September 27, 2013
by Steve Krut
Next year, Chad and Courtney Lottman will observe their 20th anniversary as owners and operators of a “first-generation” meat company. Their stewardship of C&C Processing Inc., Diller, Neb., is a testimonial to the fact that making solid business decisions can overcome even the most unexpected turns in the road.
There was no template to follow for the Lottmans who, at the age of 19, purchased a small grocery store in the community of less than 300 people.
“I was raised in the construction and concrete business,” Chad recounts. “My wife’s family had some experience in the convenience store and restaurant fields. We wanted to start a family and knew that construction meant being on the road much of the time. So in 1994, we bought the store from a family friend.”
Chad said the 25-ft. wide store offered groceries and some deli meats that he purchased from wholesalers. The previous owner had done some custom processing and taught him how to bone out a carcass so he could continue to process meats. However, after one year in business, Chad was working part-time jobs to supplement the family income.
When a custom locker plant located 15 miles away closed, Chad realized the potential in deer processing. He made the decision to buy a 25-ft. lot adjoining their 2,000-sq.-ft. store and to build their own custom slaughter and processing facility to handle hogs and game animals.
As the cash flow improved, they agreed to purchase another 25-ft. adjoining lot in Diller and put another addition onto their small plant to handle the custom work.
“It’s been a situation where about every two years we’ve added on,” Chad explains. “We’re in the process of completing another 2,000-sq.-ft. addition, which will bring us to an overall facility of 16,500-sq.-ft. We are now land-locked by the street so future expansions will get tougher. The village had to abandon 20 ft. of street right-away for us to complete this expansion.
“There were times when we thought we just couldn’t make it and put the business up for sale. It didn’t sell and it was all we had so we kept trying to make it work,” he says.
Relying on resources
Early on, the Lottmans tapped into the resources of nearby processor Dennis Schaardt (Den’s Country Meats) in Table Rock to do their bacons and hams. Schaardt mentored them until they gained enough experience and plant area to do it on their own and got them involved in state and national associations where other help could be obtained. Today, they have two one-truck and one two-truck smokehouses and their current expansion will add two three-truck processing ovens.
The family created its own Blue Valley Brand for its cured meats, named after the area where the plant is located in Southeastern Nebraska, about 60 miles from Lincoln. This coincided with their move to US Dept. of Agriculture inspection in 2001.
The facility slaughters up to 25 head of cattle once a week and about 40 hogs every two to three weeks.
“One of the problems of being a first-generation business is there are no secret family recipes to follow,” he notes. “Everything we made in processed meats was developed from scratch on our own. We had help from some of the spice suppliers on formulations and got advice and curing tips from other processors.”
Chad says he understood the potential of the internet for sales, but admits that their Blue Valley Brand didn’t have the marketing power needed to make it work. In 2002, they purchased the rights to more widely known Pony Express Ranch in Marysville, Kan., about 50 miles away, and began marketing meats under that name, as well. All processing for the Pony Express brand moved to Diller and today C&C Processing boasts a large list of internet customers. Their own BlueValleyBrand.com website features both lines of products.
Chad says the original store is more of a glorified convenience store, but the family has added a second retail store in Beatrice, Neb., where the population of 15,000 gives more exposure to their product line-up. That satellite location features their cured meats, fresh seafood, flat iron steaks, marinated chicken and pork and other specialty items not regularly offered in most supermarkets.
They have resurrected a red casing hot dog formerly made in Big Red football country and market it to Univ. of Nebraska fans. Their Blue Valley Brand red hot dog is offered in most major supermarkets in Lincoln, the home of Cornhusker football.
C&C Processing has moved heavily into private-label processing and the 30 accounts in that area now represent about 20 percent of their volume. Custom slaughter and processing is a strong suit for the family and customers truck animals in from as far as Steamboat Springs, Colo., (10 hours away) for their special services.
Deer processing remains a staple at the Diller plant, with about 1,200 deer custom butchered and made into cured specialty products each year.
The Lottmans hit a home run with one of their private-label accounts. Benny’s Bloody Mary Beef Straws approached C&C about two years ago about manufacturing a hollowed out 8-inch beef snack stick to replace straws in Bloody Mary drinks. They helped design a machine to core out the sticks and now market that product nationwide. C&C produces about 4,000 lbs. of that product per month.
Chad has become a force to be reckoned with in state and national cured meats competitions and admits that he’s coming into his own with 60 awards. He is most proud of his jalapeño and jalapeño cheese beef summer sausage.
“We won about eight awards the past two years,” Chad explains. “I’m not the connoisseur of meat products that others have become. I just pride myself on making good-quality products and the ability to make hard business decisions.”
His latest plant addition focuses on portion-controlled jerky production and packaging, and more advanced portioning scales. He says he almost gave up on private-label jerky 10 years ago, but is now focused on improving general production. The firm currently has 30 employees, including part-time workers.
“It was so difficult to say ‘no’ to some of the smaller customers who wanted batches of 200 lbs. of something like jerky,” he recalls. “I was just too stubborn to turn them down. It was so difficult to gain consistency when we were making so many different items. It meant a lot of extra work, but it has helped our reputation grow.”
Chad served as president of the Nebraska Association of Meat Processors in 2004 and he and Courtney were honored by the American Association of Meat Processors (AAMP) three years earlier with the Accomplishment Award, given to those who have achieved outstanding company growth, developed new products and launched a successful marketing campaign. He was recently elected to the AAMP board of directors.
Chad considers himself an owner and manager although his official title is president of the company. His wife tackles the accounting and bookkeeping assignments and, although her title is secretary, Chad says she is a true business partner. Their daughters, 14 and 18, have helped out in the family business, but have yet to decide on their involvement for the future.
Whatever their decision, first-generation meat-business entrepreneurs Chad and Courtney Lottman have laid out a solid foundation that should endure for many years to come.
Steve Krut, an industry veteran, is a contributing editor writing exclusively for Meat&Poultry, specializing in small business issues. He resides in Marietta, Pa.