Baked goods is expected to see faster value and volume growth in 2020 compared with 2019, with packaged leavened bread seeing the fastest value and retail volume growth. One reason for this is that the leading company in the baked goods category, Gardenia Bakeries, has produced more bread, driven by increased demand for its products.
Unpackaged baked goods are sold through two types of bakeries in the Philippines: high-end establishments usually located in shopping malls, and community bakeries located near to consumers’ homes. While artisanal bakeries in shopping malls might be adversely affected by low foot traffic, community bakeries benefited during lockdown due to their proximity to consumers’ homes.
In the second half of 2019, around August, Red Ribbon transferred its main production facility to a new commissary located south of Metro Manila. This adversely affected its performance, as it resulted in product supply shortages.
Over the forecast period, packaged leavened bread is expected to record the most favourable performance as current trends are likely to persist until 2021, given that COVID-19 cases remain high at the time of writing. The stay-at-home situation is likely to be continue into 2021, driving sustained consumption of convenient meal options such as bread with spread.
The unpackaged cakes category is predicted to see the slowest retail value and volume CAGRs over the forecast period. Multi-portion cakes is among the options in this category.
Recovery might be more challenging for artisanal bakeries located in shopping malls, as the majority of consumers are not going out as often as they used to, due to COVID-19 concerns as well as lockdown restrictions. Major players in packaged pastries such as Red Ribbon and Goldilocks, which mainly sell their products through their own bakeshops, are also likely to face more challenges.
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This report originates from Passport, our Baked Goods research and analysis database.
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