Goat meat marketing : strategies for reaching consumers

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Title:
Goat meat marketing : strategies for reaching consumers
Physical Description:
Book
Creator:
Degner, Robert L.
Publisher:
Florida Agricultural Market Research Center
Place of Publication:
Gainesville, Fla.
Publication Date:
Copyright Date:
1991

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University of Florida Institutional Repository
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University of Florida
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All rights reserved, Board of Trustees of the University of Florida
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AA00000305:00001


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Goat Meat Marketing: Strategies for Reaching Consumers

Dr. Robert L. Degner
Professor and Director
Florida Agricultural Market Research Center
University of Florida
Gainesville, Florida 32611



INTRODUCTION


Since the mid 1980's, there has been an t-.! .. of interest

in goat production all across the U.S. Most meetings and

conferences still stress production ...~. . .~:... ., with topics such as

breed .: -. ':-.., nutrition, disease and predator control drawing

big crowds. While pesky production problems continue to cut into

profits, steady progress is being made in improving husbandry

practices because there are .:animal scientists at work on these

problems. To date, however, very little attention has been paid to

.: :.. This conference, however, is an exception; it is a

pleasure to be asked to participate in a meeting where marketing is

receive.: > so much attention.

It is difficult to get excited about markete .-..; as long as

you can -.; ..; -as many goats or anyt',;, else you want at a :;.:

that results in a satisfactory return on your effort and

investment. However, producer attendance at conferences such as

this is an indication that the supply of goats and goat products

may increase dramatically over the next few years. If no thought

is given to increasing the market for goat products, the additional

supplies could have a devastating effect on producer prices.












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OBJECTIVE


My objective is to share with you i,. to increase :i, ..i r.-

S:. -.:. -' : particularly meat. The focus is on meat because it

represents a .:-. opportunity for increasing producer

^3 .-tability whether you are specializing in meat production or

culls from dairy or cashmere herds. While meat :.; .:..:.

a '.:.' : -' i: :-.. ..ty, it also poses i cO -' market '

i ..:.- ..... .-.i-, we will examine some of these challenges and

explore ways to overcome them.



THE ':: MARKETING ENVIRONMENT


In many countries of the world, particularly those with arid

climates, . ~ meat is a major source of animal protein in human

diets. In these countries, goats are more adaptable to the arid

climate than cattle or hogs, and thus their production is more

economically efficient. However, in the U.S., our temperate

climate has resulted in abundant, economical production of cattle,

hogs, and poultry, and these items are mai:: !:..: in American diets.

For example, in .:--, the average American consumer devoured

over 103 pounds of beef and 65.5 pounds of pork. Additionally, the

average consumer ate nearly 63 pounds of chicken, 15 -..... ..- of

turkey and 15 pounds of fish. The average person ate only 1.5

pounds of lamb and mutton .... 1989). In Florida, we estimated

that consumption of goat meat in areas with high proportions of

goat-eating ethnic -...- ..: amounted to approximately 1/4 ;....;.



















per person per year in 1987 -. :,, and Locascio, 1988). These per
-'-. : -I consumption -.i-.. show Americans .-. : .. ,: --. for

beef, pork, : a'.. :: and fish far -. those for i-.i, mutton, and

goat.

Goat producers can view beef, 7 -.* chicken, turkey and

-. .. -..-'- as major .. ; If you are ..'; -. of

,. -;..... in head-to-head competition with these traditional meats,

need to be aware that .,- -..-; dietary habits are hard to

break. To make matters worse, American consumers are :v-;-.i

=-.. ..away from red meats to ..--:' and seafood. For -. -, -.,:..

beef consumption in the U.S. 9... by 15 percent between 1975-77

and 1985-87, while ;.: ir.' increased by 45 percent ..: the same

period (USDA, 1989).

Still another competitive .; ...1.- arises from the fact that

goat moat is expensive at the wholesale and retail levels relative

to beef, i .--: and '. ;.. .: -, chicken. In 1987, beef chuck roast

S for $1.68 per pound, round roast for $2.53, ham for $1.54, and

whole chicken for $0.78 per pound, :r-. ..P with an estimated .45

per pound for Flor -;. ;- : whole-carcass goat .'.. ).

The h'... relative retail t-; for ; goat carcasses reflects

high r.. and costs. In most intensive goat

production I -:-.=;, the cost of ;.~'' .. iis relative-. high

because of -,.-? t ;.-.: -.: -y .-;.. J and veteri:; : -..-.-. .-: Further,

slaughter and fabrication costs ,.-;, you can find a slaughterhouse

that will process goats) on a per '. ,,.. basis are -:- .; :-

higher for goats than for beef or ,.-. because of -. '---.,:.- of
















scale. This ~ 1... means that :-:.-. -:. costs per unit of output

decrease with v,:'. -.. and most beef and pork processing plants are

very ": c .-;. at large capacities at very low cost per

of ..-...t Goats, on the other hand, are processed by small,

.vely inefficient slaughter plants. In '--I: small custom

-.::- .i houses t- .- y charge $10 to $15 per head for

For a 75 :-....-. animal, this adds -. _.,-. ,.-'y 30 to 40

cents per . to a whole carcass.

How, ..-. are goat producers .-.'.-: to compete? At this

.- the ..-: ., e- looks pretty bleak. Some of the strategies that

we are going to discuss can bb ,:~ -.- : by : ....: .- producers,

S others may ::- group action, -..: through state ..

regional, or national producer associations.









Presently, there are hundreds, if not thousands of goat

producers nationwide that are able to sell the ~., ': they ::,. -...

at acceptable prices. Where do they sell them? Al'-,_';, there are

a few .-' commercial goat :.: -,- such as

Junction City, ::> ;1: ., and Ada, goat producers in most areas

are too far : , from them to use them :-: :.y;

transportation costs are .,-.~-.., .... In Florida, goat production

is -_.: .- but relatively limited, so there are no large,

-,m markets. We found that most Florida-produced goats are












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sold directly to final consumers or dealers at the farm or through

livestock auctions. In the short run, while :l:.: for goat meat

is relatively limited and industry a ,;,.. .i are also ,-., j these

traditional marketing methods will work reasonably well. As

: ; increase, direct sales activities and auction :: : will

have to be improved.




Direct sales sound simple. Cut out the middleman, sell

directly to the final consumer and count your profits.

Unfortunately, there is a cost involved: inconvenience. If

have to disrupt your .t- l:; or leisure activities to round up your

goats to sell one or two at a time, it may be more trouble than

it's worth. You have to like people to up with the bother. On

the positive side, you : be able to **t $5 to $10 more per head

than selling :-. an auction, Another difficulty may be your

schedule. Off-farm jobs can make it difficult to engage in direct

sales. If your herd is in a remote location, direct sales may not

work at all; if you are near a large urbanized area with high

concentrations of ethnic populations, your chances of success are

greater. The major impediment to direct sales is the limited

number of people that will seek you out to buy a live animal for

slaughter. When you consider the entire population of your

::. I:.;. area, there is an extremely small : :::: i that will

go to the trouble of l 1 .ai-r, buying, and slaughter':-. a live

goat. Even those that are willing to go to this trouble will only













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do it on special occasions. Tn Flor '-. and probably most other

states as ',*:,., most direct sales are made to individuals from

ethnic groups such as cubans, Mexicans, Jamaicans and American

blacks, Rural whites are also good customers in some areas.

Greatest demand comes at major holidays.

-the inherent shortcomings of direct -;, they can be

S:. Assuming that you have a reasonably accessible

location near a sizeable urban area and you don't mind some

inconvenience, how can you increase your direct sales? :.: your

- and : program to have saleable animals available for

the major holidays such as Easter, the 4th of July, Thanksgiving

and Christmas. Run classified ads in daily .--: :;-: and weekly

":. i -:"' a week or two before all holidays. If your area has a

'. .: : - :.. : try Spanish ads. If your

production is large enough and you have large ethnic populations in

your :i:: . you might be able to make :- ive use of : i :

S on Spanish radio stations or spots in conjunction with

-- .; or black ,- ::--.- - on local radio stations.

Roadside signs can also be effective, but you will have to

comply with local .. a.. --.-.: nd make sure you keep :... well

maintained. on vehicles :: trailers can convey

..' ::. .:- relations activities can '; keep you in the

-:.. eye. c,,1 churches, civic clubs and youth :.-: .:...-.

have annual fund raisers, and barbecues are very .:. .:---. Contact

club leaders with "-- :.- e. volume 1 ...-. and a few large fund

raisers could help solve your '. problems.














7

As you develop ...:. I:r.:t sales clientele, .*.i in mind that

a satisfied customer may become a repeat customer.

;. ::-'. to get a :. address for every customer. Al''..'.

ethnic customers may move more frequently than other residents, a

S-- -. r--- of the availability of goats sent to past

customers may prove to be a very effective way to stimulate sales.

S- way to i.. e- 1.: i ;. is to provide i

service. For example, you might arrange to transport the animals

the customer has selected to a custom processor. A tie-in with a

custom slaughterhouse can expand your sales in some areas by making

the whole :-.. .s more convenient.


Through T.


Li -. .auctions are a major sales outlet for many

-. However, because of variable goat ..;~. .and limited

numbers of buyers, .;-.-- are fr, ... --o low. In ? L..:, we have

had some degree of success by arranging ;i.. ..1 goat sales. Goat

' -;-:i.: ";' organizations, county extension agents, and livestock

auctions have cooperated in .. such .. --- to goat

and r .*.;. buyers to stimulate a competitive market-

environment. --..-?,- ::, y :.: -::. goat sales can :. : as a

S..to get buyers and sellers together. Such sales don't just

S. however. They require coordinated effort ..-- support by

producers, auction managers, and buyers. However, the initiative

to organize :'.. sales rests with .'-:-.. One final point about

auctions: in Florida and most other states, most goats sold














-... auctions ultimately go to the same consumer market served

by direct sales, that is ethnic consumers,





The short-term : -.- strategies discussed above certainly

are not new or innovative; for the most t they -* .

"business as usual." Tar;E' ::,; ethnic groups and rural residents

that are ",- .. goat meat consumers and making auction markets

more efficient is a conservative strategy that may : producers

with small herds. But it is doubtful that the can rely

solely on ethnic consumers to absorb meat .- : generated by

large-scale ..: .- i..r:. Although ethnic consumers are familiar

with goat meat and are currently our best customers, they

undoubtedly will quickly reach the point where their demand for

goat meat is satisfied. Also, most ethnic consumers are at or near

the very bottom of the economic ladder, further restr'.:.- : demand

for relatively .;:.:,!;: .. -.7 products, including goat meat. How,

then can we reach "mainstream" consumers?

First of all, we ::.- 1 to gain i ..-: access to

channels that will make goat meat available to more consumers.

S, here are few .--.: where goat is sold at wholesale or

retail. ... commercial marketing channels will be

difficult to cultivate, however, and I will discuss this problem in

greater detail in a later .-:.

In Florida, one study indicated that only -_.,-:. *:, of

consumers had ever tried goat meat (Degner, 1990). This lack of












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familiarity makes it a very difficult product to sell through

:;: -:: .: r: because most consumers would not know how to prepare

it properly. Since improperly cooked goat meat is likely to be

tough, proper preparation is essential. t-. .Z -.

such as recipes, nutritional information and incentives to try new

S '.:- which are aimed at supermarket shoppers are far too

expensive to implement, given the small, fragmented nature of the

goat industry and the lack of promotional funds.

One promising strategy that can be implemented by one goat

producer or an entire producer association at relatively low cost

is to target the foodservice sector. A Florida : .. found that

nearly one-third of all : i;.. full-service restaurants

surveyed expressed moderate to strong interest in offering goat

meat on their menus. This w''-t .:. interest offers .::i.-: :the

opportunity to cultivate market outlets where goat meat can be

properly ..... ,:1 by restaurant chefs and offered to consumers as

a novelty menu item. In a :4.:t study this ; *i year, one

Gainesville restaurant sold .-:.- ..ly 200 to 250 pounds

(carcass weight) of goat : week.

Once consumers are introduced to e y prepared goat meat

in restaurants, -; ,may wish to buy it through retail food stores.

However, considerable time will probably elapse before there is

sufficient consumer demand to entice most retail stores to carry

-, meat. Thus, foodservice firms are likely to be the most

:-. sales outlets in the foreseeable future.












10

However, before generating a lot of interest among restaurant

managers, the goat industry should have the capacity to provide

..i.,i supplies of high quality meat at reasonably stable :.

r: ::-,.' wild price swings wreak havoc with menu prices, and poor

;. .ty meat or :7:*,; :.: product shortages are sure to ruin chances

of success.

Another important consideration is the product C- required

by restaurants. :r1 will want whole carcasses. In our pilot

study, leg and loin roasts were well received, and goat sausage

has also been popular. Obviously, fabrication of ready to cook

items is costly, but restaurants are accustomed to paying for

convenient products and they will avoid those that require a lot of

preparation time.





In summary, marketing strategies to reach more consumers and

expand to the demand for goat meat can take two basic directions.

The first is to examine traditional .- :' marketing activities

that are directed at current consumers and try to improve upon

them. The current consumer base, which is largely comprised of

ethnic :-.. can be targeted and served better. This is an

-..': ve ::.. in the short run. However, if goat production

should increase rapidly, producer prices are likely to decline

unless the consumer base is expanded beyond the traditional ethnic

populations. Thus, a long-run -::! 1:. strategy to introduce

properly cooked, quality : meat products to mainstream consumers












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unfamiliar with .. is needed. One way to do this is to work with

I;,;;i i; restaurants to create "- new menu items utilizing

locally produced goats. In the long run, this approach may also

enhance consumer demand to the point where goat can also be sold

effectively through retail food stores.


Literature Cited


Degner, Robert L. and J. David Locascio. "Distribution of Goat Meat
in Selected Metropolitan Florida Markets". Industry Report
88-3. The Florida Agricultural Market .:;.-- -.:.. Center, Food
and Resource Economics Department, Institute of Food and
Agricultural Science, University of Florida, May, 1988.

Degner, Robert L. :. ir.v the Meat: Goat is a Four-Letter Word".
Cash in on Cashmere, -. -* -i:::, Third Annual conference of
the Cashmere Producers of America. Tulsa, Oklahoma, November
1-4, 1990.

:;::: Judith Jones. Food consumption, Prices, and Expenditures
1966-87. Statistical Bulletin No. 773. United States
Department of Agriculture, Economic Research Service,
Washington, D.C., January, 1989.




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