Farms Inc.: Responding To Twenty-First-Century ChallengesEssay Preview: Farms Inc.: Responding To Twenty-First-Century ChallengesReport this essayProblem:Which strategy for future business development should be chosen to guarantee companys growth and success in the future?Competition:James Perdue familys company is one of the largest in the US poultry market, selling more than 48 million pounds of distinctly yellow chicken products and nearly 4 million pounds of turkey products each week. Vertically integrated, Perdue Farms sees its birds from the egg to the supermarket meat case. Perdue is expanding its value-added chicken parts and food service products and has established a plant in China through a joint venture. It also processes grain and makes vegetable oils and pet food ingredients.
Farms Inc.: “The farm standout is no other, and the number of eggs, beef, or lamb in the United States tripled in the past five years after the enactment of a farm bill in 2013.”[14]As of 2014, 80% of US birds were sold to households. For the same period of the period, approximately 60% of all chicken sold was sold to households across the nation. To accommodate the expanding bird market, Perdue Foods Inc. (PFS) is looking to build its chicken production, which accounts for one third of its US operations. With more than 40 new companies in three continents and a total of 1.5 million birds, the company is in good position to enter the new chicken space:A majority of its annual operations are located in the Midwest; all of which means that the company’s business is growing fast. Perdue is trying to expand its farm line by increasing the number of locations it has opened, which has included a new development and a new facility, and expanding its plant in the Midwest. As of the 2014 tax year, the company had a gross profit of $2.29 billion. Perdue Farms Inc. is now on the verge of becoming the #1 chicken producer in the industry; the company’s sales per hectare of 1.05 chickens rose from $26.25 in 2012 to $34.95 in 2013. The company is expanding into larger, high-producing states. Perdue is set to offer sales of some 30 new, expanded line of poultry, which could help help push poultry production far into the future. Perdue Farms Inc./USP Foods CEO James Perdue, Jr. is scheduled to speak at the 2015 National Institute of Food and Agriculture (NIFAC) Symposium on Chicken and Livestock, August 19-20, at Stanford University. He is also scheduled to sit at a meeting of the National Pork Producers and Exporters Forum on Animal and Plant Health, June 10-11, at Stanford.Perdue’s latest efforts are aimed at building “a sustainable, economically diversified, and competitive poultry business by combining high-quality, highly productive, and abundant produce with a high level of high-quality competition.” The company is also making significant strides in the field of animal and non-animal nutrition. Perdue Foods CEO James Perdue, Sr., who is also the former director of Agriculture for the US Department of Agriculture (USDA), says he has been working at “a very high level in agriculture” for eight years, but has not managed poultry at his current levels.Perdue’s leadership is in part due to his strong experience and leadership to manage and develop this new and potentially competitive poultry market. The company is on track to reach $1.3 billion by the end of 2015.[15]The company has also built a new partnership with a partner named Vodafone to help reduce the food and beverage costs associated with its chicken supply chain. In addition to PFS, Perdue Foods now has 2 other partners: Aviva Holdings, owned by the company’s founder, Mark O. Williams, and Pinnacle Foods, in partnership with U.K. and Dutch producers
There are 14 competitors for Perdue Farms Inc. and the biggest ones are ConAgra, Pilgrims Pride and Tyson Foods.Symptoms:* Industry is heavily regulated and product safety monitoring forces to invest in the companys production facilities to make them more safe and environment friendly
* Emerging food-service sector with big bargain power of buyers, such as Wal-Mart, Royal Ahold* Consumers demands are moving toward further-processed poultry* Underdeveloped value of companys competitive advantage on international marketsAlternatives:1. Strategy what would focus on maintaining their quality and efficiency in the market along with future plans for extension of product lines2. Strategy what would focus continues growth in the international market with the focus on new business opportunitiesSWOT analysis:Internal strengths are:Perdue is vertically integrated which means that they produce the chickens, they breed, hatch the eggs, they select the growers, build Perdue chicken houses, formulate and manufacture their feed, oversee care and feeding, operate their own processing plants, distribute via truck and marketing. They now also sell what used to be waste, such as the chicken feet that is sold in Asia as a delicacy
Privately held firmBirds are fed organically and not feed additivesSell both raw and