As per the reports given by telegraph, according to the Federation of Bakers, the bread industry is worth £3.4billion and is the second biggest food sector in the UK. It says that 11m loaves and packs are sold every day in the UK, with 80pc still made in bakeries and the rest in in-store bakeries. In total, the federation has nine member companies that control 47 bakeries across the country.
Reports say that this winter, because of poor wheat harvest caused by wet weather, following on the grain prices being raised after a drought in the US and also heat waves in Russia, even British bakeries were affected. Due to the economy, consumers are buying less bread and making bread from the available raw materials even if that means eating stale bread. In supermarkets, due to shoppers reluctant to purchase, there is a pressure on their suppliers for cheaper products.
As per the reports, according to Patrick Coveney, chief executive of Greencore, a leading manufacturer of convenience food for supermarkets says that bread prices have increased because of material inflation, due to which there is an impact on some of the UK’s most famous food brands.
Michael Clarke, the chief executive of Premier, the maker of Hovis bread, as per the reports said that the company has made the closures after dropping a too expensive bread contract with the Co-operative and he also said that the cuts were need to make a more sustainable and profitable bread business.
Reports from analysts say that bakeries must invest in new products along with cost cuttings.
According to the reports from Fiona Orford-Williams, of Edison Investment Research, the multi-billion-pound sliced bread market has become staples. The five big supermarkets are pricing more, due to which bread producers are struggling with global input rises. The research also says that, it is necessary for bread makers to innovate and broaden the brand appeal with new and exciting products to help with more control on over pricing.