The Canadian Cattlemen's Association

January 15, 2010 - U.S. retailers discover it’s COOL to sell Canadian beef

Now that country-of-origin labelling (COOL) is a reality, U.S. retailers are leveraging the label requirements to build unique and differentiated store brands using Canadian beef.
 
For the past five years, the Beef Information Centre’s (BIC) has worked with U.S. clients to build branded programs designed to meet the unique demands of individual retailers and their customers. Retailers recognize that development of private label and branded beef programs are key to profitability and that Canadian beef can deliver on the consistency and quality attributes required for a successful branded program.

“Under BIC’s Partners Program, we work with clients to build customized beef programs designed to deliver consistent quality and enhanced profitability,” says John Gillespie, BIC chairman and a feedlot operator at Ayr, Ont. “The target is regional retailers who, in order to stay competitive, are looking to develop a brand – a brand that can deliver specific desirable attributes for their market, every time, and at the volumes required.”

Canada is the largest supplier of grain fed beef to the United States with more than 300,000 tonnes exported each year. That preference demonstrates that Canadian beef has always met the demands of the U.S. market and enjoys a favourable reputation with American consumers. In a study of U.S. consumers done last fall, product identified as Canadian beef drew a strong response – when the U.S. consumer was asked if Canadian beef is a premium product, over 76 per cent agreed. The study also found that Canadian beef has a positive position in consumers’ minds – 59 per cent agreed with the statement that Canadian beef came from a wholesome, natural environment.

An example of one partnership involved Stauffers of Kissel Hill (SKH), an innovative retailer with eight stores in the Lancaster, Pennsylvania region. SKH wished to develop a brand that would be widely recognized and accepted in its market area, with attributes that could not be easily matched by the competition. The resulting program paired SKH with a Canadian packer to source a certified corn-fed, AAA grade Canadian beef program. The program is labeled “Stauffer’s Choice Beef” and the on-pack labels identify the beef as Product of Canada.

“The program has been extremely successful, with SKH reporting a strong double digit increase in meat department sales over the past two years,” says Gillespie. According to John Gerlach, SKH meat manager, Canadian beef has answered their needs for the beef case. SKH shoppers have accepted the brand and its Canadian sourcing because the eating experience has consistently met or exceeded their expectations. This reinforces Gerlach’s belief that delivering great taste and eating experience every time goes long way to developing shopper loyalty.

Another success story is the partnership between the Panam Supermarkets, a Maryland-based retailer selling primarily to the Hispanic market, and the Canadian packer, Cargill Better Beef. Panam is selling product under their own brand, associated with Better Beef’s brand, and is promoting Canadian beef and its quality attributes as its point of differentiation from the local competition.

The Hispanic consumer prefers bright red meat colour and white fat, two attributes that Canadian beef delivers consistently. Under the Canadian grading system, only carcasses with white fat and bright red meat are selected for the top grades – Canada Prime, AAA, AA or A. These colour requirements are unique to the Canadian grading system, part of a list of unique attributes of the Canadian Beef Advantage (CBA).

Indeed, the CBA helps retailers increase customer satisfaction and maximize profitability. Canada takes a world class systems based approach to beef production from genetics, on-farm food safety programs, mandatory cattle ID system and grain finishing in a pristine, uniquely Canadian environment, to modern USDA-approved processing facilities with mandatory HACCP programs and quality grading systems.

BIC’s efforts to maximize demand for Canadian beef and optimize the value of Canadian beef products is funded in part by cattle producers through the National Beef Check-Off, and through beef industry market development funds provided by the Government of Alberta and the Government of Canada.

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