The bread and baked goods market has seen overall value growth of an estimated 8% between 2009 and 2014. Sales have fluctuated within the period, in part reflecting the volatility of wheat prices, one of the major input costs.
A net 1% decline in volume sales is estimated between 2009 and 2014. Whilst sweet baked goods, speciality breads and rolls have grown overall during the period, the long-term decline seen in prepacked bread continues to weigh heavily on the market’s overall performance.
The prepacked segment continues to face competition from alternatives such as sandwich thins and bagels. These have attracted active NPD (New Product Development) in recent years and in many cases enjoy a stronger image as fun and less bland. Competing markets are also putting pressure on bread, such as breakfast biscuits and porridge pots as on-the-go breakfast.
Operators have made efforts to combat these challenges, with NPD in 2014 including Kingsmill’s Great White and Hovis’ Taste Sensations range, however, the success of these remains to be seen.
According to exclusive consumer research, just 42% of full-time workers eat breakfast at home daily. This makes bread vulnerable to other, more convenient breakfast options. While brands in this market have explored breakfast biscuits, there has been little innovation in bread itself when it comes to on-the-go products.
By comparison, in breakfast cereals, porridge pots have positioned porridge as a quick-to-make breakfast option that can be prepared anywhere where there is access to hot enough water.
However, that one in three users would be interested in rolls with baked-in fillings suggests opportunities for operators to position bread as more portable, including at breakfast.
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