Earlier this year, we reported that the cereal business in the United States is hurting, possibly because of protein-mania and Americans switching to other breakfast foods. One company that began to see signs of trouble was Cheerios-maker General Mills, which managed to cut costs and follow current food trends, boosting its profits.

It seemed like a great thing when Cheerios became gluten-free, which was a great thing for people with celiac disease and gluten sensitivity. Then disaster hit the production line this fall: wheat flour was mistakenly mixed into some batches, making customers sick and leading to a recall and class action lawsuits. No one attributes that to General Mills’ cost-cutting, but it’s worth remembering that cost-cutting by laying off experienced workers can lead to production mistakes and other problems.

We don’t know whether sales of the allegedly misleading product Protein Cheerios helped or hurt the company’s bottom line, but learning modern customers’ tastes and removing additives will be the way forward for all chain restaurants and food companies.

General Mills Profit Rises, Helped by Cost Cuts [Wall Street Journal]

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