Niche Marketing Presentation:
History of Sioux Preme: 1) 2) 3) 4) Harvest facility in 1969, sold only swinging carcasses, primarily in the US and Mexico. 1990 Joint Venture with Farmland Food in the old Butcher Quality facility in Sioux City. 1995 the Farmland relationship ended and Sioux Preme had a facility built. The concept of differentiation of pork products began. Today we are the processor for Beeler’s Natural Pork, Prairie Grove Natural Pork, Niman Ranch, Organic Valley and we also have a Berkshire program for Japan. 5) Today our business is 1/3 carcass sales, 1/3 commodity products (primarily light hogs) and 1/3 specialty pork projects.
Keys to successful Niche marketing programs from a processing point of view. First question you must be able to answer: Why will a customer purchase product from me and be willing to pay more for it? We all believe we have the best hogs, the best facility, the best management, the best genetics etc. There is a definite balance between the “story” and the product. 1) Customers- this may sound obvious, but 2 restaurants that want to buy boneless loins do not make up a customer base. Different customers want different items, which can be your opportunity, but also your challenge. 2) You can not be everything to everyone. You have to decide what items you can sell and sell them. Don’t get into doing 2 boxes for this guy 3 for that guy and theses are the only boxes of this item you sell or for that matter will ever sell. 3) Know your cost. If you don’t know what something really cost, you will go broke. There are slotting fees, transportation, packaging, distribution, cold storage, processing cost etc. 4) Carcass utilization- sell loins and tenders does not make a program. You get 2 hams, 2 loins, 2 boston butts, 2 ribs, 2 bellies, whether you have customers for them or not. A good balance of food service and retail customers is essential for carcass utilization. 5) Yielded Meat Cost- There are a several ways to cut up a carcass and more specifically a primal cut. Today most processors will produce 3-4 types of loins, 3-4 types of hams, 2-3 types of spare ribs, 2-3 types of bellies, 3-4 types of picnics, 2-3 types of butts. So you have gone from 1 hogs to virtually 20 different primal cuts. 6) Don’t ignore the opportunities for neckbones, skins, fat, trimmings, tails, feet, and jowls. These items will make up more than 15% of the total carcass weight. 7) Don’t harvest any hogs you don’t have sold. Many people have tried to get in the business only to find a freezer full of meat without a customer. 8) Realize no business will come easily and it will take a lot of hard work.
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