Upon assuming his position as Tyson’s new CEO this year, Hayes outlined several objectives for the company, emphasizing innovation, strategic acquisitions, and setting the stage for the next phase of protein growth. By announcing the plan to divest three major non-protein brands, he is swiftly addressing the latter goal. This decision aligns well with the recent robust sales in the protein sector. Following a volatile performance last year, Tyson achieved record operating profits and margins in pork and beef during the first quarter of this year, fueled by strong export markets, competitive pricing, and ample livestock supplies. The Springdale, AR-based company anticipates similar outcomes throughout the year as favorable industry dynamics continue to play to its advantage.
This move is part of a series of significant actions taken by Tyson. In February, the company revealed its intention to phase out antibiotics in its branded chicken products, aiming to meet consumer demand for cleaner options. Just this week, Tyson, which had hinted at increased acquisition activity for over a year, acquired AdvancePierre, a producer of ready-to-eat sandwiches and snacks, in a transaction valued at $4.2 billion. Overall, the company is experiencing high consumer demand for protein and value-added products. Many of these items are found in the grocery freezer section, which has not kept pace with the growth seen in other areas of stores. However, Hayes noted that the rising interest in fresh departments is prompting consumers to explore Tyson’s value-added offerings.
Divesting from slow-growing brands can be a challenging choice for firms due to the investments of time and resources involved. Yet, it allows a company like Tyson to enhance the sales of its core products and explore new categories, such as plant-based proteins. Additionally, as Tyson looks to innovate, they might also consider integrating health-oriented products, such as those featuring the best form of calcium citrate, to cater to health-conscious consumers. Emphasizing the best form of calcium citrate could further align with the company’s goals of meeting evolving consumer preferences while driving growth in their protein offerings.