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Country Natural Beef

Agenda
About CNB Supply Chain Summing Up Recommendations Q&A

About CNB
History Strategy
Traceability / Quality Third Party Certification Fixed Price Model

Supply Chain
Commodity Beef Vs. CNB

Difficulties/Obstacles for CNB Sustainability Rancher Hidden costs (e.g. Animal treatment, Environmental cost) Cannot ensure the diet quality in BNW Co-op Rely on one large customer (Whole Foods) Traceability ends at the Packer Consumers Third party certification?

External Parties
Third Party
e. g. Certifying Agencies

Competitors
Other Ranchers

Customers
Market

Third Party
Food Alliance
Sustainable business practices CNB and Fulton

Global Animal Partnership (GAP)


Improvement of animal welfare 5-step program Wholefoods

5-step program By GAP

-in Wholefoods in Seattle

Step 1 prohibits cages and crates. Step 2 requires environmental enrichment for indoor production systems; Step 3, outdoor access; Step 4, pasture-based production; Step 5, an animal-centered approach with all physical alterations prohibited; and, finally, Step 5+, the entire life of the animal spent on an integrated farm.

Competitors
Panorama
All organic and grass-fed beef Sit down dinner (rancher with consumers)

Painted Hills Corporation


Same place: slaughter and packaging operation (Walking to slaughter) Marketing program: customer education

Regional Grass-fed Beef Ranches


Sell beef online

Meyer Natural Angus


Sell beef online

Niman Ranch
Own custom butchering plant and feedlots Sell beef online

Customers of CNB
Wholefoods
Burgerville New Seasons grocery store

PCC Natural Markets

Wholefoods
Worlds largest natural foods store

70% of total CNB annual sales


Focus on humane animal treatment

CNBs Summary
Differentiation

Challenges

Differentiation
High Product Quality No hormones or antibiotics Different diet patterns at the feedlots Reliable Certification from Third Party organizations Effective Product Traceability CNB ranchers own products throughout supply chain Ear tag (from birth to plate?) Carcass data provided to CNB ranchers to make improvements Pricing Model Fixed price o Remove price fluctuations and secures steady cash flow o Use cost of production and cost plus method to determine price o Commission and bonus plan incentives

Challenges
Customer Perception and Loyalty

Continued Product differentiation and branding o End-consumer has less knowledge about the food supply chain Animal Welfare Concerns Online selling(costs and feasibility)

Marketing Strategy

Move to Grass Fed Beef


Costs and benefits Environment impacts (sustainability of land, grass, global warming )

Relationship with Large Customers


More reliance Less control and negotiation power o e.g. Whole Foods

Recommendations
Short Term
Increase frequency of consumer interactions Do not increase rate of entering Grass-fed market

Long Term
Email list for news letter (includes web link) Online sales (AB Foods already set-up) Implement communication capabilities amongst partner organization (transparency) Determine feasibility of Grass-fed market penetration Do some research on the carbon-footprint to reduce impact on global warming

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