The braai nation
| Ivana | Editorial Feature
Economic and environmental impacts on the butchery and braai sector
South Africa is a nation of meat-eaters, and the country’s braai culture is strong. As such, the quality of local meat and butchery products is incredibly high and consumers are both discerning and knowledgeable. Local consumers have traditionally relied on red meat as their main source of protein, and it plays a significant role in celebration day meals as a special part of the menu.
However, the cost for meat producers has been rising, impacting on the end price for consumers and pushing many cuts out of reach of shoppers who are still struggling to recover from the economic blows dealt by the Covid-19 pandemic. With the Ukraine-Russia war continuing to drive up energy, fertiliser and fuel prices, the cost of maize and other grains used to feed meat animals rising as availability falls, and everything from farming to transport and packaging costing more, what does the future hold?
Pressure points and market drivers
A collection of challenges. According to the Red Meat Industry Forum (RMIF), local meat producers are facing several challenges. This includes the ongoing outbreak of foot and mouth disease in several provinces, the effect of load shedding on processing plants, economic pressure affecting consumer behaviour, grain insecurity, rising interest rates, and the other factors mentioned above. It’s a lot, and the effect on the market is clear.
Supply and demand. In their Agri Trends: Livestock Report for Red Meat, Absa’s Abrie Rautenbach, Marlene Louw, and Nkhensani Mashimbyi note that while Class A beef carcass prices have remained stable at over R60.00 per kg, Class C prices have come down somewhat. Constrained supply is keeping these prices from dropping further. Mutton prices are about 8% higher compared to June 2022, while lamb and feeder lamb prices remain stable due to demand and constrained supply. Pork, on the other hand, is about 5.8% lower than they were a year ago. This is due to increased supply and decreased export demand. Interestingly, poultry prices remain firm as local demand increases due to consumers looking for affordable meat protein alternatives. In general, analysts expect these trends to stay on course.
Global growth drivers.
- Despite the shift to plant-based or flexitarian eating, there is increasing demand for animal-based food, according to a Meat Market report from Meticulous Research (https://www.meticulousresearch.com/product/meat-market-5261). Protein-rich diets and functional meat products are driving this demand and the growth of the global meat market.
- Based on product type, the global meat market is segmented into processed meat and fresh meat. The processed meat segment is expected to account for the larger share of the global meat market in 2022. The large share of this segment is mainly attributed to factors such as its ease of use, high availability, shelf life, and increasing demand for ready-to-cook food products due to busy lifestyles. Also, the growing urbanisation and increasing per capita income among millennials is further expected to boost the growth of the processed meat market during the forecast period of 2022-2029 (Meat Market Report, July 2022).
Local is lekker: South African butcheries remain resilient, for the most part
According to the most recent Cleaver Awards, despite the challenges, many local butchers are retaining the quality and adaptability they are known for. “With lockdowns, changes in demand, and shifts in consumer behaviour, our butcheries have had to become increasingly agile, in some instances transforming their approaches and accommodating new ways of doing business. And even though many were hit hard due to the pandemic, these Cleaver Awards confirm that South African butcheries are still very much worth their beef,” says Dewald Olivier, Executive Officer of The South African Feedlot Association (SAFA).
Forsmay Muslim Butchery in Fordsburg, Johannesburg, was named as a Gold winner in this year’s Cleaver Awards, whilst Delft Butchery and Deli received a Platinum award. A Red Meat Industry Forum initiative, these awards are held annually to recognise the country’s best butcheries based on quality, service, hygiene, and value for money. Forsmay Muslim Butchery Manager Tosif Ahmed Fazli and Delft Butchery and Deli owner Justin Mosterd share their thoughts on the current market climate.
At Forsmay, Fazli is prepared for prices to keep increasing. He says, “Compared to previous months where there has been a significant rise in costs, we are seeing that prices have somewhat stabilised. Unfortunately, I think we can expect to see them increase again in the coming months due to the many challenges we are currently facing.”
The challenges have been significant, and some are ongoing. Fazli explains, “The state of the economy and our customers’ financial positions post-Covid-19 have affected the sector. Other factors such as supply and demand, the livestock slaughter numbers being lower than previous years, exporting of beef and lamb, rampant inflation, global food shortages, climate change resulting in droughts and floods, the impact of the war in Ukraine, escalation in fuel prices, supply chain disruptions, a rise in unemployment, and the national load shedding crisis have all contributed to the increase in meat prices.”
Mosterd agrees, and he thinks there will be ripple effects He says, “I think we can expect to some smaller retailers closing their doors in the next year. This is due to the price of raw materials, the cost of power to run these businesses, and the extreme cost of back power needed to survive. Currently the price of all meat, red and white, is high. This is unavoidable due to the cost rising costs of feed, transport, and increased labour rates. Consumers do understand this, but in return they want great quality for what they are paying good money for.”
Consumer habits driven by economic challenges
The rising cost of meat products has had a significant effect on consumers, with Fazli noting that their customers are buying less meat than usual, while focusing on necessities and significantly reducing luxury items like prime cuts. Less expensive cuts are becoming more popular, as are processed products such as mince, as these stretch further than an actual cut of lamb or beef. He says they have seen a shift in their customers’ buying patterns. “Quite a number of our customers no longer eat meat on a daily basis as it is simply too expensive.”
Delft Butchery has seen a shift as well, with Mosterd saying, “We are seeing that consumers are shopping with care and watching what they spend. Portions are becoming smaller, particularly the ratio of meat to carbs on plates, and customers are looking for bulk deals and specials more regularly.” He adds, “Fewer prime cuts are being sold to the average consumer, who are instead choosing more affordable options like mince or stew products that can be extended with sauces and starches.”
Bulk buying and promotional opportunities are becoming more important for many consumers when making a meat purchase. To both incentivise and support their customers, Forsmay Muslim Butchery has its own loyalty programme that gives their customers a cashback on their purchases. They also use value added deals such as bulk buying and run monthly specials to encourage purchases. Fazli adds, “People are looking for easy options like our marinated products as these are cost effective and save time.”
This sentiment is certainly not shared by all consumers, however. Mosterd says, “During Covid there was a rise in interesting and unique cuts and seasonings. Restaurants were closed and people were watching the cooking channel at home and experimenting with their meals. This has certainly slowed down and we are back to people wanting more basic cuts. In addition to this, while there are still some consumers that like ready-made and pre-marinated products, there is a growing trend of consumers wanting to know exactly what goes into their meals due to things like potential allergens and diseases that have been increasing over the last few years. Our customers are starting to look away from the pre-packed value-added lines and are more aware of things like sugar content and additives in some of the marinades and sauces.”
Like other retailers, however, Delft Butchery and Deli is moving with the times and making changes based on what the customer wants. “We are adapting the pre-packed sizes of portions, adding regular monthly deals, and increasing the number of cooking ideas and cost-effective recipes we share with customers,” explains Mosterd.
Meet your meat: ethical, sustainable, unaffordable?
Globally, there has been a rise in ethical consumption. Consumers want to know where their meat came from, they want it to be grass-fed, free-range, and free of routine antibiotics. Gluten-free sausages and marinade sauces have also become more popular, but this comes at a cost. Mosterd says, “We are seeing interest in these factors but in reality, these products are more expensive to produce and are simply not affordable for the average person to consume.”
Meat-free Monday has gained immense traction globally as people look for healthier food alternatives. Vegan, vegetarian, and even flexitarian diets are on the rise. Paired with the rising cost of meat, meat-substitutes are becoming mainstream, better priced, the quality has significantly improved and the range on offer has expanded. In light of this, and consumer education and knowledge, Plant-based protein alternatives are becoming more popular. While this hasn’t had the most notable effect on the meat industry – understandable, given the propensity of South Africans to eat meat on a daily basis, as well as the severity of the other challenges affecting the market, it is something to be aware of. Additionally, the recent decision by The South African Department of Agriculture, Land Reform and Rural Development (DALRRD) to force the removal of any references to ‘meaty’ terms on meat-free alternative product packaging, does suggest that the industry feels that change is coming, and is perhaps battening down the hatches.
Butchery design: Where aesthetic displays meet health, hygiene, and food safety
Butchery specialist Ricky Gomes and Chriselda Kistnasamy, Marketing Manager at store design and fitment specialists TCK Retail Solutions, share the insights they have gleaned after numerous successful butchery designs and store implementations. Kistnasamy says, “The difference between butchery and any other retail space is the relationship between back of house and front of house. It is essential that the synergy between the two be seamless. Every single step is vital to sales as well as food safety. From how the product enters the back of house and the receiving procedures followed, to the processing, display, and checkout, everything is connected when you are dealing with a product with a time stamp. When it comes to the butchery, you have one shot to sell. If you fail, you end up with a rotten product that can end up costing you money. It is imperative that you create the most pleasant experience possible for your customer. Think wider aisles, enough queuing space, and easy pick up and go options, which will increase sales, encourage fast movement, and decrease any health and safety issues.
"Stack ‘em high and watch them fly" is the motto to live by, according to Gomes. “Displaying a quality product that is clearly labelled and well-priced makes life easy for the customer, as they can simply pick up and go. This also ensures the freshest product goes out the fastest. In conjunction with this, it is vital that your refrigeration system and units are functioning at optimised levels to ensure a safe and fresh meat product. This is vital – optimised equipment is everything in a butchery.”
Kistnasamy adds, “Remember the customer buys with their eyes first. If a product looks dull and grey, it will not sell. In addition to mandatory safety standards and protective action, products being merchandised in the correct manner is essential. The ‘cherry on top’ when it comes to display is lighting. It can highlight every streak of fat or curve in a bone, which is a good thing. The fact is, customers are more inclined to buy a good-looking product.”
Trends to watch
- Meats from animals that are grain- or grass fed and free-range, that are lower in fat and higher in lean muscle, are gaining popularity as consumers become more health conscious and more adventurous. This means meats such as ostrich and venison are appearing more regularly on retailers’ shelves.
- Laboratory-grown meat products are a baffling concept, and yet recent successes in this field suggest we could see this reality on plates, in South Africa, before much longer. Whether demand can ensure a cost point that is affordable remains to be seen, but it is certainly something to consider in a country where the braai is king.
- Value-added offerings for the braai, such as ready-prepared meat with innovative seasoning and marinade flavours, save time and can save money, too. For retailers, having a one-stop butchery and braai experience is crucial for getting the feet of time-strapped consumers into your store.
- In addition to this, recipes, demonstrations, and even tastings do not go amiss. This can include sides and vegetable dishes that complement different meats,
- Meat snacks, high protein offerings for specific eating plans and appealing flavour combinations that will attract newly-taste savvy consumers, are an important component of your butchery section.
At the butchery, consumer interaction is key. It means being available to give advice on the cuts that are in stock, cooking and serving suggestions, as well as proper information on the preparation of meats, especially for cheaper cuts that may turn out very tough or unappetising if not correctly prepared. Consumers want recommendations, and warm, friendly service. Your butchery is a drawcard and a destination shop – keep your customers happy in this department and they will keep coming back for more.
Sources:
https://www.delftbutchery.co.za/
By Ann Baker-Keulemans (
