India is the leading milk producer in the world and the dairy cooperatives are the backbone of Indian dairy industry. This study has analyzed the inefficiencies existing in improving milk production, procurement pattern, marketing channels, and price spread of a dairy cooperative, Uttaranchal Cooperative Dairy Federation Ltd (UCDFL), also known as ‘Anchal’ in the Kumaun region of Uttarakhand and has proposed a model for eliminating these inefficiencies. It has been found that UCDFL is focused mainly on liquid milk marketing and has not adopted product diversification, which is the need of the day. Nainital and Almora districts of Kumaon region have been selected for the study; these cover almost 40 per cent of cattle population in the division, except Udham Singh Nagar. It has been found that due to insufficient margins, the number of agents working for other private dairies has increased. Different marketing channels for milk have been identified and price spread has been calculated for all the channels. Lack of business development services related to dairy industry has been found leading the farmers to disassociate from Anchal. The study has suggested that Anchal should evolve a definite policy with regard to procurement of milk in both lean and regular periods and to sustain its members, incentive package should be provided. Anchal should find ways to establish fodder banks at strategic locations for providing fodder during emergencies and periods of fodder scarcity. Local sale of milk at the society level should be encouraged to increase the popularity of Anchal brand.