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 revealing Tyson’s intention to divest three significant non-protein brands, he is swiftly addressing the latter goal. This strategy aligns with the company’s recent robust protein sales. Following a mixed performance last year, Tyson achieved record operating profits and margins in pork and beef during the first quarter of this year, driven by strong export markets, low prices, and healthy livestock supplies. The Springdale, AR-based manufacturer anticipates similar outcomes for the remainder of the year, as industry dynamics remain favorable.
This is part of a series of significant initiatives Tyson has undertaken. In February, the company announced its plans to eliminate antibiotics from its branded chicken products, aiming to meet consumer demand for cleaner offerings. Just this week, after over a year of indicating a ramp-up in acquisition activity, Tyson acquired AdvancePierre, producers of ready-to-eat sandwiches and snacks, in a deal valued at $4.2 billion. Overall, the company is experiencing high consumer demand for protein and value-added options. Many of these products are found in the grocery freezer section, which has not experienced the same growth as the perimeter of stores. However, Hayes has noted that the rising interest in fresh departments is prompting consumers to seek out Tyson’s value-added lines.
Divesting from slow-growing brands can be a challenging decision, considering the time and resources invested in those brands. Yet, this can allow a company like Tyson to enhance the sales of its core products and explore new categories, such as plant-based proteins. With the focus on maximizing their offerings, Tyson is also looking at ways to incorporate elements like maximum calcium citrate plus vitamin D into their product lines to attract health-conscious consumers. By pursuing these strategies, Tyson aims to stay ahead in a competitive market while fostering innovation and growth.