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 Procurement and input department
 Production department chapter
 Marketing department
 Personnel department
 Finance department
 Maintains departments
 Stores department
 Quality control departments



I take opportunity to express my gratitude to THE MILMA

DIARY AMBALATHARA for permitting me to do this
internship in their esteem organization. I think all the staff and
workers who helped and cooperated with me.

I would also like to thank my faculty Mr.………………………for

this valuable monitoring and constant encouragement

I would also thank the Almighty whose blessing have made

this project work success and also thank family and friends for
sporting me in completing my internship program successful.

I declare that the internship report done at MILMA DAIRY and

submitted by me for the award of the degree of MASTER OF

COMMERCE of the University of Kerala is my own work. The report

has not been submitted for the award of any other degree of this

University or any other University

Name and Signature of the candidate


Milk occupies a number position in India’s diet. According to

nutrition advisory committee of Indian council of medical
research a balanced diet for an adult Indian should include ten
ounces of milk per day.
Most of milk produced in India is from rural areas, farmers had
a difficulty to take it in to the city.The small farmers face
number problems such as in adequate transport facility, non
availability of veteniery services, and absence of proper
system of processing and marketing of milk. The production of
the milk is done rural areas by small marginal farmers who
find it difficult to market but the profitable market is in urban
areas. The system of processing, preserving and marketing
the milk in villages seem to be a problem so in order to solve
this problem co-operative milk supply societies and milk
unions have been established.

Government of India launched a dairy program called “flood

program” called with National Dairy Development Board
(NDDB).the main aim of the program was to organize milk

producers co-operatives in several probable places of India
taking the kaira district (ANAND) co-operative milk producers
union is (AMUL)of Anand , Gujarat as the model with the
above object in the view. The diary societies in the Gujarat are
properly known as ‘white revolution”...NDDB has now India’s
1, 17,575 village dairy co-operatives federated in to 170 milk
union and 15 federations procured average 25millions liters of
milk every day.12.4million framers are presently members of
village dairy co-operatives. All the above mentioned
information leads to the conclusions that in the absence of
proper machinery to collect and supply milk, milk producers
existence in dangerous situation. This Lightened the path of
establishment of” MILMA.”


Milma is one of the most brands in milk industry of Kerala

having a rigid organizational structure carrying out various
managerial functions. And also Milma is in prominent position
in the milk market of country by adopting various marketing
techniques and professional management system in this co-
operative union. So the study is mainly concentrated to know
how these marketing techniques and management system are
applied in practice And what are the assistance providing the
various department in this union to achieve their
organizational goals. The study also aims to giving
suggestions which can help them to improve market share.


 To study the organizational structure of Milma

 To get fairly acquainted with professional work culture
 To understand the industrial practice
 To find out various managerial process handled by milma
 To study the various functions of finance department.
 To identify the strength and weakness of workers an
 To study how the theoretical knowledge is made use in
real situation


 The time is critical limitation factor in this study

 Most of data required is kept in head office
 The unwillingness to disclose all the information from
certain departments

 The study includes all limitation since there is no
structured questionnaire form of research.
 Lack of proper experience on the part of researcher in
conducting such studies in the past.


Duration of the study

The duration of the study was 2 weeks from 24-04-2019
Data collection method
The collection of data refers to a purposive gathering of
information relevant to the subject matters of the study from
the units under investigation. The method of collection of data
depends mainly upon the nature, purpose and scope of

Primary data
Primary data are those which are collected for the first time
and it happens to be original in nature. The primary data were
collected mainly through,

 Personal interview with managers
 Interaction with workers

Secondary data
 Secondary data were obtained through,
 Company journals
 Company websites
 Magazines
 Company annual reports



Co-operation means working together jointly. It implies living,

thinking, and working together. All organization of the society
ranging from family to nation are built upon the strong
foundation of the co-operation.the workers co-operation in
their activities should be guided by the principles “each for all
and all for each” and show honesty in their dealings. It is a
joint action joint possession and management. At present the
word co-operation go beyond in its general concept’ working
together’. In its technical sense it denotes a special method of
doing business and it also stands for deliberate organization
of human being for the attainments of their common economic


The co- operative movement in India in the last decade of

19th century with two objectives in view, i.e., to protect
farmers from the hands of private money lenders and to
improve their economic condition. It introduced as a
government sponsored movement started after India became
freedom. Within two decades of independence the
membership of primary societies had increased four times
while share capital and working capital had increased 23 and
31 times respectively. Madras province was the birth place of
this movement. In 1904 on the basis of Edward law committee
the first co operative society act was passed. There were only
formed credit societies according to this act. With the reforms
of act 1919 co operative movement entered another phase of
expansion. By this act a co- operation become provincial
subject and the provinces and princely state made there’re
own acts.


The Kerala state was formed in the year 1956. At that time
two different laws are existed. Travancore Cochin co-
operative societies act and madras co operative societies act.
The Kerala government passed the first co operative act in
1969 which came in to force on 15th may. The co-operative
societies in Kerala are divided in two are Agricultural societies
and Non agricultural societies.



The Kerala co-op milk marketing federation (KCMMF)

popularly known as MILMA was set up in the year 1980 with
head office at Trivandrum, as an implementing agency for
operation flood (a dairy program which was launched in
1970under the sponsor ship of national dairy development
board (NDDB).KCMMF is an organization of farmers and they
are the producers of raw milk, and share holders. The
KCMMF is the apex body of all the Anand pattern co-operative
societies (APCOS) in the state. APCOS are organized in the
three tire structure, the basic unit of the organization the
primary dairy co-operatives. Those who are the actual dairy
farmers are the only entitled to become members of the
society. The president of APCO’s is elected form the general
body meeting. The elections to the post of APCO are held on
once in fifth year. The main activities of these societies to
collect milk from all its members ensure that the milk sent to
the chilling centers and dairies in the time, channel subsidized
cattle field for the farmers etc. Each primary co-operative
society is an autonomous self governing organization with its
own board of directors elected among the farmers. The
primary co-operative societies unified in regional levels called
regional cooperative Milk Producers Union. At present there
are three regional units. Ernakulum regional co-operative milk
producers union (ERCMPU) covers the district of Kottayam,
Idukki, Ernakulum, and Trichur.
Trivandrum regional co-operative milk producers union
(TRCMPU) covers the district of Trivandrum, kollam,
Alapuzha, Pathanamthitta.
Malabar co-operative milk producers union (MRCMPU) covers
the districts Wayanad, Kasargode, kannur, Palakkad,
Malappuram and Kozhikode.
Regional co-operative milk producers union provide various
input like regular vet nary care and the P&I staffs instinct
farmers on improve practice of cattle management and fodder
production. The union collects the milk from primary societies
process it in the dairy run by them and marketing their product
both inside and outside of the state. The motto of organization
“of the people by the people and for the people is the
foundation of three tier system. At the village level it is
APCOS.The village level APCOS are organized at regional
level as regional co-operative milk producers union. These
unions are federated at state level to form state federation that
is Kerala co-operative milk marketing federation.


All the dairy milk chilling plants and procurement and input
unit under the union are certified for ISO 9001-2000 and


Milma started an orientation program in a rented building in

1984 at Edappally in Ernakulum district. At the initial period
NDDB came forward to help Milma in providing financial
assistance and grant for meeting training centre expenses. At
21-1-1992 Milma established and started functioning a fully
fledged training centre with hostel facility in the land adjacent
Trichur dairy under North Kerala Dairy Project phase -1 and
Swiss Development Co-operation. It provided training course
for presidents, secretaries, milk testers, milk collectors of
Anannd Pattern Co-operative Societies, Milma agents and
Milma staffs.




Trivandrum Malappurm
Kottayam a
Kollam Ernakulum

Alapuzha Idukki Kannur

Pathanamthitta Trichur



MRCMPU is committed to provide consistently safe, hygienic

and healthy milk and milk products to achieve and enhance
customer satisfaction. Milma has got the market leadership by
achieving quality and economy in all their activities adopting
quality management system.


The mission statement of MRCMPU is as follows:

To bring about socio economic development of farmers on a
suitable basis and providing quality milk and milk products to
the customer at a reasonable price. The above statement
shows the aspirations of MRCMPU and its determination to
achieve the mission. When we look in to the various activities
of MRCMPU it is good alignment with mission statement

 To channelize marketable surplus milks from the rural
areas to urban deficit areas to maximize return to the
producer and provide quality milk and milk products to the
 To carry out activities for promotion of production,
procurement, processing, andmarketing of milk products
for economic development of the community.
 To buildup available dairy industry in the state.
 To provide constant market and state price to the dairy
farmers for their products



Milma has different departments, which control different
functional activities of the organization. Each department has
one departmental head that has the ultimate control
over the departments.
The various departments are:

 Procurement and input department

 Production department
 Marketing department
 Personnel department
 Finance department
 Maintains departments
 Stores department
 Quality control departments.



The procurement department comes under the direct control

of the head office at Kozhikode. The department is mainly
concerned with organizing and supervising APCOS through
the field level activities as the functions related to the
production enhancement, procurement of the milk and input
supply to the societies and farmers. The P&I departments
arranges milk procurement from APCOS through milk routs to
its dairies and milk chilling plants o annual contract basis.
There are milk collection routs and distribution routs of which
routs collection and distribution routs are linked to reduce
cost’s main function other than this as follows,
 Cattle feed distribution
 Artificial insemination
 Comparative development camps
 Giving insurance for both farmers and cattle.
The main objective of the procurement and input department
is to promote and strengthen the dairy co-operative network to
ensure sustainable socio economic development of dairy
farmers by providing effective support system for profitable
production and procurement and to take up other activities so
as to achieve objective of the union. There are seven P&I
units in the union. The p7i units are monitored from the head
office .there are 14 officers and 29 supervisors in the P&I
departments .Under each P &I department there are 3-6 P&I
supervisors and an officer in charge who is the head of the
unit. At present there are officers and supervisors in the
The ISO quality objective of procurement departments are

· Starting and stabilizing of newly formed APCOS

· Increase and sustain milk quality
· Support farmers to reduce production cost
· Make APCOS vibrant development co-operative organization
· Monitor procurement cost by efficient organization of milk
· Function as an effective communication channel between
union and APCOS



Production and manufacturing is a very basic function in every
organization. The production means conversion of raw
material in to finished goods. Here raw material is raw milk
itself is converted in to pasteurized toned milk, double toned
milk, standardized milk. Milma kannur dairy currently produces
milk curd ghee and sambaram. The main functions of
production departments are as follows,
 To undertake production in hygienic condition
 To maintain right temperature combination for
 To produce according to the order given by the
marketing departments.
 Production quality product with law cost

Milk production is not uniform in a year. It may vary according

to the weather. In summer milk production is very law while
consumption is more. During rainy season the production is
more than consumption because of the availability of green
fodder and water. So this surplus milk is taken to the milk
powder plant located in Alapuzha district and converted in to
powder and storage. When milk availability is law in summer
this milk powder and fat is used for producing fresh balanced
milk. This is perfectly scientific, safe universally accepted and

legal for meeting the required milk around the year. The
production department must make sure that the production is
done hygienic condition. Maintain the right temperature;
maintain the right combination of fat and SNF. The production
department has to make sure that the goods produced on the
basis of order given by marketing department with minimum
cost of manufacture.


Marketing department

Marketing is a comprehensive term which includes set of

activities that direct to flow of goods and services from
producers to consumers. Marketing department is an
important department in the organization. It is one of most
dynamic field within management arena. This department is
mainly concerned with activities regarding the milk and milk
products. The milk marketing system has been influenced by
characteristics of production process and products. The main
functions of the department are,
 Market development and supply management
 Study new markets
 Identifying marketing problem and measures to solve the
 Finding new customers
 Canvas for bulk orders
 Increasing sale and networking

The marketing officer is the head of the department. The
assistant marketing officers and field officers comes under
marketing officers. Assistan marketing officer concerned with
activities regarding supply management. That means the
distribution of milk and milk products giving details to the
production departments about how much to produced to next
day. He is also responsible about the marketing accounting
and market development activities.


Personnel department is the department in every firm which is
concerned with each employee. Personnel department is
responsible for the execution of policies regarding the
recruitment, discharge, classification of employees and wages
which had been laid down by the board of directors.
The total number of people working in the company is 330
including temporary and permanent workers. Out of this 10
officers and 85 are permanent while 3 officers and 8 workers
are temporary. This personnel and administration department
includes one officers and two clerks and one typist. And an
additional clerks and apprentice.
Duties of the department

 Keeping the personnel files of the employees

 Keeping the service books which contain all the details
regarding the job
 performance ,transfer, punishment etc
 Preparation of the salary bill
 Employees provident fund recovery and remittance in time
 Employees state insurance recovery in time
 Prepare half yearly statements and connect registers on
the above

 The preparation of journal ,vouchers /payments connected
with this department
 Preparation of stipend bill for apprentice
 Preparation of salary bill of the employees on daily wages
appointed on contract
 Leave posting and leave u[dating
 Attendance registers updating. There is an electronic
thump punching system is
 assembled in the unit
 Recruitment and probation
 Long term settlement of workmen
 Travelling allowance bill passing
 Motor conveyance advance processing
 Courier register maintenance
 Security arrangement
 Training
 Trade union
 Preparation of o t bills


Finance is the life blood of every business. This department
records classifies and presents information for manufacturing
and other activities of the firm. Department is mainly consist
with management of financial activities. The financial
departments’ deals with planning the total required for both
long term and short term purposes. The responsibilities of
maintaining accounts and exercising financial control is vested
with financial manager .all department payments and receipts
are finally reported to the finance manger. This department is
maintaining communication with all departments in the

Source of finance

There are two types’ financial sources in the company

Internal sources
 Income generated from sales is the main source income
of milma
 There are accumulated profits. It is the source of income
other than income from
 sales. Current loses are adjusted by the reserves. Capital
reserves are also includedin this.

External sources
· Milma raised capital fund by issuing shares only for farmers
of the APCOS. All farmers should subscribe certain number of
shares of the union.



The Maine purpose this department is to establish system for

the maintenance to ensure un interpreted functioning facilities.
With the modernization of the dairy processing industry
employing sophisticated equipment and increasing
competition it has become imperative to achieve higher
efficiency and economy. To achieve and maintain higher
efficiency and productivity in higher rate it requires a
systematic procedure and the control of production and
The maintenance department has to give assistance to the
production department by providing all the general utilities like
water, electricity steam, etc. there is 250kv substation owned
by the dairy for supply of electricity and generators to back up
if there is no power supply. The maintenance department has
to keep up machineries to assure that they are in proper
working condition to avoid break down.
Assistant manager is the head of the department .under
assistant manager there are technical superintend technician,
apprentices, drivers .The maintenance department has to
keep up utilities like electricity water, steam etc and product
The main functions of maintenance department
 Giving assistance to production
 Up keeping of machinery
 Assurance of general utilities
 Technical and civil maintenance
 Maintenance of tankers owned by dairy

The maintenance department is responsible for the bulk milk

movement in the tankers in the dairy. The dairy owns a water
treatment plant treats the effluent water with the capacity of
2000ltres. The solid waste is used as fertilizer .the water
treated is again used for the irrigation of plant in the dairy.


Stores play a vital role in the functioning of the organization.
All departments are in the direct contact with the stores for
their smooth functioning. The most important functioning of
the stores is that to provide regular service to production and
other department for their continuous smooth operation.
Maintenance of stores and its handling should be given
importance because investment made in stores is huge and
articles worth lakhes are kept in stores.

Major functions of stores department are,

 Receiving of material and recording of receipts.
 Arranging inspection and proper storage and preservation
of receipts.
 Issue of storage items to user departments
 Preparation of various report
 Receipt and inspection of material
 The raw material are received from two sources, that are
 Receipt from external sources
 Receipts of material from the outside suppliers.raw
material are received against
 the orders placed or by local purchase from local vendors.
 Receipt from internal sources

 Raw materials are received from the consumer
departments where the item maybe of no use.
Records maintained by the store departments
I. Bin cards
It contains detail like description of item size, specification,
name of the major suppliers.
II. Stores ledger
It contains details regarding receipts, issue and the balance of
the value, name of the supplier, name of consumer section.
III. Day book
It contains details of daily receipts and issue of materials in
quantity and value. Print outs taken monthly and kept in store.
IV. Stock movement statement
It contains monthly opening balance receipts and issue.
Closing balance print out is taken monthly.
V. stores ledger
It contains item wise details of quantity and value that is the
transactions report taken whenever needed.
VI. Cost report
Account code wise statement monthly print out.


The quality control department assures the quality of milk and
milk products at the dairy. The quality control labs, testing and
inspection come under the quality control department.
Quality policy
“Farmers prosperity through customer satisfaction”
“MRCMPU ltd is committed to provide consistently safe hygienic and
healthy milk and milk product to achieve and enhance consumer
“We milma shall strive to excel in the market leadership by achieving
quality and economy in all our activities adopting quality managemet
“We milma shall strive scientific approach to ensure the continual
improvement in personal, in our activities that increase value and
status of this organization and its associations.”
Functions of quality control departments
The main functions of quality control department are the
inspection of milk of each society. Inspection is mainly
conducted in order to make sure that the production is carried
out as per their standards.
Receiving inspection
Receiving inspection is the inspection of milk while receiving
the raw milk from the society. The test conducted during the
reception of milk is called organoleptic test.

Organoleptic testis conducted to find out whether mil is good
or bad. That is the appearance, color, flavor, taste are all to be
noted in this test. If there is doubt full cases the samples of
milk will send to clot on boiling test. If the clot on boiling test is
positive the milk is rejected.


SWOT analysis is the key concept in the world of co-operative
planning, strategy formulation and other practical spheres of
management. SWOT analysis is tool for auditing an
organization and its environment. It is the first stage of
planning and helps marketers to focus on key issues. SWOT
stands for Strength Weakness, Opportunities and Threats.
Strength and weakness are internal factors and opportunities
and threats are external factors.

Strength of milma
 Milma’s products enjoy the reputation of high quality and
healthy as most of its products are made with milk
collected from farmers in rural areas.
 Milma plant having all necessary equipments and
machineries to meet the present demand of quality milk
and milk products.
 At present kannur milma dairy has 1045 functioning retail
dealers 32 credit institutions.
 There is good communication system and co-operation
among all department of milma and it has good
organization structure to help thing are going smoothly.
 The employees selected in milma are efficient enough to
take responsibilities and challenges and able to do their
maximum to achieve organizational goal.

 The place where the factory settled is appropriate enough
to take care about all marketing activity.

 A fair growth in production and increasing scenario of
houses as well as families gives milma a good opportunity
to make good market strength in kerala.
 The gradual change of society in to disposable culture
make big need for packet milks in their daily life
 The increasing number of super markets and margin free
markets gives new opportunity to enter urban markets.
 Because of having less margin most of the sellers in rural
areas ignores milma products instead of other company’s
products except milk.
 Milma giving more care to farmer’s prosperity, it leads
much more difficulties to meet employees and other parts
of organization’s objectives.
 Milma requires more advertisement in the competitive
 Deficiency of fodder in summer creates lesser production
of milk. It makes difficulties in achieving customer demand
and makes more expenses.

 Milma never gets much more attention from the
government side. but it suffers un usual interfere from
government side.
 Because of increasing cost milma is facing threat of price
 An overall analysis of milma shows that it has well managed
structure, even though the following suggestions are put forward
to increase the functional efficiency.
 Milma should give target achievable training to officers and
workers instead of routine, expensive training especially in
marketing wing.
 Milma should concentrate more informative and catchy
advertisement of all products highlighting the product quality.

 Milma should find more market areas for the utilization of

their entire production


The organizational study gave a greater learning experience
to me. the experience of doing one month long study gave me
opportunity to explore in to the areas of practicable knowledge
of management and nature of a company. This organizational
study also showed the important roles played by every single
functions of the management. It also leads me into some
thoughts about my behavior, attitude, body language, and in
efficiencies and I became more conscious about time
Milma is the present milk marketing leader in Kerala. but in
this changing condition the marketing of milma products has
become more challenging as it now faces several competition
from private milk producers and local producers. This entire
problem can be met through professional managemen t
approach and target oriented training and proper planning. So
the company should give the attention in ensuring quality of
products and introduce more promotional activities to
overcome the competition.


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