- Executives for Hostess Brands, Inc. said recent leadership restructuring has poised the company for more success, according to Food Business News.
- Hostess President and CEO William D. Toler announced at ICR Conference 2017 that the company's reliance on "an emotional connection with the American consumer," as well as a warehouse-centered supply chain— rather than direct-store delivery — and extended product shelf life have helped the company thrive.
- In the past, six different bakeries were responsible for producing the Twinkies product. Now, the entire product line is under one automated system, shrinking the required workforce from 38 employees to 10.
In 2012, Hostess was hammered by increasing debt, pension costs and mismanagement. When the 87-year-old snack giant shut down, it brought 36 factories, 5,600 delivery routes and 1,900 jobs with it. Consumers everywhere mourned the death of the Twinkie.
Since the company was acquired for $410 million in 2013, and after another $250 million was invested in streamlining operations, Hostess is stronger than ever.
Hostess began trading on the stock market in November, and analysts have been bullish on the company so far. Considering what they’ve been able to accomplish — year-to-date Hostess EBITDA margins of 29% were higher than competing snack companies such as The Hershey Co., 24%; Snyder’s-Lance, Inc., 14%; and Flowers Foods, Inc., 12% — it’s no surprise that other companies may consider emulating its model.
Adopting a warehouse delivery model may not work for every CPG company, but it's worth considering. By overhauling its supply chain, Hostess has been able to accrue significant savings, allowing the company up to invest in other improvements.