[THEATLANTIC] Oscar Mayer (the company, not the man) was still being run by Mayers until it was sold to General Foods Corporation in 1981. Eight years later, the company was merged with Kraft at the order of its parent company, Philip Morris. In engineering terms,creating a single point of failure.
On Thursday, Kraft Heinz Food announced that it would close down the Oscar Mayer headquarters and plant in Madison, after 96 years.
Not surprising. It's part of the pattern.
The news, though somewhat expected, has been hitting Madison residents hard. Madison's mayor Paul Soglin estimated that the economic impact will be at the cost of "hundreds of millions of dollars."
Since he's a professional lefty politician I don't imagine he went too far out of his way to entice them to stay.
The Oscar Mayer closure is part of a bigger Kraft Heinz downsizing plan to save $1.5 billion in the next two years. The company is shuttering plants in Caliphornia, an impregnable bastion of the Democratic Party,, Maryland, New York, Wisconsin, and Ontario; all told, an estimated 2,600 jobs will be eliminated.
They teach that sort of thing in MBA courses. Cutting jobs = increased profits. Theoretically, a company with zero employees makes infinite profit.
Since Heinz acquired Kraft Foods in July (in an estimated $45-billion deal),
Nine billion packs of hot dogs at $5 a package, or 72 billion wieners at eight wienies a pack...
the resulting gigantic company has been expected to consolidate its production factories and corporate staff. The best guess has been that this "new era" for Kraft Heinz will involve layoffs:
"New eras" seem to include a lot more layoffs than expansion...
In August, 2,500 workers in Kraft's North American operations--including 700 corporate staff--were let go. Including what was called for in Thursday's announcement, the company has reached its expected target, after shedding 10 percent of its 46,000 workers during restructuring.
The Little Woman (she's less than 18" tall) and I are researching how to make our own sausages, without the turkey, chicken, and corn meal that's a current staple.
The backdrop for all these changes is that Americans are becoming wary of processed foods. One report found that the market shares of packaged-food companies have been dropping by billions of dollars as consumers drift towards organic and "natural" offerings. For Oscar Mayer in particular, it doesn't help that recent studies have linked processed meats to premature death and cancer.
Wienies taste a lot different today than they did when I was a kid. Somehow Nathan's and Hebrew National taste the same, they just cost different.
But Americans still love hot dogs, consuming close to a billion packages a year, and summer barbecues and sports venues continue to be responsible for massive sales numbers. Around the world, demand is even looking up. The hot dog is definitely sticking around, but whether Oscar Mayer will be able to capture some of that growth will depend on whether it'll stick to its classic branding, for international consumers who want classic, "American-style" food, or try to conform to America's new food preferences.
The last batch of Oscar Mayer all beef doggies we bought was disappointing. The texture was mealy and even though chicken lungs weren't listed as an ingredient they could have been in there as far as taste was concerned.