Finntrop The blue and red tin cans that roll down the conveyor belt in the meat factory in the middle of summer will often contribute to the feast on Christmas Eve. The meat products manufacturer Metten is already starting to produce the sausages for the important Christmas business. A possible lack of gas would threaten this pre-production: “Without gas, there are no sausages,” says Tobias Metten, junior manager of the family company based in Finnentrop, Sauerland.
With canned sausages of the “Dicke Sauerländer” brand, Metten is the market leader in Germany with a market share of almost nine percent – ahead of its competitors Meica and Böklunder. The meat product manufacturer obtains electricity and heat from a gas-fired combined heat and power plant. The company also uses the waste heat to heat tins of sausages, boiled ham or meat sausage and to make the food last longer.
If, as feared by experts, Gazprom no longer supplies gas to Europe after the maintenance of the Nord Stream 1 pipeline, this would also cause major problems for the Metten company. “We would then have to generate heat using electricity,” explains Metten, “that would no longer be economical to heat.”
Another alternative: convert the boilers and fire them with oil. But the conversion would take time, and capacity would have to be created for oil tanks. The 46-year-old reports that the boilers are hard to come by because other companies are also asking for them.
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“Gas was always the best medium, it was cheap, energetically efficient and came reliably through the line,” explains junior manager Metten. In the long term, the company wants to switch to alternative energy sources such as hydrogen and wood pellets, but that is hardly possible within months.
Metten has an emergency plan: As long as gas is flowing, they want to produce more canned sausages in order to increase stocks. If the gas were to be rationed, production would increasingly be switched to the less energy-intensive production of salamis.
Metten manufactures more than 100 products that consumers can find in three places in the supermarket: Whole salamis, pieces of ham or roast beef are cut open at the deli counter and also at the butcher.
Market leader in canned sausages in Germany.
(Photo: Metten Fleischwaren GmbH & Co. KG)
In the self-service area, where Metten achieves 55 percent of its sales, the Sauerland company appears under private labels, supplying for example “Gut & Billig”, “Wilhelm Brandenburg” or “Rewe Regional”. The supermarket chain Rewe is the largest customer.
And in the canned food sector, which accounts for a quarter of sales, the company relies on the “Fat Sauerland”, which has been around for 61 years. In total, Metten produces 16,500 tons of sausage and ham products per year.
15 percent cost increases
Aside from the gas problems, Metten, like all companies in the food industry, is struggling with rising costs. On average, these have increased by 15 percent for the family business this year. The increase of 54 percent in tin cans, which is used for the cans, is particularly noteworthy.
Because feed prices are also rising as a result of the Russian war of aggression in Ukraine, a kilogram of standard pork has not been traded for 1.30 euros since March, but for more than 1.80 euros. In between the price was even higher. The company has managed to pass most of the cost increases on to retailers. A can of bockwurst now costs the consumer an average of 3.99 euros – 50 cents more than before the war.
“Passing on our costs was essential for survival, otherwise the lights would have gone out here quickly,” says Metten. The company was unable to reach an agreement with some private labels. That’s partly why they have reduced: “Before we have to sell our product too cheaply, we prefer to do without quantity.” Metten therefore expects lower sales this year. In 2021, the Sauerland region still earned 115 million euros.
Metten has benefited from hamster purchases
“I’ve never experienced so many crises at the same time,” says the business graduate. He has been leading the company and its 450 employees as a representative of the fourth generation since 2008. His father Ulrich sits on the management board with him. The company was founded in 1902 as a country butcher’s shop.
However, the company has benefited from a crisis: During the Corona period, more people bought canned goods to stock up. Even apart from the hamster purchases, the canned food business at Metten is growing against the industry trend: While the Sauerland region has been able to increase its sales by 17 percent since 2013, the overall market has shrunk by 19 percent, according to figures from the market researcher GfK.
The Sauerland family company is struggling with cost increases of 15 percent.
(Photo: Metten Fleischwaren GmbH & Co. KG)
“Dicke Sauerländer” are mainly on the shelves in the western federal states and in the Berlin department store KaDeWe. The company does not sell its canned goods in southern Germany. “People there like to eat fresh sausages,” says Metten. Ten million cans of Metten go over the counter every year.
New organic sausages, but no veggie alternative
Under its traditional brand, Metten has recently also been selling fried and bockwurst sausages in organic quality – while the competition has been relying on this for years. “Until now, this market wasn’t big enough for us,” admits the junior boss.
The organic share in the meat and sausage market is just three percent. The procurement of raw materials for the new organic sausages is challenging, explains Metten, the supply of organic meat is limited. That’s why Metten’s organic products are only available in supermarkets in North Rhine-Westphalia for the time being.
Metten initially does not want to rely on vegan sausage and meat alternatives. Competitor Rügenwalder Mühle has great success with veggie sausage. The food producer now achieves more sales with the imitations than with conventional sausages. “After the Greta effect, we benefit from the corona effect,” said Rügenwalder boss Michael Hähnel in the Handelsblatt last year. “People want to eat more consciously.”
Overall, the market is still small with a share of one percent, according to Metten. “If, as is currently the case, many providers throw themselves into this market, it is not so interesting for us as a smaller company.” Operationally, this is not easy to implement. Metten produces at just one location, the veggie sausage would then have to be produced in the same machines as the real meat.
Instead, Metten is experimenting with hybrid sausages consisting of meat and vegetables or cheese. “Consumers could reduce their meat consumption and do something for the environment,” says Metten.
He does not want to rule out the possibility that the Sauerland region will eventually enter the veggie sausage business. The company logo may already give you an idea: until last year it was adorned with the slogan “Best of Meat”. This was deleted without replacement with the logo revision.
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