10 400.30 430.00 500.00

CATTLE FEED SOLD M.Ts. 71743 73724 66970 66750 73577

AVG..DAILY CITY

SUPPLYLLPD 4.68 4.97 5.27 5.67 5.81

SALE OF SFM LAC PKTS/BTLS 29.61 30.32 35.85 42.49 41.92

SALE OF LASSI LAC PACKETS 10.10 10.54 12.20 16.89 19.16

SALE OF ICE-CREAM LAC  LITRES 7.63 9.17 10.23 12.18 15.61

EXPORTS RS.IN LACS 953.52 698.17 1142.28 713.67 11.50

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TURNOVER RS.IN CRORES 670.00 585.00 653.00 682.00 725.00

MARKETING OF MILKFED:-

Milkfed is serving nation wide consumers through its net work of

Regional offices and strong Distribution channels. Milkfed markets a wide

Variety of Products which include liquid milk, skimmed  milk powder,

whole milk powder, infant food, ghee,  butter,  cheese, Lassi, SFM, Ice

Cream, Malted food  Verka  Vigour etc. etc. The annual turn over of Milkfed

has crossed Rs 668 crores. Verka is a brand leader in milk powders

particularly in northern eastern sectors and SMP marketed by Milkfed

commands a premium price over powders manufactured by competitors who

include multi-national as well as private trade and other Cooperative

Federations

EXPORT OF MILK PRODUCTS: -

With competition in the national market zooming up efforts to

export products have been made. Milkfed has established its ghee market in

Middle East Market. Verka ghee reaches all the emirates and is available

almost in all super markets. The penetration is so deep that Verka ghee is

available in far off labor camps.  In addition to ghee, SMP was also exported

to Asian Countries like Philippines, Bangla Desh and Sri-Lanka. Verka Malt

Plus (Malted Milk food) has also been exported to Bangla Desh.

QUALITY ASSURANCE PROGRAMME: -

Quality Assurance Programme (QAP) which is a part and parcel of

Dairy Plant Improvement Programme (DPIP) was taken up in Ludhiana

Milk Union with the Technical guidance from NDDB. The main objective

of the programme is to improve efficiency of Plants  coupled with  loss

management to bring down the cost of  production,  improve  the  quality  of

milk and milk  products  manufactured  to ameliorate  the general hygienic

and house keeping standards  and above all to enhance the profitability and

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financial viability of the Milk Plants to enable milk producers to get better

price  for their produce.

DETAILS OF OPERATIONS

(Procurement, Reception and processing)

Inauguration of plant by Punjab Minister Giani Jail Singh dated 7 May, 1973

and the plant started in 1975.

Village Producer

↓

Societies

↓

Chilling Milk Centre

↓

Milk Plant Hoshiarpur

↓

Reception Dock

↓

Quality Control

↓

Production Department

↓

Processing

↓

Finished Products

SOCIETIES:-

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The milk plant, procure milk through co-operative societies. At

the present the plant has the 751 societies. Firstly milk is collected by these

societies and then sent to the milk plant for two times, morning and evening.

The milk producers receive rate of milk from milk plant on the basis of fat.

CHILLING MILK:-

There are three milk-chilling centers at Dasuya, Padrana and

Balachour. Firstly milk is received at the chilling center and after chilling

the milk.

MILK PLANT:-

After chilling the milk, it is sent to the milk plant, the purpose to

setup the center are that, the societies are far away from the milk plant

and milk is perishable in nature so to avoid the wastage of milk, the

chilling center were setup. Firstly milk is received in dock through

tempo in higher basis of routes. There are 3 seasons of milk - fluid,

average and lean. The lean period is during April and July and this

period supply of milk received in less quantity. The average is During

August to November and in this period the supply of milk received is

average. The flush is in winter and the milk is highly produced.

RECEPTION OF MILK:-

Reception of milk is done at the dock. Dock is like a station. The

milk plant has two Docks, firstly milk is reached in the huge quantity, after

this process milk is sent to the laboratory to find out fat and S.N.F. contents,

then milk cans are washed by the machines and again these cans are kept in

the carriers after this process tempo sheets are prepared. The numbers of

milk cans of buffalo and cows milk are recorded on these sheets are sent to

the societies for the information of quantity of milk.

PROCESSING:-

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All the received is passed on to the tank lying under the weighing

bowl. Then the milk is immediately chilled and pasteurized. Pasteurization

is a process which was found by Lou Pasteur.

MARKET SERVED DOMESTIC/FOREIGN:-

The success of a concern lies not only in production, but also mainly in

successful marketing.

“Marketing is the process getting the right goods to the right consumers

at the right place at the right price”.

In Verka Milk Plant four types of tetra packs and other products are

marked under the brand name “VERKA”, Milk plant is solely responsible for

the marketing of fluid milk products are marked by “the Punjab state co-

operative milk producer’s union ltd.”

Return of tetra packs:-

Because the expiry time of tetra pack is 6 months, good packing

and fresh supply, there is no replacement of the tetra packs.

Exports

Milk union is famous all over the country and outside the country for

its quality of milk and milk products. It holds international quality

certificates ISO 9002 and IS-15000 (HACCP). Due to these certificates its

products are easily acceptable in the international market. It export Ghee to

Dubai but no any tetra pack is export.

Products Manufactured and marketed by Milk Union:-

Milk plant, has variety of products which are available in different

packing. Raw material for all these products is milk which procured from

milk producers.

1 Sterilized Fluid Milk

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a) Standardized milk (Fat Contents 4.5%)

b) Double Tend Milk (Fat Contents 1.5%)

c) Full Cream Milk (Fat Contents 5.5%)

2 Ghee

3 Butter

4 Skimmed Milk Powder(SMP)

5 Paneer

6 Milk Cake

Besides these products milk plants sells various products

procured from plants. These products are as under:

1 Flavored Milk

2 Flavored Lassi

3 Mango Rassila

4 Yoghurt Fruit Drink

5 Kaju Pinni

6 Ice Cream

Aims Of Milk Union

Every organization is formed for achieving some objectives.

Setting of objectives and aims serves as guidelines for excellent or smooth

working of the concern. The Verka milk plant, touted to fulfil the following

aims.

1. To uplift social and economic states of the milk producers.

2. To develop dairy as an industry allied to agriculture.

3. To procure milk and execute marketing efforts so that milk

producers get good prices of their milk.

4. To provide better quality cattle feed at reasonable prices.

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5. To increase the bargaining power of milk producers at their

doorsteps.

6. To provide veterinary aids to animals of milk producers at their

doorsteps.

7. To create employment opportunities for rural youth by milk

production activities.

Study of functioning of all departments:-

Milk Procurement Section

Milk procurement business is being looked after mainly by milk

union, Milk is collected by milk producer co-operative societies ate the

village level and purchased by Milk Union, which further supplies that milk

to the Milk Plant, after charging commission from milk Plant at rates

specified by Milk Union.

The plant was registered in the year 1972 with primary

membership of 45 milk producer co-operative society. At present it has

767 co-operative societies.

Staff Structure of procurement section:

Manager, milk Procurement

Dy.Manager (Proc.)

Manager (Milk Chilling Center)

M.P.A.

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D.H.C.C.

Production Department:- This department his headed by production manager and

technical staff and officers and operation. Manager is responsible for

production planning, receiving good quality of milk, its processing and

production of milk products.

His responsible for achieving production target with minimum

wastage. He also guides workers for better performance. The production

is an important activity because other department purchasing extra

revolve around it. Different milk products are produced as per

availability of milk and as per demand of market.

First of all the requirement of milk demand is fulfilled and then

remaining milk is used for producing various products such as Ghee,

butter, cheese etc,.

Staff Structure of production section:

Manager of Production

Dy. Manager, Production

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Sr. Plant Operator

Jr. Plant Operator

D.H.C.

Purchase Department:-This department his headed by purchase officers who is assisted by

supporting staff in maintaining regular supply of store items. This section

ensures timely purchase of required store items at very reasonable cost.

Functions of purchase department:-a. To received purchase requisition from stores.

b. To buy goods or materials wisely at reasonable prices.

c. To invite quotation from number suppliers and preparing

comparative statement to choose a right supplier.

Engineering Section:-This section his headed by engineering manager who is assisted by

technical officers. He is responsible for identifies all machine needing

maintenance to avoid any breakdown during the production. He is also

supposed to introduce to new machinery by which the cost of production can

be decreased it also insured are transport vehicles of milk plant.

Staff Structure of engineering section:

Manager, Engineering

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Dy. Manager, Engineering

Foreman Foreman Foreman Foreman

Electrical Refrigeration Boiler Transportation

Management Information System:

MIS is a system where information about the activities of plant is

supplied to management. Accurate and precise information to support the

operation management analysis and decision making function in an

organization. Here data are collected from different section in an

organization, which can be useful to the management for decision making.

Accounts Department:-A manager account is the head of this department. He is responsible for

the overall management of accounts. This section is responsible for timely

payment to all the employees of milk plant and also to the parties dealing with

it. It records all the transactions in the proper books to provide necessary

information to the authorities whenever required.

Personnel and HRD department:-Production Manager & HRD Department who is assisted by

supporting staff to carry out function of this section head this section. This

section ensures compliance of labor laws, maintenance of proper records and

completion of administrative formalities for timely payments of dues to

employees. It is also responsible for maintaining cordial relationship between

workers and management.

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Marketing Department:-The success of concern lies not only is production but mainly in

successful marketing. Production of goods and services has no meanings

unless goods and services are exchanged profitably for money or money’s

worth. This involves the movement of goods from the manufacturers to

ultimate consumers. In bringing he producer and consumer together, certain

activities are performed which is the concern of marketing.

Marketing is a process of getting the right goods to right consumers at

the right place, at right time and prices.

Deputy Manager who is further assisted by supporting staff heads Marketing section. He regulates the production of milk and milk product in different ways to ensure maximum possible returns from sales.

Quality Control Department:Quality control manager heads this department and the technical staff

assists the manager by conducting all type of tests on raw materials and

finished products with the help of sophisticated equipment and machines

purchased.

Quality control laboratory helps in maintaining high quality of milk

and milk product assist ensures quality by testing the raw material as well as

finished products.

Staff Structure of Quality Control section.

Manager, Quality Control

Dy. Manager, Quality Control

Asstt.Manager, Q.C.

Chemist

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Laboratory Assistant

Helper

Store Department:-This department stores all the essential equipment and material and

stationary required in all the departments. It also keeps the records of goods

purchase and goods in stock as well as the goods the used by the particular

department. The main purpose of this section is to keep the full record of packed

material. The product is stored at clean and Cool places.

Security Department:-One senior security employee, who is assisted by a team of well-

trained personnel manager the security department. This department keeps

proper watch on men, money and materials while entering in and going out

of the plant.

Special Technique Adopted

Management information system:-

MIS is the system in where information about the activities of the

plant supplied to the management. Accurate and precise information to

support the operation management, analysis and decision making function in

an organization. Here data are collected from the different related sections

which can be the management for the decision making.

The following information are maintained and supplied to the

management when required:-

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Progress of dairy plant (monthly/Yearly).

Progress report of input activities (monthly/Yearly).

Progress report of procurement activities (monthly/Yearly).

Reports on activity of chilling centres (monthly).

Report on product wise costing (monthly).

Report on unit costing (monthly).

Report on product wise costing (monthly).

Stock statement (monthly).

Sales and return (monthly).

Transportation cost of milk collected (route wise).

Section wise salary report (monthly).

Running hours of machine (monthly).

Financial position (yearly).

Dairy co-operative societies progress (Monthly)

In any decision making matter all these information is of great help tp

the management. Thereby in an organized dairy like Verka Milk Plant,

Hoshiarpur, it is a very important section to keep the overall position/status

of the plant.

Production of milk products:-

Production is a more important activity of an organization. In occupies an

important and significant place because other functional areas of

management viz.financing, marketing, purchasing and personal revolve

around it.

Production is a process by which raw materials are converted into

finished products with the help of energy, capital, manpower, and machinery.

Production policy aims at maximum output with minimum input. The

production departments play a very important role in formulation of the

production policies.

Production planning is done by the head office and send to the

production manager according to this planning production manager arrange

to produce the products.

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Production planning of milk products is done in keeping in the view the

procurement of the milk plant and also tentative demand in the city. After the

supply of the pasteurized milk, the remaining milk is used for producing

various products. Different milk products are produced as per availabilities

of milk and as per demand of sales and keeping in view the production plan

given by head office. Every district has its own plant.

Verka products range:-

1 Ghee

2 Butter

3 Skimmed milk powder

4 Flavoured milk

5 Flavoured Lassi

6 Mango Rassila

7 Paneer

8 Milk Cake

9 Dahi

10 Ice Cream

11 Kaju Pinni

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VARIOUS PRODUCTS PRODUCED BY VERKA MILK

PLANT

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GHEE (AGMARK)

Boudine Test                        Neg.

B.R.reading (40 degree C.)  40 - 43

RM Value  (Min.)               28.0

P.Value                                  1.0 - 2.0

FFA % Oleic Acid( Max)   0.30

BUTTER

                                  TABLE       WHITE

Fat% (Min.)                   80.00          82.00

Acidity %L.A. (Max.)   00.15          00.06

Curd % (Max)                01.00          01.50

Salt % (Max)                    2.8              -

Coliform/ml. (Max.)         5                 5

Y&M (Max)/g                20               20

GENERAL COMPOSITION FOR MILK

Percentage   Cow Milk Buffalo Milk

STANDARD MILK

Milk Fat % (Min)              4.5 

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Fat                        4.6               6.6

Proteins               3.4               3.9

Lactose                4.9               5.2

 Ash                     0.7               0.8

 Water                86.6             84.2

 

Milk SNF % (Min)            8.5

PH (Max)                           6.8

MBRT (Min)                     5.00 Hrs.

Phosphates Test               Ng.

Bacterial Count/ml.(Max) 30,000

Coliform/0.1 ml.                   Nil

UHT MILK 

FAT                            4.6%

SNF                            8.6%

pH                              6.6

Acidity L.A.                0.130% LA

SWEETENED FLAVOURED MILK RASEEELA

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Milk Fat % (Min.)                         1.65

Total Milk Solids % (Min.)       17.0

Sugar % (Max.)                           6.0

Turbidity Test                             Neg.

Creaming Index                            20

Bacterial Spores per ml. (Max.)  5

LASSI

Milk Fat %                                3.0 to 3.4 

Total Solids % (By wt.)          20 - 23 

Sugar %                                    12.00 

 

Cheese Whey  %            40

Sugar %                           12-12.5

Mango Pulp%                 10.00

Brix                                    15 

Acidity(%Citric Acid)   0.28 

pH                                  3.9-4.1

ICE CREAM

Weight (g/lts.) Min.560-

580

Total Solids (Min.) (By

wt.)38.5

Milk Fat % (Minimum) 13

Acidity, L.A. % (Max) By 0.25

KULFI AND F/N CHOCOLATE

KulfiF/N

Choc

Total Solid (%Min. By

wt.)42.00 38.50

Milk Fat %(%Min. By wt.) 13.00 13.00

Protein (%Min. By wt.) 3.50 3.50

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Wt.

Sucrose % Max. (By Wt.) 14.50

Stab. Emul. % Max. 0.50

Acidity % Max (By wt.) 0.30 0.30

Sucrose % Min. (By wt.)

Total14.00 16.50

 

CHAPTER 2

INTRODUCTION TO

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THE TOPIC

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