This report looks at the following areas:
- Size and prospects of the bakery house market
- Number of stores operated by leading bakery house brands
- Emerging product trends in the bakery house market
- Distribution of bakery purchase channels and the competitive landscape
- Consumer interest in purchasing major or novel bakery products
- Consumer choices for paired beverages and spreads
- Purchase factors, and flavour and texture preferences
Despite an overall slowdown in foodservice revenues and intense competition exerting an impact on bakery houses, brands can still meet consumer demands for quality and value through varied combinations of textures, seasonal flavour innovations and premium ingredients, stimulating consumer enthusiasm for trying new products.
Rika Huang, Senior Analyst, China Insights
Market Definitions
The term ‘bakery house’ in this Report refers to bakery chains, independent bakery houses (both online and offline) and bakery sections located in hypermarkets, supermarkets, tea shops and coffee houses. The bakery products covered in this Report include freshly-made and short shelf-life bread, cakes, sandwiches and biscuits/cookies sold in bakery houses.
Excluded:
Barcoded packaged bakery products sold through retail channels are not included in the calculation of market size.
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Executive summary
- Key issues covered in this Report
- Definitions
- What you need to know
- Market size and influencing factors
- Competitive landscape and new product trends
- Consumer trends
- Keys to success
- What we think
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The market
- Market size and forecast
- Foodservice revenue in key markets remains weak and the intentional spending trend continues, hinting at slower growth to come
- Market factors
- Consumer confidence continues to fluctuate, affecting discretionary spending
- Graph 1: consumer confidence in finances improving in the coming three months, 2024-25
- Overall foodservice sales are slowing; growth in Tier 1 cities is weak
- Graph 2: retail sales growth rates for grains, oils and food and foodservice, 2020-24
- Consumers are more willing to trade up on cakes/pastries than on other snacks
- Graph 3: trading up and down on food, 2024
- Butter prices reached a historical high in 2024, piling cost pressures onto brands
- Bread festivals are now an important channel for marketing, customer acquisition and cultural dissemination
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Companies and brands
- Market share
- Bakery store churn is accelerating, with an increase in store closures
- Emerging brands are expanding rapidly by baking their products in-store
- Flagship product strategies aid the national expansion of single category brands
- Cross-category players are entering the bakery market in hopes of diversifying
- New product trends
- A richer range of festive baked goods gives Chinese consumers a taste of flavours from around the world
- Western bakery products, meet Chinese festivals: green rice balls no longer have to be ball shaped, while zongzi no longer have to be wrapped in bamboo leaves
- Tarts are diversifying in flavour, texture and category
- Retro bread flavours are reviving the tastes of childhood
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The consumer
- Intensified channel competition: membership supermarkets encroach on chain bakeries, while fresh grocery retailers need to be innovative
- Retail channels enjoy a wider audience; foodservice channels are expected to unleash bakery spending in lower-tier cities
- Graph 4: purchase channels – foodservice channels (net)**, by gender, age, city tier and monthly household income, 2025
- Graph 5: purchase channels – retail channels (net)*, by age, city tier and monthly household income, 2025
- Mainstream channels feel the pressure as independent bakeries and member-based supermarkets gain traction
- Graph 6: purchase channels, 2023-25
- Chain bakery houses may face direct competition from membership-based supermarkets
- Graph 7: purchase channels – bakery chains, by consumers using each bakery channel, 2025
- Consumers choosing private label bakery products for value for money
- Graph 8: trust in retailers’ private label fresh food, 2024
- Graph 9: purchase channels, 2025
- Assured quality offers premiumisation opportunities for private label bakery products
- Graph 10: product improvements – selected options, by purchase channel, 2025
- Consumers on fresh grocery retailing platforms are willing to try a variety of products
- Graph 11: repertoire analysis – product preferences, by purchase channel, 2025
- Tea may overtake coffee as the best drink to have with baked goods
- Graph 12: pairing preferences – beverages, 2025
- Graph 13: purchase channels, 2025
- Target innovation efforts at leisure and treats to revitalise the category
- Most consumption happens during leisure time between meals; mealtime consumption is low outside breakfast
- Graph 14: consumption occasions, 2025
- Pies/tarts and cakes lead in penetration rates; pastry bread dominates the bread category
- Graph 15: product preferences, 2025
- Pastry breads provide fuel for study and work; Chinese pastries are a dependable travel companion
- Graph 16: product preferences, by consumption occasion, 2025
- Dish bread are better suited to celebratory occasions and outdoor leisure settings than regular meals
- Graph 17: product preferences – dish bread, by consumption occasion, 2025
- What’s next? Enhance the portability and shareability of dish bread to ride the popularity of outdoor activities
- Bagels and ciabatta have potential in main meal settings
- Graph 18: product preferences, by consumption occasion, 2025
- Dacquoise is an ideal choice for category expansion due to high levels of interest and preference
- Graph 19: interest in different products (net), 2025
- King cake and dacquoise exhibit stronger growth potential than in 2024
- Graph 20: changes in preference for and interest in trying select products, 2024 vs 2025
- Compared to other emerging categories, tarts are better able to retain existing consumers
- Graph 21: attitudes towards different products – high preference, low interest in trying, 2025
- Palmiers need innovation to stabilise their customer base, while consumers are interested in trying pound cake and baklava
- Graph 22: interest in different products – low preference, high interest in trying, 2025
- Examples of improved pound cakes and palmiers
- Varied textures and flavours provide a rich experience for the taste buds
- Rich layers of texture hold the most appeal
- Graph 23: product improvements, 2025
- ‘Fluffy’ is the most popular texture
- Graph 24: texture preferences, 2025
- What’s next? Expand the use of the ‘raw’ concept to fully express fluffy textures
- What’s next? The preference for fluffy textures benefits a more diverse range of moist breads
- A combination of fluffy, crunchy and velvety textures can cater to the preferences of most consumers
- Examples of products combining a variety of textures
- Fruit and nut flavours are most popular
- Graph 25: seasonal flavour preferences, 2025
- Grapes, melons and aromatic plants attract respondents who are more willing to try new things
- Graph 26: seasonal flavour preferences – select options, by frequency of interest in different products, 2025
- Hardcore crusty bread enthusiasts are also bold explorers of flavour
- Graph 27: repertoire analysis – seasonal flavour preferences, by product preference, 2025
- Examples of products combining European-style bread with different flavours
- Better ingredients help improve quality, winning consumer trust through offering value for money
- Layered textures combined with branded ingredients can reach more consumers
- Jam is the most mainstream spread, while women and high-income groups favour cheese
- Graph 28: pairing preferences – spreads, 2025
- Premium dairy products are a guarantee of both quality and taste
- The appeal of chunky fillings and natural yeast increases
- Graph 29: product improvements – rankings of selected items, 2024 vs 2025
- What’s next? Speciality yeast or yeast ingredients showcase authentic artisanship and rich flavours
- Chinese pastries are traditional but not outdated: brands should tailor them to the needs of younger and more affluent consumers
- Graph 30: product preferences, 2025
- What’s next? New, healthier Chinese-style cakes and pastries using premium ingredients
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Appendix – market size and forecast, research methodology and abbreviations
- Market size and forecast
- Methodology
- Abbreviations
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