GOING LOCAL MAY HELP UNTANGLE MEAT SUPPLY CHAIN KINKS

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Sourcing beef and pork from smaller local producers will alleviate some supply chain headaches. And it’s not necessarily more expensive.

This article was published in Restaurant Business.

 

November 23, 2021 by Patricia Cobe, Senior Editor Restaurant Business.

 If steaks, burgers, barbecue or chicken are your restaurant’s bread and butter, these are challenging times. 

Production took a nosedive during the pandemic, meat processing slowed or stopped completely as packing houses shut down, and now a shortage of truck drivers is delaying deliveries—all tangling the meat supply chain in knots. 

Even if a restaurant isn’t meat-centric, most entree lists include chicken, beef or pork. Protein demand is high as consumers return to dining in, but low supply and increased costs are impacting menu flexibility and profits. 

Some operators are finding relief by sourcing from smaller, local producers instead of relying on the giant meat suppliers and distributors. 

Rob Levitt, head butcher and chef de cuisine of Publican Quality Meats in Chicago, is a big fan of local sourcing, building up relationships with Midwest farmers over the years. It has proven to be a symbiotic arrangement that works well for both sides. 

“Big meat companies will do everything they can until it doesn’t work for them anymore. Small producers will do everything they can to make things work for you,” he said. 

Levitt commits to purchasing a certain amount of meat every week from each of his farmer-partners. There are no written contracts—just verbal agreements. “I’ll send a text message and take whatever animals or meat they can provide. I can always do something with it,” he said. As both a butcher and a chef, Levitt knows how to break down whole animals—a skill that has come in extremely handy in the last two years. But he also sources from producers who send pan-ready meat cuts and fresh hams and shoulders. 

“Instead of cutting a pork loin into chops, I can cure it and create a product much like prosciutto,” he said. “Or I’ll grind some into sausages. You have to be willing to get creative and be flexible about the menu.” 

While the larger family farms often do their own processing, smaller operations tend to sell whole animals and sub-primal cuts. Interestingly, the traditionally cheaper cuts are rising in price more than the more expensive ones, said Levitt. Some of these—like eye of round—are more difficult to cut out of the animal. And the shortage of skilled labor is pushing up the price. Publican Quality Meats sources and sells about 700 pounds of steak, 1,000 pounds of pork and 200 chickens a week. And although commodity meats can be somewhat cheaper, the prices are getting much closer to what small farmers are charging, Levitt said. Plus, the farmers deliver the meat to the door, eliminating transportation snags and costs. 

The cost equation 

Giuseppe (Joe) Soccodato, managing director of CohnReznick, an industry advisory firm, agrees. “It used to be so much more expensive to source locally, but the local option is not as cost prohibitive as in the past—especially when you add in trucking costs from far away,” he said. There’s also a marketing advantage to sourcing locally, Soccodato added. “Reaching out to small, local producers provides a sense of community. Consumers are more aware of the importance of community since COVID,” he said. 

Tony Smith, CEO of Restaurant365, is on the same page. “Putting money into the local eco-system benefits your restaurant,” he said. 

Smith’s restaurant-management software company takes care of inventory control, ordering and invoicing for operators, and he’s seeing more customers changing to local vendors, especially when it comes to proteins. He also cites shipping costs as a major reason, but a fresher product also plays into the decision. 

Ironing out the logistics 

Operators who have been working with one supplier or distributor in the past may find it challenging to locate local producers or farmers. 

Levitt suggests getting in touch with meat retailers and butcher shops and ask them to share their contacts. Farmers markets and other independent chefs are also information sources. During COVID, many smaller producers ramped up production as supply decreased from the big meat companies. 

Larger restaurants should communicate with their distributor and ask them to find local vendors. It no longer makes sense to rely on one meat supplier; lining up several local sources provides a restaurant with more flexibility and control, said Soccodato. 

While verbal agreements may work well for a smaller independent, a distributor can take care of the paperwork, contracting to set volumes and other details. “Ordering, delivery and other details are different with every producer,” said Soccodato. “And operators have to expect to do more on their end, like cutting steaks and grinding meat for burgers. It’s a learning curve.” 

Quality control is also a consideration. “Bigger meat suppliers may have more investment in food safety and more consistent inspections,” he said. “Make sure a smaller farm is USDA certified.” 

Butmeat supply chain problems aren’t going away any time soon, Soccodato predicted. Building a network of local suppliers—even to augment supply from a larger vendor—makes sense. “There will be minor improvement in 2022, but nothing that will move the needle,” he said. “Operators may have to wait until 2023 before there’s much relief.”