Growing a business or industry is reliant on consumer spending – no matter the product. Topline, or revenue growth is the lynchpin to new opportunities. And it is far more important than simply looking at sales volume, as that doesn’t reflect total dollars coming into the business.
With that in mind, the beef industry struggled with generating more revenue between 1980 and 1998. New spending on beef products wasn’t occurring; meanwhile, pork and poultry were actively growing market share. During the nearly 20 years in which beef lagged its competitors, it received only $11 in new per-capita spending. Meanwhile, pork and poultry garnered about $110 – a 10-to-1 advantage.
This week’s graph highlights historical spending growth by protein source since 1990. Beef spending was flat between 1990 and 1998. However, since then, the beef industry has captured new spending at a faster clip than pork or poultry. In fact, beef spending eclipsed a new record in 2015 at $340 per person – that represents an increase of $155 per capita since 1998. Beef’s market share now stands at about 48% of all dollars spent on protein.
From that view, how do you perceive beef’s competitive position shaping up in the years to come? Will the economy drag beef’s position down, or does beef still have some room to run to the upside? What does beef need to do to ensure maintaining and growing market share in the future?
Leave your thoughts below in the comments section below.
Nevil Speer is based in Bowling Green, Ky., and serves as vice president of U.S. operations for AgriClear, Inc. – a wholly-owned subsidiary of TMX Group Limited. The views and opinions of the author expressed herein do not necessarily state or reflect those of the TMX Group Limited and Natural Gas Exchange Inc.
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