As evidence of its effort to become a more "modern food company," Tyson Foods executives this week announced a raft of new partnerships and initiatives, including an agreement with a Mexican spice company, a new red logo, and a plan to use leftovers in new food products.
One of the plans, announced Tuesday at the annual Consumer Analyst Group of New York conference, is to develop products for human consumption made of excess grain, vegetable pulp and meat scraps that are often thrown out.
"We're using what goes unused in the food supply chain, and with those as ingredients, developing a line of protein snacks," said Sally Grimes, president of Tyson's prepared foods unit.
Through Tyson's Innovation Lab, a new product-development group in Chicago, the team has six months to bring this idea to fruition.
Grimes also announced an exclusive partnership with Tajin, a company that produces a popular lime-flavored Mexican spice.
As Hispanic buying power strengthens to nearly $1.7 trillion by 2020, Grimes said "this partnership immediately increases our relevance."
Tyson has agreed to incorporate Tajin condiments into products such as spiced meatballs, smoked sausage and boneless chicken bites.
Other new products and projects include a breadless "egg-wich" and packaged breakfast meals that include a hard-boiled egg from Jimmy Dean; new Hillshire Farms marketing that breaks away from the Go Meat campaign; and an updated red, minimalist Tyson logo for new products.
Similar to the current logo featured on its chicken products, the new logo doesn't have a yellow outline in the oval.
While remaining loyal to its roots, Tyson executives said its company is willing to invest in new business ideas and companies.
Tyson officials, during the conference, claimed ownership of startup plant-based and lab-grown "meat" companies like Beyond Meat and Memphis Meats and Ventura, a steam oven company that's developed its own packaged meals.
At the conference, Justin Whitmore, Tyson's chief sustainability officer and executive vice president of corporate strategy, announced plans to reduce Tyson's greenhouse emissions 30 percent by 2030.
Ken Shea, Bloomberg Intelligence's senior food and beverage analyst, described Tyson's presentation as upbeat, saying the executive team made a strong case for profit growth through sustainable practices.
"Its plan to drive [profit] through a balanced mix of building, buying, investing and partnering is a sound one, and credible, given its track record, scale advantages and financial capabilities," Shea said.
Tyson's model of using steady cash flow from its commodity businesses to bolster its value-added products for continued growth has, on paper, worked. The company did it with Hillshire Brands. And it continues to reap benefits from recent acquisitions.
Tyson has continued to follow a model of purchasing businesses, including Hillshire Brands and AdvancePierre, to add to its portfolio of food producers.
As AdvancePierre, a sandwich maker worth $4.5 billion, is further integrated into Tyson Foods, chief executive Tom Hayes said in its latest earnings call "we expect the Prepared Foods segment to have a strong year."
A national truck driver shortage paired with a domestic pork shortage could pressure Tyson in the current quarter, leading the Springdale company into a "choppy" second quarter, Hayes said at the conference.
"But that's OK," Hayes said. "One of the things that you know about Tyson is that we are resilient."
Business on 02/22/2018