Tennessee Master Goat Producer Marketing
description
Transcript of Tennessee Master Goat Producer Marketing
Tennessee Master Goat Producer Marketing
Megan Bruch, Amanda Ziehl & Rob HollandUT Center for Profitable Agriculture
Aaron RobinsonTSU Cooperative Extension
Objectives
Participants will increase their knowledge of the definition and importance of
marketing the market situation for goats and goat
meat consumer preferences for goat meat considerations for marketing strategies direct marketing considerations
Marketing is… Planning and executing the idea of a
product, its price and the promotion and distribution (place) of that product to satisfy the needs of customers
Marketing allows you to determine…
1. If a potentially profitable market exists Ability to produce at a cost low enough
and sell at a price high enough to generate a profit
2. The identity of the target market Who is likely to purchase the product
3. How to reach the target market Product, Price, Place, Promotion
Introduction to Marketing
Introduction to MarketingExample 1
Without Market Planning & Execution Farmer Clark has a herd of 50 does with
kids of several different breeds The farm loan payment is due at the end of
the month Farmer Clark takes the kids to the local
auction barn to sell them ASAP for whatever price he can get
Farmer Clark is a Seller and a Price-Taker
Introduction to MarketingExample 2
With Market Planning & Execution Farmer Jones has developed relationships with
leaders in the local Hispanic population Knows that the Hispanic people in her community desire
young goats about 50 lbs. live weight for Cinco De Mayo Farmer Jones produces her kids to the desired
specifications to be ready for pick-up by customers at the farm the first week of May at the price she sets
Farmer Jones is a Marketer and a Price-Maker
Market SituationHistory of Goat Marketing in TN
Early 1990s – Goats sold at local sale barns and off the farm to customers, Producers encouraged to pool goats for larger sale base
Mid 1990s – Tennessee Livestock Producers offer goat auctions in conjunction with sheep auctions
2001 – USDA-AMS adopted live goat grading standards and institutional meat purchase specifications for goat meat
2002 – TLP offers graded goat sales 2005 – TLP offers 2 graded goat sales
(Thompson Station and Somerville)
Market SituationSupply and Demand
All markets are a function of supply and demand
Important to understand market situation to determine market potential and plan marketing strategy
Market Situation U.S. Meat Goat Inventory
U.S. inventory estimated at 1.9 million head (NASS, 2005) Texas – 1 million head Tennessee – 98,000 head Some experts believe NASS numbers
underestimate true inventory dramatically (35-45%)
Market Situation Federally-Inspected Goat Slaughter
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
19941995199619971998199920002001200220032004
Nu
mb
er o
f H
ead
Market Situation FI Goat Slaughter by State in FY2004
NJ35%
TX18%
PA9%
NY5%
TN5%
Other28%
Market SituationOther Goat Slaughter
Some experts estimate federally-inspected slaughter is only 50 to 60% of total
Other includes State-inspection programs Direct sales to consumers
Market SituationImports/Exports of Frozen Goat Meat
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
1989
1991
1993
1995
1997
1999
2001
2003
Met
ric
Ton
s
Imports Exports
Market SituationU.S. Demand for Goat Meat
Approximately 1.3 million goats slaughtered to satisfy U.S. Demand in 2004 (by combining Federally-inspected slaughter
and imports)
Of these, over half were imported
Potential to increase domestic production if consumer preferences can be met and cost of production can compete with import prices
Market SituationTennessee Graded Goat Auction Data
0
250
500
750
1,000
1,250
1,500
1,750
2,000
2,250
Jan-0
3
Feb-0
3
Mar
-03
Apr-03
May
-03
Jun-0
3
Jul-0
3
Aug-03
Sep-0
3
Oct-03
Nov-0
3
Dec-0
3
Jan-0
4
Feb-0
4
Mar
-04
Apr-04
May
-04
Jun-0
4
Jul-0
4
Aug-04
Sep-0
4
Oct-04
Nov-0
4
Dec-0
4
Jan-0
5
Feb-0
5
Mar
-05
Apr-05
May
-05
Jun-0
5
Jul-0
5
Head Sold
0
20
40
60
80
100
120
140
160
Price($/cwt)
Slaughter Head SoldPrice, Kids, Selection 1, 40-60 lb.Price, Kids, Selection 2, 40-60 lb.Price, Kids, Selection 3, 40-60 lb.
Market SituationConsumer Market
Producers need to become familiar with who consumes goat meat, where those consumers are located and why they consume goat meat
Understanding the “who, where and why” will help producers in determining the ideal “what” for the consumers
The predominantly white, middle-class population consumes relatively little goat meat
Market SituationConsumer Market
The majority of people who consume goat meat in the U.S. are from a variety of ethnic groups Hispanic/Latino Muslim Somalis Jamaican/Caribbean Asian Jewish Christian Roman/Western Christian Greek/Eastern
Consumption tied to religious or cultural traditions
Market SituationConsumer Market
Tie to religions and cultures leads to Distinct preferences for product
characteristics Seasonal demand
Target Audience Hispanics or Latinos
Animal Type Preferences
Young milk-fed kids, cabrito, 15-25 lbs. live weightYoung goats, 25 lb. carcass weight or 50 lb. live weightYoung bucks, 65 lb. live weight
Processing Preferences
SkinlessFeet offHead on
Seasonal Demand Cinco de MayoEaster
Market SituationConsumer Preferences
Target Audience Muslims
Animal Type Preferences
35 lb. carcass weight, 70 lb. live weightLean carcass (discriminate against fat)
Processing Preferences
Halal slaughterSlaughter and processing cannot be done in facility used to harvest swineHead onSkinless
Seasonal Demand
Start of Ramadan, Month of FastEid-al-Fitr, Festival of Fast BreakingEid-al-Adha, Festival of SacrificeCelebrate birth of child
Market SituationConsumer Preferences
Target Audience
Somalis
Animal Type Preferences
35-40 lb. carcass (Perceive larger carcasses are from older goats and therefore lack quality)Prefer grass-fed goatsPrefer fresh meat over frozen
Processing Preferences
Halal (but will sometimes accept Kosher)Slaughter and processing cannot be done in facility used to harvest swine
Seasonal Demand
Start of Ramadan, Month of FastEid-al-Fitr, Festival of Fast BreakingEid-al-Adha, Festival of SacrificeCelebrate birth of child
Market SituationConsumer Preferences
Target Audience
Caribbean Islanders(Haitians and Jamaicans)
Animal Type Preferences
Mature bucks, 140 lb. live weightOlder, poor-conditioned goatsYoung smelly bucks, 60-80 lbs. live weight
Processing Preferences
HeadlessSkin-onFeet onHeavily singed“Cubed” bone-in meat
Seasonal Demand
Summer MonthsJamaica’s Independence Day (August 6th)
Market SituationConsumer Preferences
Target Audience Chinese
Animal Type Preferences
60-80 lb. live weight
Processing Preferences
Seasonal Demand Winter – Chinese New Year
Market SituationConsumer Preferences
Target Audience
Jewish
Animal Type Preferences
Young goats
Processing Preferences
Kosher
Seasonal Demand
PassoverYom Kippur
Market SituationConsumer Preferences
Target Audience Christian Roman/Western
Animal Type Preferences
Young goats, 22 lb. carcass weight or 45 lb. live weightMilk-fed kids, 18 lbs. or more live weight
Processing Preferences
Seasonal Demand
EasterChristmas
Market SituationConsumer Preferences
Target Audience
Christian Greek/Eastern Orthodox
Animal Type Preferences
Young goats, 22 lb. carcass weight or 30-45 lb. live weight
Processing Preferences
Seasonal Demand
EasterChristmas
Market SituationConsumer Preferences
Market SituationDemand in Tennessee Hispanics are the largest and fastest
growing ethnic minority group
Additional resource – The Growing Hispanic Population in Tennessee http://extension.tennessee.edu/publications/pbfiles/PB1762.pdf
Market SituationDemand in Tennessee
Other ethnic group populations, such as Muslims, located in larger metropolitan areas Nashville, Memphis,
Knoxville, Chattanooga
Marketing Mix/Strategy
The four Ps of marketing Product, Place, Price and Promotion
Base your strategy on Your goals and objectives The needs and values of your target
customers
Marketing Mix/StrategyProduct
Live Animal Breed Type of feed Age of animal at
harvest Weight of animal
at harvest Condition of
animal at harvest Gender of animal Timing of harvest
to meet demand
Meat Harvest procedure
(Kosher, Halal) Fabrication
specifications Fresh vs. frozen
What product will you produce? Who is your target customer?What product characteristics do your customers want?What are your goals?
Marketing Mix/Strategy Place -- Marketing Channels
Meat Goat Producers
Brokers/Traders Local Auctions Individual Consumers
Marketing
Cooperatives
Retailers
Processors
Wholesalers
Regional Auctions
Consumers
Meat/Grocery Storesor Restaurants
Individual
Producers can also serve as processors, wholesalers and retailers.
Marketing Mix/StrategyPlace
What market channel will you use? Which method would help you best meet your goals and objectives?Who is your target customer?Where can you reach the target customer?
Marketing Mix/StrategyPrice
Prices for Selection 1 kids at TN auction range from $99.10/cwt in October 2003 to $152/cwt in April 2005
Ohio study (2003) found Somali customers paid $0.80-0.85/lb. live weight or $60/hd Willing to pay $1.99/lb frozen or $2.99/lb
fresh goat meat
Marketing Mix/StrategyPrice
What price will you seek or charge? What product are you providing (quality, value-added)?How widely available is your product?What market channel are you using?What is your target customer willing to pay?What does the product cost to produce?
Marketing Mix/StrategyPromotion
Advertising Word-of-mouth referrals/reputation Public relations/publicity Web site
Marketing Mix/StrategyPromotion
How will you promote the product? What product are you producing?Who is your target customer?How can you best reach your target customer?What is your marketing budget?
Direct Marketing Considerations
Considerations for Direct marketing of goat meat On-farm harvesting
Direct Marketing Considerations… for Goat Meat
Must be harvested, processed and packaged in a USDA-inspected facility
Must be labeled with product name, ingredients, source name and address, net weight and USDA seal
Packaging must include safe handling information
Direct Marketing Considerations… for Goat Meat
If selling meat directly to consumers (retailing) need retail permit
If wholesaling meat (like to distributors, stores or restaurants) need wholesale permit
If storing meat other than at USDA-inspected facility likely need a warehouse license
…from TN Dept. of Agriculture Regulatory Services
Direct Marketing Considerations… for Goat Meat
Direct marketing food products introduces farmers to additional liability risk
Risk management methods may include the purchase of food product liability insurance
Direct Marketing Considerations… for Goat Meat
Not all slaughter facilities are USDA-inspected Custom-exempt facilities slaughter/process
animals when the animals will not enter commerce
Example – A customer may purchase a live goat from Farmer Smith. Farmer Smith delivers the goat to a custom-exempt slaughter facility where the customer pays to have the goat slaughtered and processed for their use at a holiday celebration.
Inspected by TN Department of Agriculture Must meet Good Manufacturing Practices like
USDA-inspected facilities
Direct Marketing Considerations… for On-farm Harvesting
When selling live animals from the farm, farmers may be asked
1. Can the farmer legally harvest the animal for the customer?
2. Can the customer legally harvest the animal on the farm?
Can the farmer legally harvest the animal?
No, not without meeting regulations required for custom-exempt slaughter
To learn about specific requirements, contact the Tennessee Department of Regulatory Services
Can the customer harvest the animal on the farm?
??? No known regulations exist for
slaughter or inspection in this case
Environmental regulations for disposal of offal?
Implications for product and landowner liability if customer is injured or becomes ill?
Summary
Topics covered the definition and importance of
marketing the market situation for goats and goat
meat consumer preferences for goat meat considerations for marketing strategies direct marketing considerations
Tennessee Master Goat Producer Marketing