SIC 2051

This industry is comprised of establishments that make fresh or frozen breads or rolls and perishable bakery products such as cakes, pies, and pastries. Manufacturers of dry bakery products such as cookies and crackers are classified in SIC 2052: Cookies and Crackers. Establishments involved in manufacturing frozen bakery products other than bread are classified in SIC 2053: Frozen Bakery Products, Except Bread. On-premises, retail bakeries are classified in SIC 5461: Retail Bakeries.

NAICS Code(s)

311812 (Commercial Bakeries)

Industry Snapshot

The value of goods shipped by the commercial bakery industry in 2001 totaled $25.7 billion, up from up from $25 billion in 2000 and $23.9 billion in 1999. Private label brands dominate the traditional sliced white bread category, holding a 27-percent market share. The remainder of the industry is distributed among numerous national and regional bakeries, with Wonder Bread holding the number-two position, but only 5.5 percent of the market share.

Bread is the second most purchased item at grocery stores, behind carbonated beverages. As a mature industry, bakeries generate most of their growth through higher-end specialty breads. Cost cutting and industry consolidation have also helped to buoy profits. During the 2000s trendy sandwich shops, bakery cafes, and high-end bakeries became increasing popular, which opened up new markets for local and regional bakeries that could provide "hot-out-of-the-oven" European-style breads.

Organization and Structure

Historically, the baking industry established itself close to population centers. Because bread and cake products were perishable, proximity to a customer base was a primary concern. One way growing bakeries overcame this geographic constraint was through the purchase of companies in other areas. Many acquisitions and mergers within the industry during the last decades of the twentieth century transformed baking establishments with regional shipping systems into large conglomerates with national distribution networks. In addition, large baking establishments often attracted the attention of other investors. Since 1960 many of the nation's top wholesale bakeries were purchased by food processing companies.

The practice of buying or merging with existing firms had benefits in addition to overcoming problems related to delivering fresh products to the marketplace. Buying and refurbishing existing facilities was often less expensive than building new plants. Buying also helped avoid problems associated with creating excess capacity in specific geographic areas. Despite the trend toward building large corporations, many independent familyowned bakeries remained successful. In 1987 an estimated 56.3 percent of all wholesale bread and cake plants operated with fewer than 20 employees. These small establishments, however, captured only 2.3 percent of the industry's total sales.

The baking industry was monitored and regulated by several governmental agencies. For example, the U.S. Department of Health, Education and Welfare set the definitions and standards used to identify wheat and related products. The Food and Drug Administration (FDA) regulated product quality and mandated procedures by which food additives were to be approved prior to use. And, the National Research Council's Food and Nutritional Board (along with the American Medical Association's Council on Foods and Nutrition) published guidelines for enriching bread products with nutrients.

Background and Development

The oldest existing written record of a baked grain product dates back to about 2600 B.C. The earliest known breads were flat and were baked on smooth stones or clay plates. According to a theory held by some historians, the ancient Egyptians created the world's first leavened breads. Leavened bread was made with ingredients possessing the chemical properties necessary to make dough rise. By contrast, unleavened breads were made from doughs that did not rise.

The ability to bake leavened breads may have been developed along with the ability to brew beer, as both processes relied on fermentation. Fermentation refers to a complex chemical process in which organic compounds are broken down into simpler substances. In alcoholic fermentation, the yeast converts a mixture's sugar or starch into carbon dioxide and alcohol. Recipes with sufficient liquid produced beer-like beverages. In mixtures with less liquid, the carbon dioxide produced by the fermentation process made the dough rise.

Fermentation of wheat and water mixtures was accomplished through the incorporation of yeast. Yeast is a member of the fungus family. Although an individual "yeast" is a single-celled organism, it lives and grows by multiplying into cultures consisting of thousands of cells. In order to grow, the cells eat the sugar and starch in dough mixtures. Early yeasts were incorporated into recipes by letting doughs sit out for a period of time to "sour." These wild yeast cultures, once established in a dough mixture, were carefully maintained through a process whereby some dough from each batch was saved to incorporate into the next batch. Before the development of commercial yeast, all leavened bread was made from sourdoughs. Sourdough breads are still made from flour, water, yeast, and bacteria.

Although many grains and other products could be fermented, wheat flours were the only ones to exhibit leavening. Wheat possessed a type of gluten (plant protein) unlike the gluten of other grains. Wheat gluten, when kneaded, formed an elastic structure that had the unique ability to trap the carbon dioxide given off by the yeast and to stretch and expand as more gas was created. When leavened doughs were baked, the heat killed the yeast but the dough's expanded structure remained. As a result, leavened breads were lighter and more airy than their unleavened counterparts.

The ancient Egyptians are also sometimes credited with inventing ovens. According to one theory, the first "ovens" were earthen pots. Early bakers discovered that when dough was placed inside preheated pots, it cooked more evenly than it did when placed on top of a heat source. The construction of permanent oven structures soon followed. Along with the development of ovens came the development of bread varieties as bakers experimented with different shapes and different ingredients. Sweet cakes first appeared in the twelfth century B.C. During the classical era, the Greeks modified oven designs and introduced the use of more innovative ingredients including milk, oil, wine, cheese, and honey.

Commercial bakeries first appeared in the Roman Empire. Under early Roman rule, baking progressed to an art form. As the Empire began to crumble, however, bakeries were taken over by the government, and commercial baking became virtually nonexistent. White flour was a luxury available only to royalty. During the Middle Ages, only monasteries and manor houses baked large quantities of leavened products. Monasteries were also credited with the development of pie crusts, an early pastry product. Although pie crusts were originally used only with meat dishes, they gained popularity for dessert items when sweetening ingredients were used. Early sweeteners in baked goods consisted of honey, raisins, and other types of dried fruits. The use of sugar was introduced during the 1500s. Innovative bakers using sugared batters and doughs developed cakes and pastries.

Commercial baking as a trade began to rise again during the urbanization that accompanied the early Industrial Revolution. Innovations of the late nineteenth and early twentieth century enabled the mass-production of baked goods. As a result, large baking facilities began to supplant small local establishments. One of the most important innovations was the development of "tame" yeast because these yeast cultures produced uniform, predictable results. Wild yeast cultures were too time consuming and too unpredictable to make automatic production feasible. The first yeasts used by commercial bakers were obtained from brewers and, in 1868, Charles Fleischmann made a compressed, distiller's yeast. The selective breeding of pure yeast cultures began in 1883 and, by the early 1900s, fast acting yeasts were well established.

Another innovation that helped shorten the time required to make bread was the mechanization of dough kneading. Kneading was necessary to develop gluten elasticity. The introduction of harder wheat hybrids that produced stronger flours enabled bakers to formulate doughs capable of withstanding the stress of mechanical kneading. The practice was introduced in the 1920s and had gained widespread acceptance by the 1950s.

The automation of milling and baking practices, however, did not produce uniformly beneficial results. In the 1930s, the U.S. Department of Agriculture (USDA) conducted nutritional surveys and found extensive thiamine and riboflavin deficiencies in some segments of the population. The deficiencies were attributed to milling methods that yielded finer white flours with diminished nutritional value. For example, stone-ground white flour contained 60 percent of the grain's original thiamine content, and roller-milled white flour contained only 12-20 percent of the wheat's original thiamine content. Concomitant with the surveys that identified these nutritional deficiencies, researchers developed the ability to synthesize vitamins.

During the 1940s efforts were made to restore the vitamins lost by milling practices. In 1941, the National Research Council recommended enriching white flour and white bread. Within a year, an estimated 75-80 percent of the nation's white bread was enriched on a voluntary basis. During World War II, bread enrichment was mandated by the federal government and, to ensure continuation after the war, 27 individual states passed enrichment regulations. The Food, Drug, and Cosmetic Act, which became law in 1952, defined minimum and maximum levels for thiamine, riboflavin, and niacin enrichment.

Congress gave the Food and Drug Administration (FDA) the responsibility of establishing guidelines concerning the practice of adding nutrients to food products. According to recognized standards, the word "enriched" meant adding B-vitamins, iron, and optionally calcium to flour or cereal grain products. "Restored" referred to the practice of replacing natural nutrients that were lost during processing. "Fortification" involved the addition of nutrients not naturally present in a food. A few well known examples were the addition of vitamin D to milk or iodine to salt. During the early 1980s, an estimated 90 percent of all standard commercial white bread was enriched.

Three bread-making techniques produced most of the commercial bread in the United States. These were called the straight dough process, the sponge method, and continuous production. In the straight dough process, all ingredients, including the yeast, were combined. The resulting dough rested during the fermentation process. Following fermentation, mechanical means were used to form loaves, and the loaves were permitted to rise again before baking.

The sponge method was based on traditional bread making techniques but employed highly mechanized procedures. Recipes were based on ingredient weight rather than volume measurements. Flour was mixed with yeast and water to make a dough or "sponge," which was then permitted to ferment for several hours. After fermentation, other ingredients and additional flour were added and the dough was remixed. Following a time of rest, the dough was cut into pieces and placed in pans. After placement in pans, the dough was allowed to rise and was then moved to an oven for baking. Typical fermentation resulted in a five-fold volume increase. Resting times averaged 20-30 minutes, and rising times were approximately one hour.

The continuous production method was also highly automated. Flour and other ingredients were fed into a production line under carefully monitored conditions. The resulting dough was extruded through dies, pressed (or cut), and placed in pans. The pans moved by conveyor through a large oven. Slicing machines cut finished loaves and packaging machines blew wrappers open with a puff of air to receive the finished product.

The commercial baking industry produced two basic types of breads—yeast breads and quick breads. Yeast breads were leavened with yeast. Quick breads used other leavening agents such as baking powder. Baking powder, which also worked by producing carbon dioxide, produced results more quickly than yeast. Quick breads included such products as muffins, loaves, and biscuits.

According to Ed Wood, a researcher of the history of bread making, 75 percent of the bread consumed in industrialized nations is produced by large commercial bakeries. The Wheat Flour Institute calculated that during the early 1980s, U.S. bakers produced approximately 250 million pounds of bread every week. Bread products were available in many varieties; some individual bakers' lines exceeded 200 different products.

The most popular kind of bread is white bread made from white flour. French breads are made without milk, sugar, and shortening. Their characteristic texture is created by injecting steam into the oven during baking, and the flavor comes from the wheat itself. "Whole wheat breads" are made from whole wheat flour, and "wheat bread" is made from a blend of white flour and whole wheat flour. Cracked wheat breads are made from white flour and crushed wheat meal. Other bread varieties are made with white flours of varying coarseness. Rye breads are made with a mixture of rye flour and wheat flour because rye flour by itself does not possess the chemical properties necessary to produce a leavened product. Two types of rye flours are used to produce different rye breads. Light rye is made from the grain's endosperm; dark rye is made from the entire kernel.

In addition to its bread products, the baking industry also produces cakes. Cakes are typically made from pourable batters. The basic ingredients are flour, liquid, eggs, and leavening agents—plus flavorings and sometimes fat. The rising action of a baking cake is similar to the leavening action of bread. When a cake bakes, steam and gases cause the batter to expand. Different types of cakes are classified according to how they are leavened and whether they contain fat.

Two broad cake classifications are foam cakes and butter cakes. Foam cakes, typically airy and mild, are primarily leavened with air. One way in which this is accomplished is by beating egg whites and folding them into the mixture. Examples of foam cakes include angel food cake and sponge cake. Butter cakes rely on leavening agents such as baking powder, baking soda, or yeast. Butter cakes are typically more tender and possess a smoother texture than foam cakes. Examples include layer cakes and pound cakes. Other types of cakes do not easily fit these traditional distinctions. Chiffon cakes use egg whites and baking powder for leavening. Tortes are similar to sponge cakes but rely on ground nuts or crumbs to replace some or all of their flour.

According to figures for 1990, annual per capita consumption of bread products was increasing slightly. The average U.S. citizen consumed 28 pounds of white bread, 23 pounds of variety breads, 23 pounds of rolls, 15 pounds of cake, and four pounds of doughnuts and other sweet yeast products. Between 1991 and 1992 the value of the industry's shipments increased by 3.1 percent to $18.4 billion. Projections for 1993 anticipated that production would reach $19.2 billion. Forecasters predicted that annual per capita bread consumption would reach 60 pounds by the end of the century. One factor expected to drive the increase was the release of the Department of Agriculture's new four-tiered Food Guide Pyramid. The updated Food Guide Pyramid recommended 6-11 daily servings from the bread and grain food group.

Consumption increases varied by product, however, and overall industry growth was expected to be less than 1 percent in 1993 and only about 1.5 percent annually between 1993 and 1997. Industry watchers expected white bread to capture 58 percent of the total bread market. Demand for snack cakes was expected to increase 2.0-2.5 percent annually as manufacturers improved quality and offered new packaging options such as individually wrapped, single-servings within larger boxes. Sales of sweet yeast doughnuts were expected to increase 2.5 percent per year. With the continuing emphasis on healthy, low-fat foods, the consumption of fresh bagels exceeded $500 million in 1992, with sales growing at more than 30 percent annually.

A number of products, however, experienced declining consumption. Dinner roll consumption tapered off when pasta products gained popularity as bread substitutes. Sales of large pies, snack pies, full-size cakes, and cake-type doughnuts slackened as part of a national trend toward health consciousness. Some analysts noted that the increased consumption of sweet yeast doughnuts and snack cakes was contrary to the general trend toward more healthy products. They attributed the continuing popularity of these items to convenience.

Recessionary conditions prevalent in the United States during the early 1990s also impacted the bread and cake products industry. Lower priced products, particularly white breads, attracted renewed interest. In 1992, white bread averaged $0.75 per pound. Whole wheat bread sold for $1.02 per pound, and French breads averaged $1.26 per pound.

As the bread and cake industry entered the 1990s, its products were available virtually everywhere within the United States. Most of the products produced by commercial bakers were sold through grocery stores where breads and rolls represented the fifth largest selling category of grocery items. Additionally, the baking industry was the nation's largest consumer of nonfat dried milk. One industry analyst stated that 9 million tons of bread, rolls, and buns were sold annually. Another report pointed out that U.S. commercial bakeries consumed 73 percent of the nation's milled flour in 1980.

Despite its ubiquitous presence, however, the bread and cake industry faced several challenges in the early 1990s. One challenge was increased competition from in-store bakeries. Supermarkets with large numbers of in-store bakeries in 1990 included Winn-Dixie (with 1,117), Kroger (946), and A&P (716). Although goods baked on the premises were often priced higher than prepackaged goods, they held several advantages. Customers perceived them as fresher, and on-premises bakeries could offer specialty cakes and breads that were not available from mass producers. In-store bakeries often promoted products as impulse items, placing them near the front of the store to take advantage of baking aromas.

To meet the competition from in-store bakeries, commercial wholesalers began offering more variety in single-serving packages and increasing the assortment of specialty products. Industry analysts disagreed about the long-term effect in-store bakeries would have on traditional distribution networks. Although sales from in-store bakeries increased from $4.9 billion in 1986 to $8 billion in 1990, the rate at which they were being developed slowed during the early 1990s.

In addition to competition from in-store bakeries, wholesalers faced increased competition from prepared mixes. Prepared mixes were marketed to customers who wanted the convenience of purchased items and the freshness of newly baked goods. Competition from prepared mixes came not only within the household market, but also in the institutional market as users such as restaurants turned increasingly toward mixes.

Private label manufacturers also captured a growing portion of the bread and cake market. As the nation endured recessionary times during the early 1990s, consumers paid more attention to food prices. In order to retain market share, major manufacturers increased use of couponing and discounting.

Another challenge facing the industry during the early 1990s was increased concern about the environment. During the leavening process, ethyl alcohol was released into the atmosphere. As a result, Southern California's South Coast Air Quality Management District Board ordered smog controls on the ovens of 24 large commercial bakeries. In addition, some environmental groups criticized the industry for its use of excess packaging. Officials countered the charges with claims that the packaging was necessary to prevent spoilage. To ameliorate the criticism, bakery wrapper recycling programs were instituted in some areas.

The bread and cake industry also faced the challenge of producing products for a nation caught up in a conflict between health consciousness and a desire for taste gratification. In 1989 many items were reformulated to eliminate ingredients viewed as unhealthy. These included such ingredients as tropical oils and other fat, sugar, and salt. The elimination of fat from many classes of bakery items was a difficult accomplishment because the fat incorporated in batters and doughs served many technical and aesthetic functions. Technically, it assisted the leavening process by incorporating air into mixtures, enabling the even transfer of heat during baking and giving moisture to the final product. Aesthetically, the fat produced a favorable texture and added flavor.

To reformulate recipes without fat, different types of fat replacers were studied. Entenmann's Bakery, a subsidiary of CPC Baking, Inc., was the first national company to offer a line of fat-free products. It began test marketing them in 1989 and reported sales of $200 million during the first full year of production. To honor Entenmann's achievement, the American Marketing Association awarded the company with the 1990 Edison Award for New Product Marketer of the Year. Enten-mann's also received the grand prize from the Gorman's New Product Contest. The introduction of fat-free items helped increase consumption among consumers who traditionally skipped dessert items.

Following the launch of fat-free products during the early 1990s, many consumers reported that cholesterol and overall fat content were important in purchasing decisions. As the trend expanded and many companies began bringing fat-free products to the marketplace, Campbell Taggart introduced an enriched bread with the name Iron Kids in 1989. The bread was made with the same fiber content as the company's whole wheat bread; therefore, the FDA challenged the product's name and marketing methods. Campbell Taggart and the FDA reached a compromise in 1992. Under the terms of the compromise, Campbell Taggart printed a disclaimer under the Iron Kids logo stating that the name "refers only to a children's fitness program, and has no reference to either extra iron in this bread or to the bread resulting in superior strength or performance."

Interest in healthy products, however, appeared to be waning in 1992. A study conducted by the NPD Group of Port Washington, New York, documented a shift toward snacking and diminished concern about calorie content. Consumers were also less likely to read labels. More emphasis was placed on upscale, indulgent products than on products aimed at health-conscious consumers. A similar trend was revealed by the results of a Gallup Poll in which consumer statements about health concerns contradicted consumer spending habits. Industry analysts theorized that low-fat sweet goods were of an inferior quality and priced higher than traditional formulas. One exception was noted within the bread category where multigrain items with high fiber and low fat contents were doing well.

In the mid-1990s, increased costs of raw materials cut into the profit margins of large and small players in the industry. In 1996 bread and cake products constituted an $18.4-billion industry that employed 183,000 workers. Shipments by mid-decade were valued at $16.1 billion, with bread accounting for almost one-third of that total.

In the late 1990s, more fresh bakeries opened for business and more supermarkets expanded their fresh bakeries. Despite this, commercially prepared bakery items were gaining sales overall. Information Resources Inc. of Chicago found that commercially baked pie sales in supermarkets were up 12.5 percent and baked cake sales were up 14.5 percent from April 1998 through March 1999 (compared to the previous year). Private-label cakes rose 21 percent and private-label pies climbed 7.1 percent in sales, while Entenmann's pies fell 9 percent. Some industry observers feel that the quality of commercially baked goods has improved and the number of offerings has grown, thus keeping the commercial bakers in close competition with fresh-baked products.

The entire commercially baked products industry remained flat in 1999, as analysts pointed out that the food sector was not doing well as a whole on Wall Street, with their stocks behind the market by 34 percent. Some investors were looking for the food industry to consolidate more, as regional companies bought others and become national names.

Current Conditions

Private brands hold a lion's share of the fresh bread market. In 2001, private labels generated over $1.5 billion in sales and commanded 27 percent of the market. In comparison to private labels' sale of 1.73 billion loaves of bread in 2001, Wonder Bread, holding the second position with 5.5 percent market share, sold 210 million loaves, generating $311 million in revenues. Rounding out the top five were: Orowheat, with a 4.8-percent market share, 133 million loaves sold, and $268.6 million in revenues; Pepperidge Farms, with a 4.6-percent market share, 124 million loaves sold, and $261.1 million in revenues; and Nature's Own, with a 3.9-percent market share, 149 million loaves sold, and $220.1 million in revenues. All revenues generated by supermarket sales of fresh bread in 2001 totaled $5.6 billion.

In supermarket sales of other bakery categories, Thomas' dominated bagel sales, with a 35.5-percent market share, 69.6 million units sold, and $155 million in sales. Thomas' also dominated the fresh English muffin category, with a commanding 69.5-percent of the market share. In the supermarket bagel category, Sara Lee and private labels held positions two and three with $67.1 million and $64.6 million in sales, respectively. Lenders and Earth Grains rounded out the top five in the bagel category. Mission controlled one third of the market for flour tortillas, with $228.5 million in 2001 revenues generated by tortillas.

With strong competition from private brands for lower-end breads, national bakeries have generated their growth through the introduction of superpremium, higher-end products that pepper the supermarket bread aisle. Another trend in the commercial bakery industry is the increasing popularity of specialty bakeries that sell fresh-from-the-oven breads, and the number of bakeries producing hand-kneaded artisans breads is increasing rapidly. Selling for $4 to $5 (about twice the price of a normal loaf of bread) the specialty breads provide rich texture, unique favors, and usually a thick crust, modeled after European breads. Although not produced on the mass scale as supermarket offerings, the trendiness of high-end breads is also driving sales of superpremium breads found grocery store aisles.

Industry Leaders

Interstate Bakeries Corporation was the nation's largest baker and distributor of fresh bread and cake products. In fiscal 2002, Interstate reported sales of $3.5 billion and more than 50 percent of that came from the sales of snack cakes. That year the company operated 60 bread and cake bakeries throughout the United States.

Interstate was formed in 1937 following the consolidation of two baking companies in Kansas City. Interstate operated two major divisions—the Bread Division and the Cake Division. Its major brands included Dolly Madison, Butternut, and Holsum. Interstate distributed products through more than 100,000 food outlets located along 4,200 routes. The distribution network covered all regions of the United States except the Northeast. Inter-state's thrift store network, which had 780 operating stores, was the industry's most extensive.

The Sara Lee Bakery Group held the number two spot in the industry, reporting revenues of $2.98 billion in fiscal year 2002 (ending June 30, 2002). Sara Lee, which began as a frozen foods producer, purchased Earthgrains to take a bold step into the bakery market. In November 1999 Earthgrains Co. announced the acquisition of Metz Baking Co. The move put Earthgrains in the number two position in the baked goods industry. Metz was a regional player, with the number one brands of bread in Chicago, Milwaukee, and Minneapolis, while Earthgrains' brands could be found in the South.

Entenmann's was established in 1898 by William Entenmann. The company made its deliveries with a horse and buggy but, in 1957, a decision was made to switch from delivery routes to wholesale distribution through supermarkets. In 1978 the company was purchased by Warner-Lambert Company and was then sold, in 1982, to General Foods Corporation. After General Foods was acquired by Philip Morris and its operations merged with Philip Morris' Kraft subsidiary, the bakery line was considered outside of the company's core business and was sold in 1995 to Kraft competitor Best Foods. Entenmann's reported 1998 sales of $113 million. The Entenmann's line included more than 200 different products in 8 categories: danish, sweet cakes, pastry, cakes, cupcakes, pies, cookies, and doughnuts.

Flowers Foods was another major player in the industry through co-ownership of the second-largest cookie and cracker business in the United States—the newly combined Keebler & Sunshine Biscuit Company. Founded in 1919, Flowers' products include white and variety breads, buns, rolls, snack cakes, pastries, pies, doughnuts, and brownies. Its major brands were Nature's Own, Cobblestone Mill, Bluebird, Country Hearth, and Mrs. Smith's Frozen Pies, which had been acquired in a merger with Shipley Baking Co. of Fort Smith, Arkansas. In addition, the company manufactured products under regional brands and private labels.

Flowers continued to acquire other companies to maintain its number one status in the industry. The company bought Home Baking Co. in May 1999, which added $15 million in sales to Flowers and gave it a stronger presence in the foodservice industry in the southeastern United States and Caribbean. At the end of 1999, Flowers bought a bakery from retailer The Kroger Co., agreeing to make and distribute Kroger brand baked goods to 210 Kroger stores. In 2002 the company posted revenues of $1.65 billion.

Research and Technology

One of the most extensive areas of ongoing research within the industry involved investigating methods of extending shelf life and preserving product freshness. One method, modified atmosphere packaging (MAP), involved introducing a predetermined atmosphere inside special barrier packaging materials at the time products were sealed for shipping. Nitrogen and carbon dioxide were the most frequently used gases in MAP. The technique was used to replace oxygen, a primary contributor to product staleness. According to published reports, MAP extended shelf life up to 30 days and increased freezer life up to 6 months.

Another, more advanced method of controlling the atmosphere within a product package was called controlled atmosphere packaging (CAP). CAP relied on active means of manipulating the gas in a package's "head-space." Products were packed with chemical inserts to actively manipulate the environment within the package. For example, oxygen scavengers, frequently composed of iron compounds, would absorb any oxygen remaining after a package was sealed. Eliminating oxygen from packaging was important because it inhibited mold growth. Studies indicated that CAP extended the time period in which a product would remain mold-free by 300 percent.

MAP and CAP technologies presented many benefits. They eliminated the need for preservatives and reduced distribution costs by eliminating the need for freezing and chilling during transportation. They also increased customer convenience because products did not require freezing following purchase. They also helped maintain appropriate moisture levels so products did not dry out. Two of the biggest problems surrounding MAP and CAP usage were customer perception and price. Customers did not view bakery products with extended shelf life as fresh, and products packaged with MAP and CAP were more expensive than those packaged with traditional methods. One industry analyst suggested that CAP and MAP technologies were best suited for wholesalers with large geographic distribution networks, rather than local baking operations.

A new form of lecithin was developed by Riceland Foods in 1998. Bakers had used liquid lecithin for years, but it contained about 35 percent oil. The new powdered lecithin contained only 2 percent oil, making it useful for low-fat baking. Lecithin supplies the good taste and moistness to low-fat bakery products, making them taste more like the full-fat varieties. The product also reduces the amount of egg yolks bakers need to use, without adding any cholesterol.

Further Reading

Bennett, Bev. "From the Ovens of Artisans." Stagnito's New Products Magazine, October 2002, 34-35.

"Bread Companies Boost Healthful Qualities to Heat Up Sales." The Food Institute Report, 25 March 2002, 9.

"Flowers Industries Announces Agreement to Acquire Home Baking Company." Flowers Industries, 21 May 1999. Available from .

"Flowers Industries Announces Agreement to Acquire Memphis Bakery from Kroger." Flowers Industries, 28 September 1999. Available from .

"Flowers Industries to Acquire Bakery from Kroger." Nation's Restaurant News, 25 October 1999.

Mann, Jennifer. "Kansas City, Mo.-Based Bakery Tries to Ward Off Takeover Attempts." Knight-Ridder/Tribune Business News, 11 October 1999.

——. "Kansas City, Mo.-Based Firm Reports Increased Revenue for Quarter." Knight-Ridder/Tribune Business News, 14 September 1999.

Nicklaus, David. "Clayton, Mo.-Based Bread Firm to Purchase Rival." Knight-Ridder/Tribune Business News, 15 November 1999.

Ramseyer, Rick. "Bakers & Shakers." Restaurant Business, 1 February 2003, 41-46.

Smyth, William. "Half-Baked? With Fresh Bakeries Springing Up in More and More Supermarkets, Retailers Weigh in on the Effect Upon Sales of Commercial Baked Goods and Their Merchandising Strategies to Maximize the Category." Super-market News, 19 July 1999.

U.S. Census Bureau. Statistics for Industry Groups and Industries: 2001, January 2003. Available from .

"Wonderball." Snack Food & Wholesale Bakery, June 2002, SI10-20.

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