Blog for Rural America

The Center for Rural Affairs, a private, non-profit organization, is working to strengthen small businesses, family farms and ranches, and rural communities. Permission to reprint items from this web log is hereby granted, on the condition that clear credit is given to the original source of the material. If the blog provides information for a story, please let us know by sending an email to johnc@cfra.org.

Friday, February 11, 2005

The Benefits of Being "$pecial" - A Look at How Oregon Country Beef Makes Marketing Work for Them

-- from the desk of Russ Gifford, Director of Communications & Development, Center for Rural Affairs


The past few days has seen a flurry of activity from the agencies who keep an eye on Federal and State governments for those of us living and working in Rural America. They have called to our attention how the recent budget proposal from President Bush could make our continued existence very difficult. Even while we wait for the fall out to settle from this latest attack on our way of life, we still have to make a living. To keep our spirits up let's take a page or two from the Center's recent Fresh Promises report (http://www.cfra.org/freshpromises.htm) and see how Oregon Country Beef uses their special qualities as a marketing booster.


Oregon Country Beef, a cooperative of 40 ranches in central and eastern Oregon, has achieved the near-impossible over the past few years. While they are located in remote areas, far from any market, they successfully sell specialty beef products throughout the west coast and Pacific Northwest. Their story offers important insights into the successful specialty marketing of products, and is part of the Fresh Promises report created by the Center for Rural Affairs.

Holding on to the profits
The goal of Oregon Country Beef is to produce a sustainable lifestyle by producing a profitable product to meet customer demand for taste and integrity, created in a healthy environment. The key to any successful co-op though, is to hold on to the profits.

Traditionally, preparation and delivery of the final product to the retail chain are where profits can be “make or break”. These are areas generally reserved for specialists, who master the arcane regulations, and the special skills needed to process, ship and market beef.

Oregon Country Beef appears to have met these challenges head on. With 40 members and 61 stores carrying their product, along with restaurants and food service outlets, they produced $10 million dollars in sales last year.

What are the lessons we can learn from their success?
Pricing is realistic. The price is based on cost of production, necessary return on their investment, and a reasonable profit. They understand that cut-rate pricing eventually leads to a failure to be able to produce your goods.

Marketing is vital, and members are involved. Each member spends at least one weekend a year doing store visitations or in-store demonstrations. A team structure allows the group to share ideas and expertise, and appears to avoid the high cost of hiring outside marketing experts.

Most importantly, they did not try to create something new. They were already raising grass-fed beef free from growth hormones or antibiotics. They maintained that focus, believing it was a healthier choice of farming and ranching. Rather than trying to capitalize on something new, they created a brand based on quality and reliability.

Where to get more information
Oregon Country Beef is an example of how specialty beef marketing can be profitable. The Center has information for groups or individuals that are striving to take home a greater portion of the consumer's food dollar. For more information on the Value Added Program, talk to Mike Heavrin at the Center for Rural Affairs. mikeh@cfra.org.

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