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Synopsis of Bakery Industry

Synopsis of Bakery Industry

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Published by: Rupam on Nov 02, 2010
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05/12/2014

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INTRODUCTION Bakery is a traditional activity and occupies an important place in food processing industry.

Despite the advent of fully automatic and semi-automatic bread as well as biscuit making plants, a sizeable number of people still prefer fresh bread and other products from bakery.With growing population and preference for fresh and ready-to-eat convenient food items, demand for bakery products is steadily increasing. There are many bakery products like bread and its different variants, biscuits, cakes & pastries, cookies, puffs etc. having ready market round the year. Each product enjoys a very wide range in terms of size or weight, flavours, end-use and so on. There is a tremendous scope to introduce new varieties every year. However, this note deals only with bread and biscuits. This project can be started anywhere in the country and there is no preferred location as such. This note considers Meghalaya as the contemplated location in view of good market prospects. A bakery can be set up in urban as well as rural areas. Depending upon its location, a suitable product mix can be worked out. This profile primarily considers semi-urban location from where nearby rural centres can also be catered to. In view of this consideration, thesuggested products are bread and biscuits. These products are very well accepted in the market and have gained consumer acceptance.

Industry and market information - The Bakery Industry The Bakery Industry is a mature market and dependant on population growth and product innovation with a focus on healthy options. Other key variables which may impact upon industry growth and trends are consumer tastes and perceptions, competition, fluctuations in input costs, packaging and technological advancements in manufacturing equipment. Export provides new growth opportunities Key success factors to the industry These are internal factors that are within the control of the operator and should be observed in order to be successful in the industry. Supply chain management to maintain product quality Contracts to guarantee raw materials at established prices to assist cost of supply and production Aim at two or more distinct consumer groups with different retail approaches and products Ability to pass on increasing input costs maintains profits Cost advantages can be obtained due to expansion especially where price competition is high Key sensitivities of the industry These are external factors which are beyond the direct control of the operator that influence each company operating in the industry.

The change in consumer taste affects demand Retail demand affects end consumer demand Basis of competition in the industry These factors include internal competition between industry participants and external competition from other related industries. Good bread provides fiber and carbohydrates in a convenient. Initial substantial capital investment and the existence of major players are important considerations Wholesale bakeries need to establish relationships with retail outlets to affect sales The bread loaf segment is hugely competitive and entrants may need to consider other segments Major players have aggressively promoted their products and entrants may need to carve out market niches to be a considered player Awareness of high quality baked goods is on the rise. handmade bread. So. quantity. Good bread is a rare combination of nutrition. Today's consumer has less time to create wholesome. convenience. but increasingly appreciates the nutritional and sensory benefits it provides. low fat form that is portable and delicious. bread enriched with fibre and vitamins has helped product differentiation and stimulated consumer interest Centralised distribution networks and systems has allowed quicker response to managing stock levels Barriers to entry of the industry These are factors which can prevent a new company from entering the industry. Good bread never goes out of style. and luxury. .g. product differentiation and distribution networks Competition also stem from bakeries and hot bread shops as they have successfully catered to the consumers increasing need for quality and freshlybaked breads Product perception conversely affects price and high-brand recognition and minor techniques employed such as updating packaging and the introduction of functional qualities e. Starting up a new Bakery business will give rise to new avenue towards development as well as growth to this sector for both rural & urban areas.High competition from similar products on the shelf Fluctuations in domestic goods prices (primarily sugar and flour) contribute to the higher/lower production costs and therefore impact the overall product cost. Competition stems from price. Location like Meghalaya is mostly feasible for planting up such kind of agro-business industries.

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