THE most successful paddock to plate stories seem to evolve from a willingness to step outside comfort zones and react quickly to changing forces.
Certainly that is the case with one of the country’s leading beef brands, Sher Wagyu, produced by Victorians Nick and Vicki Sher and their family.
The Shers have weathered all the ups and downs of the Wagyu game since they started breeding 25 years ago, from the early days of live export to developing their award-winning brand which is now sold both direct to restaurants and the food service sector in Australia and to 14 export markets.
A recent achievement is supplying a new restaurant in Shanghai, China, based entirely on Sher Wagyu, complete with a display fridge in the entrance foyer full of Sher branded cuts.
The Shers operate by a philosophy of commitment, loyalty and communication in all customer relationships and say the best orders are not the first one but the second and repeats.
Their operation was put under the spotlight at the 2016 Australian Wagyu Association conference, held in NSW’s Hunter Valley last week.
The Shers have a fullblood herd of around 500 head at their 280 hectare home property at Ballan,“Glen Leckie”, near Ballarat.
They have another 970ha farm in the State’s north east and agist or background cattle on a further seven properties, all up running around 6000 cattle.
Four thousand head are also on feed near Wangaratta, where the cattle are finished for over 400 days on a specially-formulated Japanese style ration.
Sher Wagyu processes around 3000 head per year, of which 75 per cent is exported.
While the current Wagyu market is extremely strong, Nick Sher is the first to say there have been plenty of times it has been a very tough business to be in.
“We didn’t set out to be a paddock to plate business, we started out aiming to breed Wagyu for the Japanese market,” he told AWA conference delegates.
When Peter Winkler brought the first Wagyu into Australia in 1991, the Shers purchased from the first flush of his heifer, Kobeef Kinu, and calved down their first purebred embryo calves in 1992.
“In those days we were focused on learning about the genetics, and how to breed these cattle,” Mr Sher said.
“The trick was working out which genetics were any good, as everyone was making the same claims.”
That meant regular trips to Japan, where ‘just a nod of approval or a cross of arms’ indicated which genetics were recommended.
“We have never been aligned with any one source of genetics and our only criteria has been if they will add value to our herd,” Mr Sher said.
Their first shipment of live export Wagyu cross cattle to Japan was ten steers in 1995.
This side of the business grew to up to 1,000 head per year by the early 2000s, but the Shers stopped live exporting in 2005 to focus on marketing all the beef .
By the mid ‘90s, the Shers had started producing a Wagyu/Holstein, which is the traditional Japanese F1.
It was seen as crazy and there was a lot of resistance and negativity in Australia but it made sense to the Shers to look to fulfil customer demand in their target market.
“Our focus was on developing a whole supply chain - from semen distribution, breeding contracts with dairy farmers and a calf rearing operation to backgrounders,” Mr Sher said.
“To ensure we had a steady supply of semen we purchase our first fullblood bull, Kikushige 406E, which we bought in the US in partnership with Mark Fiest from North Dakota at the first fullblood auction ever held outside Japan at Oklahoma City in September 1996.
“Over the years we have introduced new bulls from our own breeding and ended up with an in-house progeny test program.
“Every single animal we have processed, which is now in the tens of thousands, are on our database and we analyse all the data in great detail.
“This has really has driven the Sher Wagyu brand.”
The Sher’s first Wagyu Holstein F1 was born in 1997 and this year the operation will produce its 50,000th calf.
While the feeder steers were bringing good prices in the late 1990s, heifers were not and that forced the Shers to look at feeding their heifers.
They said fine tuning the rations had been a critical part of their success and is still occurring today. It had been very much a trial and error process as shared information in this area had not been terribly forthcoming.
A contract to sell quarter beef into Japan, which would be broken up and packaged under a Japanese label, took five visits and many meetings to establish, Mr Sher revealed.
Then in 2001, BSE was discovered in Japanese cattle, and the country’s beef market virtually collapsed overnight.
“At that time the end consumer buying our product in Japan didn’t even know it was Australian beef, let alone who the producer was,” Mr Sher said.
“We learnt two fundamental marketing lessons - don’t have all your eggs in one basket (Japan was the only real market for Wagyu beef in the world at the time) and we needed a branded product so we could build a relationship with the end user.”
The couple say continuity of supply is the critical aspect of a successful brand.
“While we focused on developing our brand we had to make sure the paddock side dovetailed with marketing,” Mr Sher said.
“So we changed our operation to work backwards - from what we wanted to sell to what we have to produce.
“Today the logistics of running cattle on a number of properties across a spread of 650 kilometres is still a challenge but we are getting better at matching the stock to the available pastures without overdoing the trucking.”
Changing seasons are forcing a greater reliance on supplementary feeding, which is adding significantly to costs.
Sher Wagyu moved into Korea, as did most of the other Wagyu producers following the collapse of the Japanese market.
It was a pretty competitive market, so they branched out into other Asian markets, starting with Singapore and Hong Kong, and are still working with these original customers today.
Mr Sher said every market had different needs, government regulations and cultural issues and it had been critical to understand this to develop the brand in different countries.
The domestic scene
ON the homefront, Sher Wagyu now delivers five days a week, directly to over a hundred restaurants in Melbourne and regional Victoria and through wholesalers in Sydney and Adelaide.
Nick and Vicki Sher have had to put in some serious hard yards to get to that point.
In the early days, it was about calling chefs and introducing themselves and their product.
Trade shows, both locally and overseas, stands at food festivals, cooking demonstrations, hosting television shows and many, many presentations - it’s work the average beef producer never expects will be part of the deal.
“We do front-of-house staff training in restaurants so that the wait staff are familiar with our product, because diners do ask a lot of questions,” Mrs Sher said.
“All these efforts and events help to educate chefs and the public about Wagyu, about our boutique brand and how we breed and care for our cattle and manage our farms sustainably.
“Social media has also helped in connecting us to chefs and the public.”
Along the way, Mrs Sher said they had learned about food costs in restaurants, how different kitchens run, menu planning and how off-cuts can be utilised, which has all added to Sher Wagyu’s ability, as a package, to deliver value.
The Shers see encouraging the use of secondary cuts as important to the future.
“It’s up to us, as the producer and marketer, to find customers for all the different cuts and to ensure that nothing goes to waste,” Mrs Sher said.
“To value add, we’ve developed burgers, sausages and air dried bresaola which are all very popular, but they do take a fair bit of co-ordinating to find the right people to make these products for us.”
She said it was very important to match customer expectations with what they are ordering.
“Direct communication with our customers means we can encourage correct description on menus - we always encourage them to describe if it’s Wagyu F1 or fullblood , and name the cut and marble score, because obviously there’s a big difference in the eating experience of an MS 5 rump compared with a MS 9-plus striploin,” she said.
There is an ever-growing desire from beef consumers surrounding the concept of provenance and authenticity - wanting to know where their beef is coming from and how it’s produced, according to Wagyu branded beef owner Vicki Sher.
Sustainability has become a key focus at the Sher operation in Victoria.
Five years ago, the Shers swapped to using natural fertilizer, rock phosphate, lime and other minerals, as opposed to using super phosphate.
Paddocks are rotationally grazed, so good ground cover is constantly maintained regardless of seasons.
“We have planted over 7000 trees and and have fenced off waterways to improve water quality,” Mrs Sher said.
Solar power is also contributing to the running of the farm and the Sher Wagyu office at Ballan.
“When transporting cattle, we always make sure we have full loads to make the freight and fuel use more efficient and we practice low-stress cattle handling, with a very high priority on animal welfare,” Mrs Sher said.