The Most Profitable Products at Bakeries

Retail bakery owners will often share there are two kinds of products: creative new inventions (like mash-ups) that drive higher impulse sales and everyday mainstays that pay the rent. Based on findings of our 2017 Retail Bakery Operations Study, the retail bakery business in America is reaching a balancing point in which exciting new products and popular longtime favorites are playing equal roles on the road to success.

When respondents were asked what are the top bakery items they produce, cookies rank first at 89 percent, followed by cakes at 79 percent, cupcakes 73 percent, muffins/scones 68 percent, cinnamon rolls 65 percent, and bread 57 percent.

Cakes represent the largest portion of total bakery sales at 24 percent, followed by cookies 12 percent, breads/rolls 11 percent, cupcakes 8 percent, sandwiches/wraps 6 percent, and yeast-raised donuts and beverages tied at 5 percent.

New product success varied by type of operation. For full-line retail bakeries, cakes ranked first, followed by bread and cookies. New cake products included cake slices, individual celebration cakes, cake pops, seasonal cakes, and specialty cake fillings.

New bread products included half loaves and house- or regionally milled flours. New cookie products included macarons.

For specialty bakeries, gluten-free and vegan options paved the way for most successful new product introductions, and cakes and cookies were the best new product additions in 2016.

For wholesale bakeries, best new product introductions were led by bread (including kale rolls, Nutella brioche, savory varieties and spelt), followed by cakes (seasonal, Bundt rings and apple cake).

Limited-edition bakery products are gaining popularity, as retail bakeries grasp the power of marketing and social media to set influential trends.

“In 2017, we are partnering each month with a different nonprofit by making a specialty baked good in their name, then donating a portion of the profit to the organization at the end of the month,” says one specialty baker in the Midwest. It has been fun and brought in new customers, while helping nonprofits doing great things in our community.”

Houston-based Three Brothers Bakery celebrated LGBT Pride Month in June with a vibrant 7-layer rainbow cake creation, featuring layers of lavender, dark purple, blue, green, yellow, orange, and red. The promotion also coincided with Houston’s Pride Week on June 18-25.

During the month of May, Three Brothers Bakery honored Teacher Appreciation Week, National Nurses Week and Mother’s Day with limited-time themed items including dipped decorated cookies, cakes and dipped berries. “We wanted to take the time to say thank you to all the wonderful mothers, teachers and nurses,” says Bobby Jucker, bakery co-owner and fifth generation baker. “The bakery offers treats and delicious sweets for just about every holiday, so we want to offer items for those lesser-known holidays that are still just as important to our customers. Our dip decorations for Nurse’s Week and Teacher Appreciation Week are a way to thank someone who has gone the extra mile.”

Rich Labriola of Stan’s Donuts & Coffee recently introduced a special edition Rolling Stones Donut to celebrate The Rolling Stones first-ever major exhibit, which moved to Chicago after making its US premiere in New York City.

The Rolling Stones Donut is a yeast-raised Bismark filled with raspberry jam and coated in a vanilla glaze. The donut is then topped with a hand-airbrushed sugary rendition of John Pasche’s famous Rolling Stones “Hot Lips” logo.

The special donuts were available at all Stan’s locations this spring, selling for $4.39 apiece. As each donut is a handcrafted work of edible art, Stan’s locations limited sales to one donut per customer.

“We are honored to be asked to partner with Exhibitionism-The Rolling Stones,” says Labriola. “We are huge fans of The Rolling Stones and it was quite a challenge to design this donut. We are really happy with how it turned out.”

Piccione Pastry, a St. Louis-based Italian pastry shop, recently unveiled a new line of house-made artisan breads, bagels and more. “Freshly baked breads were a natural fit for Piccione Pastry,” says Sandia Hoormann, lead baker at Butler’s Pantry Artisan Breads and former pastry chef at Piccione Pastry.

“Our adoration for bringing new and unique offerings has continued to grow, expanding the menu to include Italian-inspired eats and Tarda Colazione (late breakfast) weekend brunch,” Hoorman says, adding that new products drive higher repeat sales.