ECON696_PerdueFarms_StrategicCommitments

Running head: Perdue Farms

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Perdue Farms - Strategic Commitments ECON 696 – Phillip Hampton By: Jayant Mehta Due Date: February 4th 2018

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Perdue Farms is a family owned company started by Arthur Perdue in Salisbury, Maryland back in 1920. “Perdue” popular for it’s swine and poultry in particular, began as a small egg seller and is now among the top grain companies in the U.S and the 3rd largest player in the U.S poultry industry ("Perdue Farms", 2018). Through its 2 operating subsidiaries – Perdue Foods and Perdue Agri-Business and ten B2C and four B2B brands, Perdue Farm’s making progress on achieving their goal of being the most reputable and trusted name in the food and agricultural industry with their mission of “responsible food and agriculture” ("Company | Perdue Farms", 2018). This paper will analyze on how Perdue Farms strategic commitment towards food, environment, animals care, society and stakeholders gives them a competitive advantage, differentiates them from competition and how these strategies are irreversible, clear and noteworthy.

First, we analyse Perdue’s commitment towards safe, affordable and high quality food.

All of Perdue’s products are completely indigenous, all chickens are raised with zero antibiotics, all animals are carefully processed with 26 whole grain products with minimal or no use of sodium products or fillers, keeping in mind children’s nutritional needs, meeting the standards of the Global Food Safety Initiative ("Food | Perdue Farms", 2018). Matching competitors in terms of quality in not enough, the commitment is to surpass them. At Perdue, the commitment to food safety starts with an all-vegetarian animal diet, an industry first high pressure pasteurization (to kill bacteria) and continues through its processing, packaging and distribution, which include consumer education and awareness All this along with external audits at every step in the supply chain - living up to Perdue’s standards and goals ("Quality | Perdue Farms", 2018).

Second, Perdue’s strategies commitment toward she environment with an $80.5 million interment is creditable. Perdue Agri-Recycle, its nutrient recycling and composting at Delmarva

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which till 2016 has already handled 2 billion pounds of poultry litter; can compost poultry litter, nutrient-rich by-products such as treated bio-solids from poultry plant, waste water and other organic material like soybean stems which were previously land applied. As a results, Perdue has achieved 4.6% reduction in water user over preceding 3 years, 14% less fossil fuel consumption, 0.2% less electricity consumption and a net 5.9% reduction in CO2 emission ("Environment | Perdue Farms", 2018). These results have been achieved by several initiatives like switching oil boilers to natural gas and employing biomass boilers (that burn sticks, pods and woodchips), retrofitting LED and Fluorescent lights and redesigning light’s placement, solar panel installations, working with equipment manufacturers on building lighter, fuel efficient, capable of handling a higher payload and “an innovative system that captures methane from a wastewater pond to fuel a generator and uses heat from the generator to provide hot water, cutting CO2 output by 52,000 tons annually” ("Conserving and Recycling | Perdue Farms", 2018).

In 2016 Perdue Farms raised the industries benchmark by their way of raising chickens establishing a four-part animal care program. With this, chickens have more space and increased activity, natural light through window installation, minimum 6-hour nighttime resting, gas stunning before processing, R&D and improvement in chicken health and welfare while compensating farmers for housing lesser chickens for longer periods ("Animal Care | Perdue Farms", 2018). Perdue’s respect for animals and aim for safe food check all the right boxes with consumers. The company claims “Our programs are designed so that we can raise animals in a reduced-stress environment where we don’t need to rely on human or animal antibiotics to keep them healthy, and we never use drugs for growth promotion or artificial growth promoters”. In 2017 the company reported that all its chicken and hogs were antibiotics free and so were 75% of its Turkeys. Formal animal care training was provided to its associates with a zero tolerance for

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animal abuse which can be reported via a dedicated hotline plus third party audits ensuring adherence to it strategic commitment towards animal welfare ("Continuous Improvement | Perdue Farms", 2018). Perdue is the first major poultry company to make an animal welfare commitment of this scale and to is committed on reporting their progress ("Perdue announces significant new animal welfare commitment for chickens", 2016).

Caring for and investing in its associates and society, has helped Perdue Farms retain human resources and enhance its industry position with exemplary dedication towards quality.

Today all of Perdue’s associated work full-time, receive health and insurance coverage, tuition/education reimbursement, and matched 401(k) plus are eligible for bonus plans. Post Hurricane Matthew, through the Franklin P. and Arthur W. Perdue Foundation the company collaborated with Feeding America and other local agencies, donated over $60K worth of its products and ice towards relief efforts. The foundation empowers society through education, agriculture, health and social services, public safety, and fighting hunger and poverty ("Community | Perdue Farms", 2018).

In 2013, Perdue was reportedly the third-largest American producer of broilers (chickens for eating) and was estimated as having 7% of the US chicken production market, behind Pilgrim's Pride and Tyson Foods ("Perdue Farms", 2018). Today's customers demand dependability from the brands they purchase. Intrinsic in the idea of dependability is that the company delivers on what they promise in terms of quality, value, and selection. Perdue Farms 2017 media campaign’s marketing strategy focuses on animal welfare, quality and the family aspect of the brand which “not only is it relatable to the audience, but it also builds credibility and engagement. That's because the idea of family and values go hand in hand, which is what customers want from brands especially food brands” (Olenski, 2017).

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As a result of Perdue Farms strategic commitment and business strategy fast food companies like like Wendy’s, Chipotle, Burger King, Subway and KFC Canada, due to Perdue’s quality and animal welfare schemes prefer to purchase to from morally and socially responsible companies like Perdue (Orttung, 2016). These commitments make Perdue stand out from Pilgrim's Pride and Tyson Foods, differentiate its products from theirs, even though it’s not the easiest or the cheapest way, but its Perdue’s way that appeals to its consumers. Retailers such as BJ’s Wholesale Club also express their support for Perdue’s initiative (Gilden, 2016). Perdue could but wont go back to from these aggressive commitments as it would contradict its core values and current marketing plan, moreover wont need to, as consumers support such humane initiatives and are willing to spend a little extra for quality products and the greater good of society and animal welfare. With such strategic commitments Perdue Farms will is bound to achieve their goal of being the most reputable and trusted name in the food and agricultural industry setting is apart from its competitors - Pilgrim's Pride and Tyson Foods.

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Animal Care | Perdue Farms. (2018). Perduefarms.com. Retrieved 3 February 2018, from https://www.perduefarms.com/responsibility/animal-care/ Community | Perdue Farms. (2018). Perduefarms.com. Retrieved 3 February 2018, from https://www.perduefarms.com/responsibility/people/community/ Company | Perdue Farms. (2018). Perduefarms.com. Retrieved 1 February 2018, from https://www.perduefarms.com/company/ Conserving and Recycling | Perdue Farms. (2018). Perduefarms.com. Retrieved 3 February 2018, from https://www.perduefarms.com/responsibility/environment/conserving-recycling/ Continuous Improvement | Perdue Farms. (2018). Perduefarms.com. Retrieved 3 February 2018, from https://www.perduefarms.com/responsibility/animal-care/continuous-improvement/ Environment | Perdue Farms. (2018). Perduefarms.com. Retrieved 3 February 2018, from https://www.perduefarms.com/responsibility/environment/ Food | Perdue Farms. (2018). Perduefarms.com. Retrieved 1 February 2018, from https://www.perduefarms.com/responsibility/food/ Gilden, S. (2016). Perdue Announces Industry-First Animal Care Commitments. Businesswire.com. Retrieved 3 February 2018, from https://www.businesswire.com/news/home/20160627005868/en/ADDING-MULTIMEDIAPerdue-Announces-Industry-First-Animal-Care

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Olenski, S. (2017). Forbes Welcome. Forbes.com. Retrieved 3 February 2018, from https://www.forbes.com/sites/steveolenski/2017/09/05/perdue-keeps-it-all-in-the-family-innew-campaign/#148b2c637296 Orttung, N. (2016). Perdue promises a more humane life for chickens. The Christian Science Monitor. Retrieved 3 February 2018, from https://www.csmonitor.com/Business/2016/0629/Perdue-promises-a-more-humane-life-forchickens Perdue announces significant new animal welfare commitment for chickens. (2016). World Animal Protection USA. Retrieved 3 February 2018, from https://www.worldanimalprotection.us.org/news/perdue-announces-significant-new-animalwelfare-commitment-chickens Perdue Farms. (2018). Retrieved 1 February 2018, from https://en.wikipedia.org/wiki/Perdue_Farms Quality | Perdue Farms. (2018). Perduefarms.com. Retrieved 1 February 2018, from https://www.perduefarms.com/responsibility/food/quality/ Thomson, J. (2017). Forbes Welcome. Forbes. Retrieved 1 February 2018, from https://www.forbes.com/sites/jeffthomson/2017/05/09/how-perdues-communitycommitment-guarantees-its-success/#440fd7811fe3