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November 19, 2012 at 11:31 pm #777749
waynsterParticipantNot so fast kman the company did not the union….
http://money.cnn.com/2012/11/19/news/companies/hostess-bankruptcy-bonuses/index.html?hpt=hp_t3
on the lighter side did we kill the twinkie….
http://www.cnn.com/2012/11/19/opinion/obeidallah-twinkie/index.html?hpt=hp_t3
November 20, 2012 at 12:40 am #777750
BostonmanMemberThe unions responsibility lies in the fact that they accelerated the closing. The company appears to be mismanaged from top to bottom. It is clear from the cash flow statements and the financial statements that there was no real effort made to solidify distributions and eliminate the loss leaders.
In the end its a combination of mismanagement from the lowest employee to the CEO coupled with an America that is more health conscience than ever and the future wasn’t bright for them.
November 20, 2012 at 2:37 am #777751
JoBParticipantBostonman..
“In the end its a combination of mismanagement from the lowest employee to the CEO”
so now the lowest employee gets to share the blame when incompetent managers tank the company and generate their bonuses by cutting labor costs and reneging on employee contracts?
funny you should see it that way.
November 20, 2012 at 3:05 am #777752
montanapupParticipantmore analysis of both sides…..
http://www.newyorker.com/online/blogs/newsdesk/2012/11/who-killed-the-twinkie.html
November 20, 2012 at 3:30 am #777753
miwsParticipantThe lowest employees took cuts in pay over the years, and were expected to take yet another one.
The ceo’s pay was increased rather handsomely, per the link in Jan’s post #14.
It’s time to stop blaming Labor and the Unions for everything, especially when corporate execs walk away with pocketfuls of money.
Mike
November 20, 2012 at 7:29 am #777754
HMC RichParticipantI felt bad for the Teamsters who drove the delivery trucks. They got screwed. I was taking some video over to KING and saw the picket line.
Since I lost my full time job three years ago, I can understand how many of them who lost or will lose their job will feel.
I hate to see people lose jobs and I really hate to see companies mismanaged.
Since the American People didn’t hire Romney, maybe he should be the new owner of Hostess. Hmmmm.
November 20, 2012 at 7:34 am #777755
HMC RichParticipantMIWS, remember Uniroyal? Well the eventual owners of that company hosed the rank and file. Why do I care? Because my father and an aunt lost their retirement due to bad business practices.
Bad Management and Bad Union add up to bad news for the worker.
Since I do work with some unions and have hiring restrictions based on union rules, I can empathize with these guys. Before you think I am changing, I would gladly get rid of some of the unions, while others have their place and I am glad for it. And they know I am a Republican.
November 20, 2012 at 6:32 pm #777756
JoBParticipantHMCRich..
“Since the American People didn’t hire Romney, maybe he should be the new owner of Hostess. Hmmmm.”
before suggesting that …
you might want to read the links posted here that explore the current investors at Hostess…
Bain style investors…
hmmm indeed.
November 20, 2012 at 6:40 pm #777757
miwsParticipantNovember 20, 2012 at 6:59 pm #777758
365StairsParticipantHaving just enjoyed (2) of newer apple spice glazed at The Original Bakery this am…I am not one to interject anything about the health factors of the twinkie…
Bottom line…(I have a 20/20 vision fo the obvious)…and I don’t have to read any link to know how this happened…how it’s happened before and how it will continue to happen to “big” business.
You make a product people like…a lot.
The product is in high demand…
You grow…borrow tons of cash to Lease Buildings, build conveyors, and higher staff…
Middle Managers and Sales want to look really good to the Senior Execs…they project solid growth in the near term and persuade Execs for expansion in the long term…They just want to look good…
The Execs don’t look to closely at the projections in the near and long term…they trust their Middle Management – of course…these are the future C-Class…
The projections are off…the products are not selling in certain rural areas like told. Machines are still running and inventory is piling up all over.
It’s too late…Senior Exec takes annual tour in middle America to see a building or two on a world-wind get out of Corp office…dog and pony show is on…Get out the white gloves!
Fat Cat sees a building with one line stopped…sees another with two lines stopped…all very clean and orderly and impeccable standards being met…employees all line with bleached white coats, hair nets, gloves, glasses…all OSHA approved!
Inventory room is full! Over full. Shiney Trucks and trailers parked in the lot.
Local General Manager explains they have been telling the Territory VP for MONTHS about over projecting and over promising…He stopped the lines and began a schedule adjustment and over-all cost cutting measure at his local site…it’s saved $10K…”Did I do good sir?”
Senior Exec. returns to Corporate…tells the COO…COO tells the CEO…All Hell breaks loose…get all the VP’s on the horn! Audit this site…that site…
Stop the machines! Um…the machines are stopped sir…
Let the non-essestial people go! Keep the middle managers…they’re solid…they will help us re-build!
Anyway…you get the picture.
Poor Leadership fails every company…
Hardest thing to do in business…ensure the people you hire tell you the real deal so you can make a real decision…
Hostess did not have to end up this way…it would be smaller…but not gone…if the leadership just knew how to manage growth..
November 20, 2012 at 7:29 pm #777759
JoBParticipant365stairs
coming out of the first reorganization bankruptcy with more debt than they went in sort of wiped out the economic gains from the concessions made by labor to keep the company running ;-{
it makes you wonder who thought that would really work.
November 21, 2012 at 3:28 am #777760
Talaki34ParticipantThis is a bit long, but it gives a peek at what happened. Well worth the read 365Stairs.
http://www.bizjournals.com/kansascity/stories/2004/10/04/story1.html
This article will take you to up to the 1st bankruptcy minus the dumping of the stock.
November 21, 2012 at 3:53 am #777761
miwsParticipantThanks for that, Talaki. Interesting read.
So, basically, it looks like crap, non-innovative, management, and ownership over the years, are what destroyed the company.
You know, these ceo’s and other corporate execs get compensated very well.
It sure seems for the amount of money spent on them, a few folks with some brains could be hired….
Mike
November 21, 2012 at 4:06 am #777762
redblackParticipantsorry, mike. people with brains just aren’t in the budget.
neither is your christmas bonus.
or a lump of coal.
maybe next year.
November 22, 2012 at 8:59 am #777763
kootchmanMember“coming out of the first reorganization bankruptcy with more debt than they went in sort of wiped out the economic gains from the concessions made by labor to keep the company running ;-{
Spoken like a person who has never started a business. In fact, one of the ways you make your appeal to the bankruptcy judge is that you CAN obtain credit. You can go into debt. You have investors ready to risk capital. No wonder , no wonder at all why half the country is clueless about running a capital intensive business. One of his jobs was to be able to acquire debt. For someone who condemns debt so much….. why does eternal deficits not bother you..? The government keeps extracting more and more from businesses, insuring less and less capital for modernization … government debt good, private debt bad? If you can get a return on that debt… do it.
Hostess hired a turn around specialist. Good track record for the work he does. With that level of risk, and large downside, he can command, and should command a mutli-million dollar contract.
Part of the strategy was to get 56 distribution centers, 33 bakeries, and 256 stores to synergize. Like, teamsters could combine bread, twinkies, and other products in one truck. Oh, no… not the teamsters. They would not budge from their featherbedding….”we only carry bread”…. in the end, MOST unions made the concessions until the company had a chance to execute the strategy. The Bakers union said no. Doors closed. They were told a protracted strike would do it. Sorta reminds ya of the UAW and Steelworkers… now, maybe Hostess couldn’t make it…. but 16,000 people don’t have the option of going to night school, retraining, look for better opportunity. They are now decimated. Merry Christmas. At some point you can’t get more…. Wonder bread won’t sell for $5 loaf or Twinkies for $3.00 a pack. Demanding more when there is none… won’t work.
I saw that brain trust in action… the videos on the picket line chanting “close it down”, “close it down”!!! Super smart! Well, it’s closed.
November 22, 2012 at 2:19 pm #777764
Talaki34Participantkootchman,
Did you sit down intentionally write a fairytale or did this kind of evolve as you put your fingers to key? You could not be any further from the truth of why Hostess closed its doors.
I have to laugh at your imaginative armchair quarterbacking. Just because you own a business does not mean that you have some inside track to anything to do with Hostess. Before you speak to something that you know absolutely and I mean absolutely nothing about, please refrain from writing this nonsense.
From CBC to the current management, they have been nothing but arrogant. They refused to innovate (IBC), they refused to listen to consumers (CBC on), their own Plant managers, Controllers, workers and worst of all they lied and cheated not only their employees, but their investors and vendors as well!
I am very conservative by nature and was raised in a household where everyone was held accountable for their mistakes and there was no room for shades of gray when it comes to honor and integrity. The phrase “Mitigating Circumstances” did not exist when it came to doing the right thing. What upper management did at Hostess reeked of recklessness, lack of integrity and just plain dishonesty. They should all be ashamed of themselves, but sadly people like that never are.
November 22, 2012 at 2:57 pm #777765
JanSParticipantBut, but…Talaki…it’s so much easier to change the story, make up facts, to support our arguments. ;-)
November 22, 2012 at 5:15 pm #777766
Talaki34ParticipantMorning JanS,
Unfortunately, my form this morning was unkind and just as wrong as Hostesses Management. For that I owe Kootchman an apology. My observations about him were not warranted and they did nothing to help anyone understand what happened. I am very sorry for my harsh words and I hope he accepts my apology.
“it’s so much easier to change the story, make up facts, to support our arguments.”
You are right, but in fairness and I was not fair; initially the only information that was being presented was the headlines stating that the Bakers Union forced the shutdown and possible liquidation of Hostess. It all sounded plausible so it had to be right. Wrong. Subsequent articles, many those related to business then started to relay the story behind the story that was given by the CEO and his partners, but many opinions were already made and the damage was done.
We all know from the past political debates that for many the lie told sincerely becomes the truth and truth told without common support becomes a lie. Spin works its magic and everyone loses.
November 22, 2012 at 5:32 pm #777767
JanSParticipantactually, lest you stress, my comment was not directed at your response…I’m with you on this…the unions at Hostess have taken it in the shorts. Management was inept at best, dishonest for sure, and it seems, self serving.
Have a great day, Talaki…:)
November 22, 2012 at 5:41 pm #777768
HMC RichParticipantMike, the union that my dad was in had horrible leadership. The union reps did not follow the wishes of the union members. It was a bad situation.
November 22, 2012 at 5:52 pm #777769
HMC RichParticipantJoB, you can paint Bain and Romney with your class warfare brush and hope the paint adhere’s. Yes, there are corporate raiders who only care about themselves and screw the workers. I know. But some companies do need to reorganize and changes which are harsh need to be made.
It’s appalling when a CEO takes home millions when they screw the workers. But if the company is successful, I don’t care how much upper management makes. If you don’t like where you work, go find a different place to earn a living. It’s not easy but can be done.
How about if I said Romney should have become the CEO of Solyndra or the other pet 50 companies that failed in alternative energy. I don’t hear you complaining about them. At least Hostess is private and my tax dollars aren’t being wasted trying to prop up a business model that isn’t quite ready for prime time. Soon, but now quite yet.
I don’t mind the government funding R & D on future energy possibilities. But the Ivy leaguers in office in DC don’t make wise investments as far as I can tell.
November 22, 2012 at 6:13 pm #777770
JanSParticipantHappy TDay, Rich…life is too short to bother with these things today…go have a piece of pie for me :)
November 22, 2012 at 6:38 pm #777771
Talaki34ParticipantI am not stressed and I know you were agreeing with me. :)
I guess what your statement did was make me rethink how all the information about the closure was originally disseminated to the public and how it wasn’t until after the first wave of untruths passed that a closer look into the collapse was made.
It then made me reconsider my response to kootchman and realized that in was inappropriate. You can only make a correct analysis of a situation if you have all the facts. Since Hostess tried and nearly was successful in keeping them from the public it stands to reason that kootchman’s error in his observations came honestly and without malice.
What I was trying to say and failed…I am very grateful that your opinion allowed me to right a wrong.
Hope you are feeling better. :)
November 22, 2012 at 11:16 pm #777772
kootchmanMemberTalaki want to see the videos of the great Baker Brain Trust chanting shit it down, shut it down? Continental DID have access to working capital to shut down over capacity, redundant overhead, and to reorganize…. until the Bakers union pulled the plug and made a reorganization impossible. That’s the story. Rayburn was hired to do a turnaround, not a liquidation. The unions wanted a shutdown… the union brain trust couldn’t read a balance sheet.
Oh yea… this came from Rayburn
“The pay increase was given to Brad Driscoll, Hostess’ former CEO, in July 2011, before the company filed for bankruptcy. The salary was later cut from $2.5 million to $1.5 million, according to a Hostess spokesperson. The new CEO reduced the salaries of four senior executives to $1 until the company emerges from bankruptcy, and four junior executives who received raises had their salaries reduced to pre-raise levels, the spokesperson said.”
He asked for time and concessions. That’s the end of that story.
November 23, 2012 at 12:16 am #777773
JanSParticipantRayburn Musical Instruments? Sam Rayburn? Ralph Rayburn Law? CJ Rayburn race cars? Gene Rayburn?
AC Rayburn? Which Rayburn are we talking about?
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