In the short-to-medium term, businesses will be increasingly affected by the changing lifestyle and shopping patterns of Chinese consumers. We see the development of supermarket / hypermarket groups in much the same way as we have seen in Europe and North America. These provide a shopping environment with high standards of hygiene and product quality that will become a benchmark for food retailers to follow in future.   

 

 Some bakery chains recognise this and have very good quality shop environments – these are the businesses that will have long-term success because they are the ones that recognise how to create long-term value for their customers. Food businesses should not think that money spent on good fixtures, keeping the shop in good repair, good quality air conditioning and lighting is wasted overhead – these are standards that customers will come to expect.  

 

  Supermarkets and hypermarkets will develop with their in-store bakeries. These businesses, together with the main chain bakeries, will drive the growth of bakery foods in China. But they will not dominate the retailing scene in the same way as they have in parts of Europe and North America. Many people will be unwilling or unable to travel to the big sites and neither will they purchase the big trolley sizes we see in the West. Neighbourhood shopping will continue to have an important role in food retailing – smaller convenience type shops and smaller supermarkets placed where people live. This means that fresh food retailers such as bakers can co-exist with grocery stores and, therefore, will continue to have a good future – as long as they take care to continually develop quality into their products and their shop environments.   

 

 Convenience stores, supermarkets and hypermarkets will drive growth of packaged foods, which are produced by industrial bakeries. This sector of the industry is still one that is driven by driving down costs and driving up productivity and output. These businesses need to be receptive to innovation and not be obsessed by producing the same product for ever smaller costs.   

 

Away from the shops, there is tremendous growth of foodservice concepts, growth in snacking and eating on the move. This is fantastic news for bakers – bread for sandwiches, cakes for indulgent snacks, breads and desserts for restaurants and new café type concepts. Examples include Starbucks, which is developing rapidly in China – the bulk of the food programme is based on bakery foods.   

 

 China is such a dynamic country that there are new trends appearing all the time. In the baking industry there are certainly clear consumer trends that will heavily influence how the industry will form and grow. There are many consumer drivers from a desire for quality and variety, for indulgence and for health, for value and for premium-priced luxury foods.   

 

 In this great country of contrasts we see a baking industry that has formed into channels and sections just like any developed market, yet here there are possibilities facing any business. It is an industry and market of today, but also very much of tomorrow.