That deep fried Twinkie you had at the Bloomsburg fair will be your last one you’ll ever have. Hostess brands known for the famous Twinkies, Ho-Hos and Snowballs are shutting their doors for good.
Hostess Brand opened in 1930 as Interstate bakeries till changing the name in 2009. Their signature treat, the Twinkie, was also created in 1930 is the most well-known. Headquartered at Irving, TX, they were also known for making Wonder Bread, Drake’s, Nature’s Pride and other bake goods. Stated on their website, Hostess will close 33 bakeries, 565 distinction centers, 570 bakery outlets and will cut 18500 jobs.
The decision was decided after the company and the union: Bakery, Confectionary, Tobacco Workers and Grain Millers International Union (BCTGM) were unable to reach an agreement after mediation on November 21th. Judge Robert Drain of the U.S. Bankruptcy Court in the Southern District of New York gave the approval for Hostess to go out of business and start the wind down of the company.
Now why is well-known company going out of business? The answer is that the company has been having problems for years with sales and employee satisfaction. The news broke nation-wide after workers in BCTGM went on strike because of the unfair contract of cut pensions, health and pay. Executives of Hostess received huge pay raises while their company struggled.
This wasn’t the first time the company filed for bankruptcy; they did it back in 2004 after a failed restructuring attempt. The BCTGM and Hostess then agreed on wages and benefits but they were below national competitors. Back then they closed down 21 plants. Hostess then again filed a chapter 11 bankruptcy on January 10, their second time.
Each side has each other to blame of the cause of the shutdown of the 82 year-old bakery company. The BCTGM were to blame in some cases. During the strike the company blamed the union saying that they weren’t making any profits because of their actions. Also the demands of the union wanted for their members which make 30% of the Hostess employees.
On the other side employees claimed that poor management was how they weren’t marketing the products well and employee satisfaction. Also, the proposal was to cut their pay and benefits while the upper management would get raises.
Khadafi Robinson, a freshman business major is shocked how Hostess went out of business “They shouldn’t close down! They have been there for a longtime” He believes that it’s all about business for the company not the employees which is the reason everything went wrong.
“They should have given more respect to employees. It’s not right for a company to think just for themselves it’s greedy” Robinson stated about Hostess’ practice.
Hours after Hostess announced they are shutting their doors for good; some people are taking advantage of last supplies of the precious sweets. Hostess enthusiasts are buying dozens of boxes of the sweet treats to sell on eBay and Craigslist. Most people are now selling them online starting at $20 and going up to $9800.
The company also is going to immediately start the firing process of 15,000 employees, while they plan on keeping the remainder for about a year to help with the closing process.
Hostess will start auctioning the rights of their brands to the highest bidder. Some big companies, such as Flower Foods and Bimbo are interested buying the rights of the Twinkies. Robinson said he will buy Twinkies again once they come back to stores no matter who the new owners are.