A perfect fit
Tyson Mexican Original Inc. acquired Don Julio Foods Inc earlier this year, and together, the brands have big future plans.
Earlier this year, Tyson Foods Inc. announced that its subsidiary, Tyson Mexican Original, had purchased Don Julio Foods Inc. Richard Irvin of Tyson Mexican Original and Nate Fisher of Don Julio Foods discuss what the acquisition brings to both companies now and down the road.
Tyson Foods Inc., Springdale, Ark., one of the world’s largest meat processors and marketers in the U.S., announced in February that its foodservice subsidiary, Tyson Mexican Original Inc., had acquired the assets of Don Julio Foods Inc. in Clearfield, Utah.
Tyson Mexican Original offers corn and flour tortillas and tortilla chips, flatbreads and wraps. Don Julio Foods sells corn and flour tortillas, tortilla chips, dips and salsas under the Don Julio Authentic brand; salty snacks under the Clover Club brand; and corn and flour tortillas under the Julia’s brand. The bulk of the company’s sales are in the West.
So, what does this all mean for each company going forward? Snack Food & Wholesale Bakery recently spoke with Richard Irvin, vice president of operations for Tyson Mexican Original, and Nate Fisher, general manager at Don Julio Foods, about the acquisition. Here’s what they had to say:
Snack Food & Wholesale Bakery: Why did Tyson decide to buy Don Julio Foods?
Irvin: There were several reasons. We have a pretty big, national foodservice business already in Tyson Mexican Original. Looking at our growth potential, one area where we had room for opportunity was in the retail sector. Don Julio had a good retail business—is well-established in the Salt Lake City area and had a good, recognized brand. Not only that, it had a sales and marketing group that knew the business well, and we felt like it fit well within the Tyson Mexican Original culture. We also lacked the geographic area. We already had three plants—the one farthest west is our Arkansas facility—so this gave us a good West Coast presence for our other business as well. Also, we felt the people of Don Julio were a good fit with our group and a good complement to Tyson Mexican Original.
Fisher: What Richard said is right on the money. Over the years, we found that our values really matched, even though we’re a really small company compared to Tyson. But our values and the way we do business are very, very similar. That’s made it a lot simpler to navigate and get going.
SF&WB: How did the acquisition come about?
Fisher: We weren’t really looking around, but you always keep your eyes open. We know that you need to grow, or you’re going to die. We looked at what we needed to do next, because there were a few things we knew had to do to get to where we wanted to be. All required the help of a parent company.”
Wayne Beach, [vice president of sales and marketing at Tyson], and I sat on the [Tortilla Industry Association] board. He was president, and I took his place as president, so we had a really strong relationship. We talked about how to build a national brand—what we would have to do and the energy we would need to do it. That’s kind of how the dialogue started.
Irvin: We were already one of dominate players in the foodservice side of the tortilla business, so we were actively looking for a way to enter into the retail market and for partners to do that with. Because of the relationships that we have in the tortilla industry, we knew quite a lot of the players, and we thought Don Julio was the best fit for us.
SF&WB: Will there be any management changes at Don Julio?
Fisher: There have been no management changes. They just want us to succeed. They’ve been big-time cheerleaders and very supportive. Richard flew out here a couple of weeks ago and came to our meetings. What’s neat about Tyson and very unique, in my experience, is that [the company] has an open-door policy. The guy out digging in the trenches for us can call Richard or probably even [CEO] Donnie Smith and reach both of them.
SF&WB: What does Don Julio bring to Tyson Mexican Original in the way of products?
Irvin: The primary thing was retail. It’s a little bit different product than what we do in that it’s shelf-stable. Don Julio also has the chips, not just corn tortilla chips, but potato chips and some other items that they sell [under the Clover Club brand] that we liked as well.
SF&WB: How does Tyson plan to promote the Don Julio brand and other brands?
Fisher: A group [from Tyson] came out a week ago and helped us do things that we never had the resources or time to do. We’re figuring out how to expedite the brand to the market. What we’re seeing—from all levels of the company—is a great awareness of this brand and opportunities to take it places where we never could have taken it [on our own].
That’s really another reason why we went to acquisition—so we could grow the brand. We knew Tyson had the tools and intellect to do it. Long after Richard and I are playing checkers in our rest homes, you’ll still see the Don Julio name. That’s why the Don Julio board of directors felt so strongly about this. They felt they wanted do everything they could to build the brand, which is what they’ve always done and what [Tyson] did with Mexican Original. [Tyson] understands brands and brand management.
So, we’ll take the good things that we do and figure out how to make them better. There will probably be, over a period of time, some refreshing [of product]. We’ve done that before, but it will be even better.
SF&WB: Does Tyson plan to take the Don Julio brand national?
Fisher: As we galvanize, there are areas where you’ll start to see our presence. Our goal is to expand the brand. It’s already starting to happen.
Irvin: We do have a little bit of presence right now on the East Coast that we didn’t have before. Also, the brand has more potential to it than just tortillas. In the Hispanic-type, processed frozen foods area, there are a lot of applications were we could use that form. We’re exploring all those opportunities as we speak.
SF&WB: Are there any new products already in the works?
Fisher: We have a new tortilla chip we rolled out in January. The recipe has been adjusted to make it more flavorful. We can’t keep it on the shelves in some areas. It’s doing very, very well where we have distribution right now. It’s fun to have a product where you don’t have to go out and kick the bushes, and customers are calling and saying, “Hey, I need another truckload. Our stores are out.”
SF&WB: Is there anything you’d like to add?
Irvin: We’re really excited at Tyson Mexican Originals to get our foot in the door on the retail side, and we know that that’s a tough market to be in. We’re happy to have the Don Julio team as part of our team now, to try to penetrate that market. We don’t expect that we’re going to change things real quickly. It’s going to be a long process, and we’re in it for the long haul to build this brand. It’s really exciting for us, and we’re really looking forward to growing the brand.
Fisher: Tyson is about building a brand and understanding what it takes. It’s so refreshing because it goes back to why we were so thrilled to get this acquisition done—because it will grow [the Don Julio brand]. That’s a satisfying thing. We want this brand to outlive all of us.