An estimated 50M Twinkies are now on or arriving to shelves across the country. C. Dean Metropoulos’ private-equity firm, Metropoulos & Co., is the primary owner of the new Hostess Brands LLC, out of Kansas City, MO. What Metropoulos is trying to do is instructive for brand valuation and provides a great checklist for a turnaround.
- The former Hostess was burdened with $1.3 in debt…that debt is no more;
- Innovation is a stated focus of the new company (expect to see healthier products, for example, and new flavors and textures);
- Factories have been consolidated, forcing those remaining to operate at closer to 90% capacity (these remaining plants are being modernized);
- The former Hostess had nearly 80% of its employees represented by unions…there are no unions in the new company;
- Hostess thrift stores have been shuttered;
- Distribution will expand into tens of thousands more outlets;
- Average compensation levels have been reduced;
- Poor selling products are being eliminated;
- The Wall Street Journal reports a multimillion-dollar marketing campaign will support the brand, with "The Sweetest Comeback in the History of Ever" a prominent slogan. The campaign will feature outdoor ads, a Hostess food-truck tour and extensive social media.