Propelled by continuously growing consumer demand for high-quality beef and the intentional efforts of family farmers and ranchers to hit that target, Certified Angus Beef LLC reported record sales of 1.121 billion lb. during fiscal 2017 (ending Sept. 30). This is the 11th consecutive annual sales record, continuing a 13-year streak of year-over-year growth.
Fiscal 2017 is the second year brand sales topped 1 billion lb., and it marked an increase of 10.4%, or 106 million lb., over last year.
“Our partners, from the farm to the plate, all fit together in the effort to fulfill demand for high-quality beef,” said brand president John Stika. “We are all singularly focused on the same quality endpoint. The growth in sales this year was fueled by the dramatic and positive shift that we continue to see in the supply of high-quality cattle – the best we’ve ever seen.”
A focus on quality from the start
Since the Certified Angus Beef brand’s start in 1978, family farmers and ranchers raising cattle that target the brand’s 10 exacting standards for product quality have enabled processors, distributors, restaurateurs and retailers to meet ever-growing consumer demand for premium beef. Responding to these strong economic signals over the past several years, family Angus ranchers have continued to grow the size and improve the quality of their herds through the best genetics and management practices. This collective improvement has translated into 4.53 million cattle certified for the brand – an increase of 610,000 head, or 15.6%, over fiscal 2016. In addition, the rate of cattle eligible to earn the brand name by meeting all 10 of its quality specifications rose to a record 29.7%, up from just 16% a decade ago.
International, retail, foodservice and value-added divisions set records
Sales of the Certified Angus Beef brand exploded in 49 countries outside the U.S., reaching 174.5 million lb., a 26.4% increase over last year and the best year ever for international sales. This growth represented more than 30% of total brand growth for the year and was supported by a mix of business in new markets, including China, the Dominican Republic and Peru, as well as strong gains in the established markets of Japan, South Korea, Hong Kong, Mexico and Canada.
“Supported by lower prices, which generated a greater flow of business and feature activity, particularly of end meats like roasts, retail sales grew nearly 5%,” Certified Angus Beef noted. “Representing more than 40% of total brand sales, the largest division set an all-time record of 456 million lb.”
The brand’s top 50 licensed retail partners saw average growth of 6.6%, and two-thirds of them increased same-store sales.
The Foodservice Division netted sales of 385 million lb., an 8.5% increase. Licensed broadline distributors and specialty meat companies increased sales by more than 9%, and sales to licensed restaurants increased more than 12%.
Sales of branded value-added products rose more than 5% to 27.0 million lb. to meet growing consumer demand for high-quality convenience meals in both retail and foodservice. Key items included marinated thin meats, fully cooked burgers and fresh corned beef.
Growth across product categories
Certified Angus Beef reported an 8.4% increase in sales of middle meats (premium steaks), while sales of roasts and other end meats rose 13.5%. Ground beef sales were up by 1.7 million lb., reflecting the continued appeal of the “better burger” to consumers. The most discerning customers pushed up sales of the brand’s Prime product extension by more than 35%.
“The increased availability of Prime product, although still exclusive, reflected increased focus on the farm and ranch on raising the very best beef possible,” Certified Angus Beef noted.
The balanced growth across divisions and product categories resulted in 12 monthly sales records set from the beginning to end of fiscal 2017, according to the company. This included seven out of the 10 best sales months in the brand’s 39-year history. Grilling season also set new records, with sales of more than 100 million lb. in each of the year’s last three months of July, August and September.