NEW HEALTH AND FLAVOR TRENDS IN SAUSAGE BUSINESS PLAN AND PRELIMINARY MARKET ANALYSIS

Haen Meat Packing, Inc. Team Members: Thomas J. Nack David D. White www.haenmeats.com W1910 County KK Kaukauna, WI 54130 Phone: 920.766.3239 Fax:920.766.4786

Company Background Established as a family owned business in 1959 Currently owned and operated by four Haen brothers Full service meat market featuring custom slaughtering, the finest cuts of meat, cured and smoked meats, and sausages Other items include cooked ready to eat products, soups, homemade pizzas, etc. Over 200 State and National awards 5 Governor’s Cups

Company Goals Continue to be thought of as a trend setter in regards to developing new and exciting products Offer more exotic tastes for the ever changing consumer tastes

Product Development Must be able to produce new product using existing production line Expansion in product line should lead to increased sales Product should reflect current market trends that capture Midwestern audience Product should have “premium” attributes yet remain affordable to the local market

Project Overview Aim Objectives To develop two specialty sausages that will diversify and complement existing products Objectives Increase sales by responding to new trends in the marketplace Offer a healthier low fat option for consumers Build upon reputation of leading local sausage producers when it comes to new innovative products

Project Overview Constraints Competition from large, multi-national meat processors offering products that are lower in price and quality Developing a competitively priced “premium” product that fits Midwestern budgets Can’t be overly creative, where consumers might be afraid to try the new product

Sausage Defined as comminuted seasoned meat stuffed into casings May be smoked, cured, fermented, and or cooked Made from any edible part of a slaughtered animal Formulation is always a compromise between quality, cost of raw materials, and technique used 2 general groups: fresh and heat processed

Product Concepts Gyro Sausage with Feta Cheese The great taste of a gyro without the mess Spicy Chicken Creole Sausage Lower fat option with a little added kick

World Population Trends

U.S. Population Trends http://gislounge.com

Outagamie County, WI Haen Meats Between 1990 and 2000 a 15% increase in population

Outagamie County 2003 Population: 167,411 2030 Population projection: 215,720 Population % increase of: 33.91 Median household income: $49,613 Per capita income: $21,943 Land area: 640 sq. miles http://quickfacts.census.gov/gfd/states/55/55087.html

Nutritional Requirements http://whyfiles.org/179food_pyramid/2.html

Possible Health Issues

Why Dinner Sausage Healthy aspects of the lower fat option Sales are booming Its and all occasion product Convenience Most profitable meat product

Market Data The total sales of dinner sausage alone was $1.5 billion last year; increasing 5% from 2003. A majority of the new SKU’s were of ethnic variety, upscale gourmet, or heat and serve (Petrak, 2004) Americans consume about 1.7 billion servings of dinner sausage annually, with fresh sausage making up 62% (Consumer Insight, 2002) Chicken sausage hits the health trend by reducing the fat content by 90% as compared to normal pork sausage (Major, 2004) This is probably why chicken sausage has increased 1454% from 1998-2002

Market Data Top 10 markets grossed over $450 million in refrigerated dinner sausage sales Dinner sausage consumption is uniform throughout income levels Dinner sausage sales peak during the summer months http://www.ers.usda.gov/publications/foodreview/jan1996/frjan96a.pdf

Market Forecast Bon Appetite named sausage one of two top food trends, and the Mintel International Group reported that dinner sausage is the fastest growing category within sausage increasing 36% between 1997 and 2002. (Major, 2004) Business Trends Analysis predicts total annual sausage sales to reach $9.7 billion by 2010 The large boom in the sausage industry will most likely continue due to its convenience, the low carb craze, and the new exciting flavors promoted in supermarkets, restaurants, and cooking shows (Harper, 2004)

Target Market Our product concepts will target adults rather than children due to the bold flavor profiles Men consume more sausage then women, but since women tend to do more of the shopping we want our product to appeal to both sexes

Marketing and Advertisement www.haenmeats.com

Competition Haen Meats competes with other local small scale meat markets such as Beck’s, Cedar Creek, and Jacob’s Meats. Also competes with the large multinational companies selling products at local grocery stores.

Profitability Pound for pound, sausages outperform all other meat items by 19%, in terms of profitability (Harper, 2004) Current lines of sausages at Haen Meats sell with a 40% mark up No additional capitol will be needed for this business venture

Summary of Project We would like to help Haen Meats diversify there award winning line of sausages The concepts will stem from predicting future Midwestern trends based on current national trends The overall goal is to create a buzz among the existing consumers, and this will in turn generate new customers

References Harper, Roseanne. 2004. Sales Link; from breakfast to dinner and beyond, sausage is spicing up meat case sales with new varieties and styles. Supermarket News. March 15, 2004. Major, Meg. 2004. Links to the future: As the low-carb/high protein craze continues, the sausage industry is smoking with new flavors and convenient products to augment continued category growth. Progressive Grocer. February 1,2004. Petrak, Lynn. 2004. Hitting the links: Dinner sausage sales post gains for the year as consumers seek comfort foods with convenient, flavorful twist. The National Provisioner. August 1, 2004. Petrak, Lynn. 2003. The daily grind: flavor, convenience, and demand for protein are fueling sausage category growth. The National Provisioner. July 1, 2003. http://www.haenmeats.com http://www.ers.usda.gov/publications/foodreview/jan1996/frjan96a.pdf http://whyfiles.org/179food_pyramid/2.html

The Great Sausage Race at Miller Park in Milwaukee, WI.