Management Consulting Interview Question - Growth Strategy for Dairy Farmers in India

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Management Consulting Interview Question - Suggest a Growth Strategy for Dairy Farmers in India
Our client has partnered with the Indian Government - the Department of Animal Husbandry and Dairying to help dairy farmers increase their income. Please help them with a detailed strategy and provide recommendations. 

Growth Strategy for Dairy Farmers

Priyanka: I would like to ask a few clarifying questions before I start solving the question. 
Interviewer: Sure, please go ahead. 

 
Priyanka:  What is the average cattle size? Also, do dairy farmers own the cattle? 
Interviewer:  On average, the cattle size owned by dairy farmers is 2. Also, 60-70% of farmers own their cattle. 

 

Priyanka:  Are there specific regions or states in India where we want to focus?  
Interviewer:  Yes, you can focus on East India – states of Bihar, Jharkhand, West Bengal, etc. 

 
Priyanka:  What are the primary challenges faced by dairy farmers that hinder income generation? 
Interviewer:  They are not ready to invest in buying more cattle and hence they are not able to increase their income. 

 

Priyanka:  Do we have any time or resource constraints regarding the same? 
Interviewer:  Yes, we would like to have short-term goals as well as long-term initiatives. There are no resource constraints. 

 

Priyanka:  Just to summarize, we want to support the Ministry of Animal Husbandry and Dairying who indeed are looking to help the farmers in East India to increase their income. 
Interviewer:  That is well-summarised. 

 

 

Priyanka: I would like to start by understanding the challenges faced by dairy farmers. Is there a lack of demand for their produce (demand issues) or are they not able to produce enough (supply-related issues)? 
Interviewer:  We can look at both sides. You can start by analyzing the supply side first.  
 

Priyanka: I would like to think of reasons as to how the farmers are not able to increase production. 

  • Low productivity of cattle 

  • Lack of resources – technology, credit, etc. 

  • Lack of support from the government  

Interviewer: That’s comprehensive. What do you suggest? 
 

Priyanka: I can think of the following solutions. 
Improve productivity of cattle 

  • Better and Free Healthcare Vet Services: Establish veterinary clinics and provide cheap access to healthcare services for cattle. Offer subsidized treatment facilities and vaccinations. 

  • Feed Quality: Promote the use of balanced and nutritious cattle feed to increase dairy produce and help the farmers improve their yield. 

Support farmers through technology 

  • Vernacular app: Develop an easy-to-use mobile app or online platform to connect farmers with buyers and provide information on best practices. The app should be available in local languages so that farmers can understand it easily. 

  • Health care tracking: Help farmers with an app to ensure live tracking systems to monitor the health and productivity of animals. 

Support farmers through credit 

  • Credit Access: Facilitate easy access to credit and loans for purchasing livestock, feed, and equipment. 

  • Insurance: Promote insurance to mitigate financial losses due to disease outbreaks or natural disasters. 

Support from Government 

  • Policy Reform to support dairy farmers: Advocate for policy reforms that benefit dairy farmers like fair pricing, subsidies, and support during price fluctuations. 

  • Research and Development: Invest in research and development for innovative dairy farming techniques and products. 

Interviewer:  These are great suggestions. Let's look at the demand side now. 
 
Priyanka:  Here I would like to think of why the farmers are not able to sell their produce. 

  • Lack of fair pricing mechanisms 

  • Low quality of production 

  • Lack of dairy infrastructure 

  • Growing popularity of Non-dairy alternatives 

Interviewer: How would you solve the above? 
 
Priyanka: I can think of the following solutions. 
Help farmers get a fair price for their produce  

  • Market Linkages: Strengthen market linkages to ensure fair prices for dairy products. Develop partnerships with cooperatives and private dairy companies. 

  • Pricing knowledge: Reduce the information gap by creating an app that helps farmers know the standard government rates so that we can sell wisely. 

Quality Control 

  • Milk Testing Labs: Set up milk testing laboratories to ensure the quality and safety of dairy products. Also, educate farmers about best practices so that they can improve the quality of production. 

  • Certification: Encourage farmers to obtain certifications like FSSAI (Food Safety and Standards Authority of India) to improve product marketability. 

Dairy Infrastructure Development: 

  • Cold Storage and Milk Collection Centers: Invest in cold storage facilities and milk collection centers to reduce spoilage and improve milk quality. 

  • Bulk Milk Coolers: Subsidize the purchase of bulk milk coolers to preserve milk freshness. 

Interviewer: Yes, these are helpful suggestions. 

Priyanka: I can also think of some alternative suggestions that can help farmers increase their income. 

Women Empowerment: 

  • Encourage Women in Dairy: Promote the participation of women in dairy farming by providing training and access to resources. 

  • Women's Self-Help Groups: Support the formation of women's self-help groups for collective dairy farming and marketing. 

Training and Education 

  • Financial Literacy: Provide training in financial planning and savings to help farmers manage their income and invest wisely. 

  • Farmers' Training Programs: Organize regular training programs on modern dairy farming techniques, including fodder management, breeding, and disease control. 

Interviewer: That was a great discussion. Thank you.  Important Links

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-- Technomanagers


Credits - icon@iimb.ac.in 

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