HRL Overview

Founded by George A. Hormel in 1891, Hormel Foods Corporation (HRL) originated in the small town of Austin, Minnesota. It was known, at that time, as George A. Hormel & Co. The company would work under that name until 1993, when the company officially changed its name to Hormel Foods Corporation.

Born in 1860 in Buffalo, New York, G.A. Hormel was first introduced to the food industry while working in a Chicago slaughterhouse as a young boy. Upon leaving that profession, Hormel would then become a traveling wool and hide purchaser. His travels would lead him to Minnesota where he first started his retail meat business.

Prior to the turn of the century, times were tough for George Hormel and in order to sustain his new business venture, Hormel continued to trade in wool and hides, as well as poultry. With a loan of $500, Hormel began his own meat packing operation with the help of his younger siblings. By the end of 1891, Hormel had a workforce of six men and had slaughtered and sold more than 600 hogs.

With the increased popularity of refrigerated railcars in the 1890s, Hormel increased production and sales, while acquiring the help of more family members in order to expand the company’s production. By 1893, Hormel had processed more than 1,500 hogs throughout the year, which proved to be a saving grace for the struggling company.

Following the turn of the century, Hormel became an incorporated entity and increased their production and sales at a rapid pace. As expansion continued, the company opened several slaughterhouses in which many included engine rooms, casing production and machine shops. Additionally, the company opened several distribution centers in Minnesota, Atlanta, San Antonio, Chicago, Dallas and Birmingham.

Upon return from a trip to England, G. A. Hormel began exporting their products overseas. As World War I loomed on the horizon, the company increased production in order to support the country’s war-efforts. By the conclusion of the First World War, Hormel was contributing more than 33% of their total volume to aid the troops.

The company’s most recognizable product, which was introduced in 1937, is Hormel’s Spiced Ham, or SPAM. SPAM flooded the markets as a nutritional and inexpensive food product to the masses. Consisting of chopped pork shoulder, ham meat, salt, sugar, water and sodium nitrates, the precooked canned meat product reached a milestone in early 2007 when the seven billionth can of SPAM was sold.

Today, Hormel has proven to be one of the largest meat production and marketing companies in the U.S. and throughout the world. Hormel currently operates in four business segments, grocery products, refrigerated foods, Jennie-O Turkey Store (JOTS), and specialty foods.

Through their production methods, Hormel offers a substantial product-line of various meats, including fresh, frozen, cured, smoked, cooked, and canned meat. Included in the company’s perishable meat product-line are fresh meats, sausages, hams, wieners, and bacon.

Hormel’s poultry category is composed primarily of JOTS products. Originating as the merging of Jennie-O Foods Inc. and The Turkey Store Co. in 2001, JOTS provides an assortment of high-quality fresh, frozen, refrigerated, and deli turkey products.

As for the company’s shelf-stable products, these products include canned luncheon meats, microwaveable entrees, canned stews, chilies, corned beef hash, flour and corn tortillas and salsas.

Hormel also offers nutritional food products and supplements, such as sugar and sugar substitutes, creamers, salt and pepper products, sauces and salad dressings, dessert and drink mixes, and industrial gelatin products, also known as aspic.

The company sells their products under many name brands, which include the Chi-Chi's, Dinty Moore, Farmer John, Jennie-O, Lloyd's, SPAM, and Stagg brands, as well as their own namesake.

On the international front, Hormel markets its product-line through Hormel Foods International Corporation (HFIC), throughout foreign locations such as Australia, Canada, China, Japan and the Philippines.

With an ever-increasing global presence, HFIC has minority positions in food companies in Mexico, Hormel Alimentos with a 50% holding and in the Philippines at Purefoods-Hormel, in which the company has a 40% stake. Hormel currently has a hog production and processing operation in Vietnam, the San Miguel Pure Foods (VN) Co. Ltd., in which the company has a 49% holding.

Hormel is currently in competition with Tyson Foods Inc. (TSN), Smithfield Foods Inc (SFD), Sara Lee Corporation (SLE), ConAgra Foods Inc. (CAG), Campbell Soup Co. (CPB), Pinnacle Foods, Cargill, Inc. and Butterball, LLC.

By BetterTrades