Forbes - Small Giants: Greater Omaha

SMALL GIANTS: GREATER OMAHA

three decades as more are being fed corn rather than grass. “When cattle got bigger, all of a sudden they didn’t fit through the line,” Davis says. Each day 2,400 cattle are brought in from the outside pens and slaughtered here. Then their carcasses are rigged to a machine that strips off hide in one fast pull. From there the meat is chilled for two days while a USDA official inspects the marbling and marks each with a grade—select, choice or prime. The meat then winds its way through conveyor belts and machines spread across several rooms, as the beef is sepa- rated into sections. At the very end of the line, butchers cut to order. In a new $12 million addition, the beef trimmings are ground into fresh (never frozen) hamburger meat. (The trim- mings are also sold to distributors who resell to places like Five Napkin Burger and Five Guys.) Contrary to expectations, the plant is pristine, and there is no odor. The vast stainless- steel rooms have a lablike quality to them. Davis designed the huge space to be flexible, and he’s in- vesting $40 million to erect a 65,000-square-foot eight-story cold-storage warehouse. Using artificial intelligence, robots will pull the boxed beef off shelves and fulfill orders. The new warehouse will open up space in the existing plant to allow Davis to come up with additional high-margin items. He’s already planning on doubling his ground-beef production to an estimated 70 million pounds annually by next year. Greater Omaha has also started selling to meal-delivery outfits like AmazonFresh and Hello Fresh as well as offering direct-to- consumer steaks, called TenderAge. (It couldn’t use the name Omaha Steaks, as it’s already taken by a rival.) The steaks it

sells online are some of its most expensive and premium cuts: $320 for eight 14-ounce ribeyes or $180 for eight 6-ounce filets. Davis says he will never abandon his restaurant custom- ers, a business that is still quite lucrative. Pat LaFrieda Meat Purveyors , for instance, which sells to thousands of restau- rants around the country, has been ordering from Davis for decades. “Greater Omaha actually selects product specifically for us, and that means the world to us,” LaFrieda says. Lawry’s , which operates ten restaurants and buys more than 750,000 pounds of meat a year, concurs. Executive chef Ryan Wilson says he’s been transitioning all his locations to exclusively use Greater Omaha beef, despite the fact that the

prices are a bit higher and that he can’t always get as much as he wants. “You oftentimes have to pay more of a premium up front,” Wilson says. “But I think it’s worth it,” Despite the demand, Davis says, he has no plans to open another plant. He’s toured two that were modeled after his but wasn’t interested. He also turned down buyout offers, includ- ing two since the trade deal with China. “I don’t open that door because the plant’s not for sale,” he says. Davis has no heir ap- parent and no succession plan. Divorced in 2006, he has two children in Chicago: a 26-year- old daughter who is a psychotherapist and a 23-year-old son who just started law school. Davis says neither has any interest in coming back to Omaha like he did. He’ll figure out what that means for the business when the time comes but doesn’t think that will be anytime soon: “I’ve never enjoyed this more in my life. I’m not giving this up. You’re not getting me out of here.” F

The slaughter- house’s 400,000-square- foot stainless-

steel plant is pristine and

there is no odor. The rooms have a lablike quality.

A USDA grader examines Greater Omaha’s meat for color, marbling and texture.

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