Slump in Dairy Business

Tajamul Islam Salroo

Slump in Dairy Business! Dairy Business has been showing unexpected disruptions on and off for the last couple of years. And this time it is once again showing a slump. Being associated with the dairy business I have tried to come up with some possible reasons for the ongoing dairy business slump as described below.

It is observed that consumer preferences and expectations have changed over a period of time. People have become more informed and hence, expect more freshness, taste, and nutritional value in dairy products, in particular and other food products, in common. With the rise in the number of brands for the same product people have a good amount of choice to make before purchasing the one. It has been seen that consumers look at labels and ingredients and then decide what must be taken. A good percentage of consumers are inclined towards traditional dairy products while some more health-conscious people have already reduced the intake of dairy products in their day-to-day lives.

Over the last few years, many substitutes for dairy products have come up. As far as I have observed there is a distinct consumer base for different dairy products with the same application, unlike earlier times. Earlier many people used to think that milk powder was not a milk product but made from something unknown. Similarly, people could not believe milk could stay fresh for months altogether as they were not so informed about UHT processes and the hi-tech packaging that retains the freshness of these dairy products. Now consumers ask for Whole Milk Powder, Skimmed Milk Powder, Dairy Whitener, UHT Milk, Soya Milk etc. Thus, a division has been created among dairy consumers as per their choice of preferred storage and consumption.

It is also a hard fact that the present-day consumer has become quite conscious of the contamination and adulteration of essential food products. Many expect dairy products from reputed companies to be unadulterated, tested adequately before dispatching to markets and meeting all the standards of freshness, taste, and nutritional value. In the past several years the information disseminated through various media sources about contamination and adulteration has given rise to the introduction of analogue products that are being promoted as a better alternative by its manufacturers. And people have started switching to those alternatives.

We must not sideline that a section of consumers has turned health-conscious and mindful. Many people don’t want fats in their diet and they have hence moved either to skimmed milk or milk-less beverages. Nowadays a large number of people are seen taking black or green tea instead of traditional milk tea which was not the case a few years back. And that is a challenge for the dairy business.

Organic dairy products have evolved and are believed to have a smaller carbon footprint and are therefore preferred by the contemporary consumer who pays due attention to the labels and opts accordingly for the food of his choice. It is also noteworthy that small dairy business units have been established by young and educated youth to sell organic dairy products in the markets of Kashmir.

Last but not least individual economic condition over the last few years has worsened with inflation which seems to be a big reason for cutting down on daily needs to a certain extent. Though it is believed to get better in the next couple of years but the present situation is dismal.

It, therefore, becomes necessary for dairy business firms to get into a good research methodology and innovation to develop new products with an emphasis on best quality control and nutritional benefits.

An MBA graduate, Tajamul Islam Salroo is running a Dairy Processing Unit at the Lassipora Industrial Estate