Bakery Sales Keep Rising, Raking in the Dough (and Doughnuts)

Even in the face of inflation, consumers are still indulging in bakery and dessert items, leading to significant growth in these categories. According to recent data from NIQ, bakery sales for the 52 weeks ending in May 2023 totaled $19.74 billion, reflecting a 14.5% year-over-year increase. Of this, dessert sales accounted for $7.69 billion, up 10% year-over-year. However, unit sales of desserts saw a decline of 6.1%, largely due to inflation.

Despite the economic pressures, Anne-Marie Roerink, president of 210 Analytics LLC, noted that bakery items continue to thrive because they provide affordable indulgence, offering moments of enjoyment during challenging times. Additionally, functional baked goods like bread and rolls have also performed well. Bread sales rose 19% in dollar sales and 3.2% in unit sales, while rolls and buns saw a 15.6% dollar sales increase and a 1.9% unit sales growth.

Among bakery subcategories, doughnuts stood out with a 26.6% increase in dollar sales, totaling $1.37 billion, and the highest unit sales growth of 7.9% year-over-year.

While overall bakery dollar sales were bolstered by inflation, unit sales showed a modest decline. However, this contraction softened in May, likely driven by holiday demand. Special occasions, such as celebrations and parties, remain key drivers of bakery sales, with consumers willing to spend more on premium items like cakes, party platters, and custom orders.

The International Dairy Deli Bakery Association (IDDBA) and Circana highlighted that there are still growth opportunities in the bakery sector, particularly around special occasions and premium purchases, where consumers tend to spend more. Perimeter bakery items like buns, rolls, pies, croissants, and tortillas/wraps also experienced unit growth in May, further underscoring the ongoing strength of the bakery department.