RS Sodhi on how Amul is tackling Covid-19 crisis

In an exclusive interview with ETV Bharat, RS Sodhi MD GCMMF (Amul) talks about how Amul is playing a key role in fighting against the Covid-19 Crisis. He also gave valuable insights as to how FMCG companies should take up strategies to fight in such dark hours.

Hyderabad(Telangana):RS Sodhi MD GCMMF (Amul) said that Amul is tackling the battle against Covid-19 and various strategies on supply chain management are being looked upon to help the masses. In an exclusive interview with ETV Bharat Assistant News Editor (English) Verghese P Abraham, Sodhi also spoke on how his company is making sure that people get the supply of milk and dairy products during this pandemic. Here are excerpts from the interview:

Q1. Amul is looking quite upbeat with its growth figures for FY 20 inspite of a Covid crisis. How is Amul managing it?

A1: Our business depends on the milk that we are procuring from 36 lakh farmers. Now, what served as an advantage for us was that small vendors, players have stopped collecting milk from the farmers, so we are getting 15% more milk. We faced some issues in the beginning but now the issue is settled gradually. Our whole supply chain management from top to consumer has not been affected much.

Q2. How do you ensure that COVID guidelines are adhered while collecting and distributing Amul products?

A2: We started implementing the guidelines from March 17. Safety guidelines were communicated to our members by putting up banners outside 18,500 Gujarat centres and more. Guidelines were issued at the milk collection centres to follow social distancing norms, wash hands with soaps frequently. Milk tankers are sanitized and drivers and cleaners are told to wear PPE. We are taking all measures at every step. We know how safety measures are important when it comes to food, so now we are following the guidelines in a more aggressive and minute manner.

Q3.During this lockdown, most of the organisations experienced labourers dwindling. Amul must also have faced it. How did you manage to overcome it?

A3: Yes, we faced a scarcity of labourers in big metropolitan cities like Delhi, Mumbai, Kolkata beside Gujarat. The required labour benchmark is 30% less but gradually workers have started coming in. We faced issues in our warehouses but now we are able to manage it.

Q4. Is there any change in the behavioural pattern of the householding buying? Are there any instances of panic buying or people are buying what they require?

A4: Yes, in initial days there was panic buying among the customers as the sale of milk and its products rose to 30%. Thereafter, the hospitality services, sweet shops and tea shops were closed due to which our sale declined by 15%. But today, the milk sale is down only by 7%. Household consumption has increased and demand for products like ghee, butter, cheese has increased. Even the demand for ice-creams has increased but the problem lies with the distribution.

Q5. Have you faced an unprecedented situation like this before or is it like a first-time challenge for you?

A5: In the late 80s, I have experienced curfew in eastern Ahmedabad. I used to drive my milk vans in the curfew area of the city and used to arrange for transport passes. The only difference is that this time the entire country is in lockdown. Milk is an essential item. On March 25, Ministry of Home Affairs, various Chief Secretaries approached us telling that there should be no shortage in supply of milk.

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Q6. Did Amul tie-up with any online distributors and has it benefitted your company?

A6: Amul has an online presence. Initially, we noticed that there was a decline in the online distribution but gradually it picked up. Now our online sale is 35-40% more than what we used to have before. General trade is helping us a lot.

Q7. Do you think this crisis will affect Amul? Is there any possibility?

A7: We are mainly concerned about the safety of our labourers. As far as milk processing, collecting and distribution are concerned I don't see any problem. Every day, we are giving around Rs 120 crore to the farmers. In states like Rajasthan, Punjab, West Bengal and Maharashtra the milk collection has been doubled.

Q8. We heard that Amul has now shifted to the online invoicing process. How has technology helped you in keeping your office work in place?

A8: Technology and the internet have helped us a lot. Only minimum people need to come to the office and invoicing is also done from home. Only labourers are working in plants and warehouses. We are able to communicate with anybody across the globe. But in the olden days, we did not have health hazard and we were able to bring people to the office. We could communicate with all our stakeholders because of this technology.

Q9.What do you think could be the challenges for FMCGonce this lockdown is lifted?

A9:Consumers have purchased everything beforehand. So, now FMCG companies will now to see how fast this pipeline can be filled. I think after this pandemic, consumers will become more price and health-conscious. With the supply chain becoming disrupted, manufacturers have to look at how everybody can be kept in the loop. Each company has to learn multi-tasking, multi-segment and production facilities. Companies also need to find efficient leaders who can come out in this time of crisis.

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