Growth and Challenges of the Baking Industry

1. Rapid Growth of the Baking Industry

In recent years, the bread and baking industry has experienced significant growth. In 2023, the industry added 122,000 new stores, reflecting the high demand for baking products and the vibrancy of the industry. According to bakery China, this growth is driven by the continuous demand of consumers for fresh and diversified baking products. As living standards rise, people have higher expectations for the quality and variety of food. Baking products, as part of everyday consumption, benefit from this trend. Additionally, the introduction of new technologies and the development of innovative baking methods have also driven industry growth, enabling bakeries to offer a wider variety of products to attract consumers with different tastes and needs.

2. The Challenge of High Attrition Rates

Despite the rapid growth of the industry, 120,100 bakeries closed in the same period in 2023, revealing the harsh reality of high attrition rates within the industry. This phenomenon points to multiple challenges in the baking industry. First, the industry is becoming increasingly competitive, with the rapid increase of new stores leading to market saturation. Second, the homogenization of baking products is becoming a serious issue, with many bakeries offering similar or almost identical products, making it difficult to stand out in the competition. Additionally, the development of the internet has exacerbated the rapid imitation of products; once new and unique baked goods become popular in the market, they are quickly copied by other stores, further intensifying the homogenization issue.

Survival Strategies for Bakeries

1. Strategies to Address Market Challenges

To survive and develop in the face of fierce market competition and high attrition rates, bakeries need to adopt effective strategies. First, strong financial backing is fundamental. Sufficient funding can help bakeries survive the initial phase and invest in necessary market marketing and product development. Second, excellent product-making ability is key. Bakeries need to continually innovate to offer unique and high-quality products to attract consumers. In addition, precise market positioning is equally important. Bakeries need to understand their target consumer groups and develop products and marketing strategies that cater to their tastes and needs. Lastly, effective marketing strategies are indispensable. Bakeries need to utilize various marketing channels, such as social media, online platforms, and offline events, to enhance brand awareness and attract customers.

2. Different Challenges for Established and New Brands

Both established and emerging brands in the industry face market pressure and challenges. Established brands, although having a certain customer base and market recognition, also need to continuously innovate to adapt to changing market demands. Emerging brands, while being more flexible and inclined to innovate, face greater challenges in establishing brand recognition and customer loyalty. Both need to explore new market opportunities and operational models while maintaining quality.

Faced with the high attrition rate and intense competition in the baking industry, bakeries must develop excellent product-making capabilities, precise market positioning, and effective marketing strategies. Additionally, financial support is a key factor for success. Whether an established or emerging brand, both need to continuously adapt to market changes, innovate in products and services, to meet consumer needs and expectations. Looking ahead, the baking industry may undergo more transformations, but those brands that can effectively respond to challenges, maintain innovation and flexibility, will have greater space for survival and development.

Bakery China will continue to share more industry professional content with you, so please stay tuned!

Bakery China, organized by China Association of Bakery and Confectionery Industry (CABCI) and Bakery China Exhibitions Co., Ltd. was launched since 1997. Bakery China is the Asia Pacific's leading event serving the entire value chain for the bakery and confectionery market. The event presents all range of ingredient, equipment, packaging and services, and enables global leading professionals and buyer delegates to meet and share the latest innovations and thinking on manufacturing & distribution, R&D, applications and related services for bakery industry.It is the first choice trade fair to enter China's bakery market.

The 26th Bakery China will be held on May 21-24,2024 at National Exhibition and Convention Center (NECC), Shanghai, covering 320,000 sqm show space. Over 2,200 exhibitors and 400,000 visits are expected.