Stories of recession loom large in this week’s media. The government’s national debt is massive - as it tells us not to spend beyond our means, it is not so good at taking its own advice.
Much of our gold stocks were sold years ago, at very low prices, and the American housing market, where loans have been made to those who cannot afford to repay them, is having an impact over here, with confidence reaching an all-time shakiness.
So what would happen to the bakery market in a recession? One baking industry CEO said to me this week that he feared consumers might buy fewer premium goods, which provide so much of the profit compared to standard lines. I don’t agree. Call me an optimist, if you like, but I actually agree with Edwin Booth, chairman of Booths supermarket, who said: "Consumers will continue to pay top whack for premium food despite a tightening of the economy."
I believe that is partly to do with shopping ’habits’, an appreciation of better quality, more taste, which makes for a difficult reversal. And there is also the self-pampering effect - the need for a treat when times are tough and the big things have to go, but the premium loaf (quality) and the doughnut (treat) stay.
Nevertheless, it is common sense if you are a baker to streamline products, cut down on wastage and produce only consumers’ favourites. The news that Tesco is doing just that will cause unease among suppliers, but in-store bakery buyer Simon Holt spells out to us just what is required and why (pg 4). At the moment, 80% of Tesco’s ISB sales come from half the products. Do you know your ratio? I am sure you do, because it is vital, and it also tells you the best time to launch seasonal products each year and how long to maintain them for.
I am delighted I can still buy mince pies until the end the January - but I may be the only customer doing so!
Elsewhere this week, if you run a small business and train your own staff, you may not be interested in a national skills training scheme. But for many there is a desperate need. So please let us know what you think about a National Skills Academy for Bakery (pg 17). We will publish your views.