Setting Up The New Meat Department
Since the reason for establishing a retail meat department is to expand the line of product and provide additional service to the customer while enjoying increased sales and gross profit, careful attention should be given to all the facets of department setup. Although time and space do not permit in-depth consideration of all areas, I hope this article will spark ideas and suggest in what areas to seek additional information.
Service or self service?
One of the first considerations of meat department setup is whether a service or self-service meat counter would best suit the needs of the customers.
The introduction of a meat department may be relatively novel in a co-op setting, and a lot of the customers may not eat much meat. A service meat counter with the proper people staffing it would allow the customer the opportunity to ask questions and have any special needs or concerns given proper attention. The personal contact with a person who knows about the product and can offer suggestions will gain customer acceptance and confidence. Another advantage to the full service meat counter is that you are not asking the customer to perform gymnastics in order to get the piece of meat that they want. At a self service meat department where there are four or five decks of meat displayed on top of a coffin-type lower area, the customer must bend or stretch in a manner that is not conducive to "comfortable" shopping!
Equipment
In any trade, it takes the proper tools to do the proper job. The meat department is no exception. Proper equipment and equipment maintenance are of the utmost importance.
If a tight budget situation will not permit the purchase of new equipment, good quality refurbished equipment can be obtained for a fraction of the cost of new.
You can check with local wholesalers, who will have contacts with outlets for used band saws, grinders, cube steak machines, slicers and the like. Choose equipment that will remain serviceable as the department grows and expands its product line. In general, equipment that will operate on single phase power will become useless as the demand for more product becomes greater. Motors that demand three-phase power supply will suit the needs of most departments.
Adequate space should be provided for both refrigerated and frozen product storage. Provisions for drainage and cleaning in these areas are also a prime consideration.
The meat processing area can be either refrigerated or not. The preference is that it indeed be refrigerated, since product may have to be left unattended for periods of time if meat personnel are required to serve the customers. In choosing a meat display case, choose one that offers the customer a good view of the product on display and is easily cleaned and maintained. The unit should also be refrigerated by a compressor of adequate horsepower to maintain proper display area temperatures.
Department staffing
Not enough can be said about the success of the meat department being a function of the people staffing it. Just as the right tools are needed to do the properjob, the right people are needed to manage the department.
The best places to look for experienced meat cutters are in local packing houses, mom and pop stores, or in the classified section of the newspaper under "Work Wanted -- Trades." If you choose to advertise for meat department personnel, place the ad in the classifieds under "Employment -- Trades."
The qualified meat manager candidate will not be inexpensive to employ. The person may end up as one of the highest paid employees on the payroll! The success of the entire department will ride on the manager candidate's abilities.
Once the manager has been offered the job, he or she should be the person to interview and hire the remaining people to fill the departments labor requirements.
Filling the meat department labor roster is probably the most difficult task that needs be performed in order to ensure that the sales and resulting gross profit justify the introduction of the department.
Product lines and vendors
The type of product that is to be offered depends upon the demands of the customers. In some cases, only purely "organic" meat products will be acceptable. In other situations, a mix of high quality commercial product and all-natural product will fill the bill.
Whatever the case, vendors will have to be located and delivery and payment terms established. Initially, most vendors will extend their normal terms of payment for a period of time until the department gets established. A request for terms of net 90 days is not uncommon, and most vendors will agree to extended terms for up to a year.
Of key importance is the establishment of timely deliveries of product. Once a delivery schedule is established, it should be the vendor's responsibility to notify you of any delays -- delays could very well affect the quality of the product, particularly where refrigeration is concerned. All product should be inspected upon receipt and any questionable product refused.
Quality product and reputable vendors contribute greatly to the success of meat department operations. Choose them carefully!
Display, merchandising
An old saying among meat cutters says, Anybody can cut meat, but it takes experience to cut meat and make a profit." But when asked, "How much do you mark up your meat?" or "What percentage margin do you get in your department?" the experienced meat person will just laugh! There are too many variables when merchandising meat products, variables that prevent straight answers to such questions.
The most important aspect of the new meat department's merchandising is to think SMALL. A smallish 2-pound pot roast with a retail value of $4.00 will appeal to the new meat customer more than a whopping 5-pounder worth $10.00. Try to communicate dollar value per meal. Eventually, larger cuts will become more popular as customer confidence grows and product mix becomes more varied.
Since about 50 to 60 percent of the new meat department's sales will be poultry, it should be merchandised as a last-in-line item. This way, the customer seeking poultry walks the entire length of the meat case and is exposed to more product.
Particular attention should be given to the ground meat products. The backbone of any meat operation is the ground beef. Attention to high quality and consistency help establish a strong ground beef sales base.
With regard to ground poultry, store-made product should be made only under extremely cold conditions. Poultry and salmonella bacteria go hand in hand. Unless ground poultry meat can be produced at near freezing temperature, it should not be manufactured on the premises. There are a number of high quality commercially produced ground poultry items available from wholesale grocers. They are generally mass produced in a frozen state and merchandised the same way.
The Red Meat Debate at Brattleboro Food Co-op
The discussion on whether to carry red meat at the co-op goes back in our case about 3 years before we began the 1988 relocation to our present, much larger facility. It was a difficult and sometimes highly charged emotional process, especially given the fact that our organization was founded primarily by vegetarians.
With the co-op already carrying chicken and fish, the board of directors approved a management proposal to carry local frozen lamb and pork. (At the time, we had a management collective -- later changed to a general manager.) Criticism by some members led to a subsequent member referendum, which showed 51 percent in favor of carrying these products. After further rancorous debate, the board rescinded its prior decision.
Some time later, we did a general store survey, and once again a majority of members responded in favor of the co-op carrying meat. However, at that time we simply stored that information.
Then, as we planned out the new store, we informally decided not to include a full line meat department. But about a month before the consturction was set to begin, and after all the plans and financing were well under way and approved, two directors made a formal proposal that we start a full line meat department right from the beginning. Their main argument was that it would serve the membership better, that "first impressions were best impressions," and that we should do the whole thing right from the beginning. The board tabled the proposal and asked me, as general manager, to determine what the membership wanted and also to determine the economic feasibility of having a full line meat department.
I hired someone immediately to help with the projections. I knew of a person in the community who had many years of experience in the meat business, and who actually had been a member of the co-op in past years. He was happy to help out, and after a very thorough study decided that it had potential for being successful.
As to the issue of what the membership wanted, I went back to previous surveys and talked to a number of people in order to test the waters. In concluded that it was not necessary to conduct yet another survey. What I did was to put an article in a mailing of a special issue of our newsletter, announcing that the meat issue was again up for discussion and that a decision was to be made at the next board of directors meeting.
At the board meeting, a moderate discussion was held. A few people, including some local growers, attended the meeting to speak in favor of the proposal. But, to our surprise, no one opposed showed up. An affirmative decision was made, and we got to work immediately, since it was already late in the process. We order equipment, and went about looking for a meat manager.
We also changed some aspects of the packing room design to accommodate the new needs. And, in deference to those members who we felt would prefer not to see the actual meat cutting going on, the design of the cutting room deliberately enclosed the equipment; since it is a full-service counter, we retained a window for the staff to see through.
Meanwhile, the anti-meat lobby finally read their newsletters, and they began a rather heated but short-lived campaign to scuttle the new decision. It mainly consisted of two people, a husband and wife team, the same ones who lead the fight years before to have the earlier decision reversed. Their viewpoint derived principally from a commitment to animal rights. The day the new co-op opened, the couple picketed and then withdrew their membership in protest.
It has never been our intention to alienate anyone over any issue such as this. But our experience over the 17 years of the co-op's existence is that every major decision that has been made carries with it the certainty that some people will not like and a few will even quit the co-op as a result. Yet the co-op has gone forward, gotten better and better, and serves more and more people as a result. With respect to carrying meat, I personally feel proud that are able to offer a cleaner product, and in the case of lamb and pork, a local product to members who would otherwise be buying their meat other stores.
--Alex Gyori, general manager
When product has spent too much time in the display without being sold, it should be "merchandised down" with the grinder -- the bone barrel being only a last resort. If nothing else can be done with a product, it should be sold as a special at an appreciable discount. The best practice is to make the first loss the biggest one while still getting a return.
Quality in product and service should be the rule of the meat department. All returns should be handled on a "no questions asked" basis. The surest way to lose a customer is to interrogate them as to how they handled the product after they left the store.
Recordkeeping and inventory
Administrative problems and questions can virtually be eliminated if the proper recordkeeping setup is established from the start.
When product is received, a log entry should be made and a copy of the signed receipt kept with the log. These records should be accumulated on a weekly basis. The receiving log should have the vendor name, invoice or purchase order number, date of receipt, and invoice amount.
Records of daily sales and a weekly tally should be kept for establishing proper work schedules, budgets, and seasonal increases or decreases in sales. It will also aid in working out weekly gross profits and future purchase patterns.
A library of cutting tests should be built and maintained for reference when determining pricing structures, sales and gross profit mix, and merchandising strategies. This library will become the "Bible" of the meat department. These should be updated when a new item is introduced into the display lineup, when a product line is being replaced by a new vendor's product, when a new meat cutter is hired, or once a year.
The decision to open a meat department is not one to be taken lightly. By taking the proper precautions and doing the proper planning, you can ensure that the meat department can be an exciting and profitable addition to the store and to the community.
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