Purina
Introduction
Purina, a subsidiary of Nestlé, is one of the nation’s largest producers of pet food and products. It was initially established as an animal feed company. Purina has partnered with Petfinder, a resource that assists cats and dogs in finding their forever homes, in addition to providing their pets with food, treats, and litter.
Purina was established in December 2001 when the former American manufacturer of cereals, packaged foods, pet food, and livestock feed Ralston Purina Company merged with Nestlé. It was the second-largest pet food company in the world in 2012.
History
William H. Danforth, George Robinson, and William Andrews established the business in 1894 in St. Louis, Missouri. At first, it was known as the Robinson-Danforth Commission Company. The company’s president, Danforth, introduced a cracked-wheat cereal in 1898 that was named Ralston Whole Wheat Cereal (after Albert Wester Edgerly, also known as “Dr. Ralston,” a well-known health advocate from the 1890s). In 1902, Danforth introduced the red-and-white checkerboard logo and changed the company’s name to Ralston Purina.
Antitrust concerns led consumer advocates like the Consumer Federation of America to oppose the merger. With a 45 percent share of the market for cat food, the two businesses would combine to become the largest pet food brand by market share. After Ralston sold the Meow Mix and Alley Cat brands to J.W. Childs Equity Partners, resulting in the separate Meow Mix Company, the merger was approved by the FTC. The new company’s North American headquarters then became Ralston’s St. Louis, Missouri location.
Through 2002, Nestlé Purina Petcare continued to integrate the two businesses. It moved dry dog food production to Ralston-acquired manufacturing facilities after reducing production at Friskies PetCare Company facilities in Jefferson, Wisconsin, St. Joseph, Missouri, and Arden Hills, Minnesota.
In Dunkirk, New York, new manufacturing facilities were planned, and the St. Joseph facility was later expanded for wet-food production. In Asia it moved from a “vendor framework” to dealing with its own dispersion. The North American and Latin American operations of Nestlé Purina were merged into a Nestlé Purina PetCare Americas division in 2004.
To advance veterinary research, Nestlé Purina Petcare and the Canine Health Foundation established a partnership in 2003. The following year, the business gave $100,000 to local animal shelters and distributed 80 tons of pet food to Florida pets affected by Hurricane Charley. By 2005, Nestlé Purina Petcare had increased from approximately 11% of the company’s revenues in 2001 to 13%. It had 32% of the pet food market by 2006, making it the largest market share holder.
Due to consumers’ increasing willingness to spend more money on pet care, Purina was one of Nestlé’s fastest-growing divisions by 2009. PurinaCare, a separate business with headquarters in San Antonio, Texas, was established in 2008 to sell pet insurance. In addition, Purina had established brand-new manufacturing facilities in Thailand and Russia by the year 2009. Purina named Nina Leigh Krueger the company’s new CEO in November 2020. Purina collaborates with a number of charitable organizations, one of which is the Urban Resource Institute, which manages New York City’s pet-friendly domestic violence shelters.
Products
MarketLine’s SWOT analysis reveals that Purina, Purina Dog Chow, Friskies, Purina Beneful, and Purina ONE are the pet food brands of Nestlé Purina Petcare that make up the majority of the company’s revenue. Some brands, like Alpo, are made for people on a budget, while others, like Purina ONE and Beneful, cost more and are made for people who care about their health or the ingredients in their products. Its fastest-growing brand is Purina ONE.
In 2009, the company released Fancy Feast Appetizers, a cat food appetizer. In 2010, Purina introduced a senior dog line called Pro Plan. In 2011, Purina ONE Beyond, a grain-free product, was introduced. In 2013, Purina Pro Plan Sport, an athletic dog food with extra fat and protein, became available. In 2014, Purina introduced Ravena, a product made with locally available ingredients like acerola and jabuticaba fruits, for the expanding Brazilian market.
Operations
Nestlé Purina Petcare is run as a Nestlé subsidiary.It operates in North America, Asia, Africa, Europe, Latin America, and Oceania, with its headquarters in St. Louis, Missouri. For dog shows and competitions, Purina constructed the $10 million Purina Event Center in 2010.
It supports a variety of charitable endeavors, such as the annual Pet Care Pride Day, during which employees participate in volunteer work. Pets can be brought to work by employees.
Purina Petcare, behind pharmaceuticals, was Nestlé’s second-most profitable division in 2005. It was the second-largest pet food manufacturer in Europe and the largest by market share in the United States. Purina had a 23.1% global share of the pet food market in 2012, while Mars, its largest rival, had a 23.4% share.
The Malcolm Baldrige National Quality Award was presented to Nestlé Purina Petcare in 2010 for its accomplishments in both manufacturing and organization. In addition to installing solar panels to generate electricity for its offices and facilities, its manufacturing operations have continuously reduced the quantity of materials used in packaging, increased waste product recycling, and reduced water consumption.
Purina, the pet nutrition company, is devoted to animals. In order to “promote animal welfare education, awareness, and advocacy,” Purina collaborates with the Petfinder Foundation. Over 30 million pets can find new homes on Petfinder, a resource for pet adoption. Purina cares about more than just the health of its pets. Additionally, Nestlé Purina is able to care for pets in every way possible through partnerships with organizations like Petfinder, from providing them with the best food to finding them the ideal home.
According to Two Tomorrow’s annual ranking, Nestlé Purina Petcare was one of the 11 most sustainable businesses in 2011. It had 19 manufacturing facilities as of 2014.
Growth Performance & Statistics
Feb. 13, 2020, marked Nestlé’s company-wide full-year earnings, with organic growth in the Purina PetCare division leading the pack throughout 2019. With premium brands, veterinary products, and supplements growing in “strong double-digits,” Purina was also deemed one of three key growth factors for the company.
In 2018, Nestlé reported a segment-wide organic growth rate of 7%. Purina alongside the beverage segment led growth in the Americas, which accounted for 46% of the company’s total revenue in 2019.
Nestlé Purina PetCare deals were $9.1 billion and $8.3 billion for the years December 31, 2020 and 2019, respectively. Purina PetCare’s science-based and premium brands, Purina Pro Plan, Purina ONE, and Fancy Feast, all expanded at double-digit rates, exhibited strong e-commerce momentum.
According to Cascadia analysts, Purina PetCare increased the company’s five-year compound annual growth rate of 7.5% and organic growth of 12.7% between April 2021 and April 2022. The availability of products to meet consumer needs was the greatest impediment to that growth. In 2021, logistics and supply chain issues proved to be Purina’s undoing, as they were for many other businesses. According to Cascadia’s analysts, price increases of double digits as a percentage of the manufacturer’s suggested retail price were caused by supply constraints.
Legal Issues
Blue Buffalo and Nestlé Purina Petcare began a legal dispute in May 2014 over Blue Buffalo’s advertising practices. Purina claimed that independent lab tests confirmed that its products do contain corn, whereas Blue Buffalo advertised that its products did not contain corn or meat byproducts.
In a countersuit filed less than a week later, Blue Buffalo made similar claims against Purina. Additionally, it claimed Purina was engaging in a “smear campaign.” Blue Buffalo’s claims that competitors were concealing ingredient information were unsubstantiated, according to the National Advertising Review Board and the Advertising Self-Regulatory Council. Blue Buffalo stated that it disagreed but would comply with the decision.
Another lawsuit was dropped in April 2017 regarding Purina’s Beggin’ dog treats and the claim that its advertising misled consumers into thinking they were full of bacon.
Tyson, a cat used in their testing facility, was killed in January 2017 by Nestlé Purina. Tyson was boiled alive.
