The creators of the oh-so-lovable and addictive baked goodies that Americans have loved for more than 80 years are calling it quits. Hostess Brands, the baked good company that produced Twinkies and Wonder Bread, announced Friday that it is going out of business.
The company’s operations suffered when bakers went on a national union strike after they refused to accept a new contract package in December that reduced wages and benefits. The employees were warned that if they did not return to work by Thursday evening, Hostess Brands would have no choice but to file a motion in U.S. Bankruptcy Court – the second time since 2004 – cease operations, and sell their assets.
Employees refused to oblige.
“We deeply regret the necessity of today’s decision, but we do not have the financial resources to weather an extended nationwide strike,” Gregory F. Rayburn, chief executive officer of Hostess brands, said in a statement posted on the company’s website.
“The Company determined on the night of Nov. 15 that an insufficient number of employees had returned to work to enable the restoration of normal operations.” Nearly 18,500 employees are expected to be laid off.
But that may not have been the only reason why the company is suffering a hard blow. Besides the hard times that the economy has created for many businesses, social consumerism towards food is changing. As interest in healthy-eating begins to rise and communities become more weight-conscious, less Americans are buying processed snacks with hard-to-determine ingredients. With more consumers wanting transparency in the food market, there seems to be little room for branded companies to continue engaging in an old-age business tactics.