Direct Meat Marketing Dr. Bryon Wiegand University of Missouri Elements of Market Discovery Why do I want to participate in a non-traditional marketing.
Download ReportTranscript Direct Meat Marketing Dr. Bryon Wiegand University of Missouri Elements of Market Discovery Why do I want to participate in a non-traditional marketing.
Direct Meat Marketing Dr. Bryon Wiegand University of Missouri Elements of Market Discovery Why do I want to participate in a non-traditional marketing system? What can I produce? Am I an expert in these production systems? Who would buy it? Where would I sell it? What can I charge? Will I make money? What is my contingency plan? Why do I want to participate in a nontraditional marketing system? Incorporate hobby into earnings Additional income stream for household Small-scale production system Participate in local or regional economy Value-added in current economic climate What can I produce? Endless possibilities Bound by local ordinance Limited by expertise and facilities Beef Pork Lamb Goat Poultry Rabbit Venison Am I an expert in these production systems? Animal husbandry Niche does not mean inefficient!! Niche does not mean devoid of technology and/or science!! Previous knowledge base Draw on previous knowledge, but be prepared for new thinking and changes in production practices. Access to production practice information and willingness for adoption. Planning is key! Jumping into animal agriculture with both feet might be the riskiest venture ever if serious consideration is not made for the “SYSTEM” of making meat. Who would buy it? Market study Case study Full Circle Farm Thankful Harvest Planned Lamb Evaluate locally Ask questions Do not assume that your customer wants what you want! Where would I process the animals? Local meat processors are a good source Many are State or Federally Inspected and would entertain a business agreement Approach them with a good plan Know your product Ask them questions as to options for: Slaughter capacity Cooler space (especially important for aging of beef) All fees (slaughter, aging, cutting, packaging, storage) The more streamlined you can make the system, the easier it is for the processor www.missourimeatprocessors.com Where would I sell it? Farmer’s Markets Direct/off farm Grocery stores Restaurant Web marketing Farmer’s Markets Most require an annual membership Can lead to more direct marketing opportunities/build customer base Regulated by local health authorities Selling meat at Farmer’s Markets Require meat to be inspected either by state or federal inspection Most health ordinances require meat to be sold frozen and require a chest freezer to be provided by the producer. Check with your local health department for their regulations. Requires a well defined pricing that is highly visible. Most shoppers move quickly through the market and need quick and concise information without the “total sales pitch”. Columbia Farmer’s Market Hours Monday 4-6 Wednesday 4-6 Saturday 8-12 Location behind the Activity & Recreation Center (ARC), on the corner of Clinkscales & Ash streets. Successful Vendors • Show-me farms • “Born Tender Beef ” • “Omega Beef ” • No hormones, implants, antibiotics • Pasture raised chickens • Susie’s Grass Fed Meats • “100% grass fed locally raised animals, not fed antibiotics or implanted with hormones. • Animals are sustainably raised on small family farms.” • Missouri Legacy Beef Direct/Off farm Marketing Producers located near large metropolitan areas have a greater potential for direct marketing because of their proximity to a large number of consumers. Requires more “education”, but likely appeals to more customers with “niche language”. Might have the greatest margin capabilities. More expensive Travel Fees Time Grocery Stores Small independent retailers with more upscale meat departments are probably your best opportunity Realize however that even some independent grocers buy from wholesale warehouse businesses and some products may be “spoken for” in these purchasing agreements. Large grocery chains give management some discretion for local purchases. Gerbes Hy-Vee Restaurants Since individual restaurants do not use large quantities of meat, access to a large number of restaurants and a mixture of different restaurant types is necessary for a producer to successfully target this market. Patchwork Farms features the Patchwork pork chop at Murray’s in Columbia, MO Missouri Legacy Beef is featured at Hoss’s Market in Columbia, MO Internet Marketing One of the barriers to this kind of “remote marketing” is that packaging and shipping costs can as much as double the end price to the consumer. Websites can be useful in helping local buyers to locate producers in their area. Strict rules exist regarding interstate commerce and sales tax collection. Federal Inspection required for interstate trade of most meat products. (Stayed tuned next week for Dr. Clarke) Ethnic/Religious Markets The ethnic market is a niche often forgotten for meat products. Goat is preferred by Hispanics, Caribbeans, and Muslims Jewish prefer cuts from the front-end of the animal which can be difficult to market to typical American consumer (Kosher) Facilities for on-farm ritual slaughter may be desired by some ethnic groups (Kosher or Halal) Marketing ideas Separate yourself from other producers or products that can be found at a grocery store Be certain the claims are accurate and backed by fact and not feeling Sell your product rather than demean the competition Most directly marketed products have a unique claim - find your niche Organic Local Natural Grass-fed Antibiotic Free Synthetic Hormone Free Free-Range What can I charge? Know your cost of production, promotion, and distribution. Make sure you charge more than your break-even price. Be aware of what other direct marketers are charging Attend farmer’s markets in your area to see what other producers are charging for the same type of product Economic assessment Whole Carcass sales If selling a whole or half carcass, processing doesn’t necessarily need to be done at a USDA inspected facility If the animal is sold LIVE to the consumer, custom exempt processors can be used. (Rules and Regulations for this in Part II of this series). By using this sales method, customers can specify certain cuts, wrapping, and curing preferences. Whole Animal Buying Guide Make sure customers understand how much yield they could expect from a certain live animal Beef Cutout Pork Cutout Goat Cutout Will I make money? Be honest when balancing the books Your labor is an expense Treat it like a business Small business ventures usually see “light” in three years. Depending on the level of capital investment, some turn a profit in their first full year of existence. Be patient Don’t be afraid to cut costs Web site design Printed advertising Radio advertising What is my contingency plan? Hopefully the business will be successful and you find room for growth, but what if………….? Be certain to have an out Where do you sell animals? Where do you sell equipment? Can the business be sold in it’s entirety? Having a plan to dissolve, liquidate, or sell a small business will save a lot of pain in the end.