Commercial and Retail Bakeries
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 10,800 bakeries in the US produce bread, rolls, and other bakery products. Commercial bakeries sell primarily to businesses (retailers, restaurants, and food service companies). Retail bakeries sell primarily to consumers. Major revenue categories include bread, rolls, cakes, cookies, and crackers. Companies may also sell frozen bakery products or may specialize in a particular type of product, such as cupcakes.
Variable Costs Impact Margins
The cost of ingredients, such as flour, sugar, cocoa, and dairy products, can vary and affect margins.
Dietary Trends Affect Demand
Trends and fads that drive food preferences can impact demand for bakery products.
Industry size & Structure
The average commercial bakery employs 43 workers and generates between $14 million annually, while the average retail bakery employs 11 workers and generates about $665,000 annually.
- The bakery industry comprises about 10,800 firms that employ about 337,000 workers and generate about $40.7 billion annually.
- Commercial bakeries account for 25% of firms and 88% of industry revenue.
- The commercial bakery industry is concentrated - the top 50 firms account for 70% of industry revenue. The retail bakery industry is fragmented - the top 50 firms account for just 16% of industry revenue.
- Large companies include Grupo Bimbo (Sara Lee, Arnold), Hostess Brands, and McKee Foods (Drake’s Cakes, Little Debbie).
- Bread is a standard household staple, with per capita consumption in the US of nearly 44 pounds annually.
Industry Forecast
Commercial and Retail Bakeries Industry Growth
Recent Developments
Apr 20, 2025 - Winning Wedding Business
- Wedding season is approaching and bakeries looking to establish steady wedding traffic should befriend wedding planners and venue coordinators to drive business their way, according to Retail Bakers of America (RBA). These gatekeepers are influential in steering business to vendors through their recommendations. RBA suggests bakeries looking to establish themselves as a go-to choice for wedding cakes drop off a box of samples at local venues or planners’ offices. To sell couples on your bakery, RBA recommends making tastings an experience, highlighting your best cake flavors and creating an inviting ambiance. Charging a small fee for the tasting that can go toward the final order is a good way to weed out free sample hunters. According to The Knot, in 2024 the average cost of a wedding cake was $540. Beyond the cake, offering a dessert table package is an easy way to upsell.
- Soaring snack cake sales have prompted Wonder Bread-maker Flowers Foods to launch a line of cupcakes, donuts, and other sweet treats, marking the company’s first brand extension in its 104-year history, Food Dive reports. Dollar sales of snack cakes have grown rapidly over the past five years, from $1 billion in 2019 to nearly $1.6 billion in 2023, according to Circana data cited by the National Confectioners Association. (While some of the dollar gain reflects inflation, unit sales have increased and are well above pre-pandemic levels.) “Snack cake sales are a bright spot in the bakery aisle, outpacing the overall cake market with robust, double-digit growth,” Cargill marketing manager Wendy Osborn told Food Dive. Consumers continue to show an appetite for snacking and indulgent treats and Flowers Foods’ new line of cinnamon rolls, mini donuts, honey buns, and cupcakes fits squarely within that space, according to Food Dive.
- Consumers looking to reduce their sugar consumption are checking labels for natural sweeteners that don’t compromise on the taste or texture of baked goods, Snack Food & Wholesale Bakery (SF&WB) reports. So called “clean-label” sweeteners include monk fruit, stevia, and organic date syrup made from concentrated date juice. Organic date syrup contains fiber, natural sugars (such as glucose and fructose), vitamins, and minerals and can substitute for sugar in baking due to its sweetness and moisture-retaining properties, according to SF&WB. Tagatose – a naturally occurring sugar found in various foods – is 90% as sweet as sucrose with 60% fewer calories. Tagatose also has a low glycemic index (GI of 3), a ketogenic certification, and is non-GMO Project Verified. A bulking sweetener, tagatose delivers both sweetness and textural properties. Bakers who innovate to cater to consumers looking to cut sugar without sacrificing taste and texture are likely to gain new customers.
- Farmers in the world’s top cocoa-producing regions are abandoning their crops despite high record prices, The Wall Street Journal reports. A combination of bad weather, disease, and failed government policies – intended to protect cocoa farmers from volatile swings in global markets – has farmers in Ghana and Ivory Coast uprooting their cocoa crops and reseeding their fields. Cacao swollen shoot virus, a disease that causes root necrosis and kills cocoa trees, has afflicted cocoa crops in recent years. Another factor in farmers’ decisions to abandon cocoa is faulty government policies, including a fixed price that the countries pay farmers for their beans that’s prevented growers from profiting on the price rise, WSJ reports. Cocoa production in Ivory Coast dropped 22% during the 12-month season that ended Sept. 30, from the same period a year earlier, while Ghana’s output plunged 27% over the same period, according to the International Cocoa Organization.
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