GSE Blog 

Premium Customers Demand More.

Organic. Grass-fed. Free-range.

Individual Animal Traceabilty is the Future of Higher Bottom Lines.

Premium Certifications Increase Revenue

In the retail beef market, USDA Organic and other certifications command premium pricing with staggering markups.

Prior to the existence of the GSatRancher for individual animal tracking, there was no viable option available to prove producers’ claims that their animals are Gress Fed, Free Range, or USDA Organic with the exception of certification audits conducted by private sector certification agents. In fact, the certification requirements were last updated in 2013, at a time when just over 50% of americans owned smartphones, compared to 85% today. Technology has advanced significantly since the last time certification requirements were defined, and the expectation is that in time, they will follow the advancement of technology and require traceability data for certification of animals as USDA Organic.

Certification has a tremendous effect on the retail price of beef products, representing an average of 80% markup over non-certified counterparts, with high disparity at more than double the normal price and low disparity in the mid-30s. Regardless of how much of this markup is passed along to producers, it is clear that consumer demand for certified beef products is high enough to justify significant pricing premiums. People want to know where their beef comes from, how it was raised, what it was fed, and what was injected into it. This places more value on pasture-raised animals over feedlot and grain-fed cattle.

Verifying Requirements with GSatRancher

Traceability from calf to cut tells people everything they need to know

The three major classifications for premium beef products are USDA Organic, Grass Fed, and Free Range. While the latter two currently carry less stringent requirements, USDA Organic requires animals to come from farms that meet criteria related to the production methods. As lifecycle data becomes more available, the expectation is that ranchers who can prove the free-range life of their cattle will be able to charge more in the future for the level of transparency consumers crave. Imagine a world in which certification agents, grocers, shoppers, and restaurateurs can scan a QR code on a package and see the entire 2-3 year grazing history of that animal on their phone. GSatRancher makes that a possibility.