Are we OK to call it a recession now? Just as we got the official word that we can use that dirty word, we also were told that we’re half way through it already.
Are we OK to call it a recession now? Just as we got the official word that we can use that dirty word, we also were told that we're half way through it already. I've seen differing reports about how long we've been in the current recession. Some say we're six months to a year in already; others say three. Economists also attempt to predict how long it will last. I guess that's their job, so you can't fault them for the variances in their predictions.
I won't rehash all the economic perils going on right now either. The bad news is broadcast on every channel, spread across Web sites and droned out of every talking head. Misery loves company, and part of the problem in any recession is fear-fear to spend money, fear to invest.
Your bakeries are not only trying to appeal to customers with less cash, but you're working harder to get customers to spend the cash they do have. Just be thankful you're selling food, not cars.
An interesting study of supermarket shoppers recently released by Precima, a Toronto-based retail analytics firm, reveals that U.S. consumers expect to maintain many frugal grocery shopping habits even after the economy improves. Some habits that are back in fashion now, such as cooking at home, are expected to have longevity.
Bakeries across all segments of the industry, but particularly in-store bakeries, are benefitting from this trend as more shoppers are looking to supermarkets for help with home meals. The Top 50 largest supermarket bakery chains are backing up this data. And, consumers are reportedly eating out less, particularly avoiding more expensive restaurants. The Top 50 largest foodservice bakery chains, particularly the quick casual bakery café segment, are benefitting from this trend.
Even more interesting in the Precima survey are the habits consumers plan to give up, the ones they feel are only temporary and they'd prefer not doing all together. One such habit reflects the strength of brand loyalty. Only 44 percent of consumers will continue to switch from favored brands to value brands. How does this translate to your bakery business? It demonstrates how important your brands are.
Maintaining your brand and ultimately making moves that stay true to your brand was a key theme during the Baking Industry Roundtable discussion, reported on p. 22. Staying true to your brand becomes extremely difficult under the pressure of an economic recession. Many businesses either freeze in fear and do nothing, or they make big changes that don't make sense for long-term growth or enhance their brand.
Despite what your customers may be doing, try to avoid operating your bakery in a state of fear. If you can invest in more efficient equipment or new technology that will help you grow, do it. And, above all, keep marketing your brand, keep your quality name in front of customers. As difficult as it may seem, preparing your business to jump out of the gates when the recession lifts will give you a clear advantage in the future.