Now that bakeries, retailers and foodservice operators are seeing a light at the end of the pandemic tunnel, it’s not time to exhale and express a sigh of relief. Rather, leading companies in all three segments of the broader food industry are focusing on the lesson learned from the past year and looking to turn them to strategic opportunities for 2021 and beyond.
That’s the key takeaway from a panel of food industry professionals who spoke about “Adapting and Innovating: The Omnichannel Channel” during the recent American Bakers Association’s virtual convention.
“This time we’re in right now, this window, this bubble, is a gift,” said Bob Villapiano, director, fresh bake division, Wakefern Food Corp., Keasbey, NJ. “It’s a gift in the sense in that we have a heightened awareness with the consumer. They’re engaged. They want to get back into celebration mode from the big holidays to the little ones and everywhere in between, and now is not the time to throttle back.”
No doubt, he added, 2020 was a rough year. Companies on both sides of the desk are managing their costs and supply chain, which remain a major challenge due to everything that has happened since the coronavirus (COVID-19) impacted the food industry and bakery suppliers.
“Certainly, there is a natural tendency to try to course correct and make price adjustments to the business and go to market,” Mr. Villapiano observed. “Now is not the time to throttle back. It’s about pushing forward.”
By taking risks, both retailers and their bakery suppliers will benefit by growing their top lines, he said.
Additionally, Mr. Villapiano pointed out that he’s “very excited about the growth in the bread category and all segments,” which includes a pent-up demand for packaged bakery, in-store bakeries and the foodservice channels.
“Bread is just on fire for us and we’re just trying to ride that wave of growth as well as push ourselves and challenge ourselves to some new innovation sooner than later and not just rest on our laurels,” he said.
He added the rebound in desserts and sweet goods is encouraging as consumers reconnect. However, Mr. Villapiano and others aren’t basing this year’s recovery on last year’s levels.
“As things start to open up, we’re excited about getting that business back and not only growing versus 2020, but growing significantly versus 2019 levels, which are more normal,” he said.
That’s because 2020 was hopefully an aberration by any definition.
“Last March at that point, the whole world went upside down, and we really went on the defense,” said Jeffrey Quasha, corporate R&D chef, Morrison Healthcare, Aurora, Ill.
He said the company shut down some operations, decreased menu sizes and took other immediate measures to cut costs. Two weeks later, however, the playbook for business changed.
“We went from playing defense to going to offense,” Mr. Quasha said. “We wanted to go from surviving to thriving.”
Those initiatives went from ghost and virtual kitchens to pop-up business concepts and even supplying products that consumers couldn’t get due to the surge at retail. The focus shifted to SKU optimization and menus with intention that were easier to replicate and offered supply-side synergies for every product to be sold on multiple levels.
“What we did is much more strategic,” Mr. Quasha explained. “What we did before was based more on trends and data. Now, it’s more about menu intention and SKU optimization.”
Taneya Clark, bakery category manager, The Giant Co., Carlisle, Pa., noted that wholesale baking companies struggled initially to fill the shelves during the pandemic.
“During first two months of pandemic, the commercial bread aisle was behind the eight ball, so to speak,” she said.
That provided a window of opportunity for Giant’s in-store bakeries in the long run by introducing consumers to in-store bakery products during that period and beyond.
“We were able to maintain those customers within the last year,” she said.
Aryzta North America provided in-store bakeries with La Brea Bakery Take & Bake bread, which is packaged for in-store bakery sales and may be baked by consumers at home, noted Christine Prociv, senior vice president, marketing, innovation and R&D, Aryzta North America.
The company also changed its social media messaging from an entertainment focus to additional breakfast and lunchtime sandwich ideas that incorporated its bread as a part of the more at-home normal for many families. Likewise, sourdough surged in popularity. Instead of baking sourdough from scratch, Ms. Prociv said, consumers can choose the La Brea Bakery bread that offers a simpler Take & Bake alternative.
For in-store bakeries, Mr. Villapiano said simplification coupled with food safety remains a priority. But what has changed involves the speed and trust that retail in-store bakeries need today to react to changes in the market.
“We used to operate 65 mph,” he said. “We had to learn to live at 100, and now we’re going to stay at 100 mph.”
Liliana Economakis, divisional vice president of business development, Aryzta, pointed out that speed to market has been accelerated by e-commerce and online shopping, including click-and-collect that several panelists noted is here to stay.
Bakers, she added, are challenged in foodservice to provide simple ingredients, offer great taste and provide shelf life.
Both Ms. Economakis and Mr. Quasha talked extensively about the difficulty of maintaining the quality of baked foods in the new normal. Those challenges include everything from storing refrigerated sandwiches for hours to keeping hamburgers or pastries for up to 60 minutes in a steamed compartment before they’re delivered to consumers.
For many retailers, Ms. Clark said, the future involves simplification, skilled labor considerations and offering highest quality products. She added that the in-store bakery can work in unison to keep consumers shopping for baked foods in retail as more consumers feel comfortable returning to the foodservice arena.
“I don’t want to it to sound like we’re competing with commercial bakery, but we drew that customer in, so we want to keep them there,” she said.
Looking forward, the companies of tomorrow are no longer focused on 2020, but they’re keeping a close eye on the lessons they learned from the past year, Ms. Clark said.
“I like the analogy of not pulling the throttle back,” she said. “Keep moving forward. We didn’t base (this year’s projections) on 2020. We based it on 2019, and we’re planning our growth on that. It’s not to forget 2020 because I don’t think it’s a year anyone will forget anytime soon. However, you have to look forward and just keep on building.”
The ABA panel was moderated by Tom Bené, president and chief executive officer of the National Restaurant Association.