Even before the Corona crisis, hundreds of bakeries had to give up every year because of the growing cheap competition. Now the pandemic is also causing problems for medium-sized companies.
By Klaus-Rainer Jackisch, Mr Köthen is a small, tranquil town in the middle of Saxony-Anhalt. The Rödel bakery has been here for 90 years. The traditional company survived war and socialism. But just a few weeks before the planned anniversary celebrations, Corona could now ensure that the oven goes out forever. At least that is the fear of master baker Frank Schwenke, managing director of the company, which has 14 branches and around 70 employees.
Gastronomy business has collapsed
Annoyed by the Corona policy, Schwenke sent a fire letter to the Federal Chancellor a few weeks ago, which ended with the drastic words: “I’m afraid of the day when I have to tell my employees that the Rödel GmbH bakery will be closed after 90 years is now in bankruptcy. ” The letter also went to the black-red-green state government of Saxony-Anhalt and Bavaria’s Prime Minister Markus Söder (CSU). The pandemic hit the bakery business badly: Sales collapsed by 20 percent, around 300,000 euros from reserves and private assets are gone. The November and December government aid came very late. Since January there has been nothing left because the operation falls through the grid of the ongoing bridging aid III. High investments in hygiene measures in the catering areas have proven to be unnecessary – because Schwenke is not allowed to open its bakery cafés. This is exactly where the main problem lies for the bakery specialist as well as for most companies in the industry: While the sale of rolls, cakes and other loose baked goods in the pandemic is going very well again after initial hesitation by customers, the important business is with the catering sector collapsed. However, this is of crucial importance in an industry characterized by fierce competition. “Many companies have made high investments in the catering sector in recent years,” says Susan Hasse from the Central Association of the German Bakers’ Trade. “Because only with this second mainstay can you survive the sharp price war with the discounters.”
No hotels to deliver
In fact, the food service sector often accounts for more than half of sales. But it has been missing for months because of the coronavirus pandemic. In addition to selling baked goods, other companies have specialized in catering for parties and family celebrations or delivering to hotels or canteens. Here, too, business collapsed. “We get a lot of letters from our members,” said the association spokeswoman Hasse. “Many people give up because there are hardly any prospects.” Most bakeries are still doing reasonably well compared to pure catering businesses because their counter sales are running smoothly. But overall the situation is already very tense, according to the association. The corona crisis hits the industry in a massive structural change that has been putting the mostly small and medium-sized companies under increasing pressure for years. Nowadays, more and more companies can only survive if they have several branches and an additional business area. Because against the cheap competition of the supermarkets they can not bake.
Fewer and fewer craft businesses
Almost every discounter now has a fresh bread corner and pretends to bake delicious rolls in the supermarket. In fact, it is mostly frozen goods from large bakeries that were produced there on the assembly line. In the market it is then only thawed and baked – all at prices that traditional bakeries cannot keep up with, as the association claims. Today, on “German Bread Day”, people proudly look at around 3200 types of bread in Germany – more than anywhere else in the world. But they would have their price. Company closings are therefore the order of the day even without Corona. Several hundred bakeries give up every year: The number of craft bakeries has fallen in the last 60 years from around 55,000 in the old federal territory to around 10,500 businesses now. The trend continues to decline. The craft businesses currently supply around 45,000 sales outlets, with over 265,000 employees working there.
Heavy sales slump also with confectioners
The situation at the pastry shops is also very tense – i.e. the specialist shops that specialize in the production of cakes and chocolates. It is true that many people tend to have a nice piece of cake, especially in Corona times, and “the companies have also come up with many creative solutions to increase sales over the counter,” says Julia Gustavus, General Manager of the German Confectioners’ Association. But as in the bakery industry, the cafés are also closed here – and that affects almost every confectioner. The industry’s turnover fell by 14 percent last year. For the first few months of this year, the industry association expects slumps of 40 to 50 percent. “The worst thing is the uncertainty of how things will continue,” says Gustavus. For a year now has been investing and experimenting again and again – but all without perspective. “That tires the entrepreneurs, all of whom are passionate about what they do.” Bakers and confectioners now hope that those responsible will accelerate the vaccination rate so that at least the outdoor catering can reopen: “If there is no normalization by June, it will slowly get tight,” says master baker Schwenke from Köthen. He is disappointed in politics. According to his letter, there were good discussions with the Saxony-Anhalt Ministry of Economics, where they are considering an aid fund for the industry. So far, however, no money has flowed from it. The reactions from the Chancellery and the Bavarian State Chancellery, on the other hand, were rather sobering. You would have already written kindly, says Schwenke. But in essence these are all just “irrelevant answers”.
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