most meat cases would be 100-percent case-ready by READY ...keymark.org/articles/quoted/MeatDeli/CaseReadyMove.pdf · development firm based in Marietta, GA. “I expect it to grow

Case-ready proponents take heart. Althoughpredictions made a decade or more ago byenthusiastic fans of this technology that

most meat cases would be 100-percent case-ready bynow hasn’t panned out, its progress nonetheless hasstill been very impressive.

“In 2004, the case-ready market was about 2.6billion packages, reflecting a growth of 19 percentannually since 2001,” says Huston Keith, principal ofKeymark Associates, a market research and businessdevelopment firm based in Marietta, GA. “I expect itto grow more slowly over the next five years toabout 10 to 15 percent annually.”

More case-ready products continue to enter themeat case, points out Jerry Kelly, national coordina-tor, retail task force, for the Cryovac Food Packagingdivision of Sealed Air Corp.

“The most recent research we [participated in],the 2004 National Meat Case Study, indicates an 11-percent point gain in case-ready products in the freshcategory,” he adds. “This includes beef, ground beef,pork, chicken, turkey, lamb, and veal. It went from49 percent of the packages up to 60 percent [fromthe 2002 to 2004 study].”

The list of retailers and processors leading thecase-ready charge is equally impressive. TysonFoods, Smithfield Foods, and Cargill Meat Solutionsare the largest suppliers of case-ready products,Keith says. Other processors such as Swift, AmericanHome Foods, Farmland Foods, and Shapiro havesignificant programs.

“Besides Wal-Mart, the leading retailers offeringcase-ready meat are Kroger [including KingSoopers, Ralphs, etc.], Albertsons, Safeway, AholdUSA, Pathmark, Cub Foods, Tops Markets,Miracle Mart, Loblaw’s, Wakefern, Super Target,and Ukrop’s,” Keith says.

Case-ready red meat was initially driven by laborshortages, Keith contends.

“In many markets, there were simply not enoughmeat cutters to keep cases stocked,” he adds. “ThenWal-Mart adopted [case ready] as part of a businessmodel for its Supercenters causing a huge surge ingrowth. Now the market is being driven by Wal-Mart sales growth and the gradual transition byother retailers. It’s possible, even likely, that anotherretailer will decide to make an acceleratedchangeover within the next five years, which wouldgive the market a huge boost.”

8 MEAT & DELI RETAILER / March 2005 www.meatanddeliretailer.com

CASEREADYON THEMOVE

CCAASSEERREEAADDYYOONN TTHHEEMMOOVVEE

More case-ready red meat is being offered inretail meat cases—but not at the volume proponents once predicted. By Bryan Salvage, Editorial Director

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Photo courtesy of Cryovac/Sealed Air Corp.

MDR 3/05 08-19 Cover Story.1 3/23/05 7:15 PM Page 8

Case-ready pioneerFollowing several years of selling case-ready groundbeef and poultry at some Supercenters, a March2000 Wal-Mart news release relayed that the com-pany was expanding its case-ready meat program to180 Wal-Mart Supercenters and Neighborhood mar-kets in six states. Furthermore, Wal-Mart announcedit would begin selling case-ready pork in allSupercenters by the end of 2000.

Since that time, positive customer responseresulted in Wal-Mart expanding its case-ready freshmeat product line to all Supercenters andNeighborhood stores.

“This technology, introduced by the meat industry,helps streamline distribution and reduce the time ittakes for products to move from the manufacturer tothe customer,” Wal-Mart explains on its Web site.“This is consistent with other initiatives in place atWal-Mart that help us pass additional savings on toour customers. In addition, case-ready meat providesWal-Mart customers with selections that haveenhanced quality control, leak-proof packaging, betteroverall appearance, and better tracking of product.”

“Case-ready meat is simply becoming the bestway to deliver quality at an everyday low price for

our customers,” said Lee Scott, president and chiefexecutive officer of Wal-Mart Stores Inc., on March3, 2000. “It offers the straightest line of distributionto ensure the best possible product.”

Although Wal-Mart has become the case-readyred-meat benchmark, other meat retailers are alsosold on the concept. One smaller niche chain recog-nized the case ready advantage before Wal-Mart.

“Our fresh-meat case is as near to 100-percentcase ready as you can get,” says Alan Warren, direc-tor of meat and seafood for Richmond, VA-basedUkrop’s Super Markets Inc. “The only reason it isn’t100 percent is that we do some special orders sothere might be some store-cut products that find theirway into the case.”

Ukrop’s made the commitment to case-ready redmeat in 1996. Its meat department is open from 7a.m. to 11 p.m. Monday through Saturday. Thechain is closed on Sunday.

“The reasons are numerous [for this move to caseready], but the main reason was for consistency ofproduct,” Warren says. “You have a much betteropportunity to have better cutting specifications inone meat room versus 29 meat rooms. Also, it allowsus to set our cases up each morning in a hurry. Our

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Photo courtesy of Cryovac/Sealed Air Corp.



CASE READY ON THE MOVECCAASSEE RREEAADDYY OONN TTHHEE MMOOVVEEcoverstory

“What has made us so successful is the productwe’re cutting for our members, not pre-packagedgoods,” said Andy LaRose, regional meat/service delisupervisor, Midwest Region, Oak Brook, IL, in anarticle honoring Costco as MDR’s 2003 MeatRetailer of the Year.

Holiday Quality Foods, Cottonwood, CA, is anupscale niche marketer—a 23-store chain that servescommunities in the northern end of California, upand down the Sacramento Valley and in the sur-rounding Sierra Nevada Mountain area. The onlycase-ready red meat it offers are its MAP-packagedAtkins Ranch-brand lamb products.

“[As an upscale niche marketer] we want to keepmeat cutters on duty because one of the biggestthings we want to offer our customers is friendly ser-vice,” says Dave Parrish, meat director, HolidayQuality Foods. “And we want to have somebodythere who can help shoppers with a selection, whocan special cut an order for them or help them with acooking idea. If we’re 100 percent case ready, whocan do this for our customers?”

Supply sideThere are many reasons why case-ready productscontinue to find success at the retail counter, saysKevin J. Lage, case ready brand manager, CargillMeat Solutions, Wichita, KS.

“Competitive strategy, single-order management,food safety, labor shortages, and shrink reduction arejust some of the factors that retailers are faced withand find solutions within case-ready to drive bottomline sales increases,” Lage says.

Cargill Meat Solutions operates six U.S. plantsand two Canadian plants that produce beef, grinds,pork, veal, chicken, value-added, and ready-to-cookcase-ready products.

When asked what type or types of case-readypackaging systems his company uses, Lage answers:• The company’s patent-pending REDiFresh tri-gas

MAP technology• Traditional high-oxygen packaging• Mother bag bead seal tray overwrap• Traditional tray overwrap• Cryovac packaging• Multivac packaging

“The two dominant requests from Cargill cus-tomers are case-ready solutions that will first drivesales—and second, decrease costs,” Lage says.

goal is to have the cases completely set by 8 a.m. Weget daily deliveries from our central cutting facility.Stores get the deliveries early in the morning. It’s intheir cooler before [employees] get to work.”

Brands of case-ready red meat carried byUkrop’s include Ukrop’s Own Beef and Ukrop’sOwn Pork. It also carries case-ready Australianlamb, that is processed at Ukrop’s central cuttingfacility. And it also offers Marcho Farms Premiumcase-ready veal.

“We’re unique in that we have our ownUkrop’s Own Beef thanks to a partnership withPM Beef,” Warren says. “The beef is raised to ourspecifications, and it’s got all the bells and whistles—full traceability, it is processed verified by theUSDA, and all of the beef cattle are raised onsmall ranches where additional care is taken.Vitamin E is fed to the cattle, which yields a bettercolor. We also have a premium beef program withCertified Angus Beef.

“Our pork program is similar to the beef pro-gram,” he adds. “Again, it is process verified, andour partner is Premium Standard Farms.”

There are some retail food chains, however,with a case-ready philosophy that is on the otherend of the spectrum.

“Costco has no fresh meat that is case ready,”points out Charlie Winters, vice president offresh meat operations for Costco Wholesale,Issaquah, WA. Several years ago, another Costcoexecutive explained why its meat departmentadopted this philosophy.


Photo courtesy of Cargill Meat Solutions


retailers to put their category business plan together,Zimmerman says.

“Without this information, you cannot make anintelligent business decision,” he adds. “We haveseen case-ready programs fail with retailers becausethe business plan was not put together prior to tak-ing on case ready. Case ready is a valuable businesstool. Knowledge is power.”

Some retailers told Zimmerman in the past thatcutting their own meat was their major point ofdifference compared to fresh meat offered by thebig-box stores.

“I have never agreed with that, and others arealso changing their stance,” he says. “The real differ-ence is the people servicing the customer, not whoproduced the meat in the counter. If you can displaya quality case-ready product, does the consumerreally know or care who cut it? I don’t think so, butwhat they will remember is now they can talk to Joethe butcher because he now has time to spend withcustomers. Joe is no longer tied up in the back roomcutting or gone by 1 p.m. because he came in at 5a.m. to cut that meat.”

Some retailers do not have a sufficient meat staffto operate a traditional meat department, and someretailers are opening new formats designed not tohave meat cutters. Case ready can solve both issues,Zimmerman relays.

“American Foods Group’s case-ready business isgrowing due to the way we conduct our business,”he adds. “We are centered around customer partner-ing. Typically, we meet with a retailer, discover theirneeds, and build a program based around thoseneeds. We realize that we both must remain prof-itable, and that we basically become the retailer’smeat department. Given that, we realize that weneed to create a seamless program that satisfies theretailer, but more importantly the consumer. We arestaffed with former retailers who understand howimportant this is.”

When asked what his customers are lookingfor in case-ready red meat packaging,Zimmerman answers it varies by retailer andtheir respective needs.

“Most traditional retailers want an exact replica-tion of the current back-room look while otherswant fool-proof packaging,” he adds.

How do American Foods Group case-ready prod-ucts differ from the competition?

Cargill Meat Solutions finds its competition verysingular in their approach and variety of productofferings, like a commodity boxed beef or boxedpork, Lage relays.

“Cargill Meat Solutions takes a consumer-focusedapproach to case-ready solutions,” he says. “Westrongly believe that successful case ready needs to betreated like a sales program offering consumer-centricproducts coupled with shared score cards and point-of-sale data management services to measure successat the consumer level.”

American Foods Group, Green Bay, WI, offersfurther proof supporting the continuing growth ofcase-ready red meat.

“It is definitely growing,” says Mike Zimmerman,director of case-ready operations, American FoodsGroup. “More retailers are understanding the eco-nomics and expense of the meat department—that is,what it truly costs to produce meat at store level. Byknowing and understanding those costs, you canmake an intelligent business decision.”

American Foods Group offers case-ready beef,pork, lamb, and veal, which includes cuts, grinds,patties, seasoned, tumbled, enhanced, and mari-nated products. It also produces the same productsfor many of its foodservice customers. Case-readysystems employed by the company include low-oxygen, high-oxygen, or no-oxygen systems inover-wrap, lid seal, vacuum pac, roll stock, in-the-bag programs, chubs, and boxed. New formats arealso being tested.

Knowing the cost of store-produced meat [or atleast a fairly close estimate] and the comparison of atrue-known cost of goods with case ready allows

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Wal-Mart is the reigning “King of Case Ready.”


“Those retailers that successfully adopted caseready had management that accepted case readyas an article of faith, as a better way to do busi-ness—and they stuck it out through the difficulttransition,” Keith says.

Private-label solutionsExcept for Wal-Mart, most case-ready meat is privatelabel, in fact, actually no label, so it looks the sameas store-packed meat, Keith relays.

“Traditional retailers have long resisted giving upperceived advantages of having better meat than theircompetitor,” he adds. “Carrying the same brand as alow-cost competitor like Wal-Mart is even lessappealing. Wal-Mart has long competed successfullywith national brands, and it is quite happy to [con-tinue that with] meat. The branded part will growfaster as retailers and consumers begin to see the ben-efits of consistency and improved products.”

Private-label case-ready growth continues.Abertsons kicked-off its new Blue Ribbon Beef(Select) program at its Chicago Jewel stores in 2004,says Cryovac’s Kelly.

“It’s in all the Albertsons stores—Jewel, Acme,I’m sure it will be in Shaw’s,” he adds. “Then theyintroduced their Steakhouse Choice PremiumAngus Beef program to offer a Choice beef prod-uct. Right after that, Safeway, which owns


CASE READY ON THE MOVECCAASSEE RREEAADDYY OONN TTHHEE MMOOVVEE

“It’s not about products,”Zimmerman responds. “Anycompany can invest in thesame equipment and processthe meat. Why do you shop atX store versus store Z? If Xand Z carry basically the sameitems and are priced competi-tively, where do you go?Probably where you are treat-ed well as a consumer—and towhere you have an enjoyableshopping experience.”

Whether it be vacuum pack-aged or modified atmospherepackaging (MAP), the case-ready meat category continuesto grow as consumer acceptanceof new-technology packagingand the demand for conve-nience expand, says Mel Coleman Jr., chairman,Coleman Natural Meats Inc., Golden, CO.

Coleman’s case-ready meats include a variety ofbeef cuts, plus an offering of grinds, patties, and hotdogs. Its case-ready lamb selections include butter-flied legs and a four-rib rack.

Obstacles to overcomeKeith relays that even as long as 30-years ago andas close as 10-years ago, many in the packagingand meat-packing industries anticipated that mostof the meat case would have converted to caseready by now.

“This has been a huge disappointment forthem,” he adds. “However, they greatly underes-timated the obstacles that retailers would have toovercome. Those retailers who were the leadersin case ready did not always clearly see the bene-fits, and those who waited were often able tocompete successfully with conventional in-storemeat packing.”

The key problems holding back case ready were acombination of:• Organized labor resistance• Inability to measure labor’s effect on shrink

reductions and sales increases in comparisonto higher product costs.

• The difficulty of making the transition to thepoint of economic feasibility



CASE READY ON THE MOVECCAASSEE RREEAADDYY OONN TTHHEE MMOOVVEEcoverstory

Case ready packagingMAP-lidded trays and overwraped trays eachaccount for a little less than half of all case-readypackages, Keith says. The remainder is vacuum pack-aging, including ground-meat chubs.

“The market for case-ready meat is growing at aslow pace, but growing year on year,” points outPeter Mellon, president of Canton, MA-based Reiser.

Case-ready technology providers are doing theirpart to spur category growth. Reiser offers two newpieces of equipment for case-ready packaging. ItsVemag ground-meat portioning system for net weightpacks features speeds of up to 100-portions a minutewith minimum give-away. And the Ross Inpack S90high-speed tray-sealing machine produces hermetical-ly sealed packs from pre-formed trays in both highO2 and low O2 formats. The machine can run atspeeds of up to 100-packs a minute, and tooling sizescan be changed in approximately 15 minutes formaximum flexibility.

Another case-ready packaging technology leader isKansas City, MO-based Multivac Inc. “We see themarket for case ready continuing to grow,” says BobKoch, director of sales, food division, Multivac Inc.“Retailers such as Wal-Mart are driving this trendbecause it increases efficiency and provides


Dominick’s in the Chicago area, introduced itsRancher’s Reserve Angus Beef throughout thecountry. These are examples of two major retailersthat have introduced their own private-label pro-grams just in the past year.”

Blue Ribbon Beef includes a wide range of high-quality roasts and tender-aged steaks that are“guaranteed twice” for customer satisfaction. Thebrand is being marketed under the namesAlbertsons Blue Ribbon at Albertsons stores, JewelBlue Ribbon at Jewel/Osco stores, and LancasterBlue Ribbon at Acme stores.

Steakhouse Choice Premium Angus Steaks areaged naturally and guaranteed twice, as well. If notsatisfied with their purchase, shoppers will get arefund and they can replace their Steakhouse Choicecut with another free of charge.

Rancher’s Reserve Angus Beef includes sirloins, T-bones, and other cuts.

Target now offers Archer Farms private-labelmeat products, but most of the case-ready redmeat growth is coming from branded companieslike Tyson, Hormel, Cargill, and SmithfieldFoods, says Phil Ryan, Cryovac’s senior directorof marketing and strategy for case-ready lami-nates and ready meals.

Photo courtesy of the National Pork Board



your profit and loss [P&L], there’s a portion of yourmeat merchandising costs that are fixed—your labor,the space you’re consuming in a store, equipmentrental or leases, and so forth,” he says. “To theextent you start replacing product you were fabricat-ing and then merchandising with case-ready prod-uct—and you maintain the same fixed level ofexpenses—you’re probably not going to have thesame degree of profitability you had in the pastbecause you’re paying the processor for what youused to do in the back room.”

But, several other studies show that case readyallows retailers to better manage their shrink plushave more product to sell at any given time.

“I’ve heard over the years that guys who havegone to a case-ready grind program from store-pro-duced product, when they look at their leanestgrinds—90 percent and above—they say, ‘We neverrealized how many sales we were missing!’” addsCryovac’s Kelly. “When it’s case ready and you’reputting product in the case as you need it, it’s amaz-ing how many additional sales you’ll get.”

How much time should retailers give a conversionto case ready to accurately measure results?

“The feedback we have from retailers is it’s notmore than a couple of months,” Ryan says. “That’sassuming they’re able to make adjustments in theircost structure at the fastest pace. The issues they havein launch are orientation to ordering, stocking, andmerchandising inventory levels.”

A lot depends on how good the store-by-storeinformation is.

“Do they know their sales by day, by item?”Cryovac’s Kelly says. “If so and they have good infor-mation that’s fed back to their stores, the stores can doa better job ordering to match up the case-ready prod-uct to what they were formerly producing at the store.”

consistency to the meat casewith attractive packaging.”

One of Multivac’s recentdevelopments, FormShrink,serves this growing demandby giving processors the abili-ty to shrink-package prod-ucts, such as chub sausages,beef roasts, hams, and evenwhole chickens, using an auto-mated rollstock system instead of pouches. Alongwith FormShrink, Multivac has also introduced anew mid-range traysealer, the Multivac T350.

“This system provides the speed and efficiency ofan automated traysealer at a price that is affordableto smaller processors,” Koch says. “With case readygrowing the way it is, small and mid-size processorshave the opportunity to grow their businesses at arapid clip provided they have the tools to do so.”

One of Cryovac’s newest products for case readyis its Lid 1051 printed lid film.

“It’s a multi-layer barrier shrink film that’s adhe-sively laminated to a biaxially oriented polyproly-lene—BOPP,” says Cryovac’s Ryan. “Its featuresinclude clarity; package tightness, or shrink; and antifog—the ability of the package to go through thecycles in the meat case and deal with temperaturechange and the moisture that changes inside thepackage and still maintain good clarity.”

Cryovac’s Darfresh vacuum skin packaging sys-tem was introduced in Europe years ago, and it hasbeen emphasized at trade shows in the last twoyears. Multivac is Cryovac’s worldwide equipmentpartner on Darfresh.

“It gives high shelf life—it’s a barrier vacuum-skinpackage—and it also results in excellent product,”Ryan says. “It’s fully dimensional because it wrapsitself around the product. The Darfesh format isavailable either on a semi-rigid bottom or pre-madetray and primarily used for whole-muscle product.”

Moving to case readyConverting to case ready is not an easy process formany retailers. Ryan relays several points madeduring an economics of case ready presentation byan industry expert at an industry event severalyears ago.

“If you’re a meat manager or vice president ofperishables at a large chain and you’re looking at

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The futureCase ready will continue to grow rapidly, but in-storepackaging will still maintain a significant presencefor the next five to 10 years, Keith predicts. Case-ready products are poised to continue on an ever-steepening growth curve. Consumers desire consis-tency, selection, and convenience at a value, saysCargill Meat Solutions’ Lage.

“While there are many ways for retailers to stripcosts from their operations, most have a detrimentaleffect on the consumer—whether it is product consis-tency, selection, or convenience,” he adds. “Caseready enables retailers to focus on those backroomproducts in which they have an identity and are per-ceived by their customers as ‘the’ destination for thatproduct or products.”

Case ready continues to be driven largely byretailers, says Multivac’s Koch. The ability to extendshelf life using MAP is very attractive to them.

“For their part, consumers seem to be respondingwell to the neat, consistent packaging they see withcase ready,” Koch says. “Introductions of new pre-pared entrées and other convenience foods are likelyto continue as well, which will only expand the mar-ket for case ready.”

“As food-safety issues dominate our industry, webelieve that more and more retailers will look tomajor meat packers to centrally pack meat in her-

metically sealed packs and send them to the storecase ready,” adds Reiser’s Mellon.

Case-ready red meat is still in its infancy, reflectsMel Coleman Jr.

“The benefits of new technology, extended shelflife, reduction of shrinkage, and [lower] labor costswill contribute to continued growth,” he says.“The variety, flexibility, and convenience of case-ready meats will appeal to more consumers as thevariety of options grow.”

Meanwhile, Ukrop’s will remain committed to itscase-ready red meat program.

“We think it is the way to go,” says Ukrop’sWarren. “We get no push-back from our customers.Most of the product looks as though it was cut in theback room. We have meat cutters on duty for cuttingany special orders. There’s no down side for havingcase-ready meat at Ukrop’s.”

Will those retailers currently not heavily into caseready change course in the future? At least one retail-er feels they may someday be forced to change.

“Someday, we may not be able to buy beefany other way than case ready,” Holiday QualityFoods’ Parrish says. “But you have to make a lotof substantial cuts to make that happen, and youcan’t just do one line of cuts. All the researchI’ve seen indicates you have to be case ready 100percent.” MDR


Photo courtesy of Ukrop’s Super Markets Inc.

CASE READY ON THE MOVECCAASSEE RREEAADDYY OONN TTHHEE MMOOVVEE


Documents

most meat cases would be 100-percent case-ready by READY ...keymark.org/articles/quoted/MeatDeli/CaseReadyMove.pdf · development firm based in Marietta, GA. “I expect it to grow