with minor differences in formulation that result in modest differences in their flavour profile.
But do you recall all the hubbub around the introduction of New Coke in mid-1980s? Or how many times have you sat down in a restaurant, ordered a Coke, only to hear the response Is Pepsi OK? Or have you ever felt slightly embarrassed to be serving a store brand to guests?
Proponents of the differentiation model say there s easily as much difference between a feedlot steak fattened on corn and a grass-fed steak. Neither flavour will be for everyone, but each will have its loyalists and some of those loyalists will be more than willing to pay a bit extra, just like Coke and Pepsi typically retail for about twice as much as the store brands.
Read Also
Riding the tariff roller-coaster
What producers are doing to minimize the risk created by ongoing trade uncertainty.
There are $100,000 watches out there and there are $100 watches and they both tell time, is how Weder puts it.
At first, some were worried that Prairie Heritage Beef Producers would be pinning all its future hopes on a small slice of the overall market demographic, consisting of the richest of the rich. Some feared too that this was not only a small demographic, but a fickle one too, and one that is especially subject to economic ups and downs.
But Weder counters that, as a percentage of their annual income, North Americans pay almost nothing for their food, and there s ample evidence that people will pay a bit more if they re convinced they re getting extra quality.
A lot of our customers aren t rich, Weder explains. They re people who care more about what they re putting in their mouth than what they drive and that s a good thing.
The group has been able to do some very important things that they d never have been able to achieve as individuals, Weder says. For example, they ve been able to gain enough heft to supply large customers with a reliable flow of product.
You ve got to be able to supply those customers on a 12-months-a-year basis, Weder says.
There s also the issue of accessing enough slaughter capacity at a cost that doesn t price you out of the market. Weder says he currently has an arrangement with an excellent slaughter facility, but he also has to acknowledge that some of his competitors in the U.S. have an advantage.
We re probably double the [slaughtering and processing cost] of some of the U.S. groups, he says. That s just a fact of life.
Weder says the relatively small size of the group does bring them some advantages, like a nimble ability to react to market developments. An example is the recent trade deal allowing a quantity of beef to move into the European Union duty free, which was a result of U.S. negotiations. But the beef in question must be grain-fed for at least 100 days and must meet the hormone-free status demanded by the EU and can come from any EU Most-Favoured-Nation trade partner, including Canada.
That starts in about a week-and-a-half, Weder told COUNTRY GUIDE when we talked to him in late July. We re currently the only group in North America that is ready to take advantage of that opportunity. CG
