Hostess Brands Inc. - (R.I.P.?)

[A Nonny Moose 8,263]

Missed the top step. Hostess rides yet.

Seems the corporate lawyers had a false start. Hostess and union now in mediation. I am sure the threat worked wonders on the union rank and file as well as their executive. Saved by the fact that the legal department missed a step in the requirements.

[Haljackey 17,405]

The title of this thread may be inaccurate

Twinkies can survive a nuclear holocaust, so they may also be able to rise from the dead

[hym 358]

Missed the top step. Hostess rides yet.

Seems the corporate lawyers had a false start. Hostess and union now in mediation. I am sure the threat worked wonders on the union rank and file as well as their executive. Saved by the fact that the legal department missed a step in the requirements.

Not necessarily. Nothing short of massive concessions from the union is going to save Hostess, and union leadership does not like making those kinds of bargains as it weakens their negotiating power. Leadership will let bargains fall through to the detriment of everyone if they feel it weakens them too much. Furthermore, they have all of a day to come to an agreement before the case is back in bankruptcy court. This means Hostess and the union literally have hours to come to an agreement. Such a thing is highly unlikely in itself, and is made even more unlikely by the fact that the Hostess executives are under intense pressure to wind the company down as quickly as possible. They have $75 million or less to wind the company down with, are going through that money at $1 million or more per day, and it is estimated to take 2-3 months to completely dissolve the company.

[A Nonny Moose 8,263]

The title of this thread may be inaccurate

Twinkies can survive a nuclear holocaust, so they may also be able to rise from the dead

Amended title line.

However, I have to agree with hym. The company is in extremis. The last rites should be given soon. The only good thing to come out of this will be the object lesson to the union. Saving face and keeping an untenable position may cost you your job as a union boss.

[Duke87 1,070]

Interesting to note, today, as I was inspecting several grocery stores throughout the city, that all of a sudden places have lots of Little Debbie products in stock, whereas those used to not be popular...

[hym 358]

It would seem that the negotiations were unsuccessful. IMO, this is an example of what is wrong with unions. Unwillingness to bend when necessary will take the company under. This is also why I say that labor is the problem and not the solution.

[Easy Bakes 253]

It would seem that the negotiations were unsuccessful. IMO, this is an example of what is wrong with unions. Unwillingness to bend when necessary will take the company under. This is also why I say that labor is the problem and not the solution.

except for the execs getting huge bonuses even when the company they are running has been losing money for years.

2B a year in sale's should keep any company afloat.

[Meg 368]

Do we know what the execs' bonuses have been?

It would be interesting to see their sales and expenditures and where the money went.

It could be as simple as people recognizing that most of their products don't belong in a healthy diet. But there is a lot of that going around.

[hym 358]

except for the execs getting huge bonuses even when the company they are running has been losing money for years.

Not going to dispute that. Getting a bonus when the company is doing poorly doesn't make any sense.

2B a year in sale's should keep any company afloat.

Unfortunately, that isn't true. To use some figures from 2011:

-General Motors had a total revenue of $150 billion, and it cost them $130 billion to earn that.

-Walmart had a total revenue of $446 billion, and it cost them $335 billion to earn that.

-Exxon Mobil had a total revenue of $486 billion, and it cost them $306 billion to earn that.

[A Nonny Moose 8,263]

It would seem that the negotiations were unsuccessful. IMO, this is an example of what is wrong with unions. Unwillingness to bend when necessary will take the company under. This is also why I say that labor is the problem and not the solution.

Labour unions are a phenomenon of the Industrial Revolution. In the 19th and early 20th centuries they served the downtrodden worker and improved their lot. Now, in this post-industrial period, they are relics of an earlier time. You can't always get more and more. These kinds of demands break the machine. One can see from all the out-sourcing to cheaper labour markets that they have succeeded in pricing themselves out of the market. They either have to get on board with management or go away.

[Duke87 1,070]

It could be as simple as people recognizing that most of their products don't belong in a healthy diet. But there is a lot of that going around.

The demand is still there, just less of it. If the company handled the drop in demand properly, they would be downsizing accordingly, or looking to refocus efforts into an adjacent market sector with a better outlook.

What you are seeing, then, is the company's failure to adapt to a changing marketplace.

[A Nonny Moose 8,263]

I agree that the company showed a lack of creativity. But what do you suppose happened to their R & D and Market Research budget items? What was the effect of the last union settlement?

Other than the fact that they are a large purveyor of junk food, and there is a general campaign against such products, what else caused them to conclude that the company was no longer viable?

[AcmeSigns 97]

Junk food, like many other things in life, is just fine in moderation. Blaming the food for obesity is the easy out. Be sure to never mention that more people these days spend their work time sitting at a desk; that kids don't go outside and play because of the 'boogy man' and so they spend their time being stagnant. No...it's much easier to just point at one thing and assign blame. Heaven forbid someone should take responsibility for their own actions.

Yes, food tastes are changing and, yes, Hostess should have found a way to downsize on their own terms but make no mistake here...it was the The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union that killed Hostess. And now 18,500 more folks get to join the ranks of the unemployed. I guess the unions don't see that that might also be 18,500 members not paying their union dues. Shortsightedness to the extreme.

I've belonged to unions in the past but as Nonny pointed out...unions have outlived their usefulness. Unions no longer represent the workers...they represent the union leaders and whatever their agenda is.

[hamsterTK 93]

I hate to admit, I don't really like Twinkies

[A Nonny Moose 8,263]

Hardly surprising. They are such cloying junk.

[Duke87 1,070]

I don't eat Twinkies either, but I have been forced to get by on Little Debbie Swiss Rolls with Yodels no longer available.

I actually had kept a pair of yodels around, waiting for the right time (a special occasion?) to eat them, knowing they might be the last Yodels I ever eat. Well, last night I noticed that one of them had started to grow mold, which was surprising considering the wrapper they were in was clearly still sealed airtight. So much for this stuff being food to survive the apocalypse with, eh?

Still, considering they were purchased a month ago, that's not a bad run.

I think the key is that the things which last the longest without spoiling are dry (mold needs water to grow). Pastries are moist, so they don't fit the bill. But cookies, chips, pretzels... I threw away a half finished bag of pretzels recently that had been sitting in my cabinet for well well over a year. No mold or any such fouling! But they had gotten quite stale...

[hamsterTK 93]

What's a little penicillin

It depends on if the moisture is actually water or oil and if its got enough sodium. "cheez" products like Velveeta last ages.

[Duke87 1,070]

And ye shall be granted a second life.

 

As expected, someone else has bought the rights to the brand name and intends to manufacture products under it. Remains to be seen how similar to the old products they will be.

 

Also, only talks about Hostess and Wonder... no mention of Drake's.

[Easy Bakes 253]

So who going to be making the product? the outfit that bought the name is only  an investment company.

 

you cant make Twinkies in a high rise.

[hym 358]

I'm assuming that the infrastructure that originally manufactured the Twinkies is still intact.

[A Nonny Moose 8,263]

Perhaps, but the plants are under a bankruptcy administrator.  Owning a brand does not make a plant, nor does it give rights to the plant without the consent of the courts.

 

Frankly, Twinkies were junk.  If they can be improved to be less artificial crap, then good for them.  Duplicating the product means more junk food back on the market.

[hym 358]

They don't have to be under bankruptcy administration anymore.  They could have been bought out with the purchase of everything else.

[Duke87 1,070]

Hear that rumbling? Plant is starting back up!

[A Nonny Moose 8,263]

More junk calories into the obese American diet.

[Metalpuritan 161]

I think the whole situation with Hostess is all a big lie.

 

I know when I go to the store and I see Hostess products on the shelf right next to Little Debbie products at nearly 300% of a higher price than Little Debbie products I buy the Little Debbie products instead.  To blame the downfall of Hostess on the unions I think is a major mistake.  I would instead blame their downfall on bad business practices.  It makes total sense that you should not price over your competition by 300% that is a fools game and a recipe for disaster.  They are not shutting their doors because of the union, they are shutting their doors because they failed as a competative business.  If they had dropped their prices to match their competitors they would have sold a lot more product, even with the union demanding higher pay for it's employees they would have sold enough product to remain in business.  I passed on Hostess products 100% of the time, if they were priced appropriately, I would have been buying, if I would have been buying so would others and Hostess would still be around.  They just failed at basic business.  This had NOTHING to do with unions and EVERYTHING to do with failed business practices.

 

I played this game on the old monochrome Macs when I was in school in the 80s where we had to grow apples and sell them, we set the prices and tried to do business, if you set your apples to sell at too high of a price you would fail.  You cannot get too much more simple than that.  I learned that in grade school, where did the Hostess executives learn business?  They learn business in an alley selling drugs?  Now that is a situation where you can charge 300% over your competitors and still stay in business.  But ding dongs to not equal crack, people cannot get addicted to honey buns.  If they could perhaps hostess would still be n business but pastries have no actual addictive qualities.

 

I say good riddance to Hostess shutting it's doors, bad businesses do not deserve to have success.

[JWL 52]

Only thing I'll miss about the company is the bread factory they owned near the interstate exit where I live. It was nice to come home after a long drive and get a big whiff of some freshly baked bread on the way in. R.I.P. Merita Breads.

[Duke87 1,070]

New factory jobs won't be unionized.

 

No word on whether the new non-union employees will be absorbing the same cut pay and benefits that their predecessors were having pushed on them.

[Easy Bakes 253]

New factory jobs won't be unionized.

 

No word on whether the new non-union employees will be absorbing the same cut pay and benefits that their predecessors were having pushed on them.

no they will start with those pay rates and bad benefits

[A Nonny Moose 8,263]

A symptom of the overpriced labour market.