When Molly Descheemaeker and six other ranch women from central Montana started their branded beef business in 1978, little did they know the course they were charting. Now, after a 20-year hiatus, their label — Montana Ranch — has morphed into a multi-million-dollar, branded fresh-beef enterprise.
Descheemaeker, Grass Range, MT, was secretary-treasurer and chairman of the board of the small company that produced the premium “pure” canned beef the women sold literally out of the trunks of their cars — and via mail order. After finding markets in all 50 states and overseas, the demands of family ranch life prevailed over economics and they put the business on ice. The group kept the brand name registered, however, and never lost their appreciation for what it means to put your name on a label.
“It was a branded-beef program before there were branded-beef programs — except it was in a can,” Descheemaeker jokes. “Seriously, cull-cow prices were so low in those days, we couldn't see any reason why we couldn't do better by selling our own beef directly to consumers.”
While the early version of Montana Ranch Brand was run on a shoestring, it did hold back a little money in the coffers, money eventually plowed into what's now known as Montana Ranch Brand Natural Meats.
Today, Descheemaeker's husband Larry, and sons Pat and Greg, are partners in the company that's entered the fresh “natural” branded-beef business with the same energy and vision that brought the original concept to market.
“These guys are asked to produce and promote an entirely different product, but the same challenges and opportunities exist,” she says. “They took over our brand name and gave it the professional look we never had the capital to develop.”
Descheemaeker's optimism lies partly in the nationwide movement away from “commodity” beef and to “program” beef — something she believes Montana Ranch Brand can capitalize on very soon.
“We're in an entirely new era in the beef business. I think they will be a whole lot more successful this time around,” she says. “The time is right.”
Program beef production
Montana Ranch Brand's Authentically Natural Ranch Beef is raised without added growth hormones or antibiotics, and falls under the USDA classification of “minimally processed, no artificial ingredients.” The company's featured product lines are split about 50/50 between “natural” ranch beef and Certified Piedmontese Beef.
A double-muscled breed, Piedmontese exhibits superior muscularity and leanness because of mutations of the myostatin gene. The gene is involved in control of the number of muscle cells that result in generally more tender beef with less marbling.
Of course, the owner/investors in Montana Ranch Brand want to cash in on the appeal of Montana's image. It's an image that helped draw Ron McAdams, Big Timber, MT, into the business aspect of Montana Ranch Brand.
“I've felt that as a resident of Montana — although for only 15 years — this is the type of business I should be investing in,” he says. “I don't own cows, but I own a ranch I lease out — so I have a connection to the state and an interest in seeing a sustainable and profitable beef industry as a whole.”
His second motivation is his firm belief in allowing consumers a choice beyond commodity beef — especially guaranteed “natural” beef as a segment within program beef production.
“‘Natural’ is something I want to be involved in,” he explains. “I'm not saying growth hormones shouldn't be used, I simply want to participate in one of the most dynamic growth areas in this business.”
McAdams has deduced that by working to provide a differentiated natural-beef product as an alternative to conventional beef, outfits like Montana Ranch Brand can reach a consumer base that might not otherwise consume beef, or as much of it.
“Overall, beef demand could indeed get a boost from consumers who perceive they're getting a more wholesome product,” he says. “It stands to reason that if in fact we're helping to expand the consumer ‘pie,’ everybody in the beef industry will benefit.”
Looking for cattle
Ralph Peterson, Billings, Montana Ranch Brand's president and COO, has been with the company since its formation 18 months ago. He came to the program from Montana Range — a similar program that originated from the Billings, MT-based Leachman family of companies.
“We specialize in servicing small, independent retailers with whom we can develop close relationships,” he says. “Our goal is to partner with them to provide source-verified, natural meat products.” He wants Montana Ranch Brand to be the direct source of beef for their stores.
“We want to be the beginning and end of their meat programs,” Peterson explains. “We want to be thought of as their ‘cousins’ on the ranch providing meat products they can trust.”
Montana Ranch Brand is offered in nearly 50 stores in 10 states from California to Connecticut. Peterson keeps busy traveling to current and prospective customers, doing in-store demos, learning about the local businesses, and negotiating contracts.
“Of course, we want to get into more stores and fill more space in their meat cases,” Peterson says. His goal for 2006 is $10 million in sales. To do so, Montana Ranch Brand needs more — and the right kind of — cattle.
“We'd like to focus on Montana producers and work toward someday sourcing our entire product from within the state,” he says. “But for now, we're looking throughout the Great Plains and Intermountain regions for producers who want to work with us.”
Anyone interested in becoming a part of a value-added production and marketing program should contact Peterson. “We'll evaluate them and their base cattle herd first, and their location second,” he says.
Montana Ranch Brand cattle are being fed in several approved feedlots, harvested and processed in Hastings, NE.
Peterson reports a “pretty nice” incentive structure for producers who go through the extra steps required to produce the kind of cattle that meet the brand specs. Cattle raised for their natural program can earn up to $100/head in premiums for the finished animal.
“What we really need are more producers who will get involved in our Piedmontese program,” Peterson says. “Our premium structure is geared toward high-muscle genetics. We need that muscle in the ‘money meats.’”
The value chain
John Grande, Lennep, MT, is a rancher/investor in Montana Ranch Brand. He's getting involved mainly because he sees opportunity in producing what's become known in the industry as “story” beef — and believes there's some value to the “Montana” label.
When it comes to talking about the natural connection, Grande goes beyond political correctness.
“We're still producing commodity beef though, and we're not here to say one production system is better, or produces a more wholesome product, than another,” he says. “The science just isn't telling us that natural beef is any better for a person than conventional beef.”
But science or not, he thinks if there are market opportunities in producing natural beef it's something worth looking at and worth an investment. He's interested enough to have traveled to product promotions in Pennsylvania and New Jersey.
“I've talked to people who at first tell us they don't eat beef, and five minutes later they're buying our product,” he says. “We're a differentiated product; if there's opportunity, why not work to capture that share of the market?”
Molly Descheemaeker says the key is fitting together all the pieces that collectively form the value chain and ultimately promise a better return for the rancher.
“We've started this business by providing a product we can be proud of — and a product we'll stand behind,” she says. “That's what goes with putting your name and your reputation on the label for everyone to see.”