Son Now Beats Perdue Drumstick
Frank Perdue passes the marketing mantle to his son, Jim, who is taking over at Perdue Farms, America's third-biggest poultry producer
IT takes a tough man to follow in the footsteps of a famous father.
During a recent cab ride in Boston, Jim Perdue began talking about the poultry business with the driver. The cabbie, unaware of whom he was talking to, mentioned that he ate Perdue chickens because they have more breast meat. He also said he had seen the latest Perdue Farms commercial, ``the one where Frank introduces his son.''
``The only thing is,'' the driver said, ``the son doesn't look like a chicken.''
Jim may not look the part, but nonetheless, after 24 years as television spokesman for Perdue Farms, Frank Perdue is passing the marketing mantle of the nation's third-largest poultry firm to his son.
``Having me take over is unchartered waters in many ways,'' Jim Perdue says in an interview, obviously less comfortable with the duties. ``Not many [advertising] campaigns have transitioned this way.''
But the rather public handoff isn't the first generational transition at Perdue Farms in Salisbury, Md. Arthur Perdue, Jim's grandfather, started the company in 1920, when he built a coop for 50 egg-laying chickens.
Frank joined in 1939, and under his leadership Perdue became a household name. His 1968 decision to process and market chickens under his own name was the launching pad for his television stint as the thin-necked, ``tough man who makes a tender chicken.''
Three years ago, Jim became chairman. Though he says his father will remain an important part of the management team, the time has come to pass the torch publicly. In January, in the first of several commercials, Frank introduced Jim as ``his greatest achievement.''
As the cabbie's comments indicate, the ads created by Lowe & Partners/SMS, Perdue's advertising agency from the beginning, are being noticed.
And looks are not the only way the soft-spoken Perdue differs from his more famous father. ``In terms of running the business, we both have the same end in sight,'' he says. ``But the way we get it done is probably different.''
His father was an entrepreneur, Perdue says, and made most of the decisions himself. Today the $1.1 billion company - the largest poultry producer in the Northeast - requires a different management style. ``I like the decisions to be made as close to the product as possible instead of at the top,'' Perdue says. ``We've got to depend on the people in the satellite operations making the right decisions.''
George Watts, president of the National Broiler Council, a trade group, says Frank is more intense, more in a hurry, and more likely to ruffle feathers than is his son. Jim is more deliberate and considerate, and is more likely to involve others in management decisions, Mr. Watts says.
``There are differences in style and differences in the way they operate,'' he says. ``But Jim is just as serious and committed in terms of quality and operation of the company.''
Perdue Farms has more than 18,600 employees, with facilities in Delaware, Maryland, West Virginia, Indiana, and North Carolina, among others. Each week the company processes and ships more than 11 million chickens and 3.1 million pounds of turkey to supermarkets and butcher shops from Maine to Chicago. Though Perdue's fresh chickens are currently found only east of the Mississippi, its cooked products, which have a longer shelf life, are sold in Texas, California, and Washington. The company also has a strong export business.
In terms of profitability, analysts say the poultry industry has been on a roller-coaster ride for the past five years. Perdue disagrees. It's been on a roller-coaster for ``the last 50, 60, or 70 years,'' he says.
``It's a supply and demand business,'' he says. ``Over half the cost of a live chicken is the grain, and grain fluctuates.'' Last summer's grain crop was the best in years, Perdue says, keeping costs in line. In fact, consumers can buy chicken for the same price they bought it for in the 1970s. But because other costs are higher, poultry companies have to be ``a whole lot more efficient,'' he says.
As part of its effort to stay competitive, Perdue Farms recently announced the acquisition of a former competitor, Showell Farms, which Perdue says will allow the company to expand farther west and will be a boost to its export business. ``As any industry grows, it consolidates,'' he says. ``You're either one of the acquirees or the acquirer. Any company wants to make sure its building its walls thicker.''
John Bierbusse, an analyst at A.G. Edwards & Sons in St. Louis, worries that profitability in the poultry industry could become an increasing problem. One solution, he says, is for companies to spend more on new products. The possibilites are endless, he adds.
PERDUE agrees. Though his father once declared that diversity is the most dangerous word in the English language, Perdue quotes from the company's mission statement, which says the company's job is to provide the highest-quality poultry and poultry-related products. That means that even though it deals exclusively in chicken and turkey, Perdue Farms has expanded into the sale of soybean oil (soybeans are the chickens' main feed ingredient), pet food (made from leftover chicken parts), and even exported chicken feet to China. ``Every part of the bird is used, believe me,'' Perdue says.
While some things have changed at Perdue Farms, others have not. The firm continues to use its own breed of chicken, unlike most other chicken companies that buy their birds commercially. It spends about $4 million annually on nutrition and genetics research. And it still buys its competitors' chickens and puts them through the same inspection that Perdue birds go through. ``We've been doing it since '71,'' Perdue says. ``We want to see how far apart the quality is.''
``After all,'' he says, ``ultimately this is not about advertising. The product has to carry the company in the end.''