I’ve been thinking about chickens lately. No kidding. One of my new clients asked me to structure a US manufacturing operation to launch their chicken feed product. If you are a vegetarian, or any of the other categories that don’t eat chicken, you may still want to continue reading this post as it’s more about driving efficiency into any industry. This post is not discussing the environmental and breeding conditions of chickens.
The product, as described by the founder, is non-everything: non-GMO, non-antibiotic, and non-growth accelerator. The product also meets all Generally Recognized as Safe (GRAS) guidelines. Their studies, from several other countries and foreign regulatory agencies, show a reduction in production time by about 10 days while increasing overall protein. The indirect benefits include a reduction in utilities, less feed, less effluent discharge (that’s chicken poop…), higher production turnover and, less smell! The decision to relocate to the US is because they have already been subject to industrial espionage and believe they can better protect their formula and processes in the US.
As I always do, when I don’t know about a subject, I ask a lot of people naïve questions and read a lot of articles. There are even podcasts about chickens with names like the “Chicken Whisperer” and “Coop Crate Show”! Two of my friends, Craig and Greg, also gave me insight into the poultry industry. When they were young, they ran around catching chickens for inoculation. Craig showed me his battle scars that he carries 20 years later. I also owe a lot to my assistant who I assume found it amusing to do research about chickens.
POULTRY INDUSTRY
The US poultry industry is over $1.02 trillion dollars and accounts for 5.6% of GDP[1].
There are over 9 billion chickens produced in the US and over 50 billion worldwide[2].
Chicken consumption is increasing from 77 million metric tons in 2003 to 123 million metric tons in 2018[3]. Basically, that is a lot of chickens raised for eggs and eating, which means that Chick-fil-A isn’t some cult product (well maybe they are), but has done their macro homework that selling chicken sandwiches is a rising growth industry. Let’s not forget that chickens are the original white meat favored as less calories, fat, etc.
BACK TO MY CLIENT
So, if you can reduce the time to market, increase yield, reduce feed, and make a better tasting chicken, it sounds like my client can help drive efficiency and profitability into an industry that I never really thought about. The client will be publishing US studies 3rd quarter this year so I will update this post.
The next time, I am ordering a chicken sandwich…
[1] John Dunham & Associates 2016
[2] USDA Fact Sheet 2015
[3] OECD/FAQ Agriculture Outlook 2018