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How to Run a Butchery in the USA

Carry out a well-seasoned analysis, slice through the competition and discover ways to grow your butchery business.

Butchery businesses utilize their product knowledge and exceptional cutting skills to source quality meat for the delight of their loyal customers.

Butchers trim and cut meat from bigger portions into chops, steaks, roast, and other cuts influenced by clients' demand. They then prepare the meat for sale by performing tasks such as weighing, wrapping, and displaying the meat for sale.

In this article, you'll find tips on how to grow your butchery business successfully.

Market Differentiation

The allure of a butcher is their expertise in making the proper cut to the meat and their knowledge of what meats go with specific dishes. This is the reason why a customer will come to your butcher shop instead of buying prepackaged beef from the supermarket.

The butchery industry is a consolidated market sector which means a small business entering the scene has to offer differentiation in goods and services to increase its bottomline.

Selling to trade customers such as independent grocers, hotels, and restaurants is a great way to increase your value proposition. Before you incorporate this into your butchery business, you should research things like

  • What meat items would they want and in what quantity.
  • How frequently would they need your products?
  • Whether or not they are comfortable with your trade price list.

Additionally, you could extend discounts to specific groups of people such as students and pensioners. You could also extend such discounts on stock, closing in on its sell-by date to cut down on excessive wastage.

Legal Issues You Should Consider

The U.S federal law splits the food processing industry into two major sectors: the meat/poultry sector (which butchery belongs to) and all other food processors. The former is overseen by the FSIS of USDA and the latter by the FDA.

The FSIS (food safety inspection service) ensures that food(meat) deemed adulterated or misbranded cannot be sold. It is your responsibility as a butchery business and not the government's to establish that your products are not adulterated or misbranded.

Market Analysis

Conducting an in-depth analysis on the butchery industry provides you with helpful information that can help you restrategize your business model. From the market research within your local area, you can figure out an estimated number of people that will buy from your business in a day and the amount they will spend.

According to USDA, there are four major players in the meat processing industry, and they control 55-85% of the market. It would help if you learned how this affects you as an individual butcher shop, your pricing, and how to take advantage of the consolidated market space.

Additionally, you need to check out the local competition, direct or indirect, to figure out those you have to battle with for customers and exploit their weaknesses with your value proposition. Your local competitors will include:

  • Supermarkets
  • Convenience stores/ Grocery stores
  • Freezer centers
  • Farm shops and farmers' markets
  • Online butchers

Growth Potential of the Butchery Industry

The butchery industry is a subset of the meat industry. Therefore, financial projections on the meat industry are indicators of what to expect in your butchery business.

In the last five years, the market size of the meat market declined at the rate of 1.3% per year. But there's been a significant shift in the meat market as it is expected to experience a growth of 2.1% in 2022. Also, with a current market size of $170.38bn, the meat market is projected to reach $215.76bn with a CAGR of 3.2% between 2021-2028.

The numbers above are all encouraging indications for the butchery industry. This progression is driven by consumers' increasing interest in ketogenic and protein-rich diets.

Three Interesting Facts about the Butchery Industry

  • According to IBISWorld, the meat markets industry by market size is ranked 54th in the Retail Trade industry and 578th in the US.
  • Meat is a significant part of the average American diet, and it accounts for more than 40%, 20%, and 15% of daily protein, fat, and energy intake, respectively.
  • In 2022, the average volume per person in the Meat Market is expected to amount to 50.8kg.

Innovative Marketing Ideas

The right marketing strategy gets your name and brand out to your target audience. Check out some of these marketing tips:

  • Form meaningful relationships with your local community members. An excellent way to integrate yourself into the community is by supplying local parties and hosting events.
  • Establish a digital presence by subscribing to websites and programs such as Yelp, OpenTable, and Google My Business. Maximize the potential of these sites to build brand exposure.
  • Creating an official website will help you build a digital location where prospective clients could learn about your products, place orders, and give feedback.

Another effective way to attract new customers to your butcher shop is by offering promising deals and promotions. The idea is to make more existing clients by converting first-time buyers with your high-quality products (meat).

Getting Funding for your Butchery Business

Growing your business comes with a huge financial responsibility. You're going to need funds to buy equipment and employ more hands. Here are some tips on how to secure funding:

  • SBA loans are loan opportunities specifically tailored for small businesses. These loans are guaranteed by the Small Business Administration, which makes it possible for small businesses to get favorable rates from Traditional lenders (banks)
  • Private Equity Financing allows you to secure financial investment by giving up equity in your butcher business. Private Equity isn't a loan; hence you won't be required to pay it back. It would do you good to be cautious about giving up too much equity and influence over your business.
  • Equipment Financing is a type of small business loan tailored specifically for the purchase of equipment and machinery vital to the running of your business. You take advantage of this funding opportunity to get tools like meat slicers, meat grinders, scales, packaging machines, etc.

Factors to Consider Before Selling Your Business

There are several reasons why you might want to sell your butchery business like retirement, other business opportunities, or running into loss. Knowing when and how to leave could make all the difference and should be done pragmatically.

Making plans for selling your business in anticipation of your eventual exit could be a powerful driving force for your business. Hence why it's essential to step back and view your business through the lens of a potential buyer when coming up with a plan.

This will help you see what business buyers are interested in and help you work towards making your business worth investing in or buying.

This is where conducting a business valuation plays an important role. It provides you with the opportunity to assess the financial health and potential of business. Taking into account your assets, industry, earnings, and any losses or debt, a business valuation helps you identify what to improve on to make your butchery business buyable.

Your potential buyer will be interested in knowing things like:

  • Your inventory structure and if there's a tracking system in place.
  • Your best selling products (meat) and seasons/holidays they sell the most.
  • State of your equipment, permits, and licenses.


Megan Kelly

About the author

Megan is the Content Manager for Dynamis and researches and writes for BusinessesForSale.com. She is an expert writer and aspiring digital marketer.

@Be_theBoss

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