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Sat Nov 17, 2012, 12:28 PM

 

Contrary to the current meme being launched, Hostess didn't die because of unions.

First of all, this is Hostess' second time through the bankruptcy mill within a decade. The plain and simple fact of the matter is that for thirty years, Hostess' slice of the bakery market has been in severe decline. As Americans became more health conscience they ditched the Twinkies, Ho-Hos and Ding Dongs. As Americans taste palettes became more sophisticated, the demand for Wonder Bread severely declined. After all, why buy some bland, gummy faux bread when you now had loaves and loaves of real bread available for purchase(though I do know some fishermen who swear by Wonder Bread as the best catfish bait around).

Add on top of this a billion dollars of debt, and the fact that Hostess was trying to move forward with an outdated production and distribution system and what you have is the perfect recipe for going bankrupt.

This isn't on the workers, they already sacrificed wages and benefits during the first bankruptcy run. This is about management that either purposefully or otherwise drove this company into the ground.

It will be interesting to see what happens during this bankruptcy process. My guess, that after liquidating the various brands(yes, Twinkies will survive), various eliminations of debt, and selling off all the physical assets, the current owners will walk away with millions, their reward for driving a company into the ground. Meanwhile, it is the workers, who have sacrificed time and again, who will be the victims in this tragedy. But sadly, the right is trying to demonize the workers. Don't let them get away with it.

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Reply Contrary to the current meme being launched, Hostess didn't die because of unions. (Original post)
MadHound Nov 2012 OP
Samjm Nov 2012 #1
bunnies Nov 2012 #2
murielm99 Nov 2012 #3
HopeHoops Nov 2012 #4
zbdent Nov 2012 #5
HopeHoops Nov 2012 #6
zbdent Nov 2012 #7
HopeHoops Nov 2012 #8

Response to MadHound (Original post)

Sat Nov 17, 2012, 12:41 PM

1. Already posted this

To a few "blame the unions" posts on FB:

Oh, so the demise of Hostess has NOTHING to do with the CEOs giving themselves a 300% pay raise while the company was teetering on the brink of bankruptcy, while asking workers to take severe cuts in pay and benefits. It has NOTHING to do with major management missteps, a poor brand, a lack of new product development, and rising competition. Nothing at all, let's just blame the guys who were trying to stop their wages from dropping by almost 50% since 2005.

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Response to MadHound (Original post)

Sat Nov 17, 2012, 12:55 PM

2. Hostess died because much of their product is shit...

and the business was run poorly. Period.

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Response to MadHound (Original post)

Sat Nov 17, 2012, 01:02 PM

3. I remember an incident that happened

in Chicago about fifteen years ago. A cab driver and a Hostess truck driver got into a fender bender downtown. Both of them blamed each other, and started fighting. The taxi driver was throwing punches. The truck driver was throwing Ho Hos and Ding Dongs.

It was extremely funny, and the best use of Hostess products I had seen in a long time.

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Response to MadHound (Original post)

Sat Nov 17, 2012, 01:18 PM

4. Hostest died because it got weird with its product line. Seriously.

 

While other companies were introducing more "nutritious and healthy" products, Hostess fucked around with orange cream Twinkies and other variations of products that were already crap. They bought some "healthy" food companies, but didn't put the resources into them that they should have.

It had NOTHING to do with the workers or the unions. It was all about stupid management and marketing decisions. They were still in 1950's mode.

There's a good chance that some of the brands will be purchased, but the Hostess company is dead. I think the paper said 180,000 US jobs will be lost because of this. It saddens me.

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Response to HopeHoops (Reply #4)

Sat Nov 17, 2012, 02:19 PM

5. plus $110 million in payments to the Bain clone

and none of that $110 M re-invested in the company ... or likely, to the workers who helped save the company back then ...

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Response to zbdent (Reply #5)

Sat Nov 17, 2012, 02:25 PM

6. I was trying to leave that part out. My point is that they didn't evolve.

 

They dicked around with concepts that they should have known wouldn't catch on. The core business suffered at the expense of the experiments. Besides, they were saddled with "Wonder Bread" (it's a wonder it's bread) which is really only useful for catching sunfish in a pond. What probably did them in overall was being associated with deep-fried Twinkies at southern county fairs - "Hey, YOU over there, wanna gain ten pounds in two minutes?"

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Response to HopeHoops (Reply #6)

Sat Nov 17, 2012, 02:34 PM

7. changing their product is NOT EVOLVING???

That's a new one on me ...

plus, probably the fact that the fair vendors were NOT likely paying full price for the twinkies they sold at inflated prices ... deep-fried frozen ...

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Response to zbdent (Reply #7)

Sat Nov 17, 2012, 02:52 PM

8. Changing is not always evolving. Remember Microsoft Bob?

 

Hostess introduced variations rather than next generation products. Whole Wheat Wonder Bread? Give me a fucking break. That lasted what, three years? When you've got a good food product, keep it. V-8 is still the best selling product in the Campbell's juice line, but they still kept it around, introduced spicy, low sodium, fusion, splash, and a few other things that didn't work out, and all of the others have had various levels of success. But what they push is still the original formula. They also have low-sodium versions of their soups but push the original formulas. You can still get V-8 in the cans I knew as a child.

Innovation sometimes works and sometimes it fails. You can't bank on "NEW AND IMPROVED" or "NEW FLAVOR" logos to keep your product relevant. And low-sodium V-8 sucks, but I add a little Tabasco and all is well (a low-sodium condiment). Well, vodka doesn't hurt as another addition, but it does require more Tabasco.

As for the fair vendors, they do deep fried butter and deep fried beer now (yes, beer - in a hollowed out pretzel), and the standard deep fried candy bars. I won't be shocked if they come up with a way to make deep fried deep-fry grease. It will still sell.

The problem Hostess had was not focusing on the base product line. They had a following that predates me (and I'm almost 50). In sharp contrast, Hershey has always put the focus on the main staples and just thrown stuff out to see what sticks. If it doesn't stick, they drop it. Hell, Hostess threw money at other brands willy nilly and they're the brands that will most likely survive, but they didn't help Hostess.

Still, Twinkies were good. You have to admit that.



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