Models

Throughout our analysis we have considered several models. We started with a value chain to identify the gaps we needed to fill in this part of California (Value-Chain).

We hired Keith DeHaan of Food and Livestock Planning, Inc to do some basic models, based on many assumptions, to test the economic feasibility of a livestock processing facility in our region. While these models will change drastically as the facility site and design are nailed down, they do show that in fact, a facility would be economically feasible and have a chance for high investment returns in our area. The models can be downloaded here C.GROWN plant size modeling 7-30-12 and here C-1.GROWN meat plant modeling 8-30-12.

Below are some of the various models we looked at during the process and our conclusions about them. For a more thorough discussion of all the models we examined, see the RBEG Final Report. For more details on any of these models and our analysis of their suitability, contact us.

Model 1 – Pie in the Sky

  • Start by purchasing a piece of land and build our ideal model from scratch
  • Approximate cost $2-5 million
  • Facility would include: a primo location, cut and wrap, slaughter (20-30 animals per week), hanging space for 3 week aging, commercial kitchen, retail space, composting on site, waste-water treatment, capacity for value-added products (jerky, sausage, corned beef, smoking, etc), poultry line, cold storage rooms for rent, shipping capability, hide/leather tanning
  • Business Plan for this facility: Business Plan

Model 2 – Rennovation

  • Renovate an existing vacant building
  • Approximate cost $1.25-2.5 million
  • Facility could include most pieces listed above
  • Limited by available facilities and could still be cost prohibitive while struggling with neighbors/zoning/space constraints

Model 3 – Mobile

  • A cheaper alternative
  • But research and experience shows that they don’t work because of the amount of time you must spend breaking down, cleaning, and transporting the facility
  • May work if used as a stationary facility with only one docking station
  • Still need a facility for cut and wrap

Model 4 – State to USDA

  • Upgrade from state certification to USDA could be a more reachable goal, but it has never been done in California
  • Would still need to add slaughter to the facility (mobile facility docked here?)
  • State certified facilities that are in existence are there because they have successful business plans, so they are hesitant to change

Model 5 – Transportation

  • As a short term solution to the processing problem in our area, we considered a transportation cooperative
  • Would save money and time of ranchers
  • Could create more pull for small ranchers who currently can’t get in at full processors
  • Cost is $115-$150 per beef for transportation to and from a facility
  • Detailed model: TransportationAnalysis

Model 6 – Marketing

  • Research shows that it may be necessary to have two separate businesses – processing facility and marketing
  • Marketing would focus on a regional brand encompassing meat and potentially other products from the foothills of California. Working title is Mother Lode Meats or Mother Lode Foods
  • Would market a brand of meat to urban and local areas, focusing on meat bought from local ranchers with certain standards maintained
  • Could also market other products – offal, hides, and food products made in the facilities in Model 1 or Model 2, above
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