Valley-based meat distributor’s business booming

Faster than a trip through a hamburger joint’s drive-thru, Shari Smith pulled her vehicle through a Spokane Valley parking lot on Friday morning for 100 pounds of meat, loaded into her trunk.

Smith, 63, joined more than 80 customers who came to pick up bulk hamburger or hams bought online from Spokane Valley-based Zaycon Foods. As workers distributed orders from a refrigerated truck, Smith got a 40-pound case of hamburger for her freezer and picked up the rest of the meat for her daughter’s family of four.

“We just love the convenience; the food is amazingly fresh – no pink slime,” Smith said. “It does work for retired people because you split it with family. You just plan ahead.”

The 4-year-old Zaycon Foods has grown into a multimillion-dollar business by offering this twist to the traditional food truck model. Registered customers preorder and pay online for bulk food, and Zaycon confirms with an email describing when and where clients pick up orders.

No one enters a store or even steps out of a car.

For two- and three-day delivery “events,” Zaycon will stage a refrigerated truck – often parked in large, empty church parking lots – at different times and locations in a region. The company has 350,000 registered customers in the U.S., and it holds about 7,500 delivery events a year.

Zaycon expects to reach $20 million in revenue this year, up from nearly $14 million last year, said company CEO Mike Conrad. It has 40 employees and is based at 16201 E. Indiana Ave.

“We haven’t even touched the market yet,” Conrad said. “We’ll be adding new cities all the time.”

He said Zaycon buys directly from meat processing plants and farmers, delivering in the 48 contiguous states with a fleet of 25 refrigerated trucks.

“Our model is such that we only buy what we sell, so there’s zero waste,” Conrad said.

A package of boneless, skinless chicken breasts is sold at a minimum quantity of 40 pounds. The ground beef also arrives in a 40-pound case that has four individually wrapped, 10-pound chubs. The company offers bacon in a 36-pound case, and has a two-ham package that totals about 20 pounds.

While Zaycon has added other products to its lineup such as seafood, some fresh fruits and honey, it plans to remain focused on main-course meats, Conrad said.

Frank Dell, of the consulting group Dellmart & Co. in Connecticut, is a 30-year observer of the food and consumer products industry. He said Zaycon efficiently uses social media along with the Internet, and the company’s model keeps overhead costs low.

“It’s kind of a hybrid; it’s somewhat akin to the farmers market approach,” Dell said. “For a certain customer, this probably works fine – someone who buys bulk, someone who has a large family, or someone who goes in with a neighbor. Either that, or you have to have a large freezer.”

Zaycon’s Valley delivery drew a mix of young and old, including parents with children. Hailey Kalamakis, who recently moved to Spokane from Boise, picked up meat for herself and her fiancé as well as for another couple.

“My sister has been doing this, and we split chicken with her the last time,” Kalamakis said. “This is a slick deal – you just pull in and you don’t even have to get out of your car. It’s cheaper, and it’s good meat.”

Zaycon sells its boneless, skinless chicken breast – by far its most popular item – at an average price of $1.69 a pound. Its lean ground beef is listed at around $3.49 a pound. In the first two months of this year, Zaycon sold 3 million pounds of boneless, skinless chicken breasts at nationwide events, Conrad said.

“The meat we sell is four to five days old when it gets to our customers,” he said. “It is weird for people to pull up and get chicken out of a truck, but once they get past that barrier, they’re in.”

Boise draws some of the largest crowds, and the company has hired uniformed police officers to direct traffic.

“If it’s a large event, we’ll have four or five lines of cars. For most of our locations, we use big church parking lots, then we give the church a case of whatever we’re selling, and they give that food to people who need it.”

Conrad credits the idea for the business to his older brother, J.C. Conrad, who worked as a grocery store meat manager in Utah where he first experimented selling meat in bulk to people who preregistered. By 2009, J.C. had moved to Spokane to be closer to their parents; Mike Conrad already lived here.

“We were both on welfare, and my brother said, ‘Why don’t we go to a broker and sell bulk meat?’ ”

The elder Conrad joined with an early business partner, Brandon Berezay, and the pair named the company by combining parts of their names. For the first December 2009 order, word spread fast through friends and family. The partners sold 850 cases of chicken. At the time, however, “We weren’t thinking outside of Spokane,” Mike Conrad said.

Berezay sold his interest in the venture before the end of the first year. The younger Conrad says people in other cities started requesting deliveries outside of Spokane, and then his brother dreamed up a promotion called “Chicken Across America,” that at the time offered chicken breasts for $1.49 a pound.

The promotion also offered free cases to a network of bloggers writing about food and extreme couponing, Conrad said. “We said, ‘Will you write about us? We want you to write your honest opinion.’ It just went crazy.”

About two years ago, J.C. Conrad sold his share of the business to partners including Mike and his cousin, Vice President Adam Kremin, who are majority owners.

Although the company typically delivers in cities, Conrad said Zaycon will make stops for clients in small communities, such as Ritzville and Moses Lake, if the locations are along a route.

Conrad said he hopes the company can soon be part of a pilot program to sell meat online to people on federal food stamp assistance using Electronic Benefit Transfer cards. The company also is in discussions with Lowes, Conrad said, to test a partnership that could offer deals on items such as freezers and barbecues to Zaycon customers who pick up their food orders in a Lowes parking lot. He said Seattle and Spokane are expected to be among the first sites to try the concept as early as this fall.

“We are a food company, but our focus is really the health and wellness of people, and uplifting lives,” he said.