Article from Chron Magazine.
This year has been rife with unprecedented challenges for small businesses — especially those in the food-and-beverage industry. Supply chain shortcomings have been thrown into stark relief, but perhaps nowhere more than among meat manufacturers. The plants of the “Big Four” meatpackers — Tyson, Cargill, JBS USA and National Beef — proved highly susceptible to outbreaks, and when they began operating at reduced capacity, meat prices soared.
The Justice Department has since launched an antitrust investigation into all four companies and indicted chicken-industry executives on charges of price fixing. Meanwhile, according to Buyer’s Edge Platform, between April and May, standard beef-cut prices were up 87 percent, pork was up 70 percent, and chicken-breast prices were up 23 percent.
This has been costly for consumers and companies alike, but as ever, entrepreneurs are rising to the challenge to pivot and mitigate costs. We’ve heard from numerous businesses who are making the best of a bad situation, or even making a bad situation work to their advantage. Here are nine key ways that entrepreneurs are innovating to respond to meat prices.
1. For smaller meat suppliers, pivoting direct-to-consumer
During lockdown, restaurant closures had already pushed smaller, higher-quality meat purveyors toward an online, direct-to-consumer model — and when the larger processing plants had to cut back on production, smaller purveyors were set up to capitalize on the meat shortage. Geoff Latham is the founder of Nicky USA, a family owned meat purveyor and butcher in the Pacific Northwest. He says he’s made “drastic changes to his business in order to stay afloat, including a major pivot from mostly supplying local restaurants to opening a new direct-to-consumer channel.”
Ariane Daguin, the CEO of D’Artagnan, a sustainable meat supplier used by chefs like Tom Colicchio and Bobby Flay, says that, “while the larger processors have been forced to shut down, that is much less the case with sustainable meats. We have seen significant spikes in demand — 500 percent from ecommerce and 83 percent for retail. Before the pandemic, restaurant sales made up 75 percent of our business, but we’ve pivoted to keep up with consumer demand, expanding our local delivery program and adjusting meat cuts. Because of our smaller, sustainable supply chain, we haven’t experienced any shortages.”
2. Asking customers for a little flexibility
For meal services that allow customers to customize their meal deliveries, a little advance notice has been needed to do the legwork of tracking down fresh recipe ingredients. Katie Dague, founder of custom meal-planning service Individual Nutrition, says, “We have recently asked our customers to have their weekly meal orders in by noon on Thursdays, a day sooner than normal. This helps us to ensure that we are still getting the most fresh and high-quality ingredients for our meals. We never want to compromise our product, so we are using the extra time in case we need to go searching for what is needed elsewhere.”
3. Negotiating prices with vendors, distributors and retailers
For Brooklyn Hot Dog Company, the huge increase in beef prices has been a hurdle at a time when hot dogs are in high demand. The company has had to absorb much of the cost, but they’ve been able to carve out some wiggle room on both sides of the supply chain. Owner Tony Fragogiannis says, “We worked with our processor and got the price down so it wasn’t as crazy as it was in the first few weeks, but it’s still definitely more. So we’re also working with some of our distributors and retailers. We’re trying to talk with everyone about taking a little bit less of a chunk so that the increases become more reasonable.”
Chicago-based Home Run Inn Pizza has also seen huge demand for their frozen pizzas throughout quarantine, and their food-and-beverage director Jeff Hursh says that he leaned on his vendor relationships to navigate plant closures. “I watch pricing and have a great relationship with our vendors,” he explains. “When the pepperoni plant was shut down, I secured an extra 15 weeks of inventory. As pork plants were closing, I ordered three truck loads of sausage. We’re keeping our costs stable and hoping that things are better months from now.”
4. Plant-based substitutes
Plant-based alternatives were on the rise well before the health crisis, but the shortage in meat has definitely accelerated consumers and companies’ interest. Shakil Jamal, co-founder of subscription box Craft Jerky Co. says, “We’ve been toying with the idea of exploring alternate protein sources. While we certainly wouldn’t want to upset any of our customers by completely going rogue and just switching out meat, we’re thinking about also offering an opt-in for plant-based jerky options in addition to meat-based jerky. We’re meat lovers here at Craft Jerky Co., but I also believe that part of the joy of having a subscription is the discovery and experimental aspect.”
5. Dish out the fresh veggies
As much as people love burgers in the summer, many also go for lighter, more veggie-centric fare in the hot months. Ghost Ranch is a southwestern restaurant in Tempe, Arizona, that’s revised its menu to encourage guests to try non-meat options, while still accommodating guests who are set on meaty dishes. “The menu will be a weekly rotation and focus on fresh vegetables, vegetarian, vegan and fish options,” per a restaurant spokersperson. “Proteins can be added for an extra cost. They still plan to keep their favorites on the main menu, but we hope this added alternative will encourage diners to come in and still taste great food at a price point everyone can agree on.”
6. See the seafood section
Another silver lining for restaurants is that while the health crisis has had an inflationary effect on meat prices, the opposite happened with seafood, and lobster in particular. Lobster is a traditional dish in Chinese New Year celebrations, but coronavirus wiped out most of China’s celebrations as the country went on lockdown, bringing global lobster prices way down. At Concord Hill, a restaurant in Williamsburg, Brooklyn, they’ve introduced a summer friendly lobster roll and brought back oysters for pickup.
7. Quality over quantity
A little can go a long way! At Rue Saint-Marc in Jacksonville, Florida, Executive Chef Scott Alters decided that rather than use bigger mediocre cuts, he would simply serve smaller pieces of high quality meat. “With the fluctuation in meat prices, they did not want to serve an inferior product,” says a restaurant spokesperson, “so they decreased the portion size of meat on the plate and added more vegetable components. In addition to adjusting the portion size, they also had to adjust the price of some of their dishes.”
8. Use the whole hog (or cow)
Matt Carter is the chef/partner at three restaurants in Scottsdale and Phoenix, Arizona, each of which is getting creative with less expensive meat cuts. “Right now, prime cuts are the hardest to source, both because of availability and price,” Carter says. “Fortunately, lesser-known cuts such as legs, shoulders, shanks, briskets, hangers, skirt, flat irons and the like are still available from great producers. Even with these cuts, the pricing is higher than average, but still very cost effective and tasty for both the chef and consumer.”
He recommends off-cuts for pasta dishes and skirt steak and pork shoulder for Latin cooking, as examples. “At our French restaurant, Zinc Bistro,” he continues, “we love to use so-called peasant cuts to make elevated versions of classic recipes, such as duck legs for cassoulet and Flat iron steak for Paleron de Boeuf.”
9. Bye, bye, brisket
Fine, fine, these barbecue joints aren’t actually bidding adieu to brisket — but they’re featuring less of this more expensive cut. Brent and Juan Reaves of Smokey John’s Bar-B-Que & Home Cooking in Dallas, TX, have “shifted to promoting items like pulled pork for specials to steer customers in a different direction from the brisket.” And at LeRoy and Lewis, a New School Barbecue truck in Austin, TX, they’ve only been serving brisket on Saturdays. They also specialize in dishes that use all parts of the pig — from cheeks and chuck roast to the skin and bones.