The hardworking staff truly believes there will be a Twinkie Winkie character on the Teletubbies next year, given the outpouring of juvenile nostalgia in the wake of the Hostess Implostess this past week.
Exhibit A:
The Weekend Wall Street Journal, which featured not only this Page One piece, but also an editorial that predictably blamed the Hostess labor unions (which, to be fair, are not entirely blameless in this mess).
The Twinkie, A Suicide
Perhaps it says something about America—though we’re not sure what—that iconic junk foods like Twinkies, Devil Dogs, Ho Hos snack cakes and Wonder bread have endured since the 1930s despite changing consumer health and eating habits. It does say something about institutions that can’t—or refuse to—adapt to new economic times that the company behind those products has chosen to go out of business overnight.
Hostess’s owners have decided to liquidate rather than ride out a nationwide strike by one of the largest of its dozen unions, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union. The Texas-based company owned by the private-equity shop Ripplewood Holdings and other hedge funds essentially gave up. On Friday it shut down its 33 bakeries and 565 distribution centers and prepared to fire nearly 18,500 employees en masse and auction off its brand and recipe portfolio.
Hostess posted sales of $2.5 billion in 2011 but lost $341 million and lacked the cash flow to hold out through the bakers union work stoppage that had only lost a few days of production so far. One reason is a labor-rule burden that by comparison makes Detroit look like Hong Kong.
To be sure, the Hostess labor relations are less than sweet. Via Reuters:
The Balkanized nature of its empire gave Hostess a piecemeal labor situation, including a matrix of 372 collective-bargaining agreements, a dozen separate unions, 5,500 delivery routes, and no fewer than 40 multi-employer pension plans [MEPPs] that are despised by management.
In the real world, that’s the Ding Dong of death.
Exhibit B:
Four – count ’em, four – pieces in Saturday’s New York Times.
There’s the front-page piece by Dan Barry and the Business section pieces about labor relations and the brand value of Hostess and the op-ed that wallows in cream-filled nostalgia.
Enough already!
Ding Dong this.
CNBC has just launched a marketing campaign with the theme Rise Above. It include numerous on-air segments, a print ad in the Wall Street Journal that the hardsearching staff can’t find an image of, and this video:
Campaign Outsider 