Beef Jerky Gets a Healthy Makeover
By Bethany McLean

(FORTUNE Magazine) – The mere mention of beef jerky, the pungent, chewy, dehydrated, plastic-packaged meat, often elicits yucks--or worse. But jerky has transcended food stands of gas stations and backpacks of mountain men; it's spreading to supermarkets, Kmarts, convenience stores, and fact, jerky is everywhere.

The proof is in the numbers. Last year sales of "meat snacks," of which jerky is the biggest and fastest-growing segment, increased 30%, to around $1.3 billion, according to the Snack Food Association. (That's about five times the growth rate of snack foods in general.) Unlike most food producers, jerky makers--Jack Link's and Oberto Sausage of Kent, Wash., to name a couple--are small, family owned, and privately held. (Oberto boasts that it is "impossible to distinguish where the Oberto family stops and the Oberto Sausage Co. begins.") There are niche marketers, too, such as rocker and avid defender of the hunting faith Ted Nugent, who sells his Nuge Gonzo Biltong on his Website and in Michigan. "This is a hugely exciting time," says Jeff Slater, head of marketing at GoodMark, which sells Slim Jims and Pemmican jerky.

Jerky owes part of its newfound popularity to the trendy high-protein, low-fat, Atkins-style diet. Indeed, if you consider the exercise your teeth get and ignore the 600 or so milligrams of sodium per serving, jerky resembles health food--and a convenient one at that: Slater calls Jerky "portable protein." Jerky makers have been trying to improve the taste, adding flavors such as mesquite and teriyaki. Nugent just launched maple jerky. (It's quite tasty.)

The growth-hungry food conglomerates are figuring out jerky's allure. In 1998, ConAgra acquired GoodMark; in late 1999, Oberto struck a distribution agreement with Pepsi's Frito-Lay division. "The FORTUNE 500 companies are going to pick up on this growth," says Ryan Christiansen, Jack Link's head of marketing. "But we're trying to saturate the market so that we can defend ourselves."

--Bethany McLean