Superior Farms is the largest harvester and producer of lamb in the world. For some time, Superior was readily looking for several ways to revamp its business and make it stronger. After many long debates with board members, some of whom wanted no changes at all because they felt they were already on top of the market, a resolution was finally agreed upon. Traditionally, you get lamb already fabricated and boxed, unless you are one of the few customers who gets carcass, or you are close enough to one of the plants. The strategy agreed upon, was brought about by the overweight lambs brought to the plant, growing prices from suppliers, and the bust of the lamb market. This bust was brought on by rising costs across the market in general. At the time of the bust, lamb was $3.02/lb for a whole carcass, and the quality of the meat was suffering due to fat content, as well as the growing number of aging ewes that were being harvested. In order to restore its stock back to previous quality, Superior had to get rid of less desirable meat. However, customers wanted nothing to do with these meats because a majority of the customers were of an ethnic background that had religious belief regarding their food. Superior proceeded to buy 20 new trailers, commonly referred to as a railer, which has the capability of carrying carcass hanging from the ceiling. These railers transitioned into higher costs for Superior because they held 39,500lbs instead of the traditional 42,500lbs for a full load, as well as running at a temperature of 32 degrees constantly. After this, Superior negotiated contracts guaranteeing its drivers to haul additional loads that were planned for. It began marketing the hanging carcass to a broader group, and slashed the prices to $2.75/lb on older ewes and down to $2.90/lb on regular lambs two years and younger. Another strategy was to identify five customers in the New Jersey and New York area that could take on substantial growth. Superior offered them a small portion of business; all of the customers who barely ordered the minimum weight every week. It also began tagging the product as Kosher or Halal, and leaving the head on the carcass so the proper killing method could be determined by the buyer upon delivery. As a result, Superior consolidated stops which cost an estimated $150 per stop, and significantly lowered toll cost and diesel waste. Superior also significantly broadened its target market and made its product the most unique in the business. By encouraging larger customers to order, more business increased from two carcass loads a week to four in this region. On holidays this number jumped to five truck loads. As cost of hauling and stock of old ewes went down, the revenues of distributors were increasing. Prices went from $2.75/lb for old ewes to $2.82/lb, and regular carcass was up to $3.05/lb. Superior had taken a big risk and it had paid off substantially by raising price per lb, from the original price before the market bust. The next hurdle was sustainability, how long could Superior keep up this kind of run? A great deal of analysis was done, and the trends showed that Superior had grown from having 48% of the market share to over 64% of the market share and other producers were feeling the squeeze. The two largest competitors were located in Massachusetts and Pennsylvania. The competitor in Pennsylvania was quick to strike a deal, which stated Superior would only buy and sell their veal and they will cease to produce lamb and only sell Superior’s. Massachusetts was not as easy, and they insisted that they would make a comeback without any help. Superior Farms now owns the MA plant, and has broke ground on a new building in order to further develop market. In addition, Superior has also been lobbying for changes in the code for international business that will allow it to ship whole carcass abroad, and would add a larger element of sustainability, revenue and definitely uniqueness.
Strategy is the creation of a unique and valuable position, involving different sets of activities that align with a specific goal. Superior was able to achieve its goals, such as market expansion and lower costs through the activities mentioned above. The goals reached were not through operational effectiveness, simply because no competitors in the industry were performing the activities that Superior had implemented.