Butcher driving retail prices down
He’s crazy.
At least, that’s what his accountant says, but Matamata’s Owen Henderson is a desperate man and that means even madness looks like a good option.
Henderson owns The Meat Company, a retail butchery struggling to compete with supermarkets ‘‘ smashing specials to destroy each other weekly’’.
The internet adds another layer of competition.
So the Matamata butcher has come up with a survival strategy: he plans to keep the retail side of his business afloat by selling at wholesale prices.
Henderson didn’t make the decision lightly. He has been in the industry 41 years, and has tried several retail models.
After getting his first job at a butchers in Waharoa at 15, he worked his way up the ladder to ownership over 28 years.
The shop was called Waikato Meat Supplies, and when the meat factory in Waharoa closed up Henderson moved his business to Matamata.
That was when he decided to give franchising a go, selling under the Export Meat Warehouse brand until the bills for belonging to the franchise piled up higher than the money coming in.
That is why the The Meat Company co- operative formed three years ago. A group of ex- franchisee owners got together to see if they could get the same group discount deals the franchise offered, while continuing to operate as individual stores.
‘‘It’s just a world of competition.’’
Now, that world of competition is driving him to try one last strategy to keep the retail side of the business afloat.
While people could save themselves up to 40 per cent by buying half a lamb to last them six months, few are willing or able to pay the steep price tag upfront at a retail butcher’s.
As he says, ‘‘ The only thing that counts now is the buck. Loyalty is non existent. People are specials shoppers.’’
That got Henderson thinking. Why not keep the wholesale price, but break it down into smaller packages for people?
He estimates it will save his customers 33 per cent on their meat bill. At the moment you could walk into The Meat Company and buy a mixed 12.5 kilogram pack of prime beef, pork and lamb for $150. All meat and all cuts sell for $11.95 per kg as of the start of the month.
With rent in the retail shop to pay, plus wages and power among other things, Henderson has had to make some changes to give the new strategy the best shot.
He had one staff member leave to go farming recently, and won’t replace him unless sales pick up.
He’s also buying differently. Lamb and pork have to be bought wholesale, but buying a bigger carcass saves a bit. Beef, on the other hand, is still available from local suppliers, and by leaving his wholesaler Henderson has saved a ‘‘ margin of about 10 to 12 per cent’’. He is also breaking bone in the meat himself. As he says; ‘‘it’s a bit labour intensive, but I’m also saving.’’
If it doesn’t work Henderson will just focus on wholesale side of his business. He has several contracts with smaller cafes, and says Hobbiton, Totara Springs Christian Camp and Two Tones Catering have been his ‘‘lifeblood’’.
But he says retail butcher stores don’t need to be consigned to history yet.
‘‘I don’t think it needs to be [dying], I don’t need to be yet.’’