NEW YORK, NEW YORK — Pepperoni was getting out of hand at Hormel.
The food giant last year was selling 71 different versions of its Hormel Pepperoni brand. There was diced pepperoni. Turkey pepperoni. Mini-slices of turkey pepperoni. Pepperoni sticks. Pepperoni with 50% less sodium. Pepperoni with 25% less fat. Thick-sliced pepperoni. The list goes on.
But Hormel is removing, consolidating or repackaging 25% of the items as part of a company-wide strategy to prune unprofitable items across dozens of its brands like Spam, Applegate and Jennie-O, the company said in June. Around 80% of Hormel’s profit comes from a small number of products, like Hormel Bacon and Fire Braised-brand meats, while the rest of its tens of thousands of items often drive up costs and sit untouched in warehouses and on shelves for long periods.
Hormel is reviewing its product lineup to invest in items with higher profit margins, improve lower-performing items and “remove production complexity,” a spokesperson for […]
This is wonderful news. It’s exactly how the market is supposed to work, allowing those production line to produce more profitable products within the USDA approved food factory.