Visakha Dairy mulls tie-up with Reliance Retail

Sri Vijaya Visakha Milk Producers Company Limited (Visakha Dairy), the largest co-operative dairy in the state, is planning to enter into a tie-up with Reliance Retail for procuring vegetables from villages, which would be sold through the latter's outlets.

Talking to Business Standard, D Venkata Rao, managing director, Visakha Dairy, said: "The Reliance group has approached us with such a proposal. We are seriously thinking about starting the procurement of vegetables from villages through our network. Currently, we are working out the modalities for purchasing the vegetables, grading and storing them."

Visakha Dairy has a large network for procuring milk from the coastal districts of Andhra Pradesh. About 860 registered co-operative societies and an equal number of unregistered societies supply milk to the dairy from about 1,600 villages. It procures about 4.34 lakh litres of milk a day through these village milk societies.

In 1992, on the request of the district administration, Visakha Diary started procuring vegetables from the milk suppliers in villages.

However, after four months, it stopped procuring vegetables as the exercise turned out to be loss-making due to its failure in marketing the vegetables through its milk selling points in Visakhapatnam.

"This time, we may not encounter such difficulties as the Reliance group has given assurance about marketing the vegetables. Besides, other supermarket firms like Trinetra and Subhiksha would also buy vegetables if we are able to supply quality product at reasonable prices," Rao said.

Visakha Dairy is planning to set up a separate wing with sufficient manpower and a cold storage plant at Visakhapatnam for its vegetable procurement business, he added.

The company would even procure vegetables in small quantities from local farmers and would supply them to Reliance after grading them.