Tyson Foods 2015 Annual Report Download - page 10
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Please find page 10 of the 2015 Tyson Foods annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Changes in consumer preference and failure to maintain favorable consumer perception of our brands and products could negatively impact our
business.
Thefoodindustryingeneralissubjecttochangingconsumertrends,demandsandpreferences.Trendswithinthefoodindustrychangeoften,andfailuretoidentify
andreacttochangesinthesetrendscouldleadto,amongotherthings,reduceddemandandpricereductionsforourbrandsandproducts.Westrivetorespondto
consumerpreferencesandsocialexpectations,butwemaynotbesuccessfulinourefforts.
Wecouldbeadverselyaffectedifconsumersloseconfidenceinthesafetyandqualityofcertainfoodproductsoringredients,orthefoodsafetysystemgenerally.
Prolongednegativeperceptionsconcerningthehealthimplicationsofcertainfoodproductsoringredientsorlossofconfidenceinthefoodsafetysystemgenerally
couldinfluenceconsumerpreferencesandacceptanceofsomeofourproductsandmarketingprograms.Continuednegativeperceptionsandfailuretosatisfy
consumerpreferencescouldmateriallyandadverselyaffectourproductsales,financialconditionandresultsofoperations.
Wehaveanumberoficonicbrandswithsignificantvalue.Maintainingandcontinuallyenhancingthevalueofthesebrandsiscriticaltothesuccessofour
business.Brandvalueisbasedinlargepartonconsumerperceptions.Successinpromotingandenhancingbrandvaluedependsinlargepartonourabilityto
providehigh-qualityproducts.Brandvaluecoulddiminishsignificantlyduetoanumberoffactors,includingconsumerperceptionthatwehaveactedinan
irresponsiblemanner,adversepublicityaboutourproducts(whetherornotvalid),ourfailuretomaintainthequalityofourproducts,thefailureofourproductsto
deliverconsistentlypositiveconsumerexperiencesortheproductsbecomingunavailabletoconsumers.
Failure to continually innovate and successfully launch new products and maintain our brand image through marketing investment could adversely
impact our operating results.
Ourfinancialsuccessisdependentonanticipatingchangesinconsumerpreferencesanddietaryhabitsandsuccessfullydevelopingandlaunchingnewproducts
andproductextensionsthatconsumerswant.Wedevotesignificantresourcestonewproductdevelopmentandproductextensions,howeverwemaynotbe
successfulindevelopinginnovativenewproductsorournewproductsmaynotbecommerciallysuccessful.Totheextentwearenotabletoeffectivelygaugethe
directionofourkeymarketsandsuccessfullyidentify,develop,manufactureandmarketneworimprovedproductsinthesechangingmarkets,ourfinancialresults
andourcompetitivepositionwillsuffer.Inaddition,ourintroductionofnewproductsorproductextensionsmaygeneratelitigationorotherlegalproceedings
againstusbycompetitorsclaiminginfringementoftheirintellectualpropertyorotherrights,whichcouldnegativelyimpactourresultsofoperations.
Wealsoseektomaintainandextendtheimageofourbrandsthroughmarketinginvestments,includingadvertising,consumerpromotionsandtradespend.Dueto
inherentrisksinthemarketplaceassociatedwithadvertising,promotionsandnewproductintroductions,includinguncertaintiesabouttradeandconsumer
acceptance,ourmarketinginvestmentsmaynotprovesuccessfulinmaintainingorincreasingourmarketshareandcouldresultinlowersalesandprofits.
Continuingglobalfocusonhealthandwellness,includingweightmanagement,andincreasingmediaattentiontotheroleoffoodmarketingcouldadverselyaffect
ourbrandimageorleadtostricterregulationsandgreaterscrutinyoffoodmarketingpractices.
Oursuccessinmaintaining,extendingandexpandingourbrandimagealsodependsonourabilitytoadapttoarapidlychangingmediaenvironment,includingour
increasingrelianceonsocialmediaandonlinedisseminationofadvertisingcampaigns.Thegrowinguseofsocialanddigitalmediaincreasesthespeedandextent
thatinformationormisinformationandopinionscanbeshared.Negativepostsorcommentsaboutus,ourbrandsorourproductsonsocialordigitalmediacould
seriouslydamageourreputationandbrandimage.
Wearesubjecttoavarietyoflegalandregulatoryrestrictionsonhowandtowhomwemarketourproducts,forinstancemarketingtochildren,whichmaylimit
ourabilitytomaintainorextendourbrandimage.Ifwedonotmaintainorextendourbrandimage,thenourproductsales,financialconditionandresultsof
operationscouldbemateriallyandadverselyaffected.
Failure to leverage our brand value propositions to compete against private label products, especially during economic downturn, may adversely affect
our profitability.
Inmanyproductcategories,wecompetenotonlywithotherwidelyadvertisedbrandedproducts,butalsowithprivatelabelproductsthatgenerallyaresoldat
lowerprices.Consumersaremorelikelytopurchaseourproductsiftheybelievethatourproductsprovideahigherqualityandgreatervaluethanlessexpensive
alternatives.Ifthedifferenceinqualitybetweenourbrandsandprivatelabelproductsnarrows,orifthereisaperceptionofsuchanarrowing,consumersmay
choosenottobuyourproductsatpricesthatareprofitableforus.Inaddition,inperiodsofeconomicuncertainty,consumerstendtopurchasemorelower-priced
privatelabelorothereconomybrands.Totheextentthisoccurs,wecouldexperienceareductioninthesalesvolumeofourhighermarginproductsorashiftin
ourproductmixtolowermarginofferings.Inaddition,intimesofeconomicuncertainty,consumersreducetheamountoffoodthattheyconsumeawayfrom
homeatourfoodservicecustomers,whichinturnreducesourproductsales.
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