retail news in context, analysis with attitude

Bloomberg has a story about a nutritionally bifurcated American public, more focused o healthy eating than ever, but still buying enough Twinkies to have rejuvenated that recently troubled brand.

"Nine months of forced disappearance from store shelves sharpened appetites for the golden sponge cake filled with fluffy cream, and after two bankruptcies, the 2013 acquisition of the Hostess Brands Inc. snack-cake business by a pair of private equity firms put the company back on the road to solvency," the story says, adding, "In opinion surveys, Americans rank stealthy eating right up there with healthy. While 75 percent told NPR last year they were eating wholesome food, another report, from the Boston Consulting Group and IRI, found that indulgence was a top food trend, alongside nutrition."

There is an economic side note to the Twinkies resurgence. "Twinkies’ new popularity came at a cost," the story says. "The Hostess bankruptcy enabled the private equity buyers to start over with a fraction of a workforce that once numbered about 8,000 at several bakeries across the country. Their reconstituted company now has 1,350 employees and three baking facilities. Now, one automated production line staffed by 10 employees in Emporia, Kansas, can produce 95 percent of the iconic cakes ... The changes have helped produce some of the best profit margins in the food industry."
KC's View:
No real surprise here, but it is always worth being reminder that customers are not monolithic in their needs and desires. It's why companies - retailers and suppliers alike - have to be so sensitive to how they behave, and the influences that factor into their decision-making.