The bakery sector needs “a pivot from defensive to proactive” as it responds to the end of the pandemic and to new challenges, according to a new report from Rabobank.
Among major bakery categories, after a 7.5% jump in 2020, fresh bread has regressed to its pre-pandemic sales levels on a volume basis. The real winners in the category were bagels, muffins, doughnuts, frozen pizzas and salty snacks, because they “replicate the restaurant experience at home and provide comfort,” the report says.
One category that took a major hit from the pandemic was goods baked in-store. The share who shopped at the in-store bakery on nearly every trip was 38% before the pandemic; it now stands at 32%. Conversely, the share who say they rarely or never buy goods baked in-store rose from 10% to 13%. Among that group, 14% said COVID was a major reason for their avoiding in-store goods.
The report quoted an Instacart executive’s remark that only one in three online orders currently includes a baked item – very low for a product with household penetration in excess of 99%. It recommended preparing for growth of bakery in online orders, through means like designing products or packaging for online shoppers.