Tyson Foods’ plans to expand its international and e-commerce reach and a new partnership with Chinese online retailer Dada Group is a big first step in that direction. Dada Group, a large platform for on-demand retail and delivery across China, operates JDDJ, one of China’s largest real delivery platforms for retailers and brand suppliers.
This is Tyson’s first partnership for on-demand delivery of fresh meat in China. The agreement was recently signed in Shanghai just as Tyson marks its 20th year of operations in China. Over the past two decades, Tyson has established its business footprint across the east, south, central and northeast regions of China. Much of that business has been to serve its retail and foodservice customers such as McDonald’s, Kentucky Fried Chicken, Walmart and Sam’s Club.
The JDDJ platform should allow Tyson China to see more online-to-offline growth. The O2O business model is a two-way flow between e-commerce and physical retail. This partnership will allow Chinese consumers to see an ad online for a Tyson Foods product and be driven to visit a physical store or perhaps be in a store or restaurant and order the item online for delivery. The goal is seamless service between the two channels.
Wenqi Yang, head of brand business at JDDJ, said Tyson Foods brings products and a vast supply chain to the table. He said joining with JDDJ’s ecosystem and resources, the partners will be able to create a data-driven business model for on-demand retail to help Tyson China achieve omnichannel growth.
Tyson does not break out its sales to China but it did record international sales of $1.856 billion last year. That includes the Thai and European operations of BRF S.A. and Keystone’s International business acquired in 2019, and 2018, respectively. Through the first half of 2021, Tyson reported international sales of $957 million, down 0.7% from a year ago. This includes exports in addition to in-country sales in China, Korea, Thailand, Malaysia, Australia and Europe.
Tyson CEO Dean Banks has said expanding the international segment is important to Tyson Foods’ long-term strategy. Shares of Tyson Foods (NYSE: TSN) closed Thursday at $80.56, up $1.40 on the day while also setting a new 52-week intraday high at $80.84.