Weston entering new categories, channels

by Eric Schroeder
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TORONTO — Faced with a fresh bakery market across North America that is soft and volume reductions in a number of categories, including fresh bread and rolls, George Weston Ltd. is working on a series of new product initiatives with a goal of improving performance.

“The declines are mostly in white bread and whole wheat bread, and lots of activities will be coming throughout this area in the next few months,” said Jairo Senise, president of Weston Foods, in a Nov. 20 conference call with analysts to discuss third-quarter results. “But for now, we’ve developed most of our attention developing new products that are grain inclusions. Also, we already launched some flatbread under the umbrella of the Flat Oven Bakery that is putting together all these flatbreads around the world. That segment is growing very fast now.”

Another growing segment that Weston is entering is gluten-free. The company in late October introduced a line of gluten-free products under the President’s Choice (PC) brand at Loblaws outlets.

“So far, these first numbers are doing absolutely fantastic results,” Mr. Senise said. “The products are flying off the shelves, and it’s very good, it’s very encouraging.”

In order to continue to grow its fresh bakery business Weston Foods will need to expand beyond the traditional grocery channel, which has seen a decline in volumes, and into more dollar store type venues, Mr. Senise said.

“There is growth in the alternate channels but we’re underrepresented there, and that’s obviously something that we are continuing to try and address,” he said.

George Weston said fresh bakery sales in the third quarter ended Oct. 6 decreased approximately 4.6% compared with the same period in 2011, mainly due to smaller sales volumes.
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