Dollar General now offering Hostess snack cakes
GOODLETTSVILLE, TENN. — Dollar General Corp., which operates more than 11,000 stores in 40 states, has concluded the roll-out of five Hostess products. The products that have been introduced over the past three weeks at a majority of Dollar General’s retail locations include 8-count CupCakes, 12-count Ding Dongs, 10-count Twinkies, 12-count Zingers and 10.5-oz bags of Hostess Donettes Powdered Mini Donuts.
“Dollar General is excited to welcome Hostess products to store shelves,” said Dave D’Arezzo, executive vice-president and chief merchandising officer of Dollar General. “Our consumer feedback showed that our customers love Hostess products and providing these snacks further demonstrates Dollar General’s proactive work in delivering products our customers want.”
Rich Seban, president of Hostess Brands, L.L.C., Kansas City, said Hostess’s new distribution strategy has allowed the company “to significantly expand our reach and distribute through more channels than ever before.”
“We are delighted that our iconic snack cakes will now be available at Dollar General stores throughout the country,” he said.
Mr. Seban hinted at the possibility of new channels of distribution for Hostess snack cakes in a mid-July interview with Milling & Baking News. He said the shift in Hostess’s distribution system, from one based on direct-store delivery to one geared toward delivery to warehouses, would be a big reason why such a move would be possible.
“In a D.S.D. system, each stop has to generate a certain amount of revenue to generate profit because we have our own driver in a D.S.D. system stopping,” Mr. Seban said in explaining the differences between the two systems for Hostess. “So if the stops were too small, and we couldn’t service them on a D.S.D. route because they didn’t do enough volume, then we couldn’t service them. For example, there are 150,000 c-stores in the U.S. In November (2012), we were calling on about 50,000 of them, or about a third. Now, because we’re going through a warehouse direct system, we can use independent distributors … to go after literally everywhere that candy bars are sold. … We feel we now have the ability to sell wherever candy sells, and that opens up an additional 100,000 plus operating units for us.”
In early November, Wayne, Ind.-based Aunt Millie’s Bakeries entered into a limited distribution agreement with Hostess Brands L.L.C. that will allow Aunt Millie’s to sell Hostess snack cakes, including Twinkies, Ho Hos and CupCakes, through its direct-store delivery route service to convenience stores. The program is expected to begin in December and will service certain markets, including Indiana, most of Illinois (including Chicago), Milwaukee and the northern parts of Kentucky where Aunt Millie’s currently has distribution.