Merit Meats operates a profitable business supplying cooked (retorted) meat through a JV company into NZ and Australian retail markets (Foodstuffs and Aldi). The business is led by a Chief Executive with over 30 years’ experience creating innovative meat products for domestic and export retail markets.
Merit Meats has identified an opportunity in international markets to create a range of value added products derived from NZ Wild Red Deer, targeting the pet food, hydrolysed collagen products and convenience foods market segments. Merit Meats has created the KŪWAO quality mark and HUNTAWAY Wild Food for DogsTM brand for marketing the new products.
*Projected revenue is based on the inclusion of pet food forecast revenues from FY22. It does not include the added value revenue expected to be derived from hydrolysed collagen products and convenience foods.
Merit Meats currently operates a successful importation and distribution business specialising in retorted pork ribs and shanks. The products are processed under contract in Europe and supplied to NZ and Australian retail customers (Foodstuffs and Aldi), utilising unregistered IP to enhance the value of the products.
Merit Meats has successfully deployed a differentiated focus in traditional commodity markets. It has achieved this by:
The current product range and business line generates a stable existing profitable income stream for Merit Meats.
NZ Wild Red Deer occupies a unique position in the debate over land use, carbon emissions and farming practices. The harvesting of NZ Wild Red Deer from private and Department of Conservation land assists with the control of feral populations and the preservation of NZ flora. NZ Wild Red Deer products are also free from GMOs, antibiotics and hormonal growth promotants. This creates marketing and physical qualities that meet or exceed those of conventional grass-fed or organic products.
NZ Wild Red Deer represents a niche part of the traditional red meat market and is characterised historically by volatile commodity pricing. Weak returns in late 2019 from traditional markets for raw pet food materials, venison (Europe) and skins (tanning) were further hampered by lockdowns worldwide and in New Zealand, which particularly affected the Easter roar period for recreational hunters. The results are an abundance of animals, spare capacity in pack houses and underemployed hunters.
The total addressable market in the US in 2019 for raw pet food, hydrolysed collagen products and convenience foods exceeds USD3bn. The total US raw pet food market in 2019 was USD780m, representing approximately 2% of the USD39bn US pet food market. The hydrolysed collagen market was valued at USD1bn in 2019 with an estimated 6% annual growth rate. The meat snack market in the US was USD1.7bn in 2019, with products aimed at women representing one of the fast growing segments.
Affluent overseas consumers value clean, wholesome products with clear provenance and authenticity. New Zealand enjoys an excellent reputation for its agricultural exports and a current high profile for its handling of Covid-19.
These factors create a timely opportunity in international markets to develop a product range derived from NZ Wild Red Deer, targeting the pet food, hydrolysed collagen products and convenience foods.
Merit Meats is uniquely positioned to secure long term supply of quality raw materials and convert it into profitable range of products to meet this demand. Merit Meats has created and registered the KŪWAO brand as a quality mark for marketing and distributing a new range of products, which is intended to capture the market segments identified and achieve high profitable growth.
The demand for wholesome products with clear provenance and authenticity, combined with the existing fragmented supply chain for such products in NZ, provides a compelling opportunity for Merit Meats to capture a highly profitable share of this niche market.
Merit Meats is leveraging its existing profitable business, strong supplier relationships and distribution networks in order to expand the business and capture this timely wild game opportunity. For the past 3 years Merit Meats were part-owners and operators of Southern Alps Meats Limited, one of New Zealand’s largest pack houses for NZ Wild Red Deer processing. Management has completed the following key preliminary steps:
We are now raising between $1m and $2m of capital to accelerate the expansion of the existing business to capture this profitable opportunity. We have a clear growth strategy that will focus on five key areas:
Merit Meats is confident about this opportunity and will be executing its expansion plans. However, additional capital will enable it to accelerate that expansion and growth.
We are seeking expressions of interest from wholesale investors at a minimum investment level of $125,000. Interested parties will have an opportunity to conduct due diligence on the business and growth opportunity and to participate in setting the investment terms.
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