This industry comprises establishments primarily involved in manufacturing frozen bakery products other than bread and bread-type rolls. Products include frozen cakes, croissants, doughnuts, pies, and sweet yeast goods. Manufacturers of frozen bread and bread-type rolls are classified in SIC 2051: Bread, and Other Bakery Products. Except Cookies and Crackers.
311813 (Frozen Bakery Product Manufacturing)
Frozen food sales in 2003 grew 1.4 percent to $27.1 billion. Compared to 5.3 percent growth in 2001 and 4.4 percent growth in 2002, growth in the frozen food industry was considered flat due at least in part to increased competition from refrigerated and ready-to-eat products sold in the deli section of most supermarkets. However, frozen bakery products, particularly biscuits, rolls, and muffins saw sales increase 13 percent, while frozen pizza dough sales increased 19 percent.
As a market segment, frozen baked goods realized sales of $1.5 billion in 2002, reflecting an 8 percent growth rate. Along with frozen biscuits and rolls, frozen cookie dough performed well for the industry, securing growth of 83 percent in 2002; this increase was due in large part to the introduction of Mrs. Fields frozen cookie dough. However, frozen cookie and cracker products remained the smallest industry sector.
According to the June 2003 issue of Frozen Food Age, frozen breakfast sales in 2003 totaled $945.7 million. Waffles accounted for more than half of this total with sales of $502 million. Hoping to expand their presence in this market, manufacturers targeted those consumers
who were looking for convenience, as well as attempting to woo those who were purchasing breakfast at fast-food restaurants and convenience stores.
The late 1990s saw the beginnings of a breakfast foods war among manufacturers of frozen and fresh products. Kellogg's added more flavors of waffles, while Pillsbury introduced Toaster Scrambles in three varieties: cheese and egg; cheese, egg, and bacon; and cheese, egg, and ham. Sara Lee planned to redirect its marketing efforts to its new fresh division in an attempt to tap into the $300-million supermarket bagel business. New product launches continued into the early 2000s as Kellogg's began pushing is healthier breakfast options, such as Eggo Nutri-Grain Waffles, which saw sales increase by 27.2 percent in 2003. The firm also launched Eggo French Toaster Sticks, its first french toast product, in the early 2000s, hoping to gain access to the rapidly growing french toast stick sector, which grew by 32 percent in 2003.
One of the first companies to offer frozen bakery products to the American marketplace was Sara Lee. Sara Lee Bakery was founded in 1949 by Charles Lubin. Originally the company offered a line of premium, fresh-baked products and made shipments within a 200-mile radius of its Chicago location. In 1953, in order to accommodate the needs of long-distance clients, the company pioneered freezing methods and nine years later made the decision to switch its production exclusively to frozen products.
Chicago-based Sara Lee is not only the leader among manufacturers of frozen baked goods, but one of the top ten public food and beverage companies in the United States and Canada. Initially, Sara Lee's more than 200 different items were sold in supermarkets and in 40 nations around the globe. Sales figures for 2003 topped $18 billion.
Another industry leader was Kellogg Company with Mrs. Smith's and Eggo products. Both brands were market leaders within their categories and sold predominantly to convenience-conscious customers. Kellogg had overall sales of nearly $9 billion in 2003.
American Frozen Food Institute Web Site, 2000. Available from http://www.affi.com/facts/decafood.htm .
Hartnett, Michael. "Breakfast Battles." Frozen Food Age, June 2003.
Hoover's Company Profiles. Hoover's Online, 2004. Available from http://www.hoovers.com .
"Kellogg Toasts Up Healthy Sales." Frozen Food Age, February 2004.
Murray, Barbara. "Stuck In Time." Supermarket News, 8 September 2003.
Murray, Barbara. "Upper Crust." Supermarket News, 14 October 2002.
Zimoch, Rebecca. "What's Hot in the Freezer Case." Grocery Headquarters, December 2003.