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spreadable cheese. As part of Lay’s
“Do Us a Flavor” contest, Wavy Mango
Salsa was selected as a finalist, and
this year’s entries used cactus as an
ingredient an incredible 1,362 times.
Mainstream brand offerings are clearly
exhibiting the growing preference for
Latino-inspired flavors across the U.S.
Further capitalizing on these trends
are groups like Late July and Garden
of Eatin’, which combine these new
in-demand flavors with organic and
non-GMO ingredients for their chips.
Causes of Distress
On the other side of this phenomenon
are those companies experiencing
distress. The reasons that food
companies get into trouble are as
numerous as the choices on grocery
store shelves. Though many of the
causes of their distress are not unique
to those in the food industry, there
seem to be common issues among food
processors, such as excess capacity
and related leverage, low margins,
and customer concentration issues.
Many food processors have built
whole plants, funded by debt, on
the promise of big volume from one
customer—typically a big-box store
offering enticing volume orders but
slim margins—chasing the newest hot
product. After the company invests
sometimes millions of dollars, the
market shifts, the customer walks, and
the business is unable to service this
new debt without the additional revenue
expected. Similar circumstances can
arise even when a company is able
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While publicity can often catapult a
brand to new levels of profitability,
the threat of negative publicity also
looms large for food processors.