BIC Launches Financial Guide for Retail Meat Operations
"We've had input from the entire industry in building this program," says John Baker BIC's Retail Merchandising Manager for Canada and the U.S. "The result is we've developed a tool that operators can use to ensure the maximum profitability in their beef category. The financial tools are optimized for beef and veal but also support chicken, turkey, pork, and lamb.
"The program is built on sound accounting practices, that explain financial concepts from a retail perspective," says Baker. "These financial tools give the operator the information they need to make management decisions about optimizing their purchasing and understanding their margins.
The entire program includes a compact disc with the Financial Tools spreadsheets and user guide. A financial manual is also provided which explains financial terms and techniques for determining the yield from meat and poultry items. The spreadsheets are Microsoft Excel compatible.
In order to use the financial tools, operators must first complete their own yield tests. By simply imputing information such as original weights, net weights, packaging costs and the elapsed time and labour rates used in producing the item, the operator can build an accurate database that can be used to monitor how specific meat blocks perform, as well as cutting accuracy in-house. This will help them to compare options in purchasing raw material.
"The yield test is the most important technique used to determine production decisions in the meat industry," says Baker. "For example, after performing a yield test, retail operators can realistically look at the cost of processing meat products.
Financial Tools also includes a purchasing management section that assists operators in calculating requirements but also illustrates the quantities of trim and by-products the main item will generate - based on the yields an operator has calculated. This allows for more accurate planning. Say you are planning on having a cross rib steak feature. Using the financial tools yield on the shoulder clod generating steaks, you can obtain information on how many kilos of clods you would need to produce 25,000 kg of cross rib steaks. It will also determine the amount of stew and trim that will be generated off those clods. This will give the operator the opportunity to determine the amount of raw material to purchase for this feature.
There is a comparison tool built into the program as well, so operators can compare different specifications. For example - determining a yield analysis on different specs for prime rib. The program also allows retail operators to compare up to five different primal at a time. A "Help" page is built right into the spreadsheet and operators may quickly access additional help by clicking on links on the www.meatfinancialtools.info Internet site.
"It all rolls together to create a comprehensive program that helps operators make concrete, profitable decisions in their operation," says Baker.
