2004 Cattle Industry Annual Convention & Trade Show

11:00 am - 12:30 pm • Yuma 21 Room
MA 105: Consumers — Their Beef Expectations
Nancy Kruse, The Kruse Company; Alan Warren, Ukrop's SuperMarkets, Inc.; Joe Gordan, Sparks Companies, Inc.; and Tracey Erickson, CAB, Moderator

Consumers and beef expectations

Four experts from different sectors of the beef industry explained recent trends in consumer eating habits at the annual Cattlemen’s College® Wednesday, Jan. 28, prior to the 2004 Cattle Industry Annual Convention in Phoenix, Ariz.

Factors such as the finding of bovine spongiform encephalopathy (BSE) in Washington state Dec. 23, 2003; changing consumer demographics; and changes in information flow among different sectors of the industry have changed the way consumers think about beef.

Joe Gordon, vice president of customer development at Sparks Co. Inc., said safety is the biggest issue today for consumers, followed by health, taste and cost. “That is all criteria we will have to meet. … Lifestyles are changing. You (producers) are going to change. We’re going to change, and the industry’s going to change to meet consumers demands.”

National Cattlemen’s Beef Association (NCBA) staffer Jane Gibson spoke for Nancy Kruse, of the Kruse Co., who was unable to attend the event. Gibson said despite recent beef industry concerns associated with BSE, consumer confidence has remained relatively strong.

“We’ve been fortunate in the beef industry to maintain consumer confidence, “ she said. “It continues to remain stable. Actually, each time consumer confidence is measured, it’s come up one point.”

Alan Warren, of Ukrop’s SuperMarkets Inc., agreed. “90% of customers have a great deal of confidence in the safety of beef,” he said. But, he reminded the group gathered at the Phoenix Civic Plaza that consumer education is important to further increase confidence in food safety. “Our customers have questions, and we better be ready for them.”

Mike Hertel, of Stock Yards Meat Packing Co., Tucson, Ariz., helps supply meat to a variety of customers, including restaurants and national food chains, hotels, delis and institutions. He said beef demand remains high, comprising 69% of sales.

“The United States has the highest quality beef supply in the world,” Hertel said. “It’s higher quality and more consistent.”

Besides food safety issues, Gibson said consumers’ changing demographics are affecting beef demand. Beef demand is increasing as Baby Boomers (many of whom are on the beef-friendly Atkins diet) get older, ethnic populations increase, more women enter the workplace and consumers become more educated in culinary arts.

As more and more families begin to bring in two incomes, prepared meats, heat-and-eat products, and quick-and-easy items have become high-demand items, Gordon said. “Meal preparation time is shrinking. … That will have a big impact on where we’re going and what we’re doing.”

Gordon said 70-100 new beef items have debuted in the marketplace in response to consumers’ changing demands.

“As we move through the system, there will be less beef roast and more steak items, different cooking items, “ he predicts. “Products with long preparation times will be low on the consumer radar screen.” Gordon said he also predicts growth in the foodservice and deli preparation areas. And changes in the industry itself could also affect the way consumers buy beef.

He said pricing structures are changing, and labor is tight, inexperienced and hard to find. However, information flow among different sectors of the food industry has improved.

“We’re seeing a partnership relationship with the retailer and packer that I never thought would happen in my lifetime, “ he said. “Informational flow between different sectors of the food market has improved.

“We need to understand what the expectations are as we move through the marketing change. Retailers are becoming specification-driven, they’re building their own specification of requirements.”

— by Crystal Albers

Click here to view Gordan's PowerPoint presentation