The Chinese Bakery Market – a Healthy Outlook

Over the last fewyears China’s economy has boomed and we have seen huge investments from businesses worldwide. Additionally the desire for high quality and Western style bread and cake products has driven consumption.

By Daisy Phillipson

There have been several factors contributing to the rise of bakery sales in China.

All of these factors have meant that the Chinese bakery and cereals market is one of the fastest growing by volume, according to a report by Hexa Reports Inc. This is an interesting and useful fact, and one that we are all very aware of. But how can we break this down? Knowing what trends are emerging and what buying patterns are forming can allow you to utilise this fact further and can provide a little more understanding about who is buying what in China’s prosperous economy.

According to a report on the Chinese bakery market released by Mintel last year, among the three segments of bakery products, bread accounts for more than half of the volume consumption while cake enjoyed the fastest growth in the past few years.

The report showed that bread took 52% of the total retail market by volume back in 2013. Of all bread types, grain bread showed to be the most popular last year, taking 38% of the share. This shows a trend that we all know is still strong in markets worldwide: the health trend. In China it appears there is a preference for less oily and healthier products over the sweet and fatty ones.

Mintel mentions that bread has also shown growth due to a shift of preferred occasions of having different types of bakery products. Compared to data taken in 2012, which showed that in China bread was mostly only consumed at breakfast, people are more often now eating bread for lunch and dinner, meaning it is becoming a staple food.

And the shift in occasions is not just happening for the bread sector. The report found that while cakes are strongly associated with celebrations, there is still a healthy amount of consumers who would eat cake as a snack or when relaxing at home. Mintel concludes that cake has market potential as an indulgent snack or hunger filler and this also applies to pastries.

When considering this information, one question that is useful to look at is where do consumers buy their bakery goods? It’s all very well knowing what customers are buying, but how about knowing where to place products?

According to Mintel repertoire analysis, 68% of consumers buy bakery products from three or more places, which suggests that for most customers there are no fixed places for purchase. Mintel suggests that due to these findings, convenience and product accessibility is essential to brands if they wish to win over more customers. Rather than focusing on one chain of supermarkets or bakeries, it is best to get your products stocked in a variety of establishments to get your brand trusted and known.

So there you have it – a little insight into the bakery buying patterns in China. But what about the future? Mintel predicts that the bakery products market will carry on growing steadily. Manufacturers should tap into trends such as product innovations and health benefits to reach more consumers.