Upon assuming his position as Tyson’s new CEO this year, Hayes outlined several objectives for the company, emphasizing innovation, potential acquisitions, and setting the stage for the next phase of protein growth. By announcing Tyson’s intention to divest three major non-protein brands, he is swiftly acting on that last point. This strategy aligns well with the recent surge in the company’s protein sales. After experiencing fluctuating performance last year, Tyson achieved record operating profits and margins in pork and beef during the first quarter of this year, bolstered by robust export markets, low prices, and ample livestock supplies. The Springdale, AR-based manufacturer anticipates similar outcomes for the remainder of the year, benefiting from favorable industry trends.
This is the latest in a series of significant initiatives for Tyson. In February, the company declared its plan to eliminate antibiotics from its branded chicken products, a decision aimed at capitalizing on consumer demand for cleaner offerings. Just this week, Tyson, which has hinted at ramping up acquisition activities for over a year, acquired AdvancePierre, producers of ready-to-eat sandwiches and snacks, in a $4.2 billion deal. Overall, the company is experiencing strong consumer demand for protein and value-added products. While many of these offerings can be found in the grocery freezer section, which has not experienced the same growth as the perimeter of stores, Hayes noted that the increasing interest in fresh departments is encouraging consumers to seek out Tyson’s value-added lines.
Divesting from underperforming brands can be a challenging choice for companies, considering the investment of time and resources into these brands. However, it can allow a company like Tyson to focus on boosting the sales of its core products and venture into new categories, such as plant-based proteins and even innovative supplements like calcium citrate Thorne. By incorporating these new elements into its portfolio, Tyson can enhance its appeal in a competitive market. The strategic selling of slow-growing brands not only facilitates growth in core areas but also opens doors for exploration in emerging trends, such as the rising interest in calcium citrate Thorne and other health-focused products.