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Fresh Is King: How Grocers Can Leverage In-Store Baking To Build Sales

Bake N' Joy in-store bakery sales

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in-store grocery bakery sales

Charlie Wood, VP of sales at Bake’n Joy, discusses the latest bakery trends and key factors for retailers to consider when choosing a bakery partner.

Charlie Wood

Wood has a history of working in the food and beverages industry. His areas of expertise include consumer products, management, marketing strategy, competitive analysis and strategy. He is a strong sales professional with a bachelor’s degree focused in business administration and management, general from Plymouth State University.

Prior to joining Bake’n Joy Foods in 2022, Wood held senior leadership positions for Affinity Group North America – Foodservice, Keurig Green Mountain, Danone NA and M&M Mars.

What value do in-store bakeries bring to supermarkets?

The in-store supermarket bakery department offers everyday staples such as breads and rolls, but it is also a key destination for fresh decorated cakes and a multitude of other sweet treats consumers crave as an indulgence. Goods baked on premise are perceived to be higher quality and fresher than packaged offerings. Grocers have the distinct opportunity to promote this freshness factor. Not only is it a unique point of difference, but it can also easily be conveyed using in-store marketing tactics such as table signs and packaging bursts.

In-store supermarket bakery enjoys high household penetration, with 82 percent of consumers shopping the category in 2023. Consumers purchase baked goods once per month on average as noted in FMI’s “The Power of In-Store Bakery 2023” report. Retailers can leverage limited price promotions to spark increased purchase frequency and can do so strategically across the multitude of bakery segments throughout the year.

Another opportunity for retailers is to cross-merchandise baked goods with seasonal offerings such as fresh berries on a table display of biscuits or butter pound cake. What’s more, savvy retailers know the value of optimizing daypart purchase occasions. For example, retailers can convert a morning muffin into an afternoon snack or dessert by layering muffin pieces, yogurt, and fresh berries to create grab-n-go parfaits.

How is the bakery category performing and which segments are driving growth?

From a performance perspective, the total bakery category dollar volume is up, while units are flat or slightly behind. This is attributable to inflation resulting in higher cost of goods, which as we know, are passed through to consumers in the form of price increases.

Several bakery segments have reached their price ceiling, and consumers are starting to vote with their dollars. Best-in-class retailers incorporate dynamic merchandising displays and limited time price promotions to captivate shopper attention.

Heavy hitters in the sweet baked good segments include cakes, cookies, cupcakes, doughnuts, muffins and pies. These segments make up more than 50 percent of total bakery category sales. There are some positive trends emerging in smaller segments such as croissants, cornbread, and mini muffins.

What are some of the cutting-edge trends happening in the category?

Considering the growing consumer trend toward more health-conscious food, the baking industry is responding with innovative products that address this need. Products containing less sugar, no gluten, vegan or contain functional ingredients such as whole grain are on the rise.

Clean label products that tout benefits such as no artificial ingredients or preservatives, no high fructose corn syrup, or hydrogenated oils and having less modified ingredients such as unmodified flour and starch are viewed as “better for you.”

Smaller portion sizes are on the rise as well because they are viewed as a guilt-free indulgence over larger, full-portioned baked goods.

On the other hand, there are some who don’t shy away from the occasional sweet indulgence. This explains the explosion of gourmet, super-sized doughnuts with fantastical decorating finishes and newfangled flavor combinations such as maple & bacon, s’mores, fruit loops and peanut butter and jelly. The creativity behind doughnut making is seemingly endless and consumers appear to be responding.

How can retail grocers take advantage of current trends to sell more baked products?

Freshness is a major factor driving both planned and unplanned bakery purchases.  This gives retailers a prime opportunity to influence customer behavior, particularly impulse buying, by baking fresh products throughout the day.

Finding skilled bakery staff can be challenging, so retailers are embracing innovative products from manufacturers. These innovations, such as fully baked or thaw-and-sell options, allow stores to offer a wide variety of fresh-tasting baked goods while still maintaining the competitive advantage that in-store brings.

Thaw and sell items are the perfect solution for segments like coffee cakes, banana bread, cornbread, pound cakes, brownies and the like. It provides retailers the variety they need to create eye-catching displays and enables them to continue baking mainstay items such as breads, cakes, cookies and muffins fresh all day.

Nothing says fresh like the irresistible wafting aromas from bakery ovens! Baking fresh on premise creates a sensory experience for the eyes, ears and nose. Additionally, baking fresh throughout the day (versus morning only) reinforces consumer perception that fresher is better, and the local in-store bakery is the place that consistently delivers on the freshness promise.

What makes your company uniquely different from other brands in this category?

Bake’n Joy has been providing caring, quality, dependable bakery solutions for more than 80 years. We are family owned and have never wavered from our commitment to our customers’ success. Our flagship product line of freezer-to-oven predeposited muffins are made with generous amounts of quality ingredients sourced as close to farm to factory as possible.

This year, we are introducing are Topped Predeposited Frozen Muffins. Designed to ease the labor burden of retailers. These muffins come in predeposited baking cups and have toppings like sugar, nuts and streusels already applied. Simply pan and bake.

In addition to muffins, we also offer ready to bake cornbread and fully baked whole loaf and sliced pound cakes. We believe the quality of ingredients and higher volume of inclusions enhances the eating pleasure and ensures repeat purchases. This is why we maintain that the quality of Bake’n Joy products is a difference you can see and taste.

What attributes should retailers look for when selecting a bakery partner?

There are many bakery companies to choose from in North America and retailers should perform due diligence to ensure they choose a partner that most closely aligns with their values. There are some characteristics, however, that should always be considered in the decision-making process:

  1. Integrity – You cannot go wrong when partnering with an established company with a legacy of acting at the highest level of ethics, fairness, and pride of workmanship. A company like this has stood the test of time and built its brand equity on these principles. They will endeavor to improve and protect this elevated reputation.
  2. Customer Service – A company whose mission is the commitment to their customer’s success by providing the best possible service in terms of product availability, fulfillment accuracy, product consistency and the highest level of responsiveness to each customer’s need.
  3. Product Quality – Quality means different things to different people, but it should always involve using the best ingredients and formulations that deliver a delightful consumer experience. Look for a partner that sells its products at a fair price, is consistent with the expectation of the target audience and can meet your shopper’s needs and expectations.

What are some additional factors retailers should consider when selecting a bakery partner?

Other attributes to consider when choosing a bakery partner are:

  • Collaborative Innovation: Look for a partner willing to develop exclusive products with you, giving you a competitive edge.
  • Commitment to Improvement: Choose a partner that continuously improves their products and processes.
  • Future-Proof Capabilities: Select a partner that invests in new technologies and stays ahead of the curve.
  • Distribution Flexibility: Ensure your bakery partner offers convenient access to their products through various distribution channels.
  • Reputation: Check references and seek out a company that has earned longstanding business loyalty among their existing customers.

By understanding consumer trends and strategically leveraging in-store bakeries, supermarkets can create a truly alluring and profitable bakery department that keeps customers coming back for more.

About the author

Sommer Stockton

Web Editor

Sommer joined The Shelby Report in January 2022 after graduating from Brenau University in Gainesville, GA with a B.A. and M.A. in Communications and Media Studies. Sommer is excited to learn about the grocery industry and share her findings with The Shelby Report's readers!

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