Processing Costs 64% of Sales

Tamworth Sow in Grass Nest

In the Butcher Shop article in 2009 I had explained that processing cost us 36% to 50% per pig. Costs have gone up. Last year the meat processing cost us about 64% of our meat sales. There was more sausage making and smoking which is part of that percent cost increase but the actual cost of processing climbed during that time too. It also required driving 25,520 miles, about 1,700 gallons of gasoline and 510 hours of our time driving plus about 416 hours of time related to taking the animals to slaughter, unloading at the slaughterhouse and picking up the meat. That’s about 18 hours a week. This is the cost of hired processing and trucking.

One might argue that if we used a closer processor the miles would be fewer but the reality is the other processors make us drive twice a week to them so the miles and time end up being almost the same as driving once a week to Adams Farm Slaughter in Mass. Adams is willing to hang and age our meat which allows for the single trip per week and gives top quality. The Adams family also does a far better job than any of the processors we’ve worked with in Vermont and New Hampshire so it is worth the extra drive for their humane handling and attention to detail. Quality costs but it pays.

There is also the issue that only one of other the processors besides Adams does the vacuum packaging the way we need for store sales so that right there eliminates them from the competition. Store customers want to see what they are buying. Presentation is important.

This 18 hours a week doesn’t include things that happen here on the farm related to taking to butcher such as loading the pigs, sorting meat into the freezer here for the little bit that is left over in any given week or the approximately 14 hours a week we spend doing deliveries. Deliveries is another 728 hours a year. She’s a busy lady.

The other day she looked at me and said, “you know what… I have a crazy idea… Let’s build our own butcher shop…” I told her I would give it some thought.

Outdoors: 66°F/43°F Patches of Sun
Tiny Cottage: 68°F/65°F

Daily Spark: I dream in math.

13 thoughts on “Processing Costs 64% of Sales

  1. Great idea, the more middle men you can cut out the more profit for yourselves. Hey Walter when you start butchering your own hogs at your new butcher shop will you be doing it or will you be looking to hire someone to do it for you?

  2. Thats the way to go, if you manage to set it up right so the pigs don’t get spooked like they do going on a truck and arriving at a strange place, you’ll end up with some of the tastiest pork available in stores. We used to have a man come to our farm to kill and bring the meat to his shop, …until the government shut him down(not because he was doing anything wrong, up here they forced everthing to be killed at an abbatoir). When the cattle don’t have a chance to relase stress hormones, their meat stays super tender.

    • Here in WA the law is that you can use a field butcher, and this is all state-inspected, but then you can sell only whole carcasses, direct to the end user, and that end user can’t be a store or a restaurant.

      To sell by the cut, or to sell to a store or a restaurant, it all has to be UDSA-killed and cut. We have a USDA mobile slaughter unit, but “mobile” is a relative term. It’s a 40-foot semi, and as such it’s not coming to my place.

      I don’t transport. Not beef, not hogs, not anything. I use the field butcher, with his smaller kill truck, and I accept the tradeoffs. The animals die instantly and unsuspectingly with a bullet between the eyes, and are dead before they hit the ground. No stress, no adrenalin in the meat. It’s much less time- and labor-intensive, and I still make a very comfortable, thank you, profit.

      Once I get paid for my hanging weight and the per-head slaughtering fee ($65 for a hog, $85 for a beef), I am out of the picture, and all cutting and wrapping is betweeen the customer and the butcher.

      There are many ways to do this, but I opt for the quickest, most stress-free, and most humane slaughter method I can get. If I can’t put the animals first, I shouldn’t be doing this. I have found that my customers appreciate this approach.

  3. Have you done any projections on whether or not the in house butchering will result in a net savings? Or is the primary objective to have further control over your product?

  4. The processing costs are really eating up our farm’s profits too. Thats when we can get processing. You’re really smart to build your own facility. We are still too small to justify the cost but I hope to grow to the point where we can. My parterner and I are considering that maybe what we need to do is also process for other area farms and do the deer season. That way we would be able to pay for the facility and have it available when we need it. The biggest problem is the seasonality. We need the processing in the all and that is when everyone else needs it too. How do you get around that?

    • We take pigs to market every week of the year. It took several years to develop the techniques for farrowing and raising the pigs through the winter as well as time to develop the fresh weekly market year round but was well worth it. I did this because we need income year round, not just in a big spurt in the fall. That in turn made it so that it was easier to justify building our meat processing facility.

    • We are planning to do weekly:

      10 cutter pigs (slaughter+butcher+sausage+smoking)
      5 roaster pigs (slaughter only)

      That comes to about 65 a month and a bit over 700 a year. I expect that there will be seasonal variations just as there are now since many people think to buy in the fall, some stores and restaurants slow down in the mid-winter, there are rushes on hams around the holidays of Christmas & Easter and then in the warm months there is greater activity on roaster pigs. We can easily handle 20 pigs a week with the setup as designed.

      Note that we will just do slaughter one day a week and we do all the work ourselves. That is all the capacity that is necessary for our needs. Someone building a similar facility to ours in size could handle far more. With some minor adjustments and more workers we could do 400 to 1,200 pigs a month but that is a lot more than we want to do.

      In a few years we will add rose veal (grass & milk fed young cattle), full size beef, sheep again and possibly goats as well. With that in mind we have designed an extended dry aging space into our chiller and the abattoir ceiling is 20′ tall to handle the high rail necessary for larger animals.

      You might find this article of interest: Butchering Capacity.

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