Twinkies go on sale again, with something missing
The snack cakes may taste as sweet, but lost on the road to their return are thousands of jobs.
By Aimee Picchi
As Twinkies first went on sale over the weekend at Wal-Mart (WMT -0.67%) and are now hitting store shelves widely on Monday, fans will be testing whether the cream-filled cakes offer the same sweet taste, amid reports of recipe tinkering and deep freezing.
Twinkies are returning after private equity firms Apollo Global Management (APO +1.44%) and C. Dean Metropoulos & Co. bought several of the old Hostess snack cake brands. But one thing about Twinkies is clearly missing as the brand comes back: thousands of jobs.
Twinkies are returning after private equity firms Apollo Global Management (APO +1.44%) and C. Dean Metropoulos & Co. bought several of the old Hostess snack cake brands. But one thing about Twinkies is clearly missing as the brand comes back: thousands of jobs.
Before Hostess Brands went bankrupt last year, the company employed 18,500 people. Now, upon its revival, only 20% to 25% of those jobs will be returning, CNNMoney reports, citing an estimate from IBISWorld. Even though the new company bought five bakeries, it plans to use only four, the report said.
A spokeswoman for the new venture cautioned against comparing employment numbers between the pre-bankruptcy company and the new Hostess because the private equity companies didn't buy rights to all Hostess brands, CNNMoney noted.
The earlier incarnation employed 2,500 workers producing snacks, while the new venture will use 1,800 to produce Twinkies, Ho Hos, Ding Dongs and other cakes.
Some job losses resulted from Hostess' plan to hire outside delivery companies to ship the cakes, instead of in-house truck drivers. Plus, 600 outlet stores operated by the old Hostess Brands were permanently shuttered, CNNMoney wrote.
Flowers Foods (FLO -0.21%), which has agreed to purchase Wonder Bread and other Hostess brands, declined to talk about staffing because the deal isn't yet final, the piece added. (Flowers received regulatory approval this month and is expected to close the purchase in the next few weeks.)
In the meantime, Twinkies aims to again find the sweet spot in Americans' stomachs, but it's not content to appeal just to kids. The new Hostess is reaching out to young men via wider distribution in convenience stores, and its plan to outsource deliveries will allow it to reach 110,000 stores, up from 50,000 before the bankruptcy.
"We want to go beyond just the loyal fans to some of those people who should be fans," executive Dave Lubeck of Bernstein-Rien, which worked on Hostess' new ad campaign, told Time. "So we're really trying to move beyond the grocery store consumers into the c-store target, which is a younger male."
A spokeswoman for the new venture cautioned against comparing employment numbers between the pre-bankruptcy company and the new Hostess because the private equity companies didn't buy rights to all Hostess brands, CNNMoney noted.
The earlier incarnation employed 2,500 workers producing snacks, while the new venture will use 1,800 to produce Twinkies, Ho Hos, Ding Dongs and other cakes.Some job losses resulted from Hostess' plan to hire outside delivery companies to ship the cakes, instead of in-house truck drivers. Plus, 600 outlet stores operated by the old Hostess Brands were permanently shuttered, CNNMoney wrote.
Flowers Foods (FLO -0.21%), which has agreed to purchase Wonder Bread and other Hostess brands, declined to talk about staffing because the deal isn't yet final, the piece added. (Flowers received regulatory approval this month and is expected to close the purchase in the next few weeks.)
In the meantime, Twinkies aims to again find the sweet spot in Americans' stomachs, but it's not content to appeal just to kids. The new Hostess is reaching out to young men via wider distribution in convenience stores, and its plan to outsource deliveries will allow it to reach 110,000 stores, up from 50,000 before the bankruptcy.
"We want to go beyond just the loyal fans to some of those people who should be fans," executive Dave Lubeck of Bernstein-Rien, which worked on Hostess' new ad campaign, told Time. "So we're really trying to move beyond the grocery store consumers into the c-store target, which is a younger male."
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