Perdue Farms, Inc. Analysis
Perdue Farms, Inc. has been a privately held family owned company since 1920. Over the years Perdue has become vertically integrated in order to be more competitive and maintain financial stability. Perdue's objective is to be the leader in broiler and related poultry products in the industry. They strive to maintain quality and constantly improve efficiency and service. Perdue Farms Inc. has a mission to provide the highest quality poultry and poultry related products to retail and food service customers. They want to be the recognized industry leader in quality and service, providing more than expected from their customers, associates, and owners.
1) Perdue Farms Target Market consumers who are relatively price-in-sensitive and demand a good quality product.
2) SWOT
a. Competition 53 integrated chicken broiler companies account for 99% of the ready-to-cook chicken. Among these 53, 20 of the companies make up 80% of production. Concentration has been fastest growing among the Nation's top four producers which account for 42% of the market share
i. Tyson Foods, Inc., ranked #1, sold 88.25 million pounds of chicken in 1995
ii. Gold Kist, Inc., ranked #2, sold 44 million pounds of chicken in 1995
iii. ConAgra, Inc., ranked #4, sold about 38 million pounds of chicken in 1995
iv. Perdue Farms, Inc., ranked #3, sold about 43 million pounds of chicken in 1995
b. Nature, extent of demand high
i. The U.S annual per capita consumption of poultry has risen dramatically during the past 40 years from 26.3 pounds to almost 80 pounds in 1990.
ii. Analysts say that the growth is largely the result of consumers moving away from red meat due to health concerns and the industry's continued development of increased-value products.
c. Stage of product life cycle maturity
i. Continue to defend market share and maximize profits.
d. Skills of the firm (Strengths)
i. Technologically advanced, chickens have 20% more breast meat.
ii. Environmentally concerned about waste and prevention
iii. Great social responsibility, code of ethics
iv. Birds are fed organically with no additives.
v. Management Information System (MIS) is efficient and eliminates future problems.
vi. Diverse product line including chickens, hens, turkeys.
vii. Excellent research and development department that includes 25 employees and specialists ranging from avian science, microbiology, genetics, and nutrition.
1. As a result, Perdue growers have the best vaccination program and more diseases resistant chickens than competitors.
e. Financial Resources (strength)
i. Perdue Farms revenues for 1994 was estimated to about $1.5 billion, net profits at $50 million, and the number of associates at 13,800.
ii. They bought Showell Farms, Inc. in January 1995 which should boost revenue to $2 billion and the number of associates to about 20,000
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... around 500,000 dollars in debt. If they don’t corporate with the company in buying the new equipment and what not the contact will be canceled. No way to pay off the debt, even though the average farmer (for chicken) only makes about 18,000 a year to 500,000 in debt.
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