Corporate Profiles - 2024 - 10

GRAIN-BASED FOODS
Grain-based foods
Categories hit hard by volume pressure
R
eflecting continuing consumer resistance to high prices, unit
sales were down at both of the top US bread baking companies
over the past year while private label gained market share. It
was the second straight year the commercial baking industry has experienced
pressure on its branded bread business.
Center store sandwich bread sales in the 52 weeks ended July 14
were $10.8 billion, up 1.8%, according to data published by Circana.
Unit sales over the period were 3.2 billion, down 1.1%. Most of the
leading US baking companies sustained decreases in unit volume, including
Grupo Bimbo SAB de CV, down 3.1%, and Flowers Foods, Inc.,
down 2.9%. Private label unit volume over the 52 weeks gained 3%.
While most food categories have seen unit volume pressure over the
past year, grain-based foods have been hit particularly hard. Excluding
chocolate and non-chocolate candies, which were even weaker, the food
categories that sustained the widest unit volume decreases in the second
quarter of 2024 (versus a year earlier) were grain-based, according
to Circana data. These include snack bars/granola bars, down 3.6%;
crackers, down 1.8%; cereal, also down 1.8%; and bread, down 1.5%.
Top supermarket categories outperforming grain-based foods included
yogurt, up 5.1%; fresh eggs, up 2.6%; natural cheese, up 2.2%; and
ice cream, up 1.6%.
Responses by bakers to the soft demand do not appear to include
aggressive price reductions or promotions. The average price per unit for
bread over the 52 week period ended July 14 was up 2.8% overall and
6.8% for private label, narrowing slightly the gap between the average
unit price of private label ($2.13) and bread overall ($3.39).
Some increases in promotional activity were indicated as 2024
progressed, including at Flowers Foods, Inc., Thomasville, Ga. Still, A.
Ryals McMullian, chief executive officer, said activity was not getting
out of hand.
" The competitive environment remains rational with promotions
below pre-pandemic levels, " McMullian said in August. " As economic
pressure drives many consumers to seek greater value, their response
to promotions has increased, though off of a low base due to the pandemic
impact. And in that environment, we have increased our promotional
levels somewhat, resulting in a higher percentage of product
sold on promotion. "
Rafael Pamias, who in July succeeded Daniel Servitje as CEO of
Grupo Bimbo SAB de CV, also described a measured approach toward
stepping up promotion. That same month he said Bimbo was evaluating
its promotion activity to ensure pricing is competitive and that the
company maintains " the right price-volume equation. "
" Our promotional activities continue to drive consumer engagement
and market penetration while supporting an anticipated modest
10 \ October 2024
LEADING FRESH CENTER STORE SANDWICH
bread vendors
% change
from
Dollar sales
1 Grupo Bimbo SAB de CV
2 Flowers Foods Bakeries LLC
3 Campbell Soup Co.
4 Lewis Bakeries, Inc.
5 United States Bakery
6 Aunt Millie's Bakeries, Inc.
7 H&S Bakery
8 Martin's Famous Pastry Shoppe, Inc.
9 Pan-O-Gold Baking Co.
Private label
Total
LEADING
grain-based foods categories
Dollar sales
Cookies
Cold cereal
Fresh sandwich bread
Crackers
Snack bars/granola bars/clusters
Hamburger and hot dog buns
Dinner rolls
Donuts (full-size)
Bar/finger snack cakes
$13,364,759,642
$10,939,589,193
$10,772,296,238
$10,331,051,610
$8,960,135,528
$3,397,348,685
$1,462,387,838
$1,064,076,982
$960,787,823
% change
from
year ago
2.2%
0.7%
1.8%
3.1%
0.7%
2.4%
8.7%
1.5%
-2.1%
Data for 52 weeks ended July 14, 2024
Total US - Multi-outlet with C-Store (Supermarkets, Drugstores and Mass Market Retailers,
Gas/C-Stores, Military Commissaries and Select Club & Dollar Retail Chains)
Source: Circana OmniMarket Total Store View
$3,038,685,768
$2,852,744,736
$707,955,437
$345,798,223
$227,722,558
$213,875,173
$165,494,579
$150,910,884
$113,907,241
$2,110,391,065
$10,772,296,238
year ago
-1.8%
1.9%
-6.4%
8.2%
-0.4%
1.3%
1.7%
-1.7%
0.1%
10.0%
1.8%
sequential improvement in volume throughout the remainder of the
year, " he said. " We continue to expand our distribution to meet the consumer
where they shop and provide the right value for them aligned
with channel and value pack offerings. "
The challenges of the consumer environment and Bimbo's response
were discussed by Mark J. Bendix, executive vice president of Grupo
Bimbo with responsibility for the company's North American and quickservice
restaurant business.
" We've seen that across other CPGs (consumer packaged goods
companies), " he said in July. " ... But consumers want more value to stay
with our brands and so to meet that consumer, we're providing different
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Corporate Profiles - 2024

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