To this end, Tyson has forced its farmers to provide cattle with Zilmax, a drug that makes them grow faster. With the competition vanquished, farmers, butchers and processors simply have nowhere to go if they oppose Tyson’s practices.įor example, Tyson favors quantity over quality in its production, preferring mass-produced meat over higher quality alternatives. Where will competing companies find farmers if Tyson controls them all? Where will they find people to butcher and process the meat? In all likelihood, they won’t.įurthermore, when you control the entire production process, you can force people to work toward your own strategic goals. When a single company controls the entire supply chain, it’s extremely difficult for a competitor to enter the market. The big advantages of vertical integration are that it helps mitigate competition and unify strategy. Rather, they are simply under Tyson’s control by virtue of their contractual relationships: among other things, they have to comply with Tyson’s strategy and prices, as well as work with other Tyson companies. This doesn’t necessarily mean that Tyson owns each of these partners. In Tyson’s case, companies from throughout the meat supply chain, such as farmers, feed producers, slaughterhouses and distributors, were placed under the company’s tight grip.
What’s the best way for a company to increase its profits without actually having to improve its product? One business might start by improving its marketing campaign, while another could streamline processes in order to reduce redundancy.įor a huge company, however, these small-time solutions simply won’t cut it it would need something much grander.įor Tyson Foods, this grand idea was vertical integration, a process by which a company takes control of all the independent businesses that work with it.
why Barack Obama’s plans to reform the meat industry have failed.why Tyson foods force their farmers to take part in a tournament.In this summary of The Meat Racket by Christopher Leonard, you’ll find out This book summary change that they show you the reasons behind the company’s growth, and highlight the fact that while it might have brought cheap prices to consumers, it has spelled disaster for farmers. So why don’t you know much about them? The company isn’t very vocal about its business practices and, as a result, few know how they have risen to the top of their industry. They produced about a fifth of all meat consumed in the United States. Today, Tyson Foods is the biggest meat company in the US in 2011 they raised 2.1 billion chickens, and slaughtered 7.2 million cows and 20.5 million pigs. Have you ever eaten meat from Tyson Foods? No? Well, if you’ve ever had a Chicken McNugget, or a hamburger in your staff cafeteria, it turns out you probably have!
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