Hostess, the maker of Twinkies, Sno Balls and Wonder Bread, is trying to work its way out of its second bankruptcy in four years, and CEO Greg Rayburn told CNBC it’s not going to be easy.
“We have a path to emerge, but it’s a difficult one and it’s a painful one,” he says in the following video. “It’s painful for the employee because it requires wage concessions and pension concessions. They have been through this wringer once already.”
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All employees at Hostess are being asked to take an 8% wage cut this year, Rayburn said. The company’s cost structure is the problem, as revenue remains “solid” thanks to the company’s powerful brands. Though it may be tempting to blame unions for the company’s woes, Rayburn doesn’t buy that argument.
“I don’t think unions bring down companies,” he said. “In Hostess’ case, there is plenty of blame for everyone.”