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SUMUL’s Entry in Goa is a threat to local business – Goa Dairy

In the today’s competitive business world the entry of new players is inevitable. In fact, Goa is much faster in this. The developments are taking up in a rapid pace and Goa presently facing the competitive environment in all the industries.

The entry of SUMUL was the sign of stiff competition to the local milk producers in the state but the CM had rebutted this fact then claiming that it will only develop the healthy competition. Goa Dairy is producing the milk and milk products in a large scale having existence in Goa for more than four decades. Goa Dairy is the government owned subsidiary.

According to the PTI reports, the Goa Dairy Co-operative Milk Union has expressed the fear over the entry of Surat (Gujarat) based SUMUL which according to them will lead to creating the major hurdle in their way of business. According to the officials in Goa Dairy due to the entry of SUMUL, the entire cooperative movement of Goa will get disturbed which was built in past four decades taking a lot of efforts. “We have the fear that existing 176 dairy societies which supply the milk to Goa Dairy after collecting them from farmers will face the major setback,” told Mr. Sawant, Managing Director of Goa Dairy.

According to the notification issued by the Goa Government, the Gujarat-based SUMUL (Surat district Cooperative Milk Producers’ Union Ltd) will be additional unit in Goa  to the already existing state-run unit Goa Dairy. The union has also appealed to the chief minister Laxmikant Parsekar who has assured to look into the matter soon.

Although CM has assured to look into the matter but based on his earlier stand in which he quoted that the entry of the new player into this field will only amount into the healthy competition and it will be in the benefit of the farmers. The BJP spokesperson Pramod Sawant had told the media earlier that, the entry of SUMUL will help the farmers who are now relying on the Goa Dairy alone to supply the milk.

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Goa Dairy having its headquarters in Ponda was started in the year 1975 by the government of Goa but subsequently, it was handed over to the farmers in 1984. The dairy was based on the format of Anand (Gujarat) based AMUL approved by the National Dairy development Board.

According to Mr. Sawant, there are approximately 19000 farmers have been benefited from Goa Dairy on the daily basis by supplying the milk produce to the respective societies in their villages. The society then transports the milk to Ponda based mechanized plant of Goa Dairy where the final processing is done and the milk is made available to consumers through 1200 authorized outlets spread across the state.

According to the information made available by Mr. Sawant, there are around 70000 litres of milk being supplied by the local farmers and 20000 litres procured from the neighboring states every day.  According to him, Goa Dairy generates the turnover of Rs. 140 crore in a year with nearly 10% of profit margin which is 1.78 crore according to him that is being shared with the farmers.

According to Sawant, the profit margin is sufficient enough to keep the company floating. “Despite sharing the profits with the farmers Goa Dairy made a decent profit of Rs. 40 lakh in the last fiscal out of which Rs. 24 lakh was redistributed into the societies in the form of dividend and bonus, Goa Dairy also provides the subsidized cattle feed to the farmers,” said Sawant.

The government is making policies for the benefit of Goa and Goans but the entry of SUMUL exhibits different pictures in the state. It can be a threat to the existence of local dairy since it comes with bigger setup and better Market positioning which would easily swallow the local business. But it looks like the government of Goa is stiff on its decision and most probably the SUMUL is here to stay.  Please do leave your comments and suggestions on this serious issue.

Source: Various Sources

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