Epilogue: New Chapter on Pilgrim’s Pride?


Tim J. Smith, PhD
Founder and CEO, Wiglaf Pricing

Published September 14, 2009

Pilgrim’s Pride was brought low in 2008 due to misjudgment regarding increased production during a time of rising costs and decreased demand.  Although Pilgrim’s Pride hoped they could raise prices, the predictable laws of economics indicated otherwise.  Commodity producers should never expect to raise prices and increase supply simultaneously.  Result:  Bankruptcy.

Pilgrims Pride Logo

In September of 2009, JBS SA, a Brazilian beef giant, indicated intentions to purchase Pilgrim’s Pride Corp.  Perhaps this will write a new chapter on Pilgrim’s Pride.

As for Lonnie “Bo” Pilgrims, founder of Pilgrim’s Pride, I suspect that the exact attributes that made his company great in the 20th century are those which brought him low in the first decade of the 21st century.  His brass knuckles approach to business made sense in consolidating industry where it could be expected that economies of scale would reward the largest producer.  However, attaining economies of scale were no longer the competitive frontier in the global economy of the 21st century.  Instead, the strategy of Don Tyson, founder of Tyson’s Foods, Inc., to diversify into other protein sources, expand into a global leader, and institute a strong pricing organization and related practices, has proven a more resilient approach.

All boats rise in during high-tides, but you get to see who was naked when the water recedes.


Jeffrey McCracken and Lauren Etter, “Brazilians Bid for U.S. Meat Titan,” The Wall Street Journal (September 3, 2009).


Pilgrim’s Pride: Failure to Communicate
Tim Smith, PhD, Chief Editor, February 2009

Six Months Later Pilgrim’s Pride Still Has Pricing Problems – What Went Wrong?
Tim Smith, PhD, Chief Editor, January 2009

From Homes to Appliances and Autos: Hovnanian, Corning, GM, Ford, and Chrysler Each Must Manage Lower Demand
Tim Smith, PhD, Chief Editor, December 2008

Chicken Feed, Nothing To Laugh At: Manage the Customer Value Proposition to Stave Off Hemorrhaging
Tim Smith, PhD, Chief Editor, November 2008

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About The Author

Tim J. Smith, PhD, is the founder and CEO of Wiglaf Pricing, an Adjunct Professor of Marketing and Economics at DePaul University, and the author of Pricing Done Right (Wiley 2016) and Pricing Strategy (Cengage 2012). At Wiglaf Pricing, Tim leads client engagements. Smith’s popular business book, Pricing Done Right: The Pricing Framework Proven Successful by the World’s Most Profitable Companies, was noted by Dennis Stone, CEO of Overhead Door Corp, as "Essential reading… While many books cover the concepts of pricing, Pricing Done Right goes the additional step of applying the concepts in the real world." Tim’s textbook, Pricing Strategy: Setting Price Levels, Managing Price Discounts, & Establishing Price Structures, has been described by independent reviewers as “the most comprehensive pricing strategy book” on the market. As well as serving as the Academic Advisor to the Professional Pricing Society’s Certified Pricing Professional program, Tim is a member of the American Marketing Association and American Physical Society. He holds a BS in Physics and Chemistry from Southern Methodist University, a BA in Mathematics from Southern Methodist University, a PhD in Physical Chemistry from the University of Chicago, and an MBA with high honors in Strategy and Marketing from the University of Chicago GSB.