Now is the Time to Consider Beef Direct-to-Consumer Marketing

 

Nathan Briggs, Lancaster’s new Penn State Extension Livestock Educator writes that the onset of COVID-19 caused the number of direct-to-consumer animal protein sales to increase. People wanted to secure a source of animal protein in light of uncertain events. Beef packers were backlogged due to plant shutdowns and demand increased in direct-to-consumer sales. For this reason, custom abattoirs have had long wait times. If your operation already sells direct-to-consumer, hopefully appointments for your animals have already been made. If you are considering direct sales, some key indicators to monitor to ensure profitability are your expenses, your cattle growth rates, and your individual market (i.e., what is the customer looking for in your product?).

 

To ensure profitability in a direct-to-consumer system, all expenses and revenues should be documented throughout the year. If expenses are known, the price charged per animal can be calculated to ensure profitability. Cornell has a tool available to help calculate costs and revenues. Visit the Cornell Meat Price & Yield Calculator for more information. Remember, the more accurate the information that goes into the program, the more accurate your conclusions can be. Always remember to consider farm taxes, mortgages, insurances, and personal time into farm expenses. If the operation moves cattle from their calf/cow segment straight into their feedlot segment, make sure the operation considers costs and/or profits from both segments. Keep in mind, the longer the animal resides in your care, the more investment you put into the animal, and, thus, the more risk.

 

Growth rates are important in the beef industry because they allow producers to speculate an appointment date at an abattoir. Animals that are over fattened tend to cause small packers a nuisance because every retail cut must be trimmed of the excess fat. Over fattening cattle wastes feed, so feed costs increase. Meanwhile, your relationship with your packer becomes strained because you have added to their workload. Investing into better genetics on the front end can save money in the feed bill over the whole feeding period, if you are not over-fattening cattle. Finally, if one knows the entry weight and growth expected for a group of cattle, then a finished date can be calculated. Alternatively, established operations may rely on previous performance to estimate how long the animals may need to remain in the feedlot.

 

Know the market you are serving. In general, consumers like to know that their animal protein sources are being raised responsibly. Individual consumer preference might differ slightly, but the major consumer interests tend to include the environmental footprint of the operation, the welfare of the animals, and individual story. Tell your story and explain your passion and knowledge for raising beef cattle. Every beef operation is different, so spend the extra time to keep consumers coming back!

 

The increased demand for direct-to-consumer beef is not necessarily here to stay. In order to secure your future market, spend some extra time getting to know your consumers and their preferences. Track animal weights to know how your cattle are growing. Know the total expenses and revenues for the year and market animals at the appropriate prices to ensure a profit. COVID-19 helped increase the direct-to-consumer beef sales and now I challenge you with retaining those consumers long-term.