For Tyson Foods, Springdale, AR, net-weight or fixed-weight packs represent enhanced category managementβand the future of case-ready meat. Group vice president of consumer products, John Lea, who oversees Tysonβs sales to retail and club stores, believes fixed-weight packaging offers revolutionary benefits for Tyson, for retailers, and for consumers.
βThere are very few initiatives that come along that have so many advantages for the manufacturer, the retailer, and consumers,β says Lea. βI expect to see a fast progression of this concept across the retailer community, not just for poultry, but for many protein products.β
Whatβs special about this way of packaging is that the precise net weight of a packβs contents is determined by the packer. Rather than filling pieces into a tray and pricing them according to the random weight, Tyson puts a predetermined weight in every pack.
This is a distinct departure from the traditional approach of random-weight packages where each is weighed and priced according to its weight. Fractional differences in weights equate to price differences of pennies at retail, which creates a confusing variety of packs.
The fixed-weight approach brings a variety of benefits, says Lea. For consumers, he points out, it means package-to-package and store-to-store-consistency. βConsumers receive a known portion cost on the product just as they would on frozen food or any product sold in net weight form. That way, every time they come to the store that package or price is not different solely based on its random weight.β
For Tyson and its retailers like Wal-Mart, the bar coded and scannable packs represent numerous benefits and enormous potential, says Lea. For example, shipments and product assortments can be tailored to the specific demographics of a particular location.
The secret: scannability
βThe biggest efficiencies are gained through electronic supply chain initiatives that are served by typical bar coding of cases,β says Lea. βThat means our ability to scan pallets and price accurately by case rather than by individual random package or βcatchweightβ.
βBefore, we prepriced products for retailers at our plant. With scannable product, itβs possible to do regional pricing or individual store pricing down to the particular item number if the customer desires.β
Lea points out that itβs especially useful for sale items. βBefore, when we prepriced sale product, we had to estimate the amount of product we thought the store would sell during the sale period. With this new approach, we can take existing product, put it on sale, and it is always in stock at the sale price during the sale dates. Itβs very important for the retailer to be in stock on sale products when itβs in his ad. This will keep them from running out of product during the sale.β
Standardizing into three or less stock-keeping units per productβregular, family, and jumbo sizesβgives Tyson greater control in category management. βIt was simply because we could not get that information from a nonscannable product before. We hope to work with our retailers on the proper product assortment by neighborhood demographics right down to the store level.β Lea compares it to what is already done in the nonfood aisles of grocery stores.
Tyson continues to offer random-weight packages for some customers, but feels this is the wave of the future. βItβs not being done currently for beef beyond ground beef, but we believe beef is within the realm of possibility for the future,β Lea says.
$25 million investment
Fixed-weight packaging represents a hefty commitment by Tyson of $10 to $15 million per plant to convert some operations to fixed weight packaging. Tysonβs Noel, MO, plant was converted in early 2003 and its Monroe, NC, plant is expected to follow this fall, according to Lea.
βItβs a highly technical process that starts with weighing product out of the chiller at very early stages,β explains Lea. βThen we sort pieces for the exact weight for packages they are going into. Nothing like this has ever been done before in the chicken industry.β
Tyson worked in reverse order to determine the specific net weights.
βWe focused in on keeping portion sizes consistent with what we packed before we converted to fixed weights, and we worked backwards into what actual weight a package would be,β Lea explains. That results in certain βoddβ fixed weights such as a 1.65-lb pack of chicken breasts
Another plus is that the chicken packs receive less handling in-plant and so are shipped in better condition. That means they look better on shelves, according to Lea.
With fixed weights, the products are packaged, then cased, and put in a cooler until shipped.
βThe package doesnβt have to be handled again until an order is placed and itβs pulled out for final shipment,β Lea points out. βBy the time it gets to the store shelf, the package is much improved simply from lack of additional handling within our facility.β
The packs also present a neater appearance design-wise. For one thing, thereβs no added sticker with the weight declaration to clutter the package; the weight is preprinted on the overwrap on the package front and the bar code appears on the back. And the use-by or freeze-by date and the product pricing presents a tidier appearance since itβs done by contact printing directly onto the film.
βThis will be the way fresh [case-ready] products will be sold going forward,β claims Lea.
Tyson is the number one supplier of case-ready beef and pork to retail grocers. It is also the leader in the red meat and chicken categories with 27 percent of the beef market, 23 percent of the chicken market, and 19 percent of the pork market. Tyson produces one out of every four pounds of protein in the United States.