Tag: Hostess

Twinkies Get Creamed As America Follows Suit

I did some contract work with IBC when it was based in Kansas City a few years ago.  Around 2008-ish.  Back then, the Teamsters Union was doing its best to bring about the outcome that the Baker’s Union ultimately accomplished: Death of the business.  The End didn’t come since the Teamsters knew back then–as they did now–when to pull back from the brink.   “Save the Twinkies, Save the World” was the vision.

Every day, I’d read the company’s consumer/employee bulletin board and just marvel at how divisive and completely un-moderated it was a website with a forum that some guy had set up for IBC employees to bitch about everything and I’m amazed that Hostess allowed it to exist. The CEO was constantly cursed by the union employees while everyone else damned the unions for demanding them all right out of jobs.

Nothing has changed, except that the inevitable has finally occurred.  Hostess has been a doomed business for a long time.  I’m not entirely sure who should be blamed (even though the proximate cause was the stubborness of the bakers).   The vitriol, threats, and “I told you so’s” at the link don’t tell the story, but they clearly show that there’s no shortage of blame in any direction.  It’s hard to see how any company can function for long with that much greed, suspicion, and ineptitude flying around.

I’m a stridently anti-union guy so it’s pretty obvious to me that the unions are to blame for the Hostess fiasco.  They tried to turn a company that makes baked goods into more and more of a benefits and pension provider even as the company went bankrupt and had nothing left to give.  You can’t be surprised by that kind of behavior.  It’s just what they do.  I pity the newly-unemployed workers, but I applaud the permanent destruction of thousands of union jobs.  A more responsible business will take over the brand in time and all will be well, I’m sure.

Yet there’s a lesson here for us all.  Like Hostess, the United States has also awarded lavish entitlements to its people and run up unsustainable liabilities in the process.  The bakers-as-takers simply refused to accept the hard realities of the business and arithmetic, gambled their livelihoods on money that just wasn’t there, and lost everything for themselves and the 2/3 of employees who weren’t on board.

Our big national Twinkie is similarly going stale as people demand yet more cream filling from it.  In Hostess’s case, the people who were tired of fighting about it with those who always wanted to squeeze out more simply walked away and let it go.  What do we do as a nation when the capitalists just stop giving a fuck?

Shoulda Called Bain

Risk/reward, success/failure, supply/demand, capitalism and the free market system is not fair, does not play favorites, and does not redistribute wealth. It exists in a predatory state whereby you either sink or swim, no treading water allowed. And nobody or no company is exempt from it’s affects, unless government steps in with it’s Too Big To Fail nonsense, but this post in not about that.

Some rather big companies are in the news lately concerning their inability to adapt to market forces. Eastman Kodak Co., a DOW component since 1930, has gone the way of the buggy whip.

But what is more disturbing, at least to me is the business failure and eminent disappearance of a staple of mine for decades:

Hostess Brands Inc. is preparing to file for Chapter 11 bankruptcy protection as soon as this week, said people familiar with the matter, a move that would mark the second significant court restructuring for the Twinkies and Wonder Bread baker in the past several years.
Interstate Baking Co., the name Hostess used to go by long ago, was formed in 1930. Some brands Hostess still sells, including Drake’s cakes, predate the company. In its infancy, the company made loaves of bread for grocery stores to sell.

Yeah, I like junk food, always have. I don’t eat alot of it mind you and have always been fit, but have kept Hostess in business since I was a kid. Zingers are more my specialty, the raspberry/coconut ones especially.

But other junk food is equally important. Lee wrote a post years ago about some fast food place that offered this massive cookie pizza thingee, with gobs of chocolate, whipped cream and caramel drippings, how he got diabetic rush just thinking about it, me, it made me hungry.

One place I have on my list of places and to go and things to try, is to visit one of these some day. We don’t have them here in California and I certainly would not a regular, but bet I could put a way a triple in one seating.

I treat my body pretty well but am big on indulgences, what is life for?

I’m going to miss Hostess but understand business risks, fortunately there are ample substitutes for what they offer. This guy, I can relate:

Any culinary indulgences (not good for you) you have a passion for?