LETTER ABOUT CUTTING BEEF PRICES SPELLS PUBLICITY

DENISE ZIMMERMAN

Wheatland, Wyo. -- A letter sent by an independent here to consumers to inform them of its intention to slash beef prices bought more publicity than it bargained for.

Addressed to consumers and beef producers, the letter announced that the local independent Jack & Jill would "significantly reduce our retail prices on all fresh cuts." The public statement generated news coverage on both CNN and the Associated Press news wire.

"Our intention is to help the producers, and we are," Mac McDowell, a partner in the retail firm, told SN. "Yesterday we doubled our beef cutting, but more interestingly, we are getting a lot of opportunity to sell other groceries along with it."

Mac McDowell told SN that with beef prices as low as 55 cents per pound, it was difficult for ranchers to make money, whereas at retail beef was still relatively profitable.

"We cut our margins to the bone in our fresh meat department and put out a letter that we were supporting agriculture. I think it's a real opportunity for supermarkets to do the right thing, and it could work very well for them in terms of customer response. What I'm saying is we might be able to increase beef [consumption], get the market back up, and help stores that need sales growth."

In the letter, owner/operators Mac, Sharon, and Adam McDowell expressed sympathy for the beef industry's perennial complaint.

"We here at Jack & Jill have some of the same questions concerning the inequity between the low market price paid the beef producers and the retail prices charged our customers for fresh beef," the letter said. "Why haven't retail prices reflected the lowest prices paid the producers in 10 years?"

The McDowells went on to say that the profit margin in beef at Jack & Jill had not significantly changed in years.

"Maybe this act is mostly symbolic on our part," the letter continues. "The influence we can have on the market is admittedly small, but someone has to do something, someone has to take the first step to increase the demand for beef."

"We challenge all packers, retailers and wholesalers to follow our lead."