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CATTLE TODAY

SURVEY SHOWS RETAILERS ARE RESPONDING TO CONSUMERS

Cattlemen must continually evaluate market conditions and make adjustments accordingly. It's no different for businessmen on the other side of the beef chain.

Meat marketers completed a survey of 121 retail stores in metro areas across 34 states and compared it to a similar report from 2004. “The 2007 National Meat Case Study” identified the ways retailers are responding to their consumers.

The research, funded by supporters of the Annual Meat Conference, addressed two major questions:

•      What are retailers around the country merchandising in their fresh meat cases?

•      How has this changed in the last couple of years?

“Consumers will be very vocal,” says John Cremens, director of meat operations for Foodmaster Supermarkets Inc., based in Chelsea, Mass. “When they're in the store looking for something, if there's somebody there to listen, they'll ask.”

The 10-store chain has been Certified Angus Beef LLC (CAB)-licensed since 2002 and recently won the national Beef Backer award.

The survey showed a 50 percent increase in the percentage of whole muscle beef packages with on-pack nutrition labels.

“Retailers have been doing a better job of getting more information on the package,” Cremens says. “We use the Easy Fresh Cooking labels that give cooking and preparation instructions, which definitely help consumers.”

Information is one way to move beef. Innovation is another.

“We still have a lot of traditional cuts in the case that require some finesse. That's an obstacle we face on a day-to-day basis,” he says. “That's why you see companies doing value-added cuts and different fabrications. That makes it easier for the retailers to take those muscles and prepare them in a different way for retail sales.”

Although new merchandising methods have been implemented, beef is still given relatively the same amount of retail space. The survey says 27 percent of the entire self-serve meat case is made up of beef products, with 8 percent being ground beef.

“Grinds are areas where we see growth and new offerings,” says Al Kober, CAB director of retail. “In the past, the impression was that when you grind CAB, it becomes just ground beef. Not so. The quality difference extends to the grinds.

Cremens sees value-added opportunities in the ground beef category, too.

“You generally have your four traditional blends of hamburger, but a lot of people are taking that to the next step and making seasoned burger,” he says. Pre-pattied hamburgers also hold appeal, especially when other ingredients, like portabella mushrooms or jalapeños and cheese, are added.

The average number of ground beef stock-keeping units (SKUs) rose from 12.1 in 2004 to 13.2 in 2007.

“These initiatives are changing the role of ground beef from just burgers to becoming ‘center of the plate' items for dinner,” Kober says.

The value-added category is on the increase, from four percent in 2004 to seven percent in the current study.

“Value added will continue to drive new sales,” Kober predicts. “CAB offers consumer-ready marinated top round London Broil in three flavors, fresh corned beef, beef entrees like pot roast and CAB patties.”

Those pre-cooked items are growing in popularity.

“The majority of heat-and-serve is chicken, but we're trying to gear toward all ready-to-eat categories,” Cremens says. Today, just over a quarter of all heat-and-serve items are beef.

“We find the consumers either don't have the knowledge or the time to prepare a lot of cuts,” he says. “The more we can do in retail to get it one step closer to getting it on the table is definitely the way people are going.”

One area that consumers and grocers alike don't fully understand is the natural arena. Ground beef with natural claims jumped from 7 to 25 percent in three years, a 257 percent increase. Whole muscle cuts climbed two percentage points.

“It's definitely the buzz in the industry. All retailers are jumping on board in some natural aspect with beef,” Cremens says, noting Foodmaster offers CAB Natural. “In our particular locations—urban, inner-city Boston—we only have a couple of stores that have great success with it.”

He suggests price point as one hurdle and the lack of knowledge about it as a second.

Overall the survey pointed to upward and downward trends, but Cremens knows a solid focus on good beef is good for Foodmaster.

“The company grew as a meat image company and it's stayed that way to date,” he says. “We saw that beef quality grading lacked some consistency and that's when we decided to make that switch to a brand that was always going to have that consistency.”

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