About Cobb-Vantress, Inc.
Tyson Foods spreads its wings beyond the chicken coop. While it is one of the largest US chicken producers (with processing capacity of some 42 million a week), Tyson's Fresh Meats division makes it a giant in the beef and pork sectors as well. The company also offers value-added processed and pre-cooked meats and refrigerated and frozen prepared foods. Its chicken operations are vertically integrated -- the company hatches the eggs, supplies contract growers with the chicks and feed, and brings them back for processing when ready. Tyson's brands include Tyson, Jimmy Dean, Hillshire Farm, Ball Park, Wright, ibp, Aidells, and State Fair. Its customers include retail, wholesale, and food service companies worldwide, although the US accounts for most sales.
In terms of volume Tyson Foods is, indeed, a chicken company, with processing capacity of more than 40 million chickens a week compared to about 460,000 pigs and 155,000 head of cattle at its 100 food production plants worldwide. But when counting dollars instead of eggs, the company makes nearly 40% of its revenue from its beef segment and 30% from its poultry operations. Prepared foods and pork products contribute about 20% and more than 10%, respectively.
While its chicken operations reach from egg to drumstick, Tyson raises no cattle of its own. It buys live cattle on the open market, and they're raised under contract at third-party feed lots. The majority of Tyson's swine are bought from producers; however, it does raise some swine and supplies feeder pigs to independent producers on a contract basis.
Among Tyson’s facilities are processing plants, rendering plants, blending mills, feed mills, broiler hatcheries, breeder houses, and more than a dozen distribution centers.
Headquartered in Springdale, Arkansas, Tyson Foods serves retail and foodservice customers across the US and in about 125 other countries worldwide.
Tyson's major export markets include Canada, Central America, China, the European Union, Japan, Mexico, the Middle East, South Korea, and Taiwan. The company generates limited revenue from exports however; they account for about $5 billion annually, or just more than 10% of total sales.
Sales and Marketing
Tyson Foods' products are marketed to grocery stores, meat distributors, club stores, military commissaries, chain restaurants, and foodservice operators, among other customers. Walmart alone accounts for more than 15% of its sales.
Tyson's products are marketed and sold primarily by its sales staff to grocery retailers and wholesalers, meat distributors, warehouse club stores, military commissaries, industrial food processing companies, and chain restaurants or their distributors, among other customers. Additionally, sales to the military and a portion of sales to international markets are made through independent brokers and trading companies.
Tyson promotes its products with marketing, advertising, trade promotions, and consumer incentives such as coupons, discounts, rebates, and volume-based incentives. The company spends about $240 million a year on advertising and promotional expenses.
Since falling from its peak of $41.3 billion in 2016, Tyson Foods' revenue has steadily increased. Net income has had a stronger journey over the past five years, more than tripling since 2014.
In fiscal 2018 (ended September) the company reported revenue of $40 billion, up 5% from the prior year. The results were powered fairly equally by growth in sales volume (up 2.5%) and increased average sales price (up 2.1%) for beef, chicken, and prepared foods. The pork segment declined slightly year-over-year on lower customer demand.
Net income that year was up 70% to $3 billion because of the increased revenue and a nearly $300 million income tax benefit (related to the Tax Cuts and Jobs Act of 2017) compared to an $850 million expense in fiscal 2017.
Cash at the end of fiscal 2018 was $270 million, a decrease of about $48 million from the prior year. Cash from operations contributed $3 billion to the coffers, while investing activities used $1.9 billion, mainly for acquisitions and capital expenditures. Financing activities used another $1.1 billion, primarily for stock buyback and dividends paid.
Chicken, beef, and pork have at least one thing in common: they’re protein. And that’s what Tyson Foods is placing its bets on. The company is going all-protein, all the time, divesting its non-protein businesses Sara Lee Frozen Bakery, Kettle, TNT Crust, and Van’s. As it focuses on sources of protein, Tysons committed itself to producing that protein sustainably. It says that investments in sustainability should reduce waste and costs.
To help it develop more protein products, Tyson Foods is backing a $150 million fund to invest in food innovation. New Tyson Ventures focuses on commercializing alternative proteins, addressing food insecurity and food loss through commercial models, and promoting better use of resources, safety, and consumer empowerment in the food chain. The fund invests in entrepreneurial food businesses and Tyson provides expertise to accelerate development. Some major acquisitions over the past couple of years (Keystone Foods, AdvancePierre Foods) have also opened up new product avenues.
Besides developing new protein and products, Tyson Foods looks to run a leaner organization. The company began implementing a restructuring, what it calls a Financial Fitness Program, in late 2017. The program involves the integration of acquisitions and finding cost cuts and overhead improvements in supply chain, procurement, and the prepared foods and chicken segments to reach a total savings of $800 million by the end of 2020.
Mergers and Acquisitions
In late 2018 Tyson Foods acquired Keystone Foods from Brazil's Marfrig for $2.16 billion. US-based Keystone, which sells chicken nuggets to McDonald's, also makes beef patties, fish filets, and chicken wings and tenders. The deal provides a solid foundation for international growth for Tyson Foods as Keystone has operations in China, South Korea, Malaysia, Thailand, and Australia.
Earlier that year Tyson Foods became one of the largest organic branded chicken processors when it acquired Nebraska-based Tecumseh Poultry, maker of the Smart Chicken brand of air-chilled, fresh chicken.
In 2017 Tyson acquired prepackaged foods company AdvancePierre Foods for $4.2 billion and converted the company into a subsidiary. The acquisition of AdvancePierre Foods' sandwiches, meals, and other ready-to-eat foods complements Tyson's existing line-up of prepared meals. The purchase also brought AdvancePierre's food service, retail, and convenience store provider customers.
Tyson Foods was founded in 1935 by John W. Tyson. In 1963 the family took the company public. Throughout the 1990s Tyson Foods entered new markets worldwide including countries in the Americas and the Asia-Pacific region. It became the world's largest processor and marketer of chicken, beef, and pork through the 2001 purchase of IBP.
4703 HWY 412 E
Siloam Springs, AR 72761-8906
Phone: 1 (479) 524-3166
Employer Type: Privately Owned
Administrative Assistant: Sandra Gray
Vice President: Stan Reid
Vice President, Production Operations: Randy Vardeman
Employees (This Location): 2,000
Employees (All Locations): 2,150
Siloam Springs, AR
Siloam Springs, AR