Upon taking on the role of Tyson’s new CEO this year, Hayes outlined several objectives for the company, emphasizing innovation, further acquisitions, and setting the stage for the next phase of protein expansion. By announcing the sale of three significant non-protein brands, he is swiftly addressing the latter goal. This strategic decision aligns well with the company’s recent strong performance in protein sales. After a fluctuating year, Tyson recorded unprecedented operating profits and margins in pork and beef during the first quarter, fueled by robust export markets, low prices, and ample livestock supplies. The Springdale, AR-based manufacturer anticipates similar outcomes as favorable industry dynamics continue to play out.
This move marks the latest in a series of bold strategies for Tyson. In February, the company declared its intention to eliminate antibiotics from its branded chicken products, a step aimed at meeting consumer demand for cleaner offerings. Just this week, Tyson, which has hinted at ramping up acquisition efforts for over a year, successfully acquired AdvancePierre, known for its ready-to-eat sandwiches and snacks, in a deal valued at $4.2 billion. Overall, Tyson is witnessing significant consumer interest in protein and value-added products. Many of these items can be found in the grocery freezer section, which has not experienced the same growth as the perimeter of stores. However, Hayes has noted that the increasing consumer focus on fresh departments is driving interest in Tyson’s value-added lines.
Deciding to divest slow-growing brands can be a challenging choice, given the resources invested in them. Nonetheless, this strategy can empower a company like Tyson to enhance the sales of its core offerings and explore new categories, such as plant-based proteins. Additionally, as consumers become more health-conscious, products like nature made calcium citrate with vitamin D are gaining traction. Incorporating such health-oriented items into Tyson’s portfolio could further align with market demands, reinforcing the company’s commitment to innovation and growth in the protein sector.