Eagle Brands Is Back On Shelves

After a decade away, Eagle Snacks is back in stores on its home turf of St. Louis, according to a report in the St. Louis Post-Dispatch.

Anheuser-Busch launched Eagle Snacks in 1979 in an effort to break into new markets. Eagle's potato chips and honey-roasted peanuts attracted loyal fans as the division wrestled with industry giant Frito-Lay, a division of PepsiCo Inc.

But Anheuser-Busch closed the project in 1996, ceding the brand to Procter & Gamble Co. as the brewer focused on its core beer business. Eagle products disappeared from shelves. Despite plans for a rollout in Portland, Maine, in 1999, the brand became largely dormant, the newspaper reported.

Now, Reserve Brands Inc. of Chicago is selling Eagle Snacks in about half of Schnucks' 66 St. Louis area stores, hoping to capitalize on historical goodwill for the snacks. Reserve Brands formed about two years ago to reintroduce the Eagle brand under a licensing agreement with Procter & Gamble. The company is backed by an investment group affiliated with Chicago's Pritzker family, which controls the Hyatt hotel chain, the newspaper reported.

"Fans of the Eagle remember the brand so fondly. In large part we just wanted to reward them for their loyalty," Scott Lazar, Reserve Brands' chief executive, told the St. Louis Post-Dispatch. "We see a lot of potential. I'm extremely encouraged by the reception we've gotten."

Eagle Snacks are available in vending machines across the nation and in some Wal-Mart Supercenters in a "pilot market" spread across seven western states.

Anheuser-Busch's decision to cut Eagle Snacks loose a decade ago came after years of fighting Frito-Lay and private labels for shelf space. When the brewer launched the snack brand in 1979 and sent it into retail distribution in 1981, it believed that its beer-distributing system could work equally well when applied to pretzels, chips and peanuts. The honey-roasted peanuts became popular airline food and eagle-shaped pretzels helped the company charge premium prices.

"It was a good fit in terms of branding, distribution, and customers," said Bill Finnie, a strategic and corporate planner at Anheuser-Busch from 1985 to 1991. "It also provided a growth opportunity for our wholesalers."

But matched against Frito-Lay's economies of scale — with 49.4 percent of the snack-food market in 1995, according to Information Resources Inc. of Chicago —
Eagle Snacks never cracked a profit or hit double-digit market share. In 1996, the beer company divested itself of Eagle Snacks, the St. Louis Cardinals and bakery division Campbell Taggart Inc.

"We had a great product — we always won blind taste competitions," Finnie said of Eagle Snacks. "We just lost a lot of money every year. We gave it 100 percent; our wholesalers gave it 100 percent."

David Poldoian, who served as president and chief operating officer of Eagle Snacks when it was under Anheuser-Busch's control, is now on Reserve Brand's board.

Lazar and Poldoian said sales in St. Louis have exceeded expectations, although they declined to share figures.

Asked if Eagle Snacks eventually could be distributed in more local Schnucks stores, spokesman Paul Simon told the newspaper, "We're going to gauge this by how the
response goes."

Said Lazar: "Without sounding corny, it's really in the hands of the people of St. Louis. We hope to find a permanent home on the store shelves."