category focus
Bakery products 2015: the top 10 suppliers in key US industry sectors
It’s not getting any easier to earn a crust from fresh bread in the US.
Overall unit sales of fresh bread fell 1.5% in 2015, according to IRI data, with a $0.03 per unit price increase keeping value sales flat.
Reporting its full-year trading results for the year, Grupo Bimbo last month said bread category volumes had been under pressure due to price increases in the first half of the year. The IRI data shows a slump of almost 6% in the business’ US bread sales, although its rolls and burger buns performed slightly better.
Private label products also contributed to the weak performance of the category, falling more than $80m last year compared with 2015.
A Killer performance
Of the 10 largest US bread suppliers, by far the strongest growth was from Dave’s Killer Bread, which is tapping into the growing interest in more natural products. Little wonder that the business was snapped up last summer by Flower Foods, although it will continue to operate as an independent subsidiary.
Earlier this year, Flower Foods president and CEO Allen Shiver said the acquisition of Dave’s and Alpine Valley Bread Company would be key elements in its growth strategy.
And although Flowers has performed better than many of its rivals in the bread category, it has struggled in some baked goods sectors, including rolls, buns & croissants and bagels. In its financial results for 2015, Flower admitted its earnings in the fourth quarter were “below plan.”
Sweet smell of success
In contrast to the performance of the bread category, good growth has been seen in sales of sweet baked products and morning goods.
Unit sales of muffins, for example, have soared almost 10% year on year while donuts are up almost 5%.
The value of the cupcakes and brownies category has risen almost $250m in the past 12 months, driven by factors including demand for low-cost and home-style treats. Such products are also benefiting from the increasing frequency of snacking, said IRI.
It’s a trend retailers have been keen to embrace, with private label cupcakes and brownies accounting for more than $100m of the growth.
