Producers looking at direct meat marketing have options
As direct marketing of agricultural products continues to grow in popularity, producers are looking for ways to meet this demand.
Selling product to local grocers and participating in farmers markets are common outlets for producers to market their meat. However, not everyone has the option of a USDA processor within a convenient distance, or the freezer space to store meat in between markets. In these types of situations, selling live animals as whole, half or quarters might be an option for direct marketing.
When marketing live animals for meat, a producer will typically take a deposit and then raise and finish out the animal (pork and beef are commonly marketed this way) for consumers, who then work with the processor on how they would like their meat processed and packaged. The processor might be chosen by the producer or by the customer. Once the animal goes to the processor, the customer pays the producer a set amount per pound hanging weight (this amount will include feed/finishing costs and labor), as well as covering the processing fees. Each live animal marketing program will vary a bit from farm to farm. This type of marketing does not require a USDA processor.
“If the producer is selling the animal live, then it will change ownership as a live animal and the new owner can process it at any plant they choose as a ‘not for sale’ slaughter,” Dr. Bryon Wiegand, meat sciences and animal sciences professor with the University of Missouri College of Agriculture, Food and Natural Resources, explained. “However, if the original owner is selling carcasses, wholesale cuts or retail cuts, then the animal must be processed under state or USDA inspection.”
Before choosing to sell animals in this way, it is wise to know the current demand in a producer’s region.
“It is critical to decide two items,” Wiegand explained. “Who is my customer and is there demand for the animals I am currently raising? It is easy to hear that people around the country are buying organic, or free range, or natural or any number of labels, but producers need to make sure there is demand in their area for such animals and meats.”
Producers will also want to figure their costs, including labor, into a finished animal in order to determine whether this type of marketing is financially feasible.
“Labor is not free. Finishing animals does take time and the producer’s time needs to be assigned a value/cost,” Wiegand said. “Also, is the cost of feed and transportation to the processor viable?”
If a producer determines there is a market for their animals and meat, and direct marketing a live animal is profitable, they will want to advertise.
“Once a good customer list is established, many find that word-of-mouth advertising is almost as good,” Wiegand said.
He cautioned if producers choose digital, print or radio marketing, honesty and transparency about the product are imperative.
“Nothing kills a sale or repeat purchase like a claim of production that turns out to be false,” he said.
While there are pros and cons to any type of product marketing, Wiegand explained this type of direct sale “can help sell the entire animal carcass and all of the cuts versus the more popular cuts where customers choose out of the freezer at the famers market. The average pound price is lower for the whole, half or quarter carcass sale, but the lower value cuts will move with this approach and producers are not ‘stuck’ with the lower-value cuts in inventory and have be forced to sell them at a loss to move them. Another advantage of selling direct is there are fewer customers to please and a greater volume of meat goes out the door with each sale.”