Tuesday, May 28

Two IIM Graduates Take the Milkman Route to Solve the Challenges of $70 Billion Indian Dairy Industry

Country Delight was started by Chakradhar Gade and Nitin Kaushal, a couple of IIM graduates (IIM Indore batch of 2007) who left their bright corporate careers to solve a very basic but prevalent problem – artificial and adulterated milk.

Country Delight promises natural, fresh and unadulterated milk directly to the doorstep of the consumer. Consumer ordering and servicing happen through a first-of-its-kind mobile application that completely takes away the hassle of managing one’s milk requirements.

On how and why they started this, Chakradhar Gade said, “We saw a clear problem to solve, a huge industry to tap into and a sustainable business model that we could scale using technology.”

As Indians, we love the idea of fresh milk daily. The idea of getting fresh milk is integral to our heritage and we all look back fondly to our visits to our native towns and villages. However, it’s seen that the quality of milk that gets delivered to homes is far inferior to what we expect, is of an indeterminate age, reconstituted with milk powder and has questionable storage practices.

Nitin Kaushal, who has previously worked in the ITC e-choupal initiative, explained, “We realized that the Indian liquid milk market, despite being such a large and old industry, is devoid of any innovation and follows very unscientific practices. For example, at the initial levels of aggregation, most of the milk testing is still done by tasting it. Imagine – the milk delivered to your doorstep is checked on the judgement of someone who has tasted it.”

He said, “For us the mission at Country Delight is to deliver natural, fresh and unadulterated milk. Natural means straight from the farm with no addition of milk powder or preservatives. Fresh means that the milk reaches the consumer in 24-48 hours of milking. Unadulterated means scientific quality testing of milk for adulteration at every stage and a strict no to the commonly used practice of Organoleptic (oral tasting) for accepting milk. All this quality promise of Country Delight is with the added convenience of home delivery to the consumer.”

“Our business model is subscription-based where a consumer orders once and is served on a daily basis. On the mobile application, consumers can set their daily/alternate day milk subscription plans as per their requirement. In addition, the consumer can also mark vacations when going for holidays and pay milk bills through the app,” said Chakradhar.

“The mobile app is a scalable way of acquiring consumers and also gives us the ability to cross-sell value-added products such as paneer, curd, and ghee,” Chakradhar further explained.

“We deliver on our promise with the help of our strong network of farmers who we invest in, and our network of local entrepreneurs who deliver milk to the consumer’s households. This has created a three-way win for our consumers, farmers and local entrepreneurs helping us create a scalable ecosystem that benefits the community,” said Nitin.

For its sourcing, Country Delight engages directly with the farmer, eliminating all middlemen, pays the farmer a premium for his milk, follows ethical procurement practices, invests in cold chain and quality testing infrastructure at the farmer’s location, and improves the working capital cycle of the farmer by paying him earlier as compared to others. Essentially, the business empowers the farmer to grow and to give the right product.

For its delivery, Country Delight works with local low-income entrepreneurs who work part time for 3-4 hours in the morning, delivering milk to the consumers. The regular income that they receive from these 3-4 hours of work ensures that the fixed expenses of their businesses are taken care of, leaving the remaining part of the day for their savings.

On current business and scaling up, Nitin said, “All the key components of our business are in place. We are currently a profitable business and are growing organically at 15% every month. NCR is a huge market with about 3.6 million households. Our first target is to reach 100,000 households in the NCR region (~3% of the market). As we reach this, we would start replicating the same model in the top nine cities of the country.”