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Clarence-based company braces for fallout in wake of Deen’s troubles

Paula Deen’s food empire is crumbling and that’s bad news for the Clarence-based company that brings her packaged foods line to the national market.

Nanco Group partnered with Paula Deen Enterprises last year to create Paula Deen Foods, which produces Deen-branded packaged foods such as baking mixes, regular and sugar-free chocolates, finishing butters, soups and tortilla chips. The foods have been sold nationwide at Walgreens, Walmart, Tops Friendly Markets, Dash’s Markets, Lowes Foods and at the Paula Deen Store in Savannah, Ga.

Walmart and Tops have dropped the products and cut ties with Deen in the wake of a recent racism scandal.

Walmart announced Wednesday it was ending its relationship with the celebrity cook and that it “will not place new orders beyond those already committed.”

Tops dropped the ax Thursday.

“Tops has, at this time, made the decision to remove the Paula Deen line of products from store shelves, including several varieties of sugar-free candy as well as salad dressings,” said Katie McKenna, a Tops spokeswoman, in a statement.

Nanco Group is owned by the family of Savino Nanula, who co-founded the Wilson Farms convenience store chain and Tops Friendly Markets.

A public relations firm released a statement on behalf of Savino Nanula, saying Deen has his “full support,” but declined to answer further questions about how the company might be affected.

“As a longtime friend of the Deen family, I personally know Paula to be a woman of compassion and fairness who is committed to treating all people with respect. Furthermore, I believe that everyone is entitled to make mistakes and to be forgiven. What is important is to learn from those mistakes and emerge a stronger and better person. Paula has my full support. I know that she will continue to make a positive impact throughout our industry,” Nanula said in the statement.

Dash’s Markets carries four Paula Deen Foods products, including salad dressing and barbecue sauce. Dash’s said it is “taking a wait and see approach,” in deciding whether to continue carrying the products. Dash’s marketing manager Mark Mahoney said that decision “might be made for us” if the manufacturer stops producing.

Mahoney said the Deen-branded products were of a very high quality, especially its sugar-free chocolate, but sales were “just OK.”

“The brand has been seriously wounded, shall we say,” Mahoney said.

The Nanco Group is not affiliated with other Paula Deen merchandise, such as the branded cookware and kitchen items sold in Target, Walmart and Home Depot stores. All three of those companies have dropped Deen, vowing not to place new orders with the company.

Caesar’s Entertainment, which operates four “Paula Deen’s Kitchen” restaurants, and Novo Nordisk, a pharmaceutical company that employed the diabetic Deen as a spokeswoman, have also cut ties with the celebrity cook.

On Friday, the Food Network cancelled her TV show “Paula’s Home Cooking,” after a legal deposition in a workplace-discrimination lawsuit revealed she had used the N-word in the past when referring to a black man who held up a bank where she was working and when referring to other conversations where other people had used the word. She also said she wasn’t offended by jokes targeting Jews, blacks and gays, and thought that incidents involving managers in her restaurant showing pornography to female employees was “just men being men.” She later apologized.

Though retailers have ended relationships with her, there still seems to be a market for the Deen brand. Her latest book, “Paula Deen’s New Testament: 250 Favorite Recipes, All Lightened Up” leaped to number one on Amazon’s best-seller list Wednesday. Pre-order sales of the book – which will not be released until October – have jumped dramatically in the wake of the scandal; it hadn’t cracked the top 1,000 earlier this week.