‘Making It Work’ is a series that tells the stories of small business owners struggling to survive difficult times.
Many people may conjure up romantic fantasies of the vast valleys, cold streams and snow-capped mountains of Montana ranches, but few understand what happens when the cows leave those pastures. It turns out that most of them don’t stay in Montana.
Even here, in a state with nearly twice as many cattle as people, only about 1 percent of the beef purchased by Montana households is raised and processed locally, according to estimates by consulting firm Highland Economics. As in other countries, many Montanans instead eat beef from as far away as Brazil.
Below is the typical fate of cattle started on Montana grass. The cattle will be purchased by one of the four major meatpackers (JBS, Tyson Foods, Cargill and Marfrig), which process 85% of U.S. beef. Carried by companies like Sysco or US Foods, distributors with a total value of over $50 billion. It is sold at Walmart and Costco, which together account for about half of America’s food costs. Ranchers who want to break away from this system – to sell their beef locally instead of traveling across the country as an anonymous commodity – are David in a flock of Goliaths.
“Beef packers have a lot of control,” said Neva Hassanein, a University of Montana professor who studies sustainable food systems. “They tend to have a huge impact throughout the supply chain.” “It’s kind of a trap,” she said, for domestic ranchers who are seeing diminishing returns over time.
Cole Mannix is trying to escape that trap.
Mr. Mannix, 40, has a philosophical bent. (He once thought of becoming a Jesuit priest.) Like his family since 1882, he grew up working on a ranch, baling hay, calving calves, and driving cattle to the highlands on horseback. He wants to give the next generation, the 6th generation, the same opportunity.
So in 2021, Mr. Mannix co-founded Old Salt Co-op, a company that aims to change the way people buy meat.
While many Montana ranchers sell their calves when they are less than a year old to multibillion-dollar industrial machinery, never to see them again or make a profit, Old Salt’s cattle never leave the company’s hands. Cattle are raised on Old Salt’s four member ranches, slaughtered and processed in our meatpacking facility, and sold through ranch-direct restaurants, community events and on our website. Ranchers who own the company benefit every step of the way.
The technical term for this approach, in which a company controls various elements of its supply chain, is vertical integration. It’s not something many small meat businesses attempt because it requires a huge amount of initial capital.
“These are scary times,” Mr. Mannix said, citing the company’s significant debt. “We’re really trying to invent something new.”
But he added, “No matter how risky it is to start a business like Old Salt, maintaining the status quo is more risky.”
It would have been much simpler for Old Salt, like some ranchers, to just open a meat processing facility and not bother with restaurants or events. (Indeed, much national attention has been focused on this: the White House recently invested $1 billion in independent meat processors, citing a lack of competition from major meatpackers.)
But Mannix said this would not have solved other problems ranchers faced, namely difficulty accessing distributors and customers. “It doesn’t matter if you have a good processing facility if you can’t sell the product,” he said. “You can’t rebuild a food system just by investing a lot of money in one component of the food system.”
Old Salt is his attempt to rebuild everything.
And people are taking notice. “Old Salt is a beacon,” said Robin Kelson, executive director of Abundant Montana, a nonprofit that promotes local food. “They are showing the rest of us that we can make the system work by building businesses and collaborating in creative ways.”
On a recent Saturday, downtown Helena’s newest restaurant, Union, was abuzz. The wood fire sizzled as guests ate steak and ribs. Out front was a butcher box with bacon and breakfast sausages. It all came from Old Salt’s member ranches.
This restaurant-slash-butchery is Old Salt’s latest venture. The Outpost, a burger stand inside a 117-year-old bar, and the Old Salt Festival, a food and music-filled celebration of sustainable farming at Mannix Ranch in late June, are now in their second year. . This is in addition to the company’s meat processing facilities and subscription meat program.
Andrew Mace, co-founder and culinary director of Old Salt, probably wouldn’t recommend starting five businesses in three years. But he said it was all part of the company’s “very ambitious plan to reimagine the local meat economy.”
Mr. Mace wants all of Old Salt’s outfits to make a profit, but their larger purpose is to serve as a marketing vehicle for their meat subscription service. ‘Steak and Chop Bundle’ delivered every month.
Over the next five years, Old Salt’s goal is to sell meat to 10,000 households nationwide, up from about 800 today. It won’t be easy. Americans are used to buying ground chucks at grocery stores rather than websites.
“It takes a lot of time to dig into people’s spending habits and make them understand that they’re investing in their local landscape, not just buying meat,” Mr Mays said.
That’s important to Mr. Mannix. He hand-selects Old Salt’s members from more than 9,000 ranches across the state because they share his commitment to regenerative ranching, a set of principles for replenishing the soil and reducing the environmental impact of livestock.
His overarching goal is to put more money in the hands of ranchers so they can invest more time and money managing their land. (In total, Old Salt’s ranches manage more than 200,000 acres, larger than Shenandoah National Park.)
That’s why Old Salt’s ranchers own the majority of the company and share in the profits. “We didn’t want to be a meat company that would buy cattle from ranchers and ultimately have an incentive to pay as little as possible for those cattle as the company grew,” Mr. Mannix said. “This reduces the cost you pay compared to the time it takes to actually manage the ecosystem.”
Consolidating the four ranches into one brand allows members to pool their products and marketing resources rather than compete with each other.
“It takes some boldness to do what they are doing, but it takes people like that to come forward to show the way,” said Dr. Hassanein, a professor at the University of Montana. It may sound ironic, she said, but she supported this ranch because she cares about wildlife and the environment, considering beef production accounts for nearly 9 percent of global greenhouse gas emissions.
“This is a well-known ranch. Many of them are award-winning conservationists,” said Dr. Hassanein. “If they cannot survive economically, we have to ask ourselves what will happen in their place.”
That’s a question many ranchers in Old Salt are asking as well, as they face both economic and environmental pressures. Cooper Hibbard, fifth generation rancher and Chairman of the Old Salt Board of Directors, said: “It is clear from every angle that we cannot continue to do what we have been doing. To the next generation.”
“We’re trying to chart a new model,” he said. “We’re really swinging for the fences.”
