U.S. biggest meat processor, Tyson Foods Inc on Thursday announced plans to discontinue operations at two plants in the United States as part of its efforts to improve the overall performance of its prepared foods business.
The closings will help Tyson Foods Inc to utilize available production capacity at some of its other prepared foods facilities.
The company’s Chicago Illinois, facility, which makes prepared foods for the hospitality industry and a pepperoni plant in Jefferson, Wisconsin, is expected to stop operations during the second half of the company’s fiscal year 2016, which ends October 1, 2016.
The moves will affect approximately 880 people, including about 480 at Chicago and about 400 at Jefferson. What’s notable is that none of Tyson Foods’ other Chicago facilities or offices are affected by this announcement. However, the meat-processing company said the workers of both the facilities in Chicago and Jefferson are being encouraged to apply for other openings within the company.
Donnie King, president of North American operations for Tyson Foods Inc said that the decision to shut operations in the two facilities was taken after much deliberation as this impacted the lives of the team members and their families. He said that the company eventually decided to shift production and equipment to more modern and efficient locations to better serve the customers.
Springdale, Arkansas-based Tyson Foods Inc said in a statement that the decision to close the facilities are due to a combination of factors including changing product needs, the age of both facilities and anticipated cost to renovate them was a factor in the decision, as well as the distance of the Chicago plant from its raw material suppliers.
Tyson Foods plans to work with state officials to ensure employees are informed about unemployment benefits and any potential re-training opportunities.
Tyson Foods Inc acquired the Chicago plant in 1994. At the time, it was privately owned and prepared meals exclusively for airlines. Currently, it makes prepared meals for the hospitality industry with items like tempura chicken, meatballs, crepes, omelets, soups, sauces and chicken cordon bleu on the menu.
The Jefferson plant, which produces sliced pepperoni and ham for pizza toppings, as well as sliced pepperoni and salami for deli and foodservice applications, was part of Tyson Foods’ acquisition of IBP, inc., in 2001. It was founded in 1875 by the Stoppenbach Family, as a beef, pork and lamb processing facility and was then sold in 1934 to the Bauch and Tensfeldt families.
During the late 1960s and early 1970s, the facility was converted to further processing, concentrating on pepperoni for the pizza industry. The plant was sold to Doskocil Foods in 1985, which later became Foodbrands America and was purchased by IBP, inc. in 1997.