Hormel Foods introduces new strategic business model, transitions to three operating segments

US – American food company, Hormel Foods, has unveiled a new strategic business model that aligns its businesses to be more agile, consumer and customer-focused, and market-driven.

Under the new model, the meat giant will transition to three operating segments – Retail, Foodservice, and International, starting Oct. 31, the beginning of its fiscal 2023.

The company’s largest operating segment, retail, will be focused on its “powerhouse consumer brands” in the retail marketplace, including the recently-acquired Planters, Applegate, Hormel, and Herdez.

The segment will be led by Deanna Brady, who currently oversees the company’s refrigerated foods segment, as the executive vice president of retail.

In addition, the retail segment will be linked to a new “center of excellence” called Brand Fuel, which will be a “food forward hub, housing brand management expertise, world-class marketing capabilities, and insights-led innovation”.

The company noted that the retail segment will also house the Digital Experience Group, its e-commerce and digital content team that supports Hormel’s brands and businesses in the virtual marketplace.

The foodservice operating segment will combine the company’s domestic foodservice businesses where sales have continued to experience growth due to its portfolio of branded, value-added products and market leadership positions in the pizza toppings and bacon categories.

This segment will be led by Mark Ourada as group vice president of Foodservice, who will be responsible for the sales and marketing of foodservice products within the United States.

The new Foodservice operating segment is said to remain focused on partnering with customers to deliver culinary solutions for today’s dynamic environment.

The international segment will continue to focus on “aggressively growing” its presence outside the US for brands such as Skippy and Spam.

Hormel’s plan is to accelerate growth and investment in China, Brazil, and Indonesia and further leverage its partnerships in the Philippines, South Korea, and Europe.

To achieve growth in the Asia-Pacific region, the meat processor is set to open a new R&D and innovation center in China in the fiscal year 2023 to serve as its food-forward innovation and culinary creation hub.

Swen Neufeldt will continue to lead the company’s international business as group vice president, and president of Hormel Foods International Corporation.

Hormel Foods said its One Supply Chain team will continue to oversee its global supply chain and will offer support to each segment for better business transition.

Jim Snee, President, and CEO at Hormel Foods said: “Hormel Foods is a distinctly different company than it was a decade ago, with a food forward, growth-oriented portfolio of leading brands and products that are aligned with our customer and consumer needs.”

Hormel’s new operating model is a culmination of recent strategic actions, according to Snee, which included numerous portfolio-building acquisitions, including the Planters snacking business, the creation of One Supply Chain, and the modernization of its technology and e-commerce capabilities.

Snee added that this new alignment will empower the company’s 20,000 global team members, with a more refined organizational structure that is accountable, nimble, and focused on creating the Hormel Foods of the future.

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