CAB® Mythbusters
What they thought they knew that just ain't true.
Did you know Certified Angus Beef LLC (CAB) is a nonprofit company?
It's not run by volunteers, nor do we make desperate fundraising calls like some others that might come to mind in that category. (I can assure you I make a salary. As much as I love my job, I do have to make a living, too.)
So that leads us to several myths that all go back to one big ol' fact:
Myth — Cattle producers must pay to have their cattle marketed as CAB. How else does the brand make money?
Myth — American Angus Association membership dues are diverted to support its branded beef subsidiary.
Myth — CAB pays restaurants and retailers to sell their product.
Fact — Those are all false, and simply countered by explaining the fact that we are entirely packer-funded. As we've noted before, we don't own any cattle or product. We only own our brand, and packers pay us a commission to use it.
When an animal is accepted as specified for CAB, a packer can then choose to market it as the Certified Angus Beef® (CAB®) brand — and most of the time, they do. Why? They can sell it for more money, because the distributors know they can sell it for more money, because the restaurants and retailers know a consistent eating experience has inherently more value to their customers.
That pull-through demand has funded CAB for more than three decades, and put more than $300 million in grid premiums in the pockets of farmers and ranchers.
Packers pay an average of 2¢ per pound (lb.) for every lb. sold as CAB. That amount is more for the higher-value middle meats (think filet mignon and New York strips) and less (about a penny) for things like hamburger.
Fig. 1: CAB® Tonnage
Fig. 2: Dollar percentages from commission
So here's how it shakes out: Fig. 1 provides a rough idea of what CAB tonnage is sold.
Fig. 2 shows where most of our money comes from.
That money, our annual budget, is reinvested in the program. We push marketing efforts, help explain the brand to chefs and work on consumer education. We work to open up export markets. We create recipes and design menus. The Black Ink team (otherwise known as the Supply Development and Industry Information Divisions) works on things like research and education on the cattle side of the business, aiming to increase supply. All of this in hopes that the brand you own will be even more valuable and relevant to our licensees. We want partner feedyards to see increasing premiums paid for cattle that make CAB. We want all the folks on the product side of the business to see increased sales, customer loyalty and satisfaction when they use the brand.
We need you to keep producing quality (and getting paid for it) to make sure this whole process keeps working.
To get a regular dose of this kind of information, visit the Black Ink Blog at www.blackinkwithcab.com.
