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Farewell Hostess, long live Twinkies
As Hostess Brands moves to close down, it seeks to sell its iconic brands like Twinkies to the highest bidder.
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There were fears today that "life's little Twinkie gauge is going to go empty," to borrow a phrase from Woody Harrelson's sponge-cake loving character in "Zombieland." Hostess Brands announced it's shutting down for good, and there were reports from across the country that fans of the iconic snack were emptying store shelves in their quest for one last Twinkie fix.
Hostess had filed for bankruptcy protection in January, but kept on making Twinkies, Dolly Madison cakes, Wonder Bread and a host of other baked goods that have long been household names. In recent weeks, the bakers' union rejected a new contract and went on a crippling strike. Today, Hostess followed through on its warnings that the company would be liquidated, and said it hopes to sell off at least some of its 30 brands.
Richard Chesley, a bankruptcy expert at the law firm DLA Piper, predicts Hostess could command a "substantial" sum for its best-known names, although he adds that the brands have "been under duress for such a long period of time, it's going to take work" to revive them.
Chesley, who has been involved in a number of big-name corporate liquidations, notes that the company's products still command a respectable share of shelf space. Beyond that, he says, an enterprising investor could turn those names into merchandising gold.
"You could license the Wonder Bread name and logo for any number of uses or products throughout the world," Chesley says, especially in Asia where demand has been growing for products with American brands.
NPD Group food industry analyst Harry Balzer says iconic brands get passed along all the time. "It's very difficult to have them leave the scene completely," Balzer says. Borden no longer makes Cracker Jack and Ralston Purina no longer makes Chex cereals, for example, but they live on.
Joshua Sosland, editor of the trade publication Milling and Baking News, says he'll be surprised if the company's popular brands don't survive. "Some way or another, there will be bakers baking Wonder Bread in the next year, baking Twinkies and Ding Dongs and everything else that this company makes, using the company's formulations."
Glad to hear they might sell and reopen with new employees or without a union contract. - I was worried I would have to buy a store brand at half the price! Sarcasm? Yes, come on folks it is a Twinkie. If the product is valued people will buy it or others will make it. When a company is in bankruptcy employees need to realize that concessions are needed during tough times just like incentives and raises were offered during good times.
Goodbye, Twinkies, Hello, creme filled yellow sponge cake.
Check out Todd Wilbur's DIY take on a Twinkie clone, which doesn't have to last 10+ years on the shelf: http://www.youtube.com/watch?v=-yeyy4mQoes .
Maybe some of the laid off workers should pool their resources and expertise, become their own bosses, and make junk food for people like John Carney of CNBC, who has never eaten a Twinkie.
And yet the CEOs who mismanaged the company will get hired by other companies and get bonuses to boot. The workers will get the blame for wanting to be able to provide for their families the way they used to be able to do. We seem to be in a mad race to kill the middle class and turn everyone not a CEO into the working poor. I can't figure out why we think this is a system for success. Even countries who have profited from keeping their citizens in poverty are finding this model unsustainable. Not everyone can start a business and be successful at it so I find that idea to be less than helpful as well. I am glad I'm too old to see where this all ends...right now I'm not optimistic.
