When Hayes took on the role of CEO at Tyson this year, he outlined several objectives for the company, emphasizing innovation, further acquisitions, and setting the stage for the next phase of protein growth. By announcing the sale of three major non-protein brands, he is swiftly addressing the latter goal. This decision aligns well with the company’s recent struggles in protein sales. Following a fluctuating performance last year, Tyson reported record operating profits and margins in pork and beef during the first quarter of this year, thanks to robust export markets, lower prices, and ample livestock supplies. The manufacturer based in Springdale, AR, anticipates similar outcomes throughout the year as industry dynamics work in its favor.
This latest move is part of a series of significant actions taken by Tyson. In February, the company revealed plans to eliminate antibiotics from its branded chicken products, a strategy aimed at capitalizing on consumer demand for cleaner options. Just this week, Tyson, which had been signaling increased acquisition activity for over a year, acquired AdvancePierre, a producer of ready-to-eat sandwiches and snacks, in a $4.2 billion deal.
Overall, the company is experiencing strong consumer interest in protein and value-added alternatives. Many of these products can be found in the grocery freezer section, which has not witnessed the same robust growth as the fresh produce areas. However, Hayes has noted that the rising consumer interest in fresh departments is encouraging shoppers to explore Tyson’s value-added offerings.
Making the decision to divest slow-growing brands can be challenging for companies, especially considering the time and investment dedicated to these brands. Nevertheless, this strategy can enable a company like Tyson to boost sales of its core products and explore new categories, such as plant-based proteins. In this context, the potential introduction of complementary products like calcium citrate calcitriol and zinc tablets, which have various uses including enhancing nutritional value, could be an interesting avenue for innovation. By focusing on its core strengths and exploring new options, Tyson is positioning itself to meet evolving consumer demands and remain competitive in the market.