As bakers saw incredible increased demand for baked goods in 2020, they struggled to keep up. Bakers, especially those serving retail customers, continuously had to devote their capacity to fulfilling orders of their most in-demand products. For bakers serving foodservice and institutional customers, there hardly were any orders, and customers weren’t interested in innovation, only in staying afloat. 

Demand for baked goods remains strong, but market dynamics are shifting. And consumers are starting to wake from their pandemic fog and look for something new. Has the industry started flexing its innovation muscles as well? Baking & Snack’s Trends in Industrial Baking Industry Innovation & Development study, conducted by Cypress Research, looks for an answer. 

This first-of-its-kind study asked industrial bakery manufacturers in the United States to share how they prioritized R&D and product development initiatives prior to the pandemic, throughout the pandemic as well as their priorities for the next 12 to 18 months. For the purposes of the study, pre-pandemic was considered 2018 and before, and the height of the pandemic was listed as 2019 to 2021. Findings also ascertained how sources of new product inspiration have changed and what ingredients bakers may be seeking for the future. 

For survey purposes, Baking & Snack classified product development into three types: invention, innovation and formulation. Invention was defined for survey respondents as true breakthrough product development that usually results in the launch of a new brand. Innovation refers to new products launched within existing brands or categories. Baking & Snack defined formulation as product development focused on new ingredients within brands and categories, or line extensions. 

Of the 111 respondents to the survey, most represented technical/R&D/product development roles and corporate management. Most work at large, national wholesale (42%) or mid-sized, regional wholesale bakeries (32%). Ninety percent of the companies sell products to the retail channel, with 69% selling into restaurant and foodservice. They represented multiple categories of the baking industry, with the top categories being pan bread, buns and rolls; cookies and crackers; cakes, pies and sweet goods; and artisan-style breads. 

As the baking industry tries to ride the wave of consumer demand for baked goods that crested during the pandemic, new products will have to be a part of that equation. Without them, consumers will lose interest. But the rough waters of supply chain challenges and price increases have bakers staying close to shore when it comes to taking risks. 

This article is an excerpt from the July 2022 issue of Baking & Snack. To read the entire feature on Special Report: Innovations & Ingredients, click here.