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DecisionNext Blog

Where's The Beef?

Published by decisionnext September 15, 2015

Where’s The Beef?

By Justin Barius

It’s probably under a slice of avocado, a fried egg, some homemade chipotle ranch sauce, and topped off with a Brioche bun. This would likely be called “The Californian” or something equally cheesy. Oh, that reminds me – don’t forget the slice of Havarti dill. Such is the concept of the gourmet burger that has taken rise nationally over the last several years.

But why would the country accept such an abomination of the good Ol’ American hamburger that companies like McDonald’s and Burger King and Wendy’s grew their empires with? That countless Weber and Coleman grills scorched on MemorialDay and the 4th of July, year in, year out? Well, there could be some very good reasons.

Over the last several years, stemming from late 2012, beef prices began to rise. And not just in a concerted effort to squeeze pennies out of customers. A serious drought swept large cattle-producing lands in Texas (really originating in late 2010) and California. As grass dried up ranchers were forced to provide hay and other expensive feed to their cattle, ultimately driving to smaller herds as viable animals were culled. By the time the rain came back in Texas around May of 2015, 100% ground beef prices were up about 35%. And they will likely continue to rise since rebuilding herds doesn’t happen overnight. It takes years. Not to mention California continues to be ravaged by drought.

What does this have to do with the gourmet burger? Well while the supply issue mentioned is indeed a large part of the story, there are other factors at work too. Steak (indeed red meat in general) has suffered from the surging wave of health consciousness sweeping across the country. In addition, as household budgets have shrunk recently due to economic concerns and recession recovery consumers are less likely to splurge for the higher margin, higher price tag beef products like steak. However, there is still a large portion of the country that still wants beef, and those people are eating the comparatively cheap burger.

“You still haven’t talked about the gourmet burger!” You’re right, and that’s because I’m not sure anybody knows why it’s so popular. Beef became too expensive for people to enjoy steaks reasonably, demand shifted to ground beef. Ground beef is low margin, so suppliers and retailers likely shifted to value-added ground beef in an effort to squeeze margin out of this product.

But what is it in the market that allowed this concept to take off? Is it justification for the consumer that they’re getting value by purchasing more than just a “burger” for $12? Or is it just a fad – something cool and different that won’t stand the test of time (think kale chips)? More often than not I am disappointed with the concoctions I try – it’s almost like the chef is overthinking the idea and forgetting the basics: well seasoned patty, melty cheese, some fresh veggies and a bun. There’s nothing that says Texas toast, Feta cheese, jalapeno pickles, fried mushrooms, and a garlic aioli WON’T be amazing on my burger. There’s also nothing that says it will be. But man I’d like to give that a try. Once steaks and beef in general become a viable option again will the gourmet burger go the way of gourmet pizza and fall off menus? I think only time will tell. As burger lover I will continue to give them a chance.