ORLANDO, FLA. — While the United States and Europe are similar in the size of their population, the baking industry is decisively different when it comes to the amount and type of baked goods consumed and where people buy their products.

These differences, however, are providing several opportunities for both North American and European bakeries seeking to expand beyond their geographic markets.

Those were some of the key takeaways by JP Frossard, analyst, consumer foods at Rabobank, during a presentation on global bakery trends at the recent American Bakers Association’s annual convention in Orlando, Fla., held March 23-26.

Frossard pointed out that Europe has experienced a surge in tourism since the pandemic, fueling the sale of baked goods in hotels, restaurants and local bakeries while most of the US baking industry’s growth has come from the retail channel.

That said, consumers in the United Kingdom and Scandinavian countries share more similar purchasing patterns with the US when it comes to buying baked goods at retail supermarkets than in the rest of continental Europe, which shops mostly in small retail bakeries.

“You have more in common with some European markets than you expect,” Frossard said.

Europeans also consume much more bread (82% of total volume in the continent) than other baked goods while North American consumers are much more diversified in the type of baked goods they purchase.

Moreover, Europeans tend to consume regional favorites such as croissants in France, tiramisu in Italy and pretzels in Germany while North Americans are more open to try new products and brands. 

“The younger folks here are always willing to try something different,” Frossard said.

Europe’s aging population, labor issues and consumers’ penchants to purchase their traditional, culturally favorite, locally baked goods have prompted bakeries across the pond to invest more in automation as they have a clearer view on a more stable demand in the long term.  

Frossard said such a focus on automation has also given European bakeries a competitive edge, especially as several larger baking companies look to the west to establish a presence in the US in-store bakery market with Danish pastries, croissants, brioche and more as a part of a global growth strategy.

For US bakers seeking to expand overseas, Frossard mentioned the increasing popularity of some classic American baked goods such as donuts and muffins that provide a potential opportunity in Europe. However, branded products account for only about 14% of baked goods sales in Europe with artisan and private label items accounting for the bulk of purchases.

Looking at consumer trends, Frossard noted that the emphasis on health is universally prevalent. Yet, he doesn’t see a groundswell for weight loss and GLP-1 drugs as in the United States and Canada. In fact, he called it a “non-event” for most of Europe, except for the United Kingdom.

Likewise, Frossard said the overprocessed foods debate that’s taking shape on social media in the United States is not widely discussed in Europe mainly because the countries have different regulatory schemes. Additionally, there remains a focus on Old World classic baked goods in general.