A New Way to Buy Beef

W A S H I N G T O N, Feb. 26 -- The corner butcher shop is gone. The supermarket meat cutter may not be far behind.

In a bid to boost profits and cut labor costs, giants of themeatpacking and grocery industries are trying to change the wayconsumers buy beef.

It would no longer be cut and wrapped at theback of the store, instead arriving at supermarkets prepackaged andcarrying brand names that packers hope will one day be as familiaras Kellogg's and Campbell's.

Packers can make an extra 60 percent profit on prepackaged,name-brand beef, said Christine McCracken, an analyst for MidwestResearch. Beef that's sold in bulk to supermarkets for $1 per poundwould go for $1.60 if it's sold with the brand.

Stores make up the difference in costs by eliminating the needfor meat cutters, who are among the highest-paid employees.

New Development in Food Industry

For consumers, the prepackaged beef will be handled less,reducing the risk of bacterial contamination, and it will be easierfor stores and health officials to trace when there is a problem,say industry officials.

Special leak-proof, oxygen-rich plastic packages — a newdevelopment in the food industry — ensure that the meat has thebright red color of meat that's cut inside the store. Without thatpackaging, the beef would turn brown, a sure turnoff to shoppers.

"We really believe it's the way the industry is going to go,"said Gene Leman, chief executive of fresh meats for beef industryleader IBP Inc., which introduced its Thomas E. Wilson line of beeflast year.

Wal-Mart is switching all its beef sales nationwide to Thomas E.Wilson.

Consumers want "a name in the fresh meat case that they cantrust time and time again," Leman said.

‘A Win-Win for Everybody’

Poultry giant Tyson Foods Inc. is betting IBP is right. Tyson,whose brand name now dominates U.S. chicken sales, wants to do thesame in beef and pork and recently won a bidding war with rivalSmithfield Foods to buy IBP for $3.2 billion.