Certified Angus Beef sets sales records for year

by Bryan Salvage
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WOOSTER, OHIO — Certified Angus Beef LLC, (C.A.B.) announced it achieved record sales for the third-consecutive year. Product sales from Oct. 1, 2008 to Sept. 30, 2009 topped 663 million lbs., which beats the previous fiscal 2008 record of 634 million lbs. by 4.6% and the fiscal 2007 record of 584 million lbs.

Sales figures reached 62 million lbs. in August 2009. May, June, July and September 2009 also finished among the top 10 months in the brand’s 31-year history. Strong demand during grilling season strengthened monthly sales beyond the 60-million lb. mark for the first time in July, August and September.

These achievements show consumers still prefer quality products in challenging times — and they become even more aware of the ratio of price to value, said John Stika, C.A.B. president.

"Arguably, this advanced our brand’s position," Mr. Stika said. "The premium quality pays even greater dividends when consumers apply a higher level of discretion to where they spend their dollars."

The retail division, which represents more than half of C.A.B. sales, achieved its best year ever with 343.5 million lbs. sold. September was the division’s best sales month, surpassing 33 million lbs.

Much of the retail division’s growth — a 7% increase over the previous year — came from existing retail accounts rather than the addition of new partners, said Al Kober, C.A.B. director of retail. Some retailers also expanded premium beef offerings and boosted sales by introducing the brand’s extensions — Prime and Natural.

"Consumers are looking for more restaurant-quality items in stores," Mr. Kober said. "The C.A.B. Prime line, historically more popular in foodservice channels, found new success with retailers this year as more product was available to them. Sales of Prime increased 7.5%."

Foodservice partners recognized the best strategy was to build their own brand on quality, said Mark Polzer, C.A.B. vice-president of business development. With fewer customers dining at restaurants, it’s even more important for the foodservice segment to provide memorable experiences to ensure repeat business, he added.

The foodservice division’s 200 million lbs. represented more than 30% of the brand’s sales.

International sales increased to 69 million lbs., a 4% increase over the previous year and more than 10% of the company total. Not seen since 2003, this sales level was attributed to the brand’s partners in Canada, Mexico and South Korea.

Canadian sales were up 11% to nearly 27 million lbs., although total U.S. beef exports to Canada declined 12%. Mexico remained the No. 2 global market. South Korea experienced a 46.5% increase in sales. It was a banner year for C.A.B. throughout Asia, with 26% growth for the continent.

In 2009, more than 60% of U.S. cattle were black-hided, and Angus bulls were selling at healthy premiums. Approximately 14.1 million head were identified for evaluation and nearly 2.8 million were certified, an increase of 8% over the previous year. Acceptance rates climbed to 19.8%, continuing a four-year trend.

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