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The much-heralded return of the iconic Twinkie to store shelves this past week was met with a bit of a surprise: The golden cake had slimmed down.
According to the Associated Press, rather than the 42.5-gram/150-calorie tube of sugary goodness you remember, the new Twinkie being sold is a trim 38.5 grams and 135 calories. Now you don't have to feel so guilty about eating a pack or two in one sitting. You can tell everyone it's "diet food"!
In reality, the change occurred before cake maker Hostess went bankrupt. Apparently in the months leading up to seeking court protection because of its high legacy costs, the Twinkies maker sought to save money by stretching the ingredients thin. Now that they're in the hands of private equity firms Apollo Global Management and Metropoulos, keeping the trimmed-down cake size makes good financial sense.
It's not the first time manufacturers have thought to water down their product for added profit. Spirits maker Beam (UNKNOWN: BEAM.DL ) literally tried to water down its Maker's Mark bourbon in a bid to stretch supply to meet demand. The outcry was such that it had Beam backpedaling quickly and offering up a social-media mea culpa.
Nearly a decade ago, Brown-Forman (NYSE: BF-B ) also lowered the proof on its Jack Daniel's whiskey, while Kellogg and other cereal makers have reduced the size of their boxes though they charge the same money as for the bigger box. And a few years ago, Hershey (NYSE: HSY ) shrank some of its chocolate bars from 8 ounces to 6.8 ounces and kept the price the same -- until a few months later, that is, when the company raised the cost of the smaller bar because of "rising commodity costs."
Sure, sugar costs more these days, too -- it's a profitable addiction for sugar companies -- but consumers aren't about to complain about the smaller Twinkie size, so happy are they that the goodies are back on the shelves at all. Although unreasonable union demands forced Hostess into bankruptcy, the value of its brands even beyond the Twinkie -- there are also Ding Dongs, Ho Hos, Sno Balls, and Dolly Madison Zingers -- hardly left a doubt they'd be back on the shelves sooner or later.
Who knows --maybe we'll see Twinkie "bites" coming out in those 100-calorie snack packs that are supposed to be healthier for you. So long as you don't eat them all in one sitting, perhaps your favorite cake-and-cream snack can make for a thinner you, too.
As King Edward's mistress Wallis Simpson once noted, you can never be too thin or too rich. When it comes to investing, the best investment strategy is to pick great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" not only shares stocks that could help you build long-term wealth, but also winning strategies that every investor should know. Click here to grab your free copy today.