Such chains could now be strong to challenge sandwich retailers and supermarkets in the food-to-go market.
Bakery chain sales rose by 19% in 2019 in what marks the strongest growth in on-premise business amongst major QSR channels in 2018, according to NPD Group’s Bakery Trends Tracker report.
The number of visits to bakery chains also went up 18% during the same period. NPD noted that bakeries could even be well-positioned enough to establish its off-premise operations, challenging sandwich retailers, supermarkets and QSRs for a larger share of the food-to-go, click-&-collect and delivery segments.
“We believe competition will heat up. Bakery chains are ideally suited to riding some of the big trends in British foodservice and have responded imaginatively to consumer demand for convenience,” said Peter Linden, NPD Group’s insight manager for UK foodservice.
In addition, food-to-go customers said that eight out of ten bakery purchases were consumed on the move.
Bakeries currently account for £1.2b or 5% of Britain’s £22.5b food-to-go business annually, up from £1b compared to five years ago. These chains also only service 3% of total click-&-collect market, but NPD said that its sales are already increasing from this low base.
Delivery business for bakeries is still at a very low level, but delivery volume rose nearly 63% in 2018 and the value of delivery sales has increased by over 47%.
“Bakeries and patisseries are an important part of Britain’s £57b ‘out of home’ or eat-out foodservice industry. Many businesses – small and large – are moving away from their traditional bakery offering to a sharper food-to-go focus,” Linden continued.
Sales of bakery outlets grew 6% in the year ending (YE) April 2019 and saw increased visits by 2.2%, outperforming pizza and chicken outlets, which saw declining visits. It also recorded a 9% jump in servings to 1.17 billion.
The segment’s snack sales also rose 10% and its coffee servings went up nearly 19%. Around 1.46 billion visits to bakeries for YE April 2019 involved a deal or promotion, up 16% over the past year.
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