how to direct market your beef

7/26/2019 How to Direct Market Your Beef

1/98

your beef

How to

direct market

By Jan Holder


2/98

About this Book

How to Direct Market Your Beefportrays how one coupleused their familys ranch to launch a profitable, grass-basedb e e f o p e r a t i o n f o c u s e d o ndirect market sales. Jan and Will Holderscompelling real-life ex-periences, with numerous instructional guideposts along theway, provide valuable tips for direct-marketing beef fromslaughtering to sales.

A special Entrepreneurssection features farmersand ranchers four of whom received or benefitedfrom Sustainable Agriculture Research and Education(SARE) program grants who demonstrate real-lifesuccesses in direct marketing sustainably raisedfood in innovative ways.

How to Direct Market Your Beef is not abook about market analysis and theory. See the

Resourcessection for a list of such materials.

About the Publisher

The Sustainable Agriculture Network (SAN) is thenational outreach arm of the Sustainable AgricultureResearch and Education (SARE) program.

SARE promotes farming systems that are profitable,environmentally sound and good for communitiesthrough a nationwide competitive grants program.

SARE is part of the Cooperative State Research,Education, and Extension Service (CSREES), USDA.

SAN operates under Cooperative Agreementsbetween CSREES and the University of Vermontand the University of Maryland to develop anddisseminate information about sustainable agri-culture. See www.sare.org for information aboutSARE grant opportunities and SAN publications.

A list of SAN books as well as an order form islocated on the inside back cover of this publication.

We are just now beginning a nutritionalrevolution that will revive demand for

grass-fed beef, lamb, chicken, and dairy.This period is to family farming what the

1970s were to Silicone Valley.

Jan Holder, Author, How to Direct Market Your Beef

About this Book

How to Direct Market Your Beefportrays how

one couple used their familys ranch to launch a

profitable, grass-based beef operation focused on

direct market sales. Jan and Will Holders compelling

real-life experiences, with numerous instructional

guideposts along the way, provide valuable tips fordirect marketing beef from slaughtering to sales.

A special Entrepreneurssection features farmers

and ranchers four of whom received or benefited

from Sustainable Agriculture Research and Educa-

tion (SARE) program grants who demonstrate real-

life successes in direct marketing sustainably raised

food in innovative ways.

How to Direct Market Your Beefis not a book about

market analysis and theory. See the Resourcessection for a list of such materials.

About the Publisher

The Sustainable Agriculture Network (SAN) is the

national outreach arm of the Sustainable Agricul-

ture Research and Education (SARE) program.

SARE promotes farming systems that are profitable,

environmentally sound and good for communities

through a nationwide competitive grants program.

SARE is part of the Cooperative State Research,Education, and Extension Service (CSREES), USDA.

SAN operates under Cooperative Agreements be-

tween CSREES and the University of Vermont and

the University of Maryland to develop and dissemi-

nate information about sustainable agriculture.

See www.sare.org for information about SARE

grant opportunities and SAN publications.

A list of SAN books as well as an order form

is located on the inside back cover of this publication.


3/98

How toDirect Market

Your Beef

By Jan Holder

Handbook Series Book 8Published by the Sustainable Agriculture Network, Beltsville, MD


4/98

Editor/Project Coordinator: Valerie BertonDesign: Design Fish, www.designfish.comPrinting: Jarboe Printing, Washington, D.C.

The book was reviewed by sarestaff as well as Jim Goodman, beef producer, Wonewoc, Wis.,A. Lee Meyer, University of Kentucky Extension, Peggy Sechrist, beef producer, Fredericksburg,

Texas, and Michael A. Smith, University of Wyoming. Every effort has been made to make thisbook as accurate as possible and to educate the reader. This text is only a guide, however, andshould be used in conjunction with other information sources on direct marketing. The editor,author and publisher disclaim any liability, loss or risk, personal or otherwise, which is incurred as aconsequence, directly or indirectly, of the use and application of any of the contents of this book.

This book was published by the Sustainable Agriculture Network (san) under cooperative agree-ments with the Cooperative State Research, Education, and Extension Service, usda, the Universityof Maryland and the University of Vermont. sareworks to increase knowledge about and helpfarmers and ranchers adopt practices that are profitable, environmentally sound and good forcommunities. For more information about saregrant opportunities, go to www.sare.org. sanis the

national outreach arm of sare.

To order copies of this book ($14.95+ $5.95s/h), contact(301) 374-9696, [email protected] orwww.sare.org/WebStore.

Sustainable Agriculture Network10300 Baltimore Ave., Bldg. 046Beltsville, md20705-2350p (301) 504-5236f (301) [email protected]

Library of Congress Cataloging-in-Publication DataHolder, Jan, 1953How to direct market your beef/by Jan Holder.

p. cm. Sustainable Agriculture Network handbook series; bk. 8ISBN-13: 978-1-888626-11-7

1.Beef Marketing. 2. Direct marketing.3. Beef United States Marketing. 4. Beef industry United States. I. Title. II. Series.

hd9433.a2h65 2005641.3620688 dc22 2005022003


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introduction..................page 1

starting out.....................page 5Find A Niche

Selling the Whole CarcassHow to Cut Up a CarcassMake $10Mistakes, Not $1,000OnesStand By Your PriceExpect to Reinvent the WheelFrozen vs. FreshOrganic vs. NaturalScheduling

Learn How to Cook Your BeefProcessingGetting a LabelPackaging Your ProductGeneticsForage

entrepreneurs.............page 44Carver FamilyHodge FamilyBrownlee FamilyElliott/Rude FamilyHatfield FamilyJames FamilyHolder Family

selling product..........page 53Situational AnalysisSales OutletsDistribution and TruckingMarketing Your Product

Advertising BasicsPublic RelationsRecord Keeping

growing profit...........page 81The Future for Small Beef OperationsDeveloping Growth

Factors that Impact Your Bottom Line

resources.........................page 88

c ntents


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photo by edwin remsberg


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1

When my husband and I took over the management of the fam-ily ranch in 1992, we thought that it was going to be an idyllic life.We were going to whip the ranch into shape in a few months andthen spend the next 20years canning vegetables and writing the greatAmerican novel. We thought that if we just ran things a little moreefficiently, the ranch would instantly be profitable.

It took us a couple of years to learn what was really wrong with theranch. Sure, the place was a little rundown. The houses were in needof repair. The corrals were held together with more baling wire than

wood. The land was overgrazed. But we didnt mind hard work, soeverything was going to be fine.

Then, slowly, the realization hit us. No matter how hard we worked,no matter what building we repaired or pastures we improved, theranch was still never going to make it on its own. The beef industryhad changed. Just a few generations ago, you could support your familywith a herd of 25. Today, with our commodity-based cattle industry,

a small cattle rancher was increasingly challenged just to make a living.After asking around, I found that the only ranchers who were solventwere the ones who had other income. Either the wife or husband workedin town, or in our case, we had a father who was an eye doctor with deepenough pockets to subsidize the ranch. Sure, the really big ranches,the huge ranches, were making it. They could make 3cents on a carcassand still come out okay. But they were running many thousands ofanimals. We had a herd of 200. How could we possibly compete?

intr duction


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2 how to direct market your beef

It was clear that we couldnt. We had to figure out how to sell our beef in anew way. We decided to try to take it from the pasture to the plate withoutall the middlemen in between. But after contacting an old advertising client

in Phoenix who ran a chain of restaurants, I found that we could barelycompete with his prices, even after cutting out all those middlemen. So,we decided that we had to make our beef different and better. Then folkswould be willing to pay more for it.

To differentiate our product, we thought we could highlight our pesticide-free beef, our range-protection strategies, our gentle approach to raisingour animals, and our acceptance of predators on the land. After all, wewere considered radical, weird and strange for our tree-hugger mentality.

Most other cattle ranchers thought that wewere nuts. We didnt use pesticides. We treatedour cattle as gently as possible. We constantlytook classes on ways to use cattle to improvethe land. We didnt kill predators. All we hadto do was tell people how wonderful we wereand they would flock to us in droves and buyour beef! This was going to be so easy. I reallycouldnt believe that all small producers werentmarketing their own beef.

After reading both of Joel Salatins books (Salad Bar Beef and Pasture Profits),we felt that between his ranch-direct program and selling in the nearest lo-cal towns, we could market all of our beef. Soon we found that we were toofar out in the boonies for ranch-direct selling, the nearest tiny hamlet being1 hours away. People in the nearest sizeable town 2 hours away werent

going to pay a premium for beef. Many of the residents of those townsseem more impressed with 60-cent-a-pound hamburger than anything thatwe could come up with. So we decided that we were going to have to sell inPhoenix or Tucson.

To differentiate our product,

we thought we could highlight our

pesticide-free beef, our range-protection

strategies, our gentle approach

to raising our animals, and our

acceptance of predators on the land.


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3

We still believed in Joel Salatins idea of relationship marketing, but realizedthat our relationships were going to take a slightly different form. Eventhough people seemed to like the idea of ecologically sensitive ranching,

not that many were willing to put their money where their mouths were.Suddenly, what looked like a huge demand turned out to be a few commit-ted people.

We did sell to a local organic buying club (and still do), but to really makeit we were going to have to hit the big cities.

Back at the ranch, we asked ourselves, How are we going to sell beef fiveand six hours away? We decided to target stores, restaurants and natural

foods distributors.

Years later, it still seems too early to rest on ourlaurels (is there ever a time when we can reston our laurels?), but we are very happy with thechoices we have made, and sales have gone verywell. In 2004, the grass-fed beef industry wasestimated to be worth around $5billion, and

growing at a rate of20

percent per year.Our Ervins Grassfed Beef now sells throughout 11western states through natural food distributioncompanies, as well as at farmers markets in Arizona. In addition to groundbeef, ground beef patties, steaks and roasts, we now also sell pre-cookedmarinated roasts and pre-cooked sliced roast beef.

Even though direct selling our beef has increased our bottom line, our com-

pany also has helped us to live the life we want, a life on a family ranch.

introduction


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4 jan and will holder on their arizona ranch


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5

Find a NicheTo successfully direct market your beef, you must do something no oneelse is doing. With conventional beef sales, large companies can producehamburger for about 60cents a pound. If you can figure out how to doit for 59cents a pound and remain profitable, you will be very successful.

Obviously we cant do this. So you have to look for other ways of differingyourself from the competition.

Bill Niman, founder of Niman Ranch, is a good example of an entrepreneurfinding a niche. He recognized that the products in conventional beef salesvaried quite a bit. One day you might get a good steak, another day youwont. (If you are the only game in town, you dont have to care.) All BillNiman did was offer a consistent product. If you buy a Niman steak, you

know it will be good. Hence, you can charge more.A niche also can be something that is non-tangible. Many of our customersbuy our product because we dont kill wolves. That does not make the beeftaste any better, but it is a difference that people are willing to pay for. Thedifference doesnt have to be a real thing, it can also be a perceived thing.For instance, which is better: Coke or Pepsi? They are essentially the sameproduct with different packaging. Remember, if folks can find differentniches for sugar water, surely you can find one for beef.

starting ut

starting out


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The emergence of e-coli outbreaks,

salmonella, lysteria, mad-cow disease,

and hoof-and-mouth disease has

opened the door for another marketing

opportunity: clean, safe beef.

There are lots of these sorts of niches. Youjust need to be creative to see them. To helpyou get your juices flowing, heres a list ofpossible niches:

Slaughter procedures (for those whowant beef slaughtered a certain way)

Choice-grade grass-fed beef

Organic

Corn fed

Grass fed

Angus

Longhorn Prime

Lean

Guaranteed tender

From a family farm

Locally produced

Humane handling

Nebraska beef Argentina beef

Ethnic markets

The emergence of e-coli outbreaks, salmo-nella, lysteria, mad cow disease, and hoof-and-mouth disease has opened the door foranother marketing opportunity: clean, safebeef. Many people are very worried aboutthose problems and are willing to paymore for the peace of mind, knowing thebeef they feed their families is safer fromcontamination. As a small producer, this isone way you can compete and win againstthe big guys.


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7

The sheer volume of beef and the speed atwhich they have to process cattle makes itimpossible for large producers to providebeef free of contamination. Being small, you

have the ability to literally monitor everycarcass you sell. You can be much morecertain of the safety of your product.

Most niche producers today also are certi-fying the source of their cattles feed. Thiswas brought on by concerns that cattle fedrendered animals could cause mad cow dis-ease. Its another way you can differentiate

yourself from the pack.

The beef industry needs to make some majorstructural changes to deal with customerperceptions that beef isnt healthy. Until theydo, selling clean, healthy beef is one of the bestniche-market opportunities you have as asmall producer.

Selling the Whole CarcassWhen first starting out to market your ownbeef, one of the first problems you will faceis that it is easy to sell the high-end cuts andhard to sell the low-end cuts.

Restaurants love buying steaks from localranchers, but steaks only make up about10percent of the carcass. You still have alot of beef to sell.

Conventional beef marketing deals with thisproblem by using price. Thats why chucks,hamburger and rounds are cheap, and loinsteaks and tenderloin are expensive, because

starting out


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Marketing on a smaller scale,

you can pick your customers and

select them in the right proportions

to what you need to sell.

everyone wants steaks and tenders. Everyday, they have so much beef to sell, andthey get on the phone (just like the tradingfloor of the stock exchange) and sell their

beef. Because fresh beef has a limited shelflife, they have to sell it before it spoils. Asthe industry saying goes, You have to sell itbefore you smell it. They just keep goingdown in price until all their beef is sold.

Marketing on a smaller scale, you can pickyour customers and select them in the rightproportions to what you need to sell. For

example, if a restaurant wants 50pounds oftenderloin a week, you will have to matchthat demand with customers who are willingto buy 1,000pounds of hamburger a week.

Of course, you can always sell your othercuts on the conventional market, but youllhave to accept a very low price. Most big meat

distributors only deal in huge quantities,which makes it hard for small marketers todump what they cant sell.

Youll also find that the low-end cuts aremuch more price sensitive than the high-end cuts. You might be able to chargedouble or triple market price for your ten-derloin, but you may have to settle with just

10to 20percent more for your ground beef.

Initially, you will probably sell out of steaksand be left with ground beef, limiting youroverall sales. People seem ready to pay fora premium steak but balk at $3-a-poundground beef.


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9

Another way of dealing with the

lower demand and lower-priced

cuts is to add value to them. If you

make that round roast into jerky or

a ready-to-serve marinated roast,

suddenly youve got products that

rival the loin steaks in profitability.

They may not realize there is a differencebetween yours and the 60-cent-a-poundsupermarket version. Once they are hookedon your steak, give them a free pound of

ground beef. One pound will usually convincethem to buy a balance of all of your cuts.

To make things even more difficult, there area few cuts in the middle that no one reallyknows about. People know what a steak isand what hamburger is, but whats a tri tip?Whats the difference between a flank andskirt? Being small, you will have a lot of

face-to-face interaction with your customers,so you can educate them on how to cook thedifferent cuts.

Ive found that with a little planning you canproportion your customers to match howyou cut up the carcass and not be forcedto sell for a lower price just to get rid of all

your beef. You will want to find a lot ofhamburger buyers, because about 50percentof your carcass will be hamburger.

Another way of dealing with the lower demandand lower-priced cuts is to add value to them.The margins on a round roast are not verylarge, but if you make that round roast intojerky or a ready-to-serve marinated roast,

suddenly youve got products that rival theloin steaks in profitability. So if you cantsell it, rather than take a lower price, be cre-ative and think what you could turn it into.

There are also several other parts of thecarcass that can become more profitable.

starting out


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Your creativity is the only boundary: Tongue, livers and kidneys can

be mixed with fat, hamburger andvitamins for premium dog food.

Hides, tendons and pizzles canbe turned into dog chews.

Bones can be used for dogs, zoosor wildlife rehabilitation centers.

Marrow bones are seeing a comebackat high-end restaurants, health foodstores and hospitals.

Ground and dried liver and glands

are used as supplements in healthfood stores.

Trim can be dried and turned intodog chews.

Consider these specialties: summersausage, beef bacon, jerky, deli meats,hot dogs and marinated roasts.

I have had good luck with selling cuts atfarmers markets that I cant seem to moveelsewhere. Usually, I have had to be a littlecreative. For instance, I once had a lot ofskirt steak that wasnt moving. I addedspices, rolled them up, sliced them andlabeled them spiced pinwheel steaks. Isold out in one hour at $4.50a pound.

These were skirt steaks that we couldntsell at $1.50a pound. The secret was that Iset up a grill and let people taste samples.I handed out a recipe and cooking instruc-tions for the item with each sale.

At this same farmers market, I sold 32poundsof flank steak that I had to move. I marinat-ed it in a very simple marinade for an hour


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11

and cut it up and stuck it on skewers. I had10people buy the whole skewer for $3apiece.That comes to about $30a pound.

However, make sure that you check your local,

county and state regulations concerningsampling products and selling value-addedproducts such as spiced pinwheel steaks andmarinated cuts. Depending on the laws inyour area, they may not be allowed at farm-ers markets. If you alter a cut after it hasbeen inspected (by adding other ingredients)and labeled, you may void that inspection.

Cooking and giving away samples may requireyou to be inspected and licensed as a restaurant.

How to Cut up a CarcassAnd How Much Youll Getof Each Cut After You Do

No doubt if youre looking into directmarketing your own beef youve talked toa butcher about how a carcass is cut up,and how much of what cut you can expectfrom a carcass. If you have and walked awayfeeling totally mystified, join the club. Thereare a million ways to cut up a carcass. If thatisnt bad enough, different people call the

same cuts by different names.

Whats the difference between a top sirloinand a T-bone? Or a Kansas City strip steakand a New York strip steak? Or a breakfaststeak and a cube steak?

starting out

There are a million ways to cut

up a carcass. If that isnt bad

enough, different people call the

same cuts by different names.


18/98


I even went in and watched them cut up the carcass, thinking it mighthelp to visualize all this stuff. Actually, it did and I would recom-mend it highly. Even more, the biggest help to me was a book calledThe Beef Buyers Guide. This is a secret club kind of thing. Everybody in

the industry pretends that this is a holy writ, but you wont find it in abookstore (although you can order it online). This book breaks downthe carcass into different pages, tells you all the cuts you can makefrom a certain section and provides helpful pictures.

For instance, with the rib section you can make a rib steak/bone in/tailon, or rib steak/bone in/tail off, or boneless rib steak, or tied rib roast,and so on. It is a bit of overkill, but it will give you a working knowl-edge. Plus, it contains the codes that restaurants use, so youll know

when someone calls and says he wants a 1139a(whole tenderloin, -inch trim, lip on).

In actual practice, it turns out no one reallyknows all of those codes. There are regionaldifferences in what meat people will call thesame cut, both in name and in code (a NewYork strip and a Kansas City strip are the

same thing). But if you know them, it willmake you look smarter than the conventionalmeat salesperson.

As I mentioned, you can cut up a carcass many ways. It all dependshow much, and of what, you are selling. If youre just starting out andarent that sure of your quality, start with cull cows. Theyll give youexcellent hamburger and store-quality tenderloin. The next step up isyoung cows and steers, which give you tenderloin, stew beef, marinated

roasts, jerky and hamburgers. If youre really good, you have the slaughtersteer or heifer, which gives you everything.

As a rule of thumb, a 1,000-pound live animal will give you about300pounds of saleable beef or, in industry lingo, your boxed weight.You might hear people talk about getting 50percent yields (versusyour 30percent). What they are talking about is the cold carcassweight, or how much your carcass weighs on the rail. This weight


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13

Tenderloin

12 pounds/carcass$9.60 per pound$115.20 gross

New York StripSteak

14 pounds/carcass

$6.40 per pound$89.00 gross

Ribeye Steak


Fajita/Stir Fry6 pounds/carcass$3.20 per pound$19.00 gross

Round Roast


Ground Beef


is meaningless; what counts is the weight ofthe beef you sell. If you are cutting steaks ormaking hamburger for people, there is a lotof bone you dont get paid for.

Of course, you can divide a carcass into manydifferent cuts (right), each of which contributesto your bottom line. Your actual weights mayvary 5percent each way depending uponyour genetics and slaughter weight, but thisis generally about average.

Make $10, Not $1,000MistakesOnce you have decided to market your ownbeef, it wont take long before you figure outthat things would be easier if your marketingeffort were bigger. Thats because conven-tional beef marketing is set up to move hugequantities of beef very cheaply. Unfortunately,there are a lot of people who have lost an

awful lot of money trying to do this.

Large beef processing and distribution com-panies can move huge quantities of meatvery cheaply because theyve been at it awhile.Although we dislike the dominating corporatenature of their business, we have a great dealof respect for what they have been able to

accomplish. They do what they do very well.When we first started out, we made a presenta-tionto a very kind individual with a naturalfoods distribution company. He informed usthat we were not experienced enough or largeenough to service them properly. He alsosuggested that we sell directly to our areassmall natural food buying clubs, which were

starting out


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These basic industry definitions help you sound like you know what youre

talking about, although you dont really need to know them.

Yield: Percentage of sellable, live beef weight. On average, expect 30 percent. Were

getting a 30-percent yield.

Yield Grade:(Note: Does not actually pertain to yield.) Amount of fat per carcass where

1 is leanest and 5 is the most fatty. Most often applies to the manufacturing of value-

added items such as hot dogs and sausages.

Hanging Weight:Weight of carcass on rail following slaughter; somewhat meaningless

as carcasses are not sold in this manner.

Cold Carcass Weight (CCW): Weight of carcass on rail following chilling. Grain-fed

cattle shrink 5% from hanging weight (mostly water loss), while grass-fed cattle

have minimal to none.

USDA Grading System: Voluntary, inconsistently used method for grading beefbased on age and total marbling. USDA grades include: prime, choice, select, standard,

commercial, utility, cutter and canner. Some products carry merchandising or packer

house brands. Non-graded cuts are sometimes called no rolls since a grade stamp has

not been rolled onto the carcass.

Wurter Brazelton Sheer Test:Method of testing for tenderness in which seven

samples taken from a cooked cut are measured for the force it takes to cut it, then

averaged to produce a tenderness score.


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his customers. Even though we were a trifle(okay, maybe a lot) peeved at his suggestion,it turned out to be some of the best advicewe have gotten.

We learned what cuts the customers want,how they want it packaged, and how manypounds to put in each package as well asa myriad of other details we hadnt eventhought about. For example, we found outthat customers liked beef in see-throughfresh food packages better than if it waswrapped in butcher paper, because they

could see the meat.

Moreover, we found out that our customerslike 1-pound packages of ground beef morethan 2-pound packages (2pounds was toomuch for most families).

If you are just starting out, sell to your friendsor to groups. Sell sides of beef using an ad in

the local paper. Call up local groups like theElks and ask if you can sell them the beeffor their next big barbecue. Invite commentsand criticism. You need all these experiences.

If people criticize your beef rightly orwrongly the natural thing to do is defendyourself. Try not to. It will only create ill will

between you and your customers. Just begracious and thank them for their comments.Offer their money back.

When first starting out, you will need torestrain yourself from being big. Start smalland stay small until you have worked yourway through all the surprises. Then take onsome more demand. Do it incrementally,

starting out


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do it slowly. No one gets everything right.There are too many things to go wrong.The mistake that gets you wont be one youknow, itll be one you hadnt even consid-

ered. Your margins wont be as big whenyou are small. By the same token, a mistakewont kill you either. Take it slow, workyour way through mistakes, and be creative.There is always more than one way to skina cat.

Dont buy a refrigerated truck. Dont buy anyprocessing equipment. Dont buy a process-

ing facility. Lease or hire it until you are afew years down the road.

Jim Goodman of Wonewoc, Wis., boughta walk-in freezer as his only initial start-upequipment. He says his business would havebeen impossible without it. It allows us tosell on the farm, makes getting ready for the

farmers market, where all meat must be soldfrozen, quick and easy, with no running torented freezer sites, he says.

Stand By Your PriceThe easiest way to determine your price isto start with the cow and work your way to

the consumer. It costs you x to make a 500-pound calf, x to finish it, x to process it,and x to store, transport, package and dis-tribute it. Once you know all that, you cansimply add what you think is a fair profit.You may end up having to revise it, but atleast you will know where your break-evenpoint is. The point is to create a price and

If you are just starting out, sell to

your friends or to groups. Sell sides

of beef using an ad in the local paper.

Call up local groups like the Elks

and ask if you can sell them the

beef for their next big barbecue.


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17

stick to it. You can count on folks tryingto talk you down. Dont take it personally.This is how the commodity game is played.However, dont be afraid to turn some folks

down because of price. You cant be allthings to all people, and there are plenty ofother places a person can find cheap beef.

Items to be worked into your price: Cost of creating a saleable animal

(labor, supplement, replacementcost, etc.)

Land

Finishing

Transportation to slaughter facility

Slaughter fee

Processing

Packaging

Storage

Transportation to retail

Promotion

If you are still not sure that your prices arein line with what the customer will pay,go to a big natural foods store in the near-est thriving metropolis, and check out theprices. Write down the price of each cut,per pound, and compare them with yours.

Figure that the retail price is about 30per-cent higher than what the wholesaler sold itfor. If they ask what the heck youre doing,you can always say that you are planning abig shindig and are on a tight budget.

One mistake we made early on was notpricing our beef high enough. People didntperceive this as a bargain. They perceived

starting out

The easiest way to determine your

price is to start with the cow and

work your way to the consumer.


24/98


our beef as inferior to beef that sold for ahigher price. So we simply priced ourselveshigher and made everyone happy.

Refer to Factors that Impact Your Bottom Line

(p. 84) for more tips on pricing.

Expect to Reinvent the WheelAuthor Allan Nations view of the learningcurve shows the potential downside to beingtoo ambitious without doing your researchfirst. In his version, naive enthusiasm leads

to total despair. In other words, take a goodlook before you leap into marketing yourown beef.

As stated earlier, the conventional beefmarketing system is not set up to dealwith small producers. So even though thiscountry has an excellent infrastructure for

transporting, processing, packaging anddistributing beef, it means nothing to you.It costs almost as much to ship 100poundsof beef across town as it does to ship 1tonacross the country. These are frustrating,but important facts. You will need to getused to reinventing the wheel, because, atleast in this case, the wheel wasnt designed

for you.Actually its even harder than that. Notonly do you have to reinvent something,but you also are challenging the status quo.

As in all industries, there are good peopleand bad people. You will probably run intoa few of these bad apples along the way.


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19

Theyll probably be rude; they might laughat you, or act condescending and tell youthat you will never make it. Try not to takeit personally, and dont let their negativity

rub off on you.The majority of folks who try to market theirown beef run into a few of these obstacles,get frustrated and quit because its impos-sible. Its not impossible. It might be crazy,it might be work, and it might ruffle some-ones feathers. But its not impossible. Whatit will be is creative. Just plan on having to

customize every little step, from pasture toplate, and take nothing for granted.

Frozen vs. FreshThere is an age-old debate among meatscientists that asks the question, Which isbetter: fresh or frozen? Our experience has

been that there is no difference in quality.In fact, our frozen beef may be more tenderbecause fresh, conventionally marketed beefgoes through its aging process during trans-port. So if you happen to be first on the deliv-erythat week, your beef hasnt aged enough.There is a discoloration of the beef whenyou freeze it, from a cherry red color when

its fresh, to more of a rose color when itsfrozen. After its cooked, it looks the same asfresh beef.

However, there is a perceived difference.We have yet to meet a chef who will accepta frozen product. Weve tried blind tastetests and the whole shebang, but they just

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want a fresh product, its just their deal. Thereare also some retail customers who feel thesame way, but its even sillier with them. Ofcourse, the first thing they do with the beef

when they get home is throw it in the freezer.

Organic vs. NaturalUntil the summer of 1999, the usdawouldnot recognize, nor issue labels, that madeany kind of claim to being organic (at leastas far as beef was concerned). Thats how

naturalbeef got started. Legally, the usdause of naturalonly meant that your beef hadno artificial additives and was minimallyprocessed. So unless you injected your sir-loin with Red Dye No. 5or ground it andreformed it into steak nuggets, you couldqualify as natural.

However, some folks felt they could offer

more and strove for an organic label. Theusdahas since finalized its organic label, in-cluding one for beef. As part of that, usdarecognizes third-party private certifiers. Tolearn more about organic livestock produc-tion, see the online Organic Livestock Workbookproduced by ncat. (Resources,p. 88.)

USDA Legal Definitions Natural beef:No artificial additives,

minimally processed.

Organic beef: No hormones, antibiot-ics, pesticides, and fed only organical-ly raised feed. For beef to be certifiedorganic, the processor who renders itneeds to be certified as well.


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What makes this issue confusing is that cus-tomers have differing perceptions on whatthese terms mean. For instance, natural beefis considered by most people to be beef with

no antibiotics and no steroids. Using theusdadefinition, that isnt necessarily true.

Although most people can tell you what thetermfree rangemeans, there is a great deal ofconfusion among consumers between organicand natural. You should be aware of howeducated your customers are before goingthrough all the trouble and cost of being

organic.

Personally, I feel this will be the final chapterfor the vague natural label. I predict that theterm naturalwill start to fade away, as beefcompanies develop their specific certificationprograms.

SchedulingUnlike marketing your cattle convention-ally and selling everything on one day,direct marketing your beef will cause youto have to deliver cattle several times a year(Entrepreneurs, p. 44).

It can be trickier than you might think. Ifyou are doing farmers markets, it is notso critical if you dont have beef to sell atevery market (other than lost opportunity).However, if you are selling to stores andrestaurants, you cannot ever run short. Theywill be willing to work with you from timeto time, but if it becomes a habit, theyll stopbuying from you. In fact, that will probably

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Natural beef is considered by most

people to be beef with no antibiotics

and no steroids. Using the USDA

definition, that isnt necessarily true.

be your biggest stumbling block to selling torestaurants and stores earning their trustthat you wont ever come up short.

If youve done your planning homework,you should be able to predict your demandclose enough not to cause any major prob-lems. Stores and restaurants have a very goodidea of how your product will do with theircustomers. Be sure to flat out ask them whatyour sales volume might be, listen and respecttheir advice. We also make it a rule to have a

major new client one full year before addingadditional clients, so that we get a good feelfor their demand cycles.

Choosing how to schedule your cattleproduction is important from a market-ing perspective. Most urban customers areconditioned for convenience they are usedto buying tomatoes 365days per year, ratherthan late summer when the tomatoes are ripeon the vine in our part of the world. Thissame thinking applies to cattle as well. Mosturban customers do not realize that it takestwo years to grow out beef, or that cattle onlyfinish well during a certain part of the year.

It will be your job to either educate your

customers about time and seasonal restraints,or develop a pipeline that will satisfy theirneed for the convenience of having grass-fedbeef available 24/7.

There are basically only three ways to sellbeef: 1) feedlot, 2) seasonally, and 3) frozen.Of course there could even be variations or


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combinations of these three ways, but howyou schedule your cattle will depend a lot onwhich way you choose.

The most forgiving of these three is frozen.Your frozen storage is your pipeline. Youcan theoretically finish all your beef in threemonths, throw it all in a freezer, and thensell it all year long. Of course there is somecost with this, and that needs to be figuredinto the equation. It also allows you to keep acushion that will smooth out the bumps be-

tween supply and demand, or when bringingon a new customer.

Weve never run a feedlot, but it seems to bethe second easiest way. A lot is also a pipe-line. The hard part is buying the right weightsat the right time of year to feed your demand.To do this, you will either have to developmultiple breeding seasons, or buy from alarge geographical area where folks dont allcalve at the same time. You also dont have toplan so far in advance with a feedlot. Becausemore of your cattle will finish within a year,you can move and make changes faster. In agrass-fed program, it takes two years to finishan animal.

Finally, a seasonal product is hardest, at leastfrom a scheduling point of view. It also hasa lot of advantages in that your cattle are outon the pasture earning you money, instead oftaking money eating bought feed or pay-ing rent for frozen storage. However, youwill have to stair-step your cattle to finishthroughout the season. Its a pretty hard task

in itself, not even considering all the other

starting out

Most urban customers do not realize

that it takes two years to grow out

beef, or that cattle only finish well

during a certain part of the year.


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elements that can frustrate you: differing ratesof gain, sickness, drought, demand surges,predator kills, carcass variability and mechani-cal breakdowns at the slaughter house (even

though the processing has stopped, yourcattle are still going). With a seasonal pro-gram, once you get behind, things snowballfast and its almost impossible to catch up.

To help us plan for the un-plannable, weforward contract our cattle as much as twoyears in advance. You can do this with direct

marketing because you are in control of thecarcass price and therefore also control thelive price. See Factors that Affect Your BottomLine(p. 84).

Learn How to Cook Your BeefSince starting this business, weve found that

we are an endangered species people who cookand eat their own food! At first we took it forgranted that people would know how to cooka variety of dishes, and would know the appro-priate cut of beef for that dish. Its not true.

I cant tell you the number of times that wevehad a customer call and complain about thetoughness of their steak. After a little ques-tioning, it usually turns out that they took around steak, plunked it under the broiler andturned it into a hockey puck. Then they thinkour meat is tough. They usually try to tell usthat they always cook round steak this way.


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I think what really happens is that they go tothe market, buy a slab of something red anddo the easiest possible thing broil the crudout of it. We bet that they never have any

idea what cut they bought.

We have found that this is even more truefor grass-fed beef. You dont have to apolo-gize for anything, just tell them what to cookwith what. Tell people specifically what cutsare good for what kinds of dishes. We evengive away a little booklet, the Holder Familys

Favorite Recipes.I thought that the recipes inthere are just regular stuff, but people raveabout them.

Cooking really comes in handy at farmersmarkets. Keep in mind that you will have tocheck the local, county and state regulationsto see what they will allow. In one countywhere I sell and pass out samples at farmersmarkets, I dont need any kind of permit atall. In another county, I need a $15permit.In yet another, it isnt allowed unless I ampreparing the samples in a county-certifiedmobile kitchen. Make sure you check it out.

Anything you have a hard time moving can besold at farmers markets just cook samples

and hand out recipe cards for the dish. Whenwe do sampling in supermarkets (again, checkregulations), we ask that the manager havepre-made ingredient kits available peopleare thrilled to be able to just pick up a packetand go. Similarly, request that store managersstock extra of any ingredient found in yourrecipe. One day, we made fajitas for sampling.

Even though we had asked the store manager

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to stock extra tortillas, peppers, etc., they soldout within an hour. The store not only losta lot of sales but also had to contend withdozens of irritated customers.

ProcessingFinding a processing facility can be reallyhard or really easy, depending where you liveand what your needs are. Processing plantsvary enormously in the types of processingthey do. You need to have a pretty good ideaof what your needs are before you go lookingfor a plant because the evaluation and site vis-its youll need to do are very time-consuming.

Check your state Department of Agriculture fora list of facilities in your state. This list will tellyou if the plant is state or federally inspectedand whether it is a kill plant, a pro cessing

plant, or both. A kill plant actually kills theanimals, hangs and chills them. A processingplant cuts up the carcasses.

First, target only the ones that do both kill-ing and processing. You dont want to truckyour meat from one plant to another if youcan avoid it. Then call them up and find outexactly what they do. A lot of plants are veryspecialized and only serve a particular market.

Then go visit them. No matter what theytell you on the phone, nothing replaces a siteinspection. Pay attention to the details. Aretheir offices clean? Are the employees happy?Strike up conversations with everyone youcan. Ask them how long they have worked

there, what they do, and how they like their

PHOTO BY EDWIN REMSBERG


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jobs. Write down the names of their equip-ment; ask them about the throughput per hour,day and week in every area of the operation.Ask them who their customers are. Ask for

references. Ask to meet their inspector.

The good plants will be very open. Theywill show you everything; they will be proudof their plant. The bad ones will be obviousafter just the first few minutes. They wontwant you talking to anyone. They will askyou why you need that information. They

wont give you specifics. They will act in-sulted that you questioned their integrity.

Run away as fast as you can.

Once you have it narrowed down, get pricingon the work you want them to do. Be veryspecific. Tell them what products you want,exactly how you want them cut, how each cut

is to be packaged, boxed and labeled, and whereand when your shipment will be delivered.

For us, it was pretty hard. We needed a fed-erally inspected plant (because our productscross state lines, and our clients insurancedemanded federal, not state inspection), thatcould kill and custom-process. It also had tobe able to separate our beef from other beef,because of our grass-fed label. We foundonly three federally inspected killing andprocessing facilities in the state that wouldcustom-process for us. So keep in mind thateven if your product doesnt cross state lines,you may still need a federally inspected plant.

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We have found that with increasing frequency,a restaurant or stores insurance carrier requiresthem to only sell federally inspected products.

So dont assume that state inspection is ac-ceptable unless you ask your potential client.

Most large federal plants will not deal withyou. They arent interested in cleaning theirmachines so that their meat does not con-taminate yours. They do not want the hassleof having to keep your meat in a separatearea from the conventional beef. They donot want your few animals gumming up theirmassive assembly line.

We now have most of our processing doneat the University of Arizona Meat ScienceLab. The plant is sparkling clean, it has greatequipment, and the person who runs it hasbeen very helpful to us.

Our jerky and marinated roasts are processedat another plant. We have to truck the meatin refrigerated vehicles. We are using a sau-sage and hot dog plant in Phoenix that doesa great job and has a wonderful little old manoffering you great samples.

However, the plants we use are okay for now,

but not perfect. We cannot serve many clientsbecause we do not have the right kind ofprocessing available to us.


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MAKING SURE YOU GET IT DONE RIGHT

Keeping an inventory of processed beef isnext to impossible. The yield of every carcass

is a little different, and you might cut up dif-ferent carcasses differently. However, keepinggood records keeps meat from disappearing.

Weve created a form that helps us: Communicate with the processing plant

about how we want our carcass cut.

Create a visual check list to make sureweve accounted for the whole carcass.

Inventory cut beef.

Keep the processing plant honest.

See trends to predict yields ofcertain cuts.

Access written records if there isa problem.

Create carcass performance data that

can be taken to a breeder.You may want to consider having yourcarcasses graded, at least occasionally, tohelp you learn more about your cattle. Ourprocessor will do it for free on an unofficialbasis. An official usdagrader charges a fee.

FEDERAL INSPECTORS

All federally inspected processing facilitieswill have a federal inspector who maintainsa permanent office within the facility. Theyare always present when the slaughter is doneand they regulate the way the meat is handledwithin the facility. They also enforce therules concerning the transfer of meat between

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facilities. For instance, if you transfer meatfrom a federally inspected facility to a state-inspected facility, it is then considered onlystate-inspected.

Like everyone else, there are good inspec-tors and bad inspectors. Yet, every one ofthem wields a lot of power. Most of theirinteraction will be with the operators of theprocessing plant, but you will need to dealwith them a little. Be nice to them. Theycan be a great help, or they can make your

life miserable. For instance, the amountof meat that you can give away is actuallyregulated. Samples are all supposed to bemarked sample, and the amount may notexceed 2,000pounds per year. Now, if youhave a good relationship with your inspec-tor, he probably is not going to inspect andcount each and every sample that you take

from the processing plant, but he certainlyhas the power to do so.

Getting a LabelIf you plan on having your product crossstate lines, you have to have a federal label.A federal label can only come from a feder-

ally inspected plant. Your label is attached toyour processing plant. For instance, we havea separate label for our jerky and marinatedroasts than for our other beef products. Theylook almost the same. The only differenceis the establishment number in the circle inthe lower-right corner. Thats it. The plantthat does your processing will apply to the

Like everyone else, there are good

inspectors and bad inspectors.

Yet, every one of them wields a lot

of power so be nice to them.


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If you plan on having your product

cross state lines, you have to

have a federal label. A federal label

can only come from a federally

inspected plant. Your label is

attached to your processing plant.

federal government for your label. You needto have the artwork created preferably on acomputer, so that changes can be made easily then give it to your processing house to have

it approved. Some plants will provide thisservice for you, usually at no charge.

Obtaining approval on your label can take aslittle as 10days, or many months, dependingon how out of the ordinary your label is andthe experience of the processing company.

When we applied for our first federal label,it took quite a while. Our processing househad never applied for a label with anythingstrange like natural on it. Even adding thatfairly innocuous word apparently makes thefeds nervous. Our label kept being rejectedover and over, and we couldnt figure out why.

Finally, out of desperation, we hired a label

expediter to help get our label through. Anexpediter is a person who knows all theguys in Washington who fret over the termslike natural and organic and hormone-free.He gets paid a lot of money for knowingwhere their offices are and what questions toask when they tell him that your label wasrejected. And, most amazing, he can tell you

exactly what to change so that the label willpass. After months and months of goingaround and around with our label, it turnedout that what was wrong was frustratinglysimple. We stated on the label KeepRefrigerated or Frozen. It turns out thatwe can say, Keep Refrigerated or KeepFrozen, but not both. How could we have

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Obtaining approval on your label can

take as little as 10 days, or many

months, depending on how out of

the ordinary your label is and the

experience of the processing company.

been so misinformed? Actually, in the endit was not really very expensive (a couplehundred dollars), and we should have hiredthe expediter a lot sooner.

While I would never claim to entirelyunderstand the label approval office, theyseem to be getting more user-friendly. Youcan find out more about labels and gettingyour approval at www.fsis.usda.gov/home.If you want to sell your product as certifiedorganic, your label as well as your process-

ing plant also will have to be approved byyour state or third party certifier.

The easy thing to do is to team up with aprocessing house with experience dealingwith natural or organic labels or copy onethat has already been approved. Dont tryto do your advertising with your productlabel. You will never win in a battle withfederal regulators. Make all your claims onyour point-of-purchase material or yourproduct literature, not on your federal label.Anything that you say on your federal labelhas to be approved by the feds. That istime-consuming, at best.

If you want to say that your beef is better

for you, say it in your brochures. If youwant to say that your beef is tender, say itin your brochures. If you put it in your bro-chures, its just your business. If its on yourfederal label, its the feds business.


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LABEL SOURCES

When youre first starting out, especiallywhen you are still deciding what your

product mix will be, go to a small print-ing company for your labels. You want toorder pressure-sensitive labels that come oncontinuous-feed rolls. Your quantities willbe too small for a regular label company tobe cost-effective. Most small printing com-panies sub-contract with a to-the-trade-onlylabel printer.

Make all your labels the same color (al-though you can create screens of one colorfor more visual interest) and try to do themall at once. You may have different quanti-ties of each 1,000stew beef labels, 500sirloin steak labels, 500tenderloin steaklabels, and 3,000ground beef labels. Go witha standard size, as custom sizes are a lot

more expensive. Sizes usually run in 1-inchincrements.

When your volume is higher (such as 10,000labels or more), deal directly with a labelprinting company. Most major metropolitanareas have one or two. Look in the yellowpages. Get bids from two or three if pos-

sible. Make sure to give them the followinginformation: quantity of each label, totalquantity, size, ink color, color of stock(the paper that the labels are printed on),whether the labels need to be waterproof,and delivery location. Expect a four-weekturnaround time.

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Packaging Your ProductBulk ground beef is most economicallypackaged in small bags, usually referred to

as chubb bags. They come in 1-, 2- and5-pound sizes, and you can select fromdifferent thicknesses of plastic. You canbuy them pre-printed with some standarddesign, and then have your label affixedwhen they are filled at the processing plant.When your quantities are higher (5,000andabove), you can have your label pre-printed

on the bag. There are only a few chubb bagcompanies around. Dont purchase reallycheap bags, as cheap bags tend to get holesduring the filling process. Seek food serviceequipment and supplies sources online.

Recently, we have changed our ground beefpackaging to a Styrofoam tray with a perish-able food wrapping. Our processor stilloccasionally had trouble with pin holes inthe chubb bags. Even though it is moreexpensive, in the end it made our customersand us happier, not to have packages thathad to be returned due to defects.

Most consumers will not buy a productthat they cannot see, especially if theyve

never bought it before. So package yourbeef in clear plastic perishable food wrap-ping, vacuum packed. It is more expensive,but important not only so the consumercan see what he or she is getting, but also sothe product stays fresh longer. Food wrap-ping, such as Cryovac, gives meat a longershelf life than paper-wrapped meat. The

higher cost is offset by these benefits.


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Package your beef in convenient sizes. Wehave found that the person who typicallybuys our product tends to eat smaller por-tions than your average meat consumer. At

the supermarket, ground beef is usually soldin 1- to 2-pound packages. Our customerscomplained that that was too large. So nowwe sell our ground beef, ground beef patties,stew beef, and fajita beef in 1-pound pack-ages, steaks two-to-a-package, tenderloin at of a pound per package, New York stripsat 1pound per package, rib eyes at 1pound, 3

ounces per package, roasts at 3pounds eachand beef jerky at 1ounce per package.

If you wind up selling to a distributionsource such as a restaurant, natural foodsdistribution company, or a retail store instead of directly to a consumer, they willinquire about case sizes. Generally we have

found it is best to have a case big enoughthat the cost of cardboard doesnt kill you,but it wont mean too large of an investmentin one order.

Also, weight is a factor. A lot of women areemployed as warehouse workers these days.Dont make up cases weighing over 35or 40pounds. Our cases are usually 24pounds.

You need to label all cases with the productcodes (we use the standard codes listed inthe beef buyers guide unless we have comeup with a cut that is not listed then wemake up our own).

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PHOTO BY BOB CUNNINGHAM


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UPC CODES

Some retailers want you to include barcoding or a Universal Product Code (upc).

That is the little code on your product thatidentifies your company and its location tothe store, and may contain other informa-tion including the product price. Bar codingis new for meat products. We have neverhad a client insist upon it, which is good, asit does add cost to the bottom line.

There are many websites that detail how

to get a bar code onto your label. Anyprocessed product (such as hot dogs, jerky,etc.) will require a upccode. Some pro-ducers join the Universal Product Codeorganization, which charges a one-time fee.The Universal Product Code association ison the Internet at www.uc-council.org.

A ranching friend buys all his bar codesfrom a private company he finds cheaperand faster: www.buyabarcode.com. Theirone-time fee of $75is a bargain comparedto the $800charged by the upcCouncil,and the bar codes are only $35each. More-over, you dont have to sort through newsoftware to download a code.


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Then, consider three ways to get your barcode on your product:

Contact a printing company that

prints upcbar code labels, which canthen be applied to your product.

Have a upcbar code printed directlyon the package of your product.

Print upcbar code labels yourself usingoff-the-shelf software.

INSURANCE

Some of your customers mostly retail stores,restaurants and some farmers markets willrequire you to carry product liability insur-ance. This is a separate policy from yournormal ranch or farm insurance. Its not allthat big of a deal. Most places require $1million in liability. Present a certificate of

insurance to your client whenever you meetthem for the first time. If they demand it, itwill save some time. If they dont, you willlook all the more respectable and trustworthy.

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GeneticsThere are a ton of different breeds of cattleout there. If you read the breeds marketing

literature, they all seem to calve well, gainfast, and do great under range conditions.Of course, if this were true, wed only needone breed of cow. In reality, we all live indifferent climates, and we are all lookingfor certain strengths in our cattle evenmore so for you as a niche marketer.

For example, meat marbling is definitely oneof those personal preference issues. Someparticularly health-conscious customers dontwant any marbling in their beef. Others claimtheir beef isnt tender without a little fat. Youllneed to discern what most of your custom-ers like and plan your breeds accordingly.

One more thing you also will hear is,

There are more differences within a breedthan between breeds. There is an elementof truth to this. By the same token, you willnever find a Zebu that marbles as well as aWygu. The moral here again is only youwill know whats best for you. Based onwhat we learned about genetics and our ex-periences, weve made some basic conclusions.

Cattle that marble well: Angus Jersey Hereford Red Angus Highlanders Murry Grey

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39selling product

Ive read that Highlands cattle marble veryeasily; they have so much hair, they dontneed any back fat and put that energy inmarbling.

Leaner cattle with less marbling: Zebu

Brahma

Brangus

Gelbvieh

Braunvieh

I have heard that there is a strain of Brahmathat is very tender. Personally, I have hadvery bad luck with them, as tenderness goes.Only about 4percent have been tenderenough.

The longer we are in this business, the morerespect we have for genetics. Good geneticshas a lot to do with the tenderness of yourbeef. Angus cattle can make just as many toughsteaks as a Brahma. It just depends on thegenetics behind them. Good genetics also hasa lot to do with profitability. There is a 20-percent difference between our best cattle andour worst in the weight of our high-end cuts.

Another area we are working with is ma-

turity. Maturity is based on frame size, butknowing when an animal has matured (and,more importantly, marbled) is as much of anart as a science. Its just a skill you have todevelop. However, there are some basics.

PHOTO BY EDWIN REMSBERG

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For a grass-fed product, we are

looking at something that

will mature in two years or less.

No matter how much you feed youranimals or how good the forage is, theywill not start to marble until they mature.Currently, the conventional market is look-

ing for animals maturing at 1,200to 1,300pounds. This seems ludicrous. The onlyperson to profit on such heavy weights isthe feeder (who gets to sell more feed), andthe packer (who gets a break by spreadinghis hard costs over a heavier animal).

For a grass-fed product, we are looking at

something that will mature in two yearsor less. After about 30months of age, youwill start running into tenderness problemsrelated solely to age (this isnt a hard andfast rule, with good genetics weve been ableto slaughter open three-year-olds with notenderness problems). With that in mind,weve been looking to raise an animal that

will mature at 800to 1,000pounds, a figuresort of pulled out of a hat. Maybe 600to800pounds is the magic figure. We chose800to 1,000pounds because it seemeddo-able without getting into an extremebreeding program.

As our genetics and quality of forageimproves, we are experimenting with try-ing to take this weight up to 1,000to 1,100pounds. The jury is still out on whetherthis is economical. If you buy calves insteadof producing your own, you may want tochoose the shorter frame animals that willmature at your lighter harvest weight.


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All forage is not created equal. You

can work to improve both the amount

and quality of your feed. Each season,

we work to improve our pasture,

and a large part of that is managing

how the forage is harvested.

Ultimately, we believe these new breed-ing programs will be a spin-off industry ofgrass-fed beef. Beef that do well in a feedlotdont necessarily do well on grass. Special

breeding lines will have to be created. Grass-fed cattle in Minnesota will be very differ-ent genetically from Florida, or Arizona, oranywhere else. We all have different situ-ations and needs. We will all need differ-ent genetics, and someone, somewhere willsupply them.

ForageAll forage is not created equal. You canwork to improve both the amount and qual-ity of your feed. Each season, we work toimprove our pasture, and a large part of thatis managing how the forage is harvested.

Youll want to put your brood cows on yourpoorest forage. Granted, they will do betteron better forage, but to get the biggest bangfor your buck, youll want to save your goodforage for your high-value animals, thoseyou are finishing. These animals are gainingin weight and quality, as opposed to yourcow herd, which is depreciating and doesnt

get as much of a benefit out of good forage.Some intensive graziers even do a leader/fol-lower system.

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In beginning our grass-fed program, wedidnt worry too much about forages. Weused all native forage that was already in thefields. In fact, some producers report raising

great-tasting beef from native grasses, whichalso saves them money. However, our expe-rience is leading us to believe there may beenough value in planted forages to warrantmore research.

We are looking at finishing our animalswith high-energy forage. Here is a list,

ranked highest to lowest: brassicas

legumes

cool-season annuals

perennial ryegrass

warm-season annuals

cool-season perennials

alfalfa

Most of the grass-fed world (Argentina,New Zealand) concentrates on the topfour. In taste tests in Alabama, Californiaand England, ryegrass was found to pro-duce a better tasting beef than grain.However, while fescue was almost univer-sally disliked, it can be a useful piece ofyour system.

No one knows the minimum amount oftime an animal has to be finished on highquality forage. There have been some fig-ures thrown about ranging anywhere from


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50to 100days, but no one really knows.Again, native grasses might prove an attrac-tive, low-cost option.

One thing we do know comes from Dr.Dick Diven, of the Low Cost Cow/CalfProduction School: When your steer reaches60percent of its mature body weight, itwill be at a point in its development whereit grows intramuscular fat (marbling) cellsor connective tissue (gristle). If your steeris on an upward plane of nutrition (gaining

weight), it will form marbling cells. If not,it will form connective tissue. This is onereason you cant look at a fat steer ready forslaughter and predict if hell marble well.Unless you know how he was doing whenhe hit 60percent of his mature weight, youcan feed him all you want and he still wontmarble.

Dr. Diven also has a word of caution if youare using grain to supplement your grassprogram. Without going into the complexrumen chemistry, oil grains (like cotton seedor soy) will work more efficiently with therumen, allowing the steer to eat more cheapgrass. A starch grain (like corn) will workagainst the rumen in a grass-based program,

making the rumen, in time, more dependenton bought grain for its nutritional needs.

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People who market sustainablyraised food in innovative ways

provide inspirational real-lifemodels. Consider adapting ideasfrom the approaches that follow.

entre reneurs


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45Written by Valerie Berton | Image from Dan and Jean Carver

With more than a centuryof sheep ranching tradi-tion on their 30,000-acre

central Oregon ranch, Danand Jeanne Carver wanted to

continue raising sheep despitedeclining lamb and woolmarkets. With a grant fromthe Sustainable AgricultureResearch and Education (SARE)program, they researched mar-kets and launched a productline featuring uniqueness andquality.

Today, their sales include lambfor high-end restaurants,wool in yarn-and-patternkits for hand knitters, andready-to-wear woolen andlambskin fashions. Thesesideline enterprises augmentthe main ranch commodities,which include 800 head ofcattle, hay, and 3,000 acres

of no-till grain.

With a lack of processors,the Carvers were forced tofind custom outfits willing todevelop out-of-the-ordinaryretail products. They found asmall meat processor 80 milesaway and attracted restaurantsusing many messages fresh,

locally grown, natural springlamb from a ranch awardedfor its conservation practices.Thats a lot of sizzle, saidJeanne.

Once washed and dyed, the woolbecomes yarn for kits featuringthe Carvers knitwear designsand is sold through a dealer whopublishes a catalog circulated to

100,000 crafters. Repeated requestsfor finished garments from theirwool encouraged Jeanne to workwith area designers and knitters tocreate handmade woolen clothingsold in resorts and specialty shops.To use the whole animal, theybegan tanning hides and addedlambskin fashion items to theirclothing line.

The marketing project has in-creased awareness and visibilityof what we grow, how we growit and, most importantly, howwe manage the land, said Dan,referring to a bevy of practices tosafeguard the environment, suchas installing miles of fencing tocontrol grazing impact and building

dams to create watering holes fordomestic stock and wildlife.

Lamb sales have spurred interestin their beef, which the Carversprimarily sell as 700-pound calvesto the generic market. With thenew interest from lamb buyers,however, they now direct-markettheir finished beef to some of their

established lamb customers andhigh-end restaurants dotting theColumbia River Gorge.

Dan said they only direct-market about 50 head ofbeef a year, but not for lack ofinterest. Once the chefs tourthe ranch and see the roots of

their product, they ask Howdo we get your beef? hesaid. The demand is there forincreased direct-market salesbut it will grow only as fast asour processing and distributionwill allow.

The Carvers estimate theyclear 30 percent over the price

of lamb sold on the genericmarket, and wool profits aregrowing even while they keepprices affordable.

Our customers love the qual-ity of our product, the flavor

profile of the meat, the feel ofthe wool and the message ofthe land and sense of place,Jeanne said.

THE CARVER FAMILY

2002 sare program grant recipient


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46

Bill and Di Hodge hadraised a small cattleherd in addition to their

day jobs for decades, butgot serious about making the

sideline activity a real income-generating enterprise after theysaw the potential of marketinggrass-fed beef.

Six to eight years ago, wesuddenly came to the realiza-tion that a cow was put onthis Earth to graze, said BillHodge, an extension educa-

tor who farms in northwestGeorgia. We wanted tosee if we could produce aconsumer-acceptable productfrom pasture.

After four years of forageresearch, the Hodges hadperfected a system of growingcold-season and warm-season

grasses that not only performedwell in their climate but alsoproduced a good flavor in theirbeef. They introduced customersto their new product at a nearby

farmers market in Carrolltonstarted in 2002 partly with supportfrom a Sustainable AgricultureResearch and Education (SARE)program grant.

The Cotton Mill Farmers Marketfilled a gap in northwest Georgia.As a suburban population driftedwest from Atlanta during the 1990s,

Carroll County grew. Many of thenew residents knew nothing aboutthe local farm products. SAREsgrant supported a new market initi-ated by civic groups, governmentagencies and farmers committedto bridging that gap.

As Carroll County extension direc-tor, Hodge participated in the

local effort to launch the market.In 2003, its second year, themarket featured 32 producers, theHodges among them. The marketwas an ideal venue to test theirpackaging scheme devised to usethe whole animal: 20-, 30- and40-pound packs of ground beef,steaks and roasts.

That season the farmers market

became a primary sales outlet forthe Hodges, especially with theopportunity to feature their beefin occasional chef demonstrationsprepared on site.

The farmers market gave usa venue to be in the marketand expose the product, Billsaid. It really made a differ-ence [to customers] to have

a chef prepare our beef, withthe aroma flowing throughthe market.

Today, the Hodges sell their meatunder their Hodge CommonSense Beef label directlyfrom their farm or on onlineat websites like LocalHarvest.org and EatWild.com, where

Hodge says they have gainedmany customers. They stillgo to the Cotton Mill marketsometimes, but say demandnow exceeds supply from theirherd of 40.

The Hodges have begunmarketing meat for severalproducers under their label.

Others dont want to spendthe time dealing with thepublic, Bill said. Theres alot of time and energy involvedin direct marketing.

Despite that, the Hodges stillsell at the market periodically.They expect to diversify andoffer lamb from a new flockof sheep and are considering

goats as a biological weedcontrol on their land.

THE HODGE FAMILY

Benefited from a 2002 sareprogram grant

Written by Valerie Berton | Image from Wendy Crager


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47Written by Valerie Berton | Image from Bill & Denise Brownlee

For eight years, Bill andDenise Brownlee watchedfeed prices rise and pork

prices fall, wondering all thewhile how they could make

their Wil-Den Family Farmsin Pennsylvania more profit-able. In 2002, they decidedto exploit what they saw asa market advantage foryears they have perfected anoutdoor production systemwhere their hogs farrow andfinish on pasture withoutgrowth stimulants and minimalantibiotic use. The Brownleeswithdrew their pork fromconventional sales and begantrying to market their productdirectly to customers.

Given the time commitmentinvolved in direct marketing,they scaled back their opera-tion from 170 sows to 60 and

began focusing on selling900 to 1,000 animals peryear, this time at a premium.Their broad efforts includedeveloping a meat-orientedcommunity agriculture project,running a subscription service,partnering with CSA farmers,selling at farmers marketsand grocery stores, selling toinstitutions, and establishingan on-farm store.

With help from a grant from theSustainable Agriculture Researchand Education (SARE) program toa local non-profit organization thatwanted to test the concept of a

community-supported agricultureproject focused on meat, theBrownlees began hosting meatsampling events. They hoped tocapture 100 families interested inbuying annual shares of theirfarm product. For between $400and $800, depending on theirchoices, each member would receivea mix: bone-in center-cut chops,bacon, ground pork, breakfastsausage, Italian sausage andsemi-boneless ham, throughoutthe year. The concept, however,failed to take hold.

We tried to pattern it after howpeople are used to buying fromvegetable farmers: paying up-front, Denise said. For whatever

reason, they were hesitant tocommit. They changed theirstrategy to encourage people tobuy a months supply of meat ina subscription service and hopetheir happy customers will beginbuying for a full year. About 40customers have subscribed formonthly meat deliveries.

Denise and Bill host meat samplingat a variety of venues. Denises firstpresentation at a local businessgained a handful of customers,whoare still receiving meat deliveries.

A local restaurant featured theBrownlees, a beef producer anda poultry farmer in a pasturedmeat tasting. And at a nearbyconservatory, they took part

in a Green Eats event,distributing tastes of pork toa well-heeled crowd.

Early successes include sellingwhole hogs, an inexpensive wayto move the entire animal, toinstitutions such as a conventand ground pork to Washingtonand Jefferson College in

Washington, Pa. Selling lower-end cuts remains one of theirbiggest challenges.

Weve doubled the pigs weslaughter under our label,

but its not enough, Denisesaid. We have just 60 sowspaying the bills and we needto make more money fromthose animals.

THE BROWNLEE FAMILY

Benefited from a 2004 sareprogram grant


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48

Since 1999, Wende Elliotthas raised poultry andlamb in a pasture-based

system on her 120-acre centralIowa farm. With her husband,

Joe Rude, she gained organiccertification for her meat prod-ucts, as well as alfalfa, oatsand corn.

As they fine-tuned their produc-tion, Wende and Joe ponderedhow to get the most from theirmeat. In 2001, Wende wrote abusiness plan and successfully

launched a cooperative calledWholesome Harvest. With twogrants from the SustainableAgriculture Research andEducation (SARE) program, shebegan to promote meat salesin five Midwestern states.

Wholesome Harvest is now athriving, farmer-owned organicbusiness with more than 40members. The e-commerce site,wholesomeharvest.com, is a suc-

cessful direct sales mechanismthat augments more traditionalmarkets such as grocery storesand restaurants.

The website provides a wealth ofinformation about the WholesomeHarvest cooperative and the groupsefforts to promote organic meatgrown on pasture with humane

handling practices.Wholesome Harvests virtual mar-ket enables buyers to order meatonline for delivery. It evolved fromWendes vision that people whowanted to eat certified organic,independently raised meat fromfamily farms didnt have to gofarther than their computer to

shop for it.In an innovative twist on communityagriculture projects, people can joinWholesome Harvests meat-of-the-month club and receive monthlyshipments of organic beef, chicken,lamb, duck, goose and turkey, muchlike a CSA. Frozen meat on dry ice isshipped via two-day express delivery.

In its advertising, the co-opemphasizes that its products arelocally grown, farmer-owned,pasture-raised and renderedat custom processors to give

them a human edge over themore anonymous industrialmodel.

We cant compete on cheapfood, Wende said, but wecan compete on quality andfreshness and the fact thatour product is local.

Growth, the co-ops commu-nications officer says, is steady.For that and other reasons,Wende hopes to form a nationalcoalition of regional organicmeat cooperatives.

Only by working together canfarmers protect the added valueof organic meat, and capturepremium and remote as well

as mainstream markets fortheir products, Wende said.Otherwise, they will end upbeing paid what the plantwants to pay them.

To learn more about the nationalcoalition, contact Wende [email protected].

THE ELLIOTT/RUDE FAMILY

2000 & 2002 sareprogram grant recipient

Written by Valerie Berton | Image from Wholesome Harvest


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There were two pioneers in the direct marketing beef business:Mel Coleman of Coleman Beef, and Doc and Connie Hatfield ofOregon Natural Beef. Mel basically modeled his production system af-ter the conventional market and had mixed results (for a more detailedanalysis, read his book Riding the Higher Range). The Hatfields, however,truly blazed their own trail.

In a nutshell, they created a cooperative of producers who promisea certain number of cattle during different parts of the year. These

cattle are then fed out and slaughtered, with the owner retaining own-ership. At slaughter, the slaughter house buysthe beef for conventional prices, but stores thebeef separately from their conventional beef.The Hatfields then get on the phone to theirclients and take orders for that week. Withorders in hand, they then buy back as muchof their beef as demand will allow from the

processing facility. Then they pay the producera premium for the amount of beef they wereable to sell.

The nice part of this model is that there is a steady supply of freshbeef and a guaranteed sale. At the very least, youd get what you wouldhave gotten by selling your cattle conventionally. Finally, it makes pro-ducers more conscious of the product they offer.

STRENGTH: Year-round production, guaranteed sale

WEAKNESS: High production/start-up cost

THE HATFIELD FAMILY

OREGON NATURAL BEEF

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The James family, like the Salatins, has made a nice living doingthings on a smaller scale. They slaughter their beef at around 950-1,150 pounds, the majority in the late fall, but also some in the spring.The beef is then frozen and sold throughout the year. Part of theirmarketing is done through an on-ranch store that is open one day aweek. Another part is sold at a local farmers market. They also sellmost of their hamburger through some high-end local restaurants whocater to tourists looking for a western experience as well as natural foodgroceries in and near Durango.

James Ranch beef cattle begin their lives onpastures in Utah and are then moved to theranch to graze on cool-season grasses andclovers. The Red Angus beef cattle growquickly on grass and are ready for marketbetween 18and 30months of age.

Besides grass-finished beef, the multi-generational family operation also producesartisan cheese and pastured pork.

The Jameses advertise their meat online at www.jamesranch.net. There,customers can pre-order beef using an online order form and pick it upin Durango.

STRENGTH: Low start-up and production cost

WEAKNESS: Time spent away from the ranch at store or in market

THE JAMES FAMILY

JAMES RANCH GRASS-FINISHED BEEF


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51

Will and I started Ervins Grassfed Beef (egb) in 1997. The companywas named after my husband Wills maternal grandfather, Ervin Hicks(below), who had a wonderful land ethic and a gentle way with animals.Originally, we tried to form a cooperative, including our neighborsand a few other ranchers who do a great job with their land and theircattle. Unfortunately, even though everyone agreed that it was a greatidea, no one but us was willing to spend any money or time developingit. So now, our program is set up like a cooperative, at least in spirit.On paper, egbis simply a marketing agent that buys cattle from otherranchers who are willing to adhere to the sameset of standards that we do. This way, egbisa pretty lean organization, giving most of thevalue to the producer and the consumer.

Each rancher with whom we work is certifiedby egbto meet the standards we advertise tothe consumer. They are responsible for the

product and retain ownership until the steeris on the rail. Some producers dont want theresponsibility of finishing a steer, so our ranchbuys them from the producer (similar to astocker operation), and sells them to egb.

egboffers three prices: hamburger (cull cow), stew beef (tough steer)and steak (tender steer). We only buy what our demand calls for.Originally, we started offering only a frozen product but have sincebeen able to offer fresh as well.

STRENGTH: Starting with frozen product is very forgiving andmaximizes per carcass net

WEAKNESS: Frozen product limits marketability

THE HOLDER FAMILY

ERVINS GRASSFED BEEF


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53selling product

Situational AnalysisThe first thing that you have to do is to identify your strengths andweaknesses. This sounds really simple, but weve found that it actuallytakes quite a bit of time. We wasted a lot of time trying to follow themodels of some pretty brilliant people, only to get a ways down theroad and find out that, given our particular set of circumstances, wecouldnt go that route. So first off, do your homework. Make a list ofwhat you have to work with.

Your team: Your familys background. This is a group effort.

Your personality. How do you deal with others? Would youenjoy making a cold sales call?

Your education and experience.

Your physical resources: The size of your ranch.

The number and breed of cattle.

The ranchs history, layout, elevation and character.

If pesticides, non-organic fertilizers or herbicides have been used.

If any part is irrigated or able to be irrigated.

The condition of the pastures.

Water availability.

If you own, or have access to, scales.

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Your location: The distance to a town.

The distance to a major metropolitan area.

The nearest processing facility and its willingness to train you.

Economics: Your economic situation. Do you have savings to support you

during transition?

How much money does the ranch need to produce, both shortand long term?

How much cash reserve do you have?

What is your available credit?

Can you afford to break even or even lose money for a few years?The general rule is to expect seven years to establish a profitabledirect-market bus

how to direct market your beef

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