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Tyson, Donald John - Overview, Personal Life, Career Details, Chronology: Donald John Tyson, Social and Economic Impact

chicken company business foods

(1930-)
Tyson Foods, Inc.

Overview

Don Tyson took over the family business in 1966 and turned Tyson Foods, Inc. into the largest chicken company in the United States. Known as “Mr. Chicken” in and around the poultry industry, Tyson is counted as one of the richest people in America, with a net worth of around $1 billion.

Personal Life

Donald John Tyson was born April 21, 1930, in Olathe, Kansas, and was raised surrounded by chickens. His father, John W. Tyson, developed an interest in raising chickens in the 1930s while driving his truck through Springdale, Arkansas. The elder Tyson paired off with some local chicken farmers and began hauling produce for farmers; that later expanded into hauling chickens. It wasn’t long before his father started raising his own animals. One of his dad’s innovations was the travelling chicken truck, allowing the transport of live fowl from Arkansas to Chicago in trucks equipped with feeding and water troughs.

The young Tyson left the farm in the early 1950s for the University of Arkansas, but school couldn’t hold his interest, and he soon left to return home. It seemed that Tyson was more interested in chickens than books. He married Mildred Ernst on August 24, 1952, and had three children, John, Cheryl, and Carla, all who work in the family business. He and his wife have been separated for more than 20 years.

Tyson is a Democrat, a rarity among big chicken growers and processors, and has a close relationship with President Bill Clinton and First Lady Hillary. He was a large contributor to Clinton’s presidential campaign. Tyson Foods has a political action committee, Typac, which reportedly contributed $99,800 to candidates for Senate and House seats in the 1993-94 Federal year. Tyson and other company executives also contributed to the unsuccessful Mississippi congressional campaign of Henry Espy, the brother of Clinton Agricultural Secretary Mike Espy. Because of his political ties, he has been accused of undue influence over Bill Clinton, when Clinton was an Arkansas governor and as president. The most controversial aspect of Tyson’s political activity involved Secretary Espy, who resigned from his post effective December 31, 1994. There were several allegations swirling about, such as claims that Espy improperly accepted plane rides, meals, and tickets to a Dallas Cowboys football game from Tyson. Also, Tyson allegedly received favorable treatment from the U.S. Department of Agriculture. One favored status repeatedly cited was Espy’s crackdown on unsanitary slaughterhouse practices. Somehow only the meat industry was the target of that probe; none of the poultry producers were investigated.

Tyson, however, dismisses these allegations and defends his right to be involved in politics. “The system in the United States has been super good to my family and myself and my company,” he said in Nation’s Restaurant News in January of 1995. Tyson said the company encourages its people to get involved at any level of politics, whether it is the local high school or city council or local civic clubs. He strongly believes that, “We have a responsibility to that community and to the society, because they’ve been good to us. You have to give something back. You never should take all the time.” He concluded that, “Because of that, you evolve into politics. If we don’t express our opinions, then we have no right to say anything about it.”

Tyson spends much of his time enjoying his favorite pastimes: fishing, visiting his country house near London, or working on a proposed new billfish museum in Florida. In 1991 he was named one of America’s top ten fisherman by Power and Motor Yacht magazine. He caught a 1,100 pound black marlin, and enjoys travelling around the world catching fish. Tyson has donated large sums of money to a variety of charities and has helped fund the Farm Aid musical concerts that raised money for agricultural workers. He also once rebuilt a poor congregation’s church that had burned down.

Career Details

Tyson, it seems, was destined to be in the chicken business. He learned much of the business from his father, who controlled every aspect of his chicken business, which included purchasing grain mills, processing plants, and transportation facilities. His father also sold Ralston Purina feed, catering to individual farmers. Not one to stand in the shadows, Tyson began putting his fingerprint on the company in 1965, when he persuaded his father to introduce the rock cornish hen. These tiny birds were a novelty at the time, and distributors were willing to pay a rate of 50 cents per bird. This was a critical agreement, and the impact to the company’s bottom line was enormous, as it allowed Tyson to calculate margins without having to worry about fluctuating grain prices.

It seemed that Don Tyson was well on his way to learning the family business. Unfortunately, tragic circumstances put him at the helm of this budding enterprise earlier than expected. At the age of 35, Don Tyson was forced to take control of the company when his father and stepmother were killed in a car-train crash. “A replica of John Tyson’s office in the corporate headquarters contains a clock stopped at the time of his death,” according to the New York Times. Tyson and his half brother, Randall, inherited the company, which at that time, controlled less than 2 percent of the nation’s poultry market. That computed to earnings of $507,000 on sales of $52 million.

Commenting on his parents death in Nation’s Restaurant News, in January of 1995, he said: “To lose both of them in one day was a real transition for me. It was January, it was cold, and we were losing money. It wasn’t a very good month.”

Tyson’s interest in chicken is not limited to just one process. Like other poultry businesses, Tyson sells raw and packaged chicken and has been a leader in that area. But he has also made tremendous inroads in prepared chicken (the kind that is cooked, breaded, and battered). These time-savers have been a big hit with busy families. “We’re selling time along with quality and convenience,” he told the New York Times. “We produce it and assemble it.” This strategy helped Tyson to become less dependent on grain prices because the packaged or processed chicken requires other steps that impact the price of the chicken. Moreover, Tyson is careful not to waste chicken, and even sells chicken feet, which is used in soup, to China. While there have been some winning strategies, there have been some flops as well. In the 1960s, when Tyson planned to open a chain of fast-food chicken restaurants across the country. All 30 were dismal failures. Another idea that did not catch on was its Gizzard Burger, which contained leftover ground chicken gizzards supplemented with various beef and beef flavoring. “They did everything but sell,” Tyson recalled.

Chronology: Donald John Tyson

1930: Born.

1951: Became Tyson Foods plant manager.

1956: Named president of Tyson Foods.

1965: Tyson started selling rock cornish hens.

1967: Parents killed in car/train crash.

1989: Purchased Holly Farms.

1991: Named one of America’s top ten fishermen.

1992: Bought Arctic Alaska Fisheries of Seattle, Washington.

1995: Tyson supplied 82 of the Top 100 fast-food chains.

1995: Retired from day-to-day operations.

While the Gizzard Burger may not have worked for the company, Tyson has enjoyed many other successes. Food service was one of the first areas in which Tyson expanded after opening its first processing plant in 1958. He helped McDonald’s develop the Chicken McNugget in the early 1980s, and was able to create his own frozen version for home use. Tyson also helped bring the first chicken sandwiches and chicken nuggets to other burger chains. In 1995 Tyson controlled 70 percent of the export market to Japan and expanded its fast food accounts to include Kentucky Fried Chicken and Wal-Mart. That year Tyson supplied 82 of the Top 100 fast food chains.

What we do is anticipate a need and then try to fill that need," Don Tyson said. “We make over 3,000 products today with chicken, with variations of breading and batter and taste and spice levels. We make whatever our customer wants.” Indeed, in 1995 Tyson Foods sold 6,000 products in 57 countries, and its sales of $5.2 billion brought it to the 110th rank on Fortune magazine’s list of the 500 biggest companies.

In addition, Tyson built a new research and development plant for about $9 million, 100 times the amount he spent on his original chicken plant. “My dad let me have $75,000 to build our first chicken plant, and I couldn’t do it. I had to borrow another $15,000 from friends for the $90,000 plant,” Tyson told Nation’s Restaurant News. The original plant is still running in Springdale, Arkansas.

Much of Tyson’s growth has been through acquisition as well as diversification. By 1994 Tyson Foods had made more than 20 corporate purchases, catapulting it to one of the nation’s largest hog producers and leading seafood processors. Tyson also started a beef processing division specializing in chicken-fried steak. Tyson’s biggest acquisition to date was the 1989 purchase of Holly Farms, which, at the time, was the nation’s second-largest chicken producer behind Tyson. The company acquired Holly Farms for $1.5 billion, and it has been one of the company’s best deals. In 1992 Tyson bought Arctic Alaska Fisheries of Seattle, Washington, the largest at-sea fishing processing fleet, as the company began to diversify into fish, beef, pork. Don Tyson tried in 1994 to acquire WLR Foods of Virginia, a huge turkey producer, but shareholders of that company were against the marriage.

At work, Tyson was known to wear the same attire worn by other Tyson employees: a khaki jumpsuit with his name stitched on the pocket. His management philosophy was somewhat unique and called his workers people and not employees. Anyone heard using the “E” word in his presence was fined a quarter. In the mid-1990s Tyson instituted literacy programs to assist illiterate workers and paid tuition to about 200 Tyson people going to college in 1994.

Social and Economic Impact

As time progressed, Tyson began to lose his edge and failed to follow many of his own rules. The Arctic purchase proved to be a problem, as Tyson had reportedly paid much too much to acquire the company. The pork business turned out to be much more difficult to run than Tyson Foods had previously thought, and the beef business was not fairing much better. With business taking a turn for the worse, Tyson decided to exit Tyson Foods, handing the reigns over to his hand-picked successor, Leland Tollett. Tyson stepped down as chief executive officer in 1992 and on his 65th birthday in 1995, relinquished the day-to-day operations of the company. It seemed apparent that Tyson’s center-of-the-plate protein strategy, a plan to dominate major meats and poultry consumed by Americans, was a bust. Once Tollet was in place, he immediately began to sell the pig slaughtering plant. A year later, Tollet moved to rid the company of all of its other beef and pork plants.

Looking back over the years, Tyson says he regrets none of his expansion ventures. “If it makes money, we expand it,” he said. “If it doesn’t, we cut its throat. The 11th Commandment is that you need to make a profit. If you’re not making money, you need to change.”

Although he is no longer involved in the daily operations, he still calls the office daily, and he most certainly has final say over all important business decisions. In 1996 he controlled 90 percent of the company’s voting shares.

Tyson, Neil de Grasse(1958–) - Astrophysicist, writer, Chronology [next] [back] Tyson, Cicely (1939–)

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