After reading yet another article questioning whether Wal-Mart is losing its way by introducing organic products, Choice beef and higher-end products, I have to wonder about our arrogance. Wal-Mart is the 800-lb. gorilla – both loved and hated for its size. There's no doubt that Wal-Mart's decision has shifted the pricing of Choice/Select product and, if they continue to do so, will once again alter the marketing landscape. But, whether that's a good or bad thing for individual producers depends on the type of cattle you feed or the selection emphasis you place on your breeding programs.
But, from an industry standpoint, the question is simply this: Will this mean selling more or less beef, and will it result in more or fewer total dollars flowing back to the industry? I wouldn't presume to know, but more choices being offered to consumers by our biggest customer probably isn't a bad thing.
Wal-Mart is a lot of things, but one thing the retailing behemoth is very good at – besides managing supply chains, lowering costs and managing inventory – is assessing what its customers want. Thus, I'm inclined to defer to its judgment. Wal-Mart obviously is positioning itself in the manner it feels is best to gain market share and increase profits. Wal-Mart's focus and goals are intertwined with us nearly as much as with their direct customers and shareholders.
What's more disturbing to me is that some of the articles I've read question whether Wal-Mart's offering higher Choice product is somehow in conflict with its push for more emphasis on sustainability. It isn't Wal-Mart, but commentators, who are suggesting that producing a quality product and producing more food with fewer resources is somehow in conflict.
But it's these hidden connotations that represent risk to our industry. Efficiency is essential, but if we are ever to really rebuild demand and our industry, it will be done through meeting consumer demands more effectively. And, that goes beyond price, value or even eating quality.