New snack products were encroaching on stomachs, wallets and shelf space that had once belonged exclusively to Tastykake: breakfast bars, bags of crackers, flavored nuts, an endless array of chips potato, tortilla, taro, etc.
At the upper end of the market, health-conscious snackers began to shun junk brands like Tastykake. At the lower end of the market, Tasty Baking was losing customers to Little Debbie, a producer of cheaper, if inferior, cakes that give consumers a similar sugar rush. Local Asians eat virtually none, according to former Tasty Baking executives.
Tasty Baking had improved its shelf life in the mids with new packaging, and it had also joined its competitors in baking cakes that were packed with preservatives.
But margins on the out-of-region sales were relatively low, given the higher distribution costs, and faraway snack consumers unfamiliar with Tastykakes often stuck with their favorites, such as Twinkies.
Executives who worked at Tasty Baking say Watts was positioning the company to be sold. He put short-term sales and cost-cutting ahead of long-term investment — moves designed to make the company more attractive to would-be buyers.
Even then, a sale would arguably have been the best option for shareholders. The fact is, regional bakeries like Tastykake are a dying breed: Most have already merged with other companies or been bought by larger conglomerates. In that context, the selection of Pizzi makes a little more sense.
Charlie from the block would never move such an iconic company outside the city. He poured money into marketing and technology, which had been badly neglected under Watts.
He experimented with new products. Tasty now sells more than products under its brand name, from brownies to energy bars to chocolate-covered pretzels.
And he upgraded both management and the board with experienced food-manufacturing expertise. His signature accomplishment, of course, was cutting the deal that moved Tastykake out of the Nicetown plant and into the Navy Yard. He convinced Liberty Property Trust to build the factory and lease it to him, thus lowering the amount of cash Tastykake needed to borrow to get the new bakery up and running.
And there is perhaps nobody with better connections to the system than Pizzi. Not to mention all the broad, long-term challenges that the entire snack-cake industry is confronting, like changing consumer tastes and tougher nutritional guidelines keeping junk food out of a lot of public schools.
Given all these challenges, perhaps no CEO could have managed to both build a new factory and maintain a healthy bottom line. But some former Tasty Baking executives say Pizzi got in over his head. They say he gave up too early on national sales efforts and botched expansions into new markets. The facility is vast and open, with ceilings as tall as an airplane hangar and walls of white cinderblock.
Sugar and flour hiss like white noise as they fly through elevated pneumatic tubes that connect supply silos to mixers. The overwhelming impression is of cool efficiency. The only splashes of color in the scene are the cakes themselves and columns painted blue and yellow. It feels like an Ikea warehouse. But the fact that the new facility lacks the 20th-century charm of the old one is no indictment of Pizzi. In putting together the deal that made the new factory possible, Pizzi accomplished what the board hired him to do.
They are so weak, so fragile, and there are so few of them that, even in dire financial times, virtually no objections were raised when Pizzi asked for a little public assistance. Obviously, companies nationwide have their hands out. Leaving AARP. Got it!
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Home » Recalls » Tastykake recall: Some cupcakes…. Share This: share on facebook share on twitter share via email print. Flowers Foods shared these images of multi-item cupcake packages recalled Oct. Share This Gallery: Share on Facebook. Share on Twitter. Share via email.
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