METHODS AND PRACTICES OF RETAILING MEAT 
17 
SPREAD BETWEEN WHOLESALE COST AND RETAIL PRICES 
The question of spread between the market value of live animals 
and retail prices of various cuts of meat is a vexatious one to the 
producer and is closely associated with the question of price determi- 
nations. Available comparisons of prices purporting to show the 
spread are in most cases based on retail prices of some of the so-called 
preferred cuts. This does not constitute a basis from which logical 
or sound' conclusions can be drawn. Retail prices of all cuts must 
be included and an average price for the carcass must be determined. 
Percentage yields of all retail cuts and gross results based on prices 
prevailing in a market in Washington, D. C, on the date the test was 
made are shown in Table 1 . The test w^as made in a market which pur- 
chases straight carcasses only. Therefore an equal number of fores 
and hinds are used. The spread in prices as shown by this test com- 
pares favorably with comparisons made in numerous markets in differ- 
ent parts of the country which handled straight carcasses to advan- 
tage. This test should not be compared with other margins shown in 
cost studies covering all kinds of meats handled in a year's operations. 
The reasons generally advanced for the spread in the past have put 
the burden of the responsibility on the consumer because of the dis- 
proportionate demand for certain cuts. This responsibility has now 
been shown to lie not entirely with the consumer. A large percentage 
of retailers are to blame, as the problem is partly caused by lack of initia- 
tive, salesmanship, and merchandising ability on the part of retailers. 
Statistics gathered in this study showed that the efficient stores 
which, as a rule, handle a proportionate number of fore quarters and 
hind quarters are able to maintain a relatively close relation between 
prices of so-sailed preferred cuts and prices of cheaper cuts, not 
usually out of proportion to wholesale cost. In the stores of owners 
who lacked a practical knowledge, the study showed either an 
unusually wide spread between prices of the cuts called for and whole- 
sale costs, or showed a waste of edible meats from the so-called 
cheaper cuts. In at least one store doing a business close to $25,000 
per year, monthly accounts covering fat, bone, and trimmings sold 
to rendering companies ran as high as $165. On the other hand, 
stores with like volume were found whose monthly accounts with 
renderers were as low as 94 cents. In the former instances the spread 
was unusually wide and in the latter instances they were unusually 
narrow. 
Table 1. — Wholesale and retail cutting test, close side steer beef, grade "good" 
Weight of side 310 pounds; quartered all ribs on fore quarter. 
Weight of forequarter 163 pounds; percentage of side, 52.58. 
Weight of hind quarter 147 pounds; percentage of side, 47.42. 
Wholesale cost of side (310 pounds at 13 cents per pound)— $40.30. 
Yields and Percentage of Wholesale and Retail Cuts 
wholesale cuts 
Forequarter |'w-g* 
Per cent 
of side 
Hind quarter 
Weight 
(pounds) 
Per cent 
of side 
Chuck (including neck) j 63 H 
Rib (7 ribs) I 30^ 
20.484 
9.839 
13. 871 
8.226 
.161 
i Loin (trimmed) . 
50 
12 
72 
13 
16. 129 
Sirloin tip . 
3.871 
Plate and brisket I 43 
Round 
23. 226 
Shank j 25li 
Cutting shrinkage }4 
Flank.. . 
4.193 
Total 
147 
47 419 
Total 163 
52. 581 
