Supply Side briefs: ConAgra layoffs, Nestle’s frozen focus, Tyson bets on jerky

• ConAgra corporate layoffs begin
ConAgra Foods recently began the first wave of layoffs that will impact roughly 1,000 of its employees among its corporate ranks. The company unveiled more details of the layoffs on Friday, (Oct. 16).

The Omaha World Herald reports 40 information technology workers will be phased out over the next six months. The workers support a project related to how goods and services flow through the company’s production process.

“We need to reduce our selling, general and administrative costs and that means we will have fewer positions in many areas,” reads a memo obtained by The Omaha World-Herald on Oct. 16. “Your patience is appreciated. As these decisions are critical, we need to take the necessary time to determine the best option for our company. We operate in a highly competitive and complex environment and will do what is necessary to make ConAgra profitable and successful.”

The memo said ConAgra will disclose information about more layoffs in early November and later. It also contained information regarding efforts to offer voluntary retirement incentives to certain employees related to this corporate restructuring. Also in the next few weeks, ConAgra management will reduce reduce its “discretionary spending” as part of an earlier announced plan to save $300 million in annual expenses over time.

“This includes adjustments to our travel policy, catering, amenities, printing, etc.,” the memo said. “Collectively, these changes will add up to several million dollars in annual savings without impacting our ability to grow.”

CEO Sean Connolly told investors this summer that the company will also begin more stringent management spending with zero-based budgeting, which requires department managers to justify each expense again every year.

ConAgra is a major supplier to Wal-Mart Stores Inc. and has a large sales office in Northwest Arkansas.

• Nestle focuses on frozen
Nestle’s renewed focus on its frozen food business starting to pay off behind the repositioning of Lean Cuisine and Stouffer’s brands, according to company executives.

“If we start talking about our US frozen range, as you know, we did a lot of work in order to renovate, repackage, reformulate, reposition our frozen food franchise, and we are happy to see that the results are coming,” said Francois-Xavier Roger, chief financial officer, during an Oct. 16 conference call with financial analysts. “We have been positive for seven months in a row now, month on month in growth for the frozen food business in the U.S., and if we look at the third quarter of the year, we were a positive and even high single digit in growth against the same period of last year.”

The company was clear that it’s not just going for stability, but it’s major focus is growth in sales and market share.

 With the opening of a frozen food research and development center in Solon, Ohio, earlier this year, Nestle committed to aligning its products with consumer trends.



“I think what we have to do there in that category is stay always sharp and connect permanently with the consumer,” said CEO Paul Bulcke. “We lost it a little bit because the consumer has moved dramatically fast, called the millennials, but I think we are now there and have the capabilities to stay really attuned with what they expect now.”


For the full year, the company expects to deliver organic growth of 4.5%, down from its previous target of 5%, with improvements in margins and underlying earnings per share in constant currencies and capital efficiency.

Nestle is a major supplier to Wal-Mart Store and operates a large sales and marketing office in Rogers.

• Tyson Foods unveils jerky
Just in time for the Major League Baseball playoffs, Tyson Foods is rolling out a new snack food under its Ball Park’s brand — beef and pork jerky.

Tyson said it the national Ball Park Flame Grilled jerky product launched Oct. 14 on a national scale. Available in beef flavors that include Original, Bourbon BBQ and Peppered and pork flavors including Teriyaki and Barbecue, the products are available at approximately 10,000 US retailers, including Wal-Mart, Kroger, Publiz and Kroger stores..

The meat giant said it expects to disrupt the meat snack category with this new jerky product line.