Cash Flow and Product Profitability Analysis and Improvement for Small Meat Processors

Purpose of the project is to improve financial viability of small, private meat processing firms through improved product pricing, pricing of services and improved cash flow, With the leadership and cooperation of the Iowa Meat Lab, Dr. Joe Cordray and Matt Wenger, the approach is to develop an Excel-based direct costing software system taught to owners and employees of meat processing firms through six workshops. As a result of the workshops, the staff involved learned that firms 1) do not know their costs, 2) may lack technology and skills to utilize the costing spreadsheets, and 3) do not manage their firms from a financial viewpoint, but 4) desire to learn techniques to better manage their firms. One firm that implemented the cost system and reviewed prices reported a potential 15 percent increase in sales revenue, a savings of 5 percent with a potential of adding 1-2 additional employees. The lesson learned is to continue the effort with another series of workshops and to provide one-to-one assistance to firms.

Contact:
Verl ‘Andy’ Anders
Iowa State University
Center for Industrial Research & Service (CIRAS)
2701 SE Convenience Blvd.
Ankeny, IA 50021-9434
vanders@iastate.edu
515-231-4497