Walmart and USMEF: a winning partnership in Central America

Markets
Mar 7, 2014
by WLJ

The largest collaboration between Walmart and U.S. Meat Export Federation (USMEF) in Central America to date recently concluded in four countries in the region. Walmart in Costa Rica, Guatemala, El Salvador and Nicaragua worked with USMEF on a six-week “Ten New U.S. Beef Cuts” promotion at 27 stores in the region that produced a solid 70 percent sales growth and a promise of continued collaboration in the future.

In addition to promoting the 10 U.S. beef cuts in the region, USMEF trained Walmart personnel in a special program to familiarize them with the specific attributes of the cuts as well as information on U.S. cattle breeds, grading, marbling, cold chain management, proper meat handling, and tips on cooking or grilling the new cuts. The program was developed with support from the Beef Checkoff.

“Grilling is an important summer family activity, and we developed this program to help Walmart staff teach their customers how to grill or prepare these new cuts in the kitchen,” said Gerardo Rodriguez, USMEF Trade Development Director for Mexico and Central America. “The response from the Walmart staff has been spectacular.”

The 10 cuts featured in the promotion were: short ribs, rib-eye center cut, Delmonico, New York strip loin, outside skirt, culotte, inside skirt, T-bone, flap meat and sirloin. The promotions were conducted at Walmart’s supermarkets called Mas x Menos in Costa Rica, Paiz in Guatemala, La Despensa de Don Juan in El Salvador and La Union in Nicaragua.

In addition to promoting the products at the meat case, the stores also set up cooking demonstrations outside the store (inside in El Salvador) where a different cut was prepared hourly. The stores installed meat coolers and checkout stands at the outside demonstration sites so that motivated customers could easily purchase the products.

The results—a 70 percent increase in sales among a targeted higher-income audience—drew a favorable reaction from Walmart executives, who already are looking ahead to further collaboration with USMEF on a wider range of cuts, including both beef and pork.

“The promotions with US- MEF brought new clients to our stores,” said Rodrigo Cordero, Central America trade manager, meat division, for Walmart. “We had teamwork with a shared objective. Looking ahead, we are thinking of expanding to different cuts to target a wider variety of consumers.”

Cordero noted that the unique promotion with US- MEF that combined product sampling with a demonstration on how to handle and prepare the product was a first for Walmart. Typically, the grill is used just to prepare products for sampling.

The addition of education on how to prepare both the grill and the meat for the best results was a new approach. Some consumers purchased the product and asked the chef to prepare it so it could be taken home for the family dinner.

Making a difference for the consumer

 

“At the end of the day, the consumer is grateful if you make a difference for them,” said Cordero. “If we can help the consumer while increasing our sales by mixing sampling and education, the program is a success. This program helped educate shoppers so they will know how to use the cuts of beef after the promotion is over.”

Walmart matched the re sources that USMEF brought to the promotion, showing its commitment to the program’s success.

“Walmart made a significant investment in this program,” said Rodriguez. “But the true measure of success is how much of that growth we can sustain after the promotion ends. We will be working closely with Walmart and monitoring that in the months ahead.”

Rodriguez believes this program yielded strong results because it educated both the retailers and consumers. The demonstrations, which seated anywhere from 25-35 consumers at a time, covered everything from charcoal placement, fire safety and grill cleaning to the proper cooking temperature for rare, medium and well-done meat as well as preparation of meat for cooking. While the primary goal was to help sell U.S. beef, consumers also could purchase grills and cooking implements.

 

Beef exports to Central and South America through the first half of 2013 are up 12 percent in volume and 11 percent in value to 19,327 metric tons (42.6 million pounds) valued at $70.9 million. The promotion with Walmart is giving U.S. beef strong visibility in an area where the U.S. competes directly with Nicaraguan beef. Nicaragua is the leading beef exporter to both Costa Rica and El Salvador, and No. 2 behind the U.S. to Guatemala. — USMEF

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