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<blockquote data-quote="Bagels" data-source="post: 1067658" data-attributes="member: 43436"><p>Rapidly declining sales drove Hostess into bankruptcy. Rapidly declining sales were caused in part by changing consumer tastes (healthier snacks, premium artisan breads, etc.) and in part by consumer transition to lower-priced brands. If you're in management, how do you solve this problem considering your cost structure? Yes, management made its mistakes. For example, it should've recognized the trend toward value-priced store brands to be permanent, consolidated its various brands under the most-recognizable Wonder Brand name, heavily reduced production & focused solely on specialty breads. </p><p></p><p>Yes, unions gave previous concessions. But sales continued to decline. If you worked as an interdependent contractor for Bimbo, your earnings would decrease as stores cut orders on, for example, Entenmann's products. Larger givebacks were a necessity to keep the company afloat. Employees could have accepted large givebacks and STILL made more than their competition Instead, they're competing for even lower-paying jobs and Wonder Bread may replace "Great Value" as Walmart's in-house bread brand.</p><p></p><p>And the bonuses management received are peanuts compared to the HUGE sums of money they would have earned should Hostess had become profitable and been able to issue an IPO.</p></blockquote><p></p>
[QUOTE="Bagels, post: 1067658, member: 43436"] Rapidly declining sales drove Hostess into bankruptcy. Rapidly declining sales were caused in part by changing consumer tastes (healthier snacks, premium artisan breads, etc.) and in part by consumer transition to lower-priced brands. If you're in management, how do you solve this problem considering your cost structure? Yes, management made its mistakes. For example, it should've recognized the trend toward value-priced store brands to be permanent, consolidated its various brands under the most-recognizable Wonder Brand name, heavily reduced production & focused solely on specialty breads. Yes, unions gave previous concessions. But sales continued to decline. If you worked as an interdependent contractor for Bimbo, your earnings would decrease as stores cut orders on, for example, Entenmann's products. Larger givebacks were a necessity to keep the company afloat. Employees could have accepted large givebacks and STILL made more than their competition Instead, they're competing for even lower-paying jobs and Wonder Bread may replace "Great Value" as Walmart's in-house bread brand. And the bonuses management received are peanuts compared to the HUGE sums of money they would have earned should Hostess had become profitable and been able to issue an IPO. [/QUOTE]
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