Foodservice becoming more important to Hormel Foods

BOSTON — Hormel Foods Corp.’s Foodservice business unit accounts for approximately one-third of company-wide sales and half of its profits. The ascension of the business unit within the organization reflects the pressures foodservice operators are under to better manage costs and streamline operations.

“I think if you step back and look at our Foodservice performance over time, we have proven the business model we have to be very unique and durable to grow even in down markets when industry challenges persist,” said John Ghingo, president of the company, during a Sept. 9 presentation at the Barclays Global Consumer Staples Conference.

During the third quarter of fiscal 2026, ended July 26, Hormel’s Foodservice business segment profit rose 3% to $144.5 million from $141 million the year before. Quarterly sales rose 2% to $1 billion from $987 million the year before.

Ghingo identified three attributes of the business unit he sees fueling additional growth.

“One is our value-added portfolio and the innovation we continue to bring to that portfolio,” he said. “We need to continue to create more value.”

Second is the company’s direct sales team that works with operators to communicate the strengths of the Foodservice unit to operators.

“Our direct sales force is truly a unique engine of culture, talent, capability, and the work they do with our operator partners is critical,” Ghingo said. “They’re gathering insights. They’re building relationships. They’re being creative and solving problems in the kitchen with the operator partners and then bringing back solutions.

“And, so, when you’re doing that even in a challenged environment, you can grow the top line because those operators will gravitate to the partner who’s solving the problems they’re dealing with.”

Hormel Foods’ Flash 180 chicken platform is an example of how the Foodservice business unit is serving its customers.

| Photo: ©EXQUISINE – STOCK.ADOBE.COM

Finally, Ghingo said Hormel’s diversified foodservice customer base is an opportunity for the company.

“So, whether you’re talking commercial, noncommercial, independence chains, geographic diversity, channel diversity,” he said. “So, that gives us the opportunity to play different channels where we see pockets of growth and pockets of opportunity to keep the growth engine going.”

An effective foodservice solution identified by Ghingo is Hormel’s Flash 180 chicken platform.

“If you look at the demand space in foodservice around breaded chicken, it’s one of the fastest-growing areas,” he said. “Consumers, diners want more breaded chicken, whether it be chicken tenders, whether it be fried chicken sandwiches, but if you’re an operator … (and) you want to sell more chicken, it gets difficult.

“You’re bringing raw chicken (and) it takes time; you have to handle it; you have to batter/bread in the fryer, 10 to 12 minutes. So, we’re bringing through our Flash 180 chicken platform. One-hundred and eighty seconds from package to plate, pre-prepped. So, it’s super simple to execute (that) saves time …. So, that’s an example of a solution.”