Making some more bread
Normally trends work like this. The luxury, high end of a sector produces some outlandishly expensive product or concept that is then picked up by the mainstream market where less extravagant, cheaper, mass-market replicas proliferate. This established scenario has been somewhat turned on its head at Claridge’s Bakery, which sits on a mews road behind the world-famous five-star hotel.
The bakery is not focused on fashionable sourdough loaves or intricately designed pastries. It instead has traditional treats like iced fingers and lardy cake on its pristine counters, but they are overshadowed by the more egalitarian house loaves that include bloomers, granary loaves, country bread and white rolls. These various breads account for an impressive 50% of sales.
Everything is around the £6 mark, so with entry-level rooms at the hotel hitting the £1,000 level for a night, this is the equivalent of a mountain of bloomers (more than 160 in fact). A veritable bargain for taking home a slice of Claridge’s. This highlights how the bakery category can effectively be all things to all people. It has the ability to appeal to customers at all ends of the market. It can produce affordable items that impressively straddle both staple and treat.
Even handmade, local, small batch and non-processed loaves and bakery goods – from Claridge’s downwards – can be produced for relatively modest costs, and even as a bonus come with a rich story and provenance aplenty. This is just the sort of thing younger consumers can get their teeth into.
Although the Mayfair hotel’s bakery has eschewed it, many modern bakeries are winning over customers by combining craftsmanship with visual appeal. Architecturally impressive pastries and mouth-watering confections have certainly captured the hearts of instagramming influencers, and certain bakeries have to contend with queues down the road. These include Quince, Fortitude Bakehouse and Toad Bakery in the capital, along with Farro in Bristol, Northern Rye in Newcastle and a growing list of other fashionable bake houses.
As well as being affordable and a treat, the bakery category enjoys an incredible level of frequency from consumers. Consider that in 2025, an impressive 87% of UK consumers purchased at bakeries, with 19% doing so two-to-three times a month, 25% weekly, and as many as 12% more than once a week. A further 71% shopped at pastry shops, according to a survey by Business Gateway.
Needless to say, this particular sweet spot in the hospitality sector has sucked in plenty of operators. Bakeries are the second fastest-growing fast-food category behind chicken shops, with the number of outlets expanding by 2.6% between January and September 2025, equating to more than 330 new bakeries nationwide, according to data from Meaningful Vision. And the future looks bright, judging by the revenues across the bakery cafes category, which is expected to grow at a compound annual rate of 4.5% between now and 2029-30 to reach £1.6bn, according to IBISWorld.
Along with the bigger guns of the category – including Wenzel’s, Gregg’s and Gail’s – all growing, there is also a plethora of small chains and single-unit independents setting up shop and building out a presence. Just in my part of north London, there’s Sourdough Sophia continuing to open units, Jolene has recently opened a fifth unit with a move into Soho, German bakery Cinnamood has just opened its maiden UK site and Fink’s now has five branches.
Elsewhere, Cornish Bakery has just launched a new concept, RISE by Cornish Bakery that adds small plates to the mix; Rowe’s Cornish Baker’s has 70 sites and is looking for more units; Warren’s Bakery has 45 stores and is transitioning to higher footfall locations as well as recently moving into a first travel retail location at Liverpool Street station; Scottish bakery business Stephen’s has 15 of its own outlets and latterly has been opening drive-thru units; and at the upper-end of the market, Michelin star chef Tom Sellers has opened a second bakery under his West Sussex-based Gwyn’s Bakery business in Horsham, Sussex.
Even pubs are getting in on the action, with Anglian Country Inns (ACI) incorporating a bakery within a large barn at its White Horse pub in Holme-Next-The-Sea that James Nye, managing director of ACI, says had “gone bonkers, and the biggest challenge was handling the numbers of customers”.
The fact Gregg’s no longer produces bread of any description while Claridge’s Bakery has bloomers and granary loaves as its signature products highlights the incredible fluidity of the category that does not play by the rules and appeals to everybody. This raises the question: what are the opportunities for restaurants, pubs and even quick service restaurant brands to sell bread and other baked products as additional spin-off revenue generators?
Glynn Davis, editor, Retail Insider
This piece was originally published on Propel Info where Glynn Davis writes a regular Friday opinion piece. Retail Insider would like to thank Propel for allowing the reproduction of this column.