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    Dairy & Milk Industry Business Consulting

    Dairy Industry

    With the widespread demand for milk products and their constructive role in the global food industry, milk products play a crucial role in the growth of the world’s economies. Over the years, by specialization, modernization, and restructuring, the milk industry has seen improvements in food protection. Moreover, the sustainability of dairy farms has also been affected by developments in global trade.

    Milk and dairy products have a leading role in the global market for food products. Probably the most competitive and unpredictable agricultural commodity market is fuelled by global dairy processing. The consumption of milk and milk products has risen globally with the growing population. Besides, per capita income growth and understanding of the health benefits of dairy products have increased demand, especially among the urban population. Manufacturers are introducing high-end technology, such as data analytics, to increase their milk production ability to meet this growing demand.

    Dairy Industry Market Drivers

    One of the key factors supporting market growth is the increasing demand for milk and milk-based ingredients. This can be due to the population’s growth, growing incomes, awareness of health, and the booming food and beverage industry. The introduction of automation technology into dairy farms is another critical development in the industry. Farmers now have better access to advanced technology that help track complex operations such as grass and herd management by quantifying information.

    Besides, different robots, mobile data applications, satellite systems, and drones are now available on the market to make profitable and effective decisions for farmers. Again, demand for clean label goods that are free from contaminants, artificial preservatives, or chemicals has increased. With the introduction of organic dairy products, farmers are encouraged to broaden their product portfolio.

    India is known for the largest dairy companies globally, based on geography, but almost all of its dairy products are consumed domestically. India is followed by Europe, New Zealand, Australia, and the United States of America, which are among the top dairy producers and direct the worldwide dairy trade.

    Challenges Faced by the Industry

    #1.Price

    Milk and subsidy income per kg of the quota will differ considerably from one farm to another. Changing the protein / fat ratio can affect quota returns / kg. Tighter margins of profit plus high quota prices would push producers to optimize their quota ‘holdings’ returns. Milk income accounts for about 85% of most dairy farms overall revenue.

    Again, to produce a litre of milk, there is a vast number of production costs. To decide which section of the operation performs best, producers can control each company’s output, such as milk, herd replacements, and crops.

    #2. Shortage of Fodder

    There is an overwhelming amount of unproductive animals competing with productive dairy animals to use available feed. Due to industrial development, the grazing area is markedly reduced each year. They are thus resulting in a scarcity of feed and fodder supplies to the total requirement. The output of dairy animals is frequently restricted by the growing difference between demand and supply of feed and fodder. In addition, the supply of low forage quality to dairy cattle limits animals. The low ability of small and marginal farmers and agricultural workers involved in milk production to purchase feed and fodder results in insufficient feeding. Mineral mixture non-supplementation results in diseases of mineral deficiency. High-cost feeding decreases the dairy sector’s earnings.

    #3. Breeding

    Everywhere in the world, breeding is an essential feature of modern dairy farming. However, even the most basic dairy cow breeding skills are absent, which is a significant problem for the growth of the country’s livestock industry. For any successful dairy farming enterprise, choosing the right animals to breed is essential.

    There is no successful identification of heat symptoms by cattle owners during the oestrus period. The calving period is on the rise, resulting in a decrease in animal output quality. Abortion-causing diseases contribute to economic losses for the industry. Deficiencies in nutrients, hormones, and vitamins contribute to fertility issues.

    #4. Lack of Required Skills and Expertise

    Dairy companies need to equip themselves with proper knowledge and skills to help them with the best background for processing milk in the dairy industry. Vital education and training programs on acceptable dairy practices could contribute to the development of healthy dairy products, but they must be participative to succeed. In this respect, all workers need to be informed and trained to understand what they are doing and develop a sense of ownership. Nevertheless, the creation and implementation of such programs in the milk sector require a strong management commitment, which is, at times, a stumbling block.

    #5. Dairy Hygiene Conditions

    One of today, today’s most significant milk production targets is maintaining a high level of hygiene. The hygiene standard directly affects the economic outcome of production, and dairies implement this by gradually increasing their raw milk quality requirements. More specifically, however, the protection of dairy products and the conditions under which they are processed are of interest to consumers.

    Unsanitary conditions contribute to mastitis conditions in cattle sheds and milking yards. The processing of unhygienic milk contributes to a decline in the quality of milk and other products’ storage and spoiling.

    #6. Dairy Health

    In far off areas, veterinary health care centres are situated. The ratio between the population of cattle and veterinary establishments is broader, resulting in insufficient animal health facilities. There is no consistent and periodic vaccination schedule, and there is no consistent de-worming schedule, resulting in massive mortality in calves. No adequate immunity is developed against different diseases of cattle.

    Future in the Dairy Industry

    Over the last 15 years, the dairy sector has undergone many shifts, pushing the market towards greater industrialization. However, the reality is that the world is changing rapidly, and to continue feeding the world, the dairy industry needs to change as well.

    As the economic crisis unfolds, consumer preferences, perceptions, and emotional needs will begin to change. Dairy producers have a responsibility to effectively, reliably, and innovatively carry your goods to customers. Therefore, in product creation and distribution, continued informative, fast, and careful thinking is essential.

    In the past, distributors collected milk and used their milk containers to sell fresh milk every morning to visit households or the consumers (Distributor to consumer or distributor to the household (D2C or D2H)). The household used to make purchases from them.

    Since market demand has been altered, today, consumers are becoming more mindful of their health and food hygiene. The market research found that many industrial processors have appeared and have arisen. With the promise of hygiene and quality, they collect, process, and distribute dairy and milk products in packaged form.

    As companies/ brands purchase milk directly from producers, pay them proportionately, process the milk, and distribute it to end customers through distributors and modern retail stores, wherein the middlemen are effectively removed.

    How YRC as Business Process Consultants can help you to overcome these challenges

    #1. Logistics Planning

    The logistics of handling a short shelf life product produced daily from a large region is a significant challenge for the dairy industry. Lean manufacturing consultants provide organizational-wide enhancement and take logistics into account when it looks at the consumer’s end value and steps in producing this end value, not just the manufacturing portion.

    #2. Process Automation

    Automation of business processes uses technology to conduct recurring activities or operations in an organization where human effort can be substituted. This may include Artificial Intelligence (AI ), Machine Learning (ML), Internet of Things ( IoT), ERPs, chatbots, equipment for packaging and handling, etc. It is achieved to cut costs, improve productivity, and streamline procedures.

    #3. Dairy Processing Handbook / Process Manuals

    The Dairy Processing Handbook draws on our comprehensive know-how and offers thorough but easy-to-understand knowledge on production processes. Get insights from pasteurization, homogenization, and UHT treatment to filtration, automation, service systems, wastewater treatment, and many other aspects of modern dairy production into processing technology and the whole chain.

    #4. Standard Operating Procedures (SOPs)

    The industry continues to be troubled by the limited availability of structured process documentation resulting in lack of proper (internal and external) communication, mismanagement of feed management, sanitizing methods, input vs. production, waste management, utilization of human resources, selection and monitoring of breeds, added value and profitability of the dairy farm. SOPs aim to solve all and more of these problems.

    YRC Dairy Consultancy Services is committed to helping our clients to maximize their ‘farms’ production and boost productivity and profitability.

    SOPs in the Dairy Industries

    Dairy industries should have a manual that describes how the dairy functions, a detailed plan that outlines how the dairy executes all its processes. These are the standard milk company operating procedures (SOPs). With the help of a dairy consultant, your SOPs should cover:

    • General management of herd health: vaccine schedules and treatments
    • Milking management: processes, sanitation washing, liner modifications, etc.
    • Calls for emergency
    • Manufacturing process
    • Procurement
    • Repairs & maintenance
    • Organizational chart- who is responsible for what
    • Packaging, Distribution and Logistics management
    • HR & Administration
    • Accounting
    • Warehousing and storage

    IT System Integration of SOPs

    The centre of all business processes consists of a reliable IT infrastructure. IT applications can reduce operational costs substantially, also improving process accuracy and automation.

    As influential leaders know, well-documented structures and processes are a must to establish a company that scales. Standard operating procedures (SOPs) help companies streamline business processes, and ensure workers understand how to execute assigned tasks in the most effective way possible to the desired standard.

    For example, SOPs are imperative in a manufacturing environment to ensure consistent performance, quality control, traceability, and employee protection.

    As such, ensuring that all company members work from a formalized and organized collection of processes that improve efficiency and minimize the likelihood of mistakes, establish a chain of command, and ensure that all regulatory requirements are met is imperative for proper and efficient management of SOPs.

    Digital Sales Techniques for Rapid Expansion

    The centre of all business processes consists of a reliable IT infrastructure. IT applications can reduce operational costs substantially, also improving process accuracy and automation.

    • Adopt D2R (eliminate distributors and directly reach out to retailers)

    Milk companies purchase milk from farmers under a Direct to Retail (D2R) digital distribution model and then use a transparent digital marketing system (e.g., online sales portals), removing all intermediaries/ distributors. Retailers can place an order and fresh milk & dairy products are shipped to the retailer directly by the manufacturer.

    • D2C business model (Via e-commerce directly sell to consumers)

    Direct to consumer (D2C) give the manufacturer more significant influence over the brand, reputation, publicity, and sales strategy. In addition, it allows the milk producer to stay agile, communicate directly, and learn from end consumers on an ongoing basis.

    Thus, SOPs help to establishing and implement best practices across the organization at every stage of business cycle i.e. Startup, Growth or Maturity stage

    Get Advice for Dairy & Milk Industry Business

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    We work only for Visionaries.

    PROCESS AUTOMATION

    The idea of having Ecommerce Consultants on-board from the beginning itself points towards reducing the involvement of the promoters in daily operations. Ecommerce Businesses willing to be a brand reaping profits & sustaining the competition must ensure that most of their processes should be automated. The more the manual intervention, the more would be the errors.

    In Ecommerce business, you get only 1 chance to impress the customer & if you mess up there, you lose the customer for long.

    Process automation in respect to all the activities pertaining to customers from order receiving to order fulfilment is a must for a seamless experience for the customers.

    Task Management is another grey area where most deadlines fail as 90% of the tasks are assigned manually & are forgotten, unheard, misunderstood or mistaken.

    YRC Team of Ecommerce Management Consultants helps to make maximum of the processes system-driven to ensure minimalistic manual intervention.

    VIDEOGRAPHY & PHOTOGRAPHY

    No matter how good your product is, the customer would know only if it looks good.

    Photography includes the following steps:

    • Cataloguing your products
    • Cataloguing your images
    • Backup your images (A few cloud storage solutions include Dropbox, Google Drive, Bitcasa, Apple’s Cloud Storage etc.)
    • Choose the right camera & lens (You may also outsource the photography to a third party agency)

    DIGITAL MARKETING

    Digital Marketing includes SEO & SMM. SEO i.e. Search Engine Optimization includes activities like back-linking, meta tags, blog-writing etc. to ensure your website ranks on the 1st page on Google Search.

    Next comes SMM i.e. “Social Media Marketing” which as the name suggests including promoting your products on all the social media sites, email marketing, influencer marketing & several other BTL activities.

    These activities are going to be recurring & would decide the traffic on the website, the conversions, whether the right target market is tapped, the likes, the views, the orders, the reviews & much more. YRCs Ecommerce Consultants create a budget for digital marketing right from pre-launch to launch & for each month thereafter.

    Building digital marketing strategies in coordination with the agency, selecting them to signing them off would be the role of YRC.

    This ensures seamless coordination, detailed interactions & desired execution as it is always advisable to work with a single agency than multiple of them.

    IT INTEGRATION

    Selection of the right software for smooth functioning of back-end operations right from production to webstore display would be suggested and integrated by YRC Team.

    YRC’s Team defines SOPs of Product Movement, maps it with the locations & people. They then create a blueprint of all the features required in the software & help in shortlisting & selection.

    IT Integration involves connecting your offline inventories with real-time online webstore so when a sale occurs, inventories get deducted real time across offline as well as online platforms.

    This helps in accurate inventory management, maintaining the MOQs, re-order levels & achieving the optimum inventory levels.

    Some popular software include unicommerce, viniculum for your front-end website management & Genisys for your entire back-end Purchase, Production, Accounting, Invoicing etc. management.

    WAREHOUSE & LOGISTICS PLANNING

    • How many cities or countries you wish to sell in?
    • Where should your Warehouse be located?
    • Should you have one warehouse in each country or city?
    • Should you be having your own delivery team in your base city?
    • Would the 3rd party vendors be reliable? What happens when they lose or misplace your product during delivery?
    • How should I manage the logistics if my goods are coming from different countries?
    • How should the goods be stored and barcoded?
    • How much space do I require for warehouse?
    • I am sure several such questions must be haunting you while you think of starting your own fashion ecommerce brand.

     

    At YRC, our warehousing and logistics experts can help you devise a strategy for all of the above mentioned queries and much more.

    We design the layout of the Warehouse considering the inward, goods processing, software entry, barcoding, outward, goods return, scrap storage, goods stacking & much more.

    Logistics route plan is devised considering the manufacturer to your warehouse and from there to last mile delivery locations.

    UI & UX DESIGNING

    This Step involves 03 distinct parts:

    Part 1: Choosing the right Platform:

    From several platforms available in the market right from Shopify to magento, woocommerce, prestoshop, wordpress etc. you must choose the one that fits best for your business

    Part 2: UX Designing:

    “UX” denotes User Experience, which if put in simple language is building the functional requirements of the website.

    UX Designing includes designing the features required in the website, customer journey map, website features, the browsing features, navigation features, ecommerce order management process flow, checkout cart features, catalogue management, ecommerce payment system, cross selling features & much more.

    “As per statistics, 68% of the customers abandon the carts before payment”

    An interesting UX ensures the customer sticks on to the website for a longer time.

    Part 3: UI Designing:

    UI stands for User Interface, which means designing the look and feel of the website. UI includes using the right colours, elements and the entire aesthetics of the website.

    A good User Interface ensures the user completes the task that he has come for. It navigates the user through the journey of the brand in the simplest but most effective way.

    The UX designer maps out the bare bones of the user journey; the UI designer then fills it in with visual and interactive elements.

    If User experience is the bare bone, user interface wraps it up with an attractive cape.

    At YRC, our team if experts can help you develop the entire User Journey to ensure it is engaging!

    SAMPLING & PRODUCTION

    This step follows the “Designing” Phase, whether you have an in-house design team, freelance designers or an outsourced design company. It is one of the most exciting phases, as here you see your designs turning into products & your ideas turning into reality.

    In most start-up cases, production is outsourced i.e. brands tie-up with the established manufacturers/ job-workers to get their products manufactured.

    Sampling involves multiple 04 Stages, Fit-Sample, Prototype Sample, Pre-Production Sample & the Production Sample.

    Prototype Sample is the first sample provided to the buyer. It can be in any fabric/ colour. This sample is just to understand whether the product design looks equally great in reality.

    Fit Sample, as the name suggests is prepared to check the fit of the garment i.e. the various sizes, length, width etc.

    Pre-production is made by the actual production line. Here the stitching quality and other aspects related to manufacturing are checked. This is the last stage where rejection can be accepted.

    Production Sample is made before the production which is the replica of what is going to be finally produced.

    Once you are through with all this, you are good to go ahead & get your goods manufactured.

    PRODUCT DESIGNING / SOURCING

    Product Designing or Sourcing is the heart of the Ecommerce Fashion Brand.

    Product Designing / Sourcing can be done in several ways, as follows:

    • In-house Design Team
    • Freelance Designers
    • Outsourced Design Team
    • Ready Product Sourcing (From Manufacturer or Wholesaler)

    At YRC, we evaluate your business strategy & business model to arrive at the decision, which of the above ways would be best-fit for your business. In certain cases, product sourcing may be a combination of the above.

    These are the people who are going to build your brand! Whether they are the designers or merchandiser, your brand look is going to be in their hands.

    If you are designing each garment from the scratch, the sourcing would play crucial role in developing design identity of your brand.

    Sourcing includes fabric, trims, lining & all the raw material required to build the garment.

    BRANDING

    Branding is the “Look of the Brand”, right from logo to tagline, the colours used, the brand story, the brand communications on social media, the packaging & all the other aspects which speak directly or indirectly to the customers. Branding constitutes the look & feel of the brand & hence must be thoughtfully planned to match with the product that we are selling.

    Branding must appeal to our target audience. Example : A golden colour logo depicting finesse, art, richness, premium, however beautiful it may be individually cannot go with a brand selling affordable kids wear products. So, your logo must be in-line with your brand positioning, whether you are an expensive brand or a luxury brand or a value for money brand, it must be depicted from your “Branding”.

    It is an integral part to attract the target audience.

    ORGANOGRAMS & SOP’s

    Organogram is the “HR Blueprint” of the business which is created at the onset, to map out the team required across each function at various stages of the business. At the launch, only key people need to be got on board to ensure the project gets started & at this stage, all of them need to multi-task. Similarly, certain financial as well as operational goals are set for addition of the further team. Example, for the operations team, we hire 1 operations manager during the pre-launch phase & we add 1 more only when the business kicks-off & we reach a volume of selling more than 1000 pcs/ month or a turnover of more than 0.1 million USD.

    SOPs are Standard Operating Procedures, a bible to run the entire organization right from Sales, Purchase, HR, Order receiving to Order fulfilment, Inventory Management, Accounts, Warehouse, Logistics, Supply Chain, Production & all the other relevant functions for the business. Business must be organized from its first day of operations; only then the tasks can be delegated.

    At YRC, we design the organization structure, the processes, and approximate time taken to execute each process, job profile of every member within the organization, their KRAs, KPIs & the Reporting Structure.

    CRITICAL PATHWAY

    Critical Pathway Analysis (CPA), is a project management technique which cannot be overlooked while launching an ecommerce fashion brand. Brand launch process is cumbersome with multiple inter-dependent & time-bound tasks involved, which need to be tracked to ensure the project remains on track.

    CPA outlines key tasks across the project, their turnaround time (TAT) & the dependencies of tasks upon each other. It identifies the sequence of tasks, their interdependent steps from inception to completion, their criticalities, and their dates of onset, target dates of completion along with the key responsible person for the respective activities. Critical Pathway helps in understanding the unimportant & not urgent tasks which may jeopardize the execution of the project because of an unexpected snag! It also maps out the potential bottlenecks which might be posed because of the dependencies of tasks upon each other & cases where the next task cannot be commenced before the completion of the previous one.

    CPA detects the minimum & the maximum time involvement of a particular individual or team to execute the task, thereby arriving at the overall deadlines associated with the project.

    At Your Retail Coach, we design the Critical Pathway & review it periodically to ensure the project is on track & the progress is measurable.

    BUSINESS STRATEGY & BUSINESS PLAN

    Business Strategy includes the vision, mission, goals, business model, business plan & strategy for all the functions within the organization.

    Business Strategy is a well-defined plan that outlines who, what, where, why, how & when for the company; for example, who would be the target market, how to attract the target audience, when to launch new products, where to operate from, how to handle competitors, what would be the USP, what would be long term goal of the organization & several other answers to the 5Ws of Strategy.

    Business Strategy aligns the organization towards a common goal. Business SWOT helps company to identify & overcome their weaknesses & focus to sharpen the strengths. Business strategy forecasts future risks and helps business in building skillsets to overcome the potential threats.

    YRC’s Business Plan focuses on creating a “Blueprint” of the business, thereby deriving the feasibility of the concept & gauge whether the opportunity is lucrative to invest time, energy & effort. Business Plan creates cash flow understanding i.e. building inflow & outflow cash projections from Week zero to week 60 i.e. 05 year projection. Business Plan calculates the capital investment, operating costs, one-time costs, recurring costs & all the other numbers relevant to obtain the breakeven sales, return on investment, return on capital, internal rate of return & several other ratios. Business Plan is also one of the important requirements if you are targeting the “Investor Route”. Fund raising becomes extremely transparent & channelized. With business plan panned out clearly, the business will know until what point must it be stretched & where to stop, which reduces the probability of unplanned investments.

    MARKET RESEARCH

    Starting the concept of Ecommerce Fashion brand with Market Research ensures we get detailed understanding of the industry & this research report also acts as a social confirmation for your concept. Market Research helps in understanding the target locations, their population, potential online buyers for your product, competitors for each category, and top selling products of the competitors, competitors’ price range, offers & their responses & much more. Market Research helps in thorough understanding of your brand position as compared to our competitors. It helps in identifying gaps in the market, in your category along with the scope of the said product in the desired market. This will help in validation of your concept & prevents you from making the same mistakes as your fellow brands, eventually saving your time, energy & efforts. This phase is also a make or a break phase, as the market research study may at-times come up with some eye-popping numbers & statistics which might compel you to re-think on your product or category that you are planning to sell or alter your entire concept itself!! Market Research Reports analyse the competitors’ webstore for their traffic, conversion & sales. This is extremely valuable information to derive our inventory budgets & projections, which takes us to our next phase.