Yes indeed , management decisions , especially of the gobble up all the competition variety, messed up this company.
''Continental Baking merger
In January 1995, it acquired Continental Baking Company, for US$330 million and 16.9 million shares of Interstate stock from Ralston Purina. Among the divisions brought into the fold were Wonder Bread (which made bread products) and Hostess brands which concentrated on cakes such as Twinkies which had been created in 1933.[5] It also bought San Francisco French Bread Company, John J. Nissen Baking Company, Drake's, and My Bread Company.[4]
Under ex-Merita Baking head Charles Sullivan, Butternut and Wonder Bread operated with different cultures: Butternut was unregimented and each bakery was a self-contained profit center; Wonder Bread was very "procedural and by-the-book." This caused some problems early on. In both cultures, snack cakes were more profitable due to economy of scale and logistics. When extended-shelf-life enzymes were developed for bread, the hope was to convert the system of many small inefficient bakeries into an efficient network of a relatively few giant bakeries like their snack cakes operation.'' For more see the link :
Hostess Brands - Wikipedia, the free encyclopedia
