Adroit Market Research - Industry Insights

Frozen bakery products market has had an interesting journey making its evolution an interesting topic for discussion. Busy lifestyle and inclination towards readily available foods have led to an increase in the demand for the frozen bakery products. Owing to some other favorable factors, like wide range of bakery products that are available across various distribution platforms, cost effectiveness and health awareness this market is growing. Market analysis based on Porter’s five force analysis and various market segments is also discussed. Frozen bakery products market is expected to see considerably high growth in regions of Asia-Pacific in the future especially India and China.

Frozen bakery products market has had an interesting journey making its evolution an interesting topic for discussion. Busy lifestyle and inclination towards readily available foods have led to an increase in the demand for the frozen bakery products. Owing to some other favorable factors, like wide range of bakery products that are available across various distribution platforms, cost effectiveness and health awareness this market is growing. Market analysis based on Porter’s five force analysis and various market segments is also discussed. Frozen bakery products market is expected to see considerably high growth in regions of Asia-Pacific in the future especially India and China.

Frozen food is garnering extreme attention due to its growing popularity among different generations. There has been tremendous growth in the frozen food industry during the years. The concept of freezing foods for increasing the shelf life of a food product has been present since long. However, it was in the early 1920s when, with the help of research done by Birdseye the process of double-belt freezing came into existence and resulted in growth beyond the scope of temperature and weather. Frozen foods are growing in popularity due to technical advancements in the world of refrigerators and freezers.

In the last 5 decades there has been considerable growth in various technical streams causing variety of products being added to the basket of frozen food. One of the initial food products that was frozen is fish followed by various other factors. The frozen food industry is largely influenced by the consumer behavior and how buyers are responding to increased innovations in the segment.

Frozen food products are basically ice creams, bakery products, sea food, processed food and ready-to- eat food items. Across the globe there is huge demand of frozen food in the regions of Germany, France and U.K., among these the U.K. region leads the market share and is the most developed region in terms of per capita income, however at the same time Germany gives the highest market value for the region. There has been huge growth in the number of supermarkets and fast food chains across the regions, in turn helping the growth of frozen food types.

The frozen bakery products is a segment that is becoming extremely popular among the range of products. Frozen bakery products have various sub-types viz., Pie and Tarts, Cakes, Croissants and others. In the year of 2017, the frozen bakery product market was valued at a high value of USD 17 million and is expected to grow over the coming years.

Increased health awareness and the high living standards have helped the market grow. Increased awareness in today’s consumers has led to purchasing of packaged food products as they are considered safe. Frozen bakery products can be identified by consumers as they provide with optimum quality and various healthy products that have better taste and consistency. The growing economic standards is one of the most important factors for the market growth. Today it is easy for consumers to buy frozen products due to its increased shelf life. Especially in the countries of European and North America that display have a solid economic growth?

Porters Five Force Analysis

With the help of Porters Five force analysis various factors influencing the market placement can be analyzed

1. Bargaining power of the Buyers: The market has many providers for frozen bakery products. These are either locally based or are big corporates working across the globe. The fact remains that buyers have multiple options to select from. Hence increasing the bargaining power.
2. Threat to new entrants: the frozen bakery market is influenced by various new product launches and increased amount of research and development happening in the sector. In regions like Europe, new entrants are finding it difficult to enter and grow due to the established market leaders. Instead the key market players work towards acquisitions or mergers depending on the market scenario. This has led to lower threat to new entrants.
3. Threat of Substitutes: In the regions of Asia-Pacific and Rest of the World, the market is still dominated by preference over fresh baked products. There is an increased threat of alternative substitute products in the market.
4. Degree of Competition: The degree of competition in the industry is neither high nor low, it can be calculated as of medium capacity. Based on regional insights there are less number of competitors as compared to local level markets where the competition is high.

Types of frozen bakery products

The frozen bakery product market is segmented as frozen pastry, frozen cake, frozen bread, pizza crust and others. The below figure indicates market share of various frozen products. The pizza crust contributes maximum to the market share followed by Frozen Bread and then Cake.

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Apart from these there are other products also that are a part of the frozen bakery product industry, viz, Pie and tarts, Croissants and cookies and scones.

The supply chain process of frozen bakery products

The supply chain of frozen bakery is a simple process that has direct and indirect flow of activities. The first step is the procurement of Raw material supplies, which is distributed to chain bakers and industrial bakers. The in-store chefs/cooks/bakers procure the raw material and prepare the food item and sell it to the consumers. These products are also sold at various hypermarkets and convenience stores in a half-baked form. There are many companies across the globe that work on these products and are selling to the consumers.

Market Overview:

Millennials are the biggest consumers of frozen bakery products. It is easy, quick, tasty and cost-effective. The market is driven by people who are health and hygiene driven as packaged food assures them of good and trusted quality product. Apart from this the taste consistency is always same and there are of optimum nutritious value.

Furthermore, there is constant growth in number of new supermarkets and convenience stores, along with the concept of Quick service restaurants. The market is driven by the convenience that it provides to its consumers, be it retail or supermarket or at restaurants. The frozen bakery market is growing with the increasing population looking out for better and easier lifestyle.