Pastries hold their own; Is vending missing out on a chance to upsell?

Sikes noted pastries, like other vend product segments, are getting new growth from micro markets. He said traditional vend products are being ordered for micro markets, along with larger packages, such as multi packs. “The mix of products is still in its infancy,” Sikes said of micro markets.  

Midwest: Demand varies

Sanese Services Inc. based in Columbus, Ohio has been a leader in promoting wellness, but customers still want pastry, noted Matt Warner, purchasing manager. The company carries mostly fresh pastry in its ambient snack machines. The only frozen pastry the company carries is what goes in the cold food machine, which represents a small portion of the pastry sales.

Warner was among several operators who noted that ethnic and low-calorie offerings have not fared well in pastries. The company tried Hispanic pastries when some of the manufacturers offered it several years ago. He said the Hispanic products did well in certain accounts.

One problem with Hispanic pastries, noted Rusty Jackson, vice president of special markets for Cloverhill Bakery, is that Hispanics encompass a variety of ethnic groups who don’t share the same tastes. “A Mexican pastry is not the same thing a Latino in Miami eats,” he said.

Sanese Services never tried the 100-calorie pastry that was introduced several years ago since it had a short shelf life and required the company to place an expiration date on the product. “It’s one of those steps I don’t need to mess with in the snack machine if I don’t have to,” Warner said of the 100-calorie pastries.

Pastries have been losing facings in recent years noted Jeff Smith, president, All Star Services Inc. in Port Huron, Mich. “There has been a lot of turmoil in the pastry business,” he said, referring to the financial issues that some pastry companies have experienced. The company primarily carries fresh pastries and uses frozen pastries as back up.

Smith said his company has better data to decide what items to carry in the machine, thanks to wireless reporting. “We’re more account specific as far as our customers’ desires,” he said.

Smith said “better for you” pastries did not sell well when he tired them. This does not mean he won’t try them in the future. “It rests with the consumer,” he said.

All Star Services has been aggressive with micro markets, but Smith has not found pastries to be great sellers in the markets, to his surprise. One reason is that fresh food has gained a much larger share of the micro market business than other items, compared to a vending bank.

Vending operators and suppliers in other regions have not experienced as much strength in pastries as the Southeast and parts of the Midwest.

Bud Burke, a sales rep for Gibbstown, N.J.-based Thayer Distribution, which serves the New York, New Jersey and Mid Atlantic market, said overall, pastry sales are down 6.1 percent this year. He said frozen, which represents the majority of the business, has fallen by 7.8 percent while fresh pastry is only down by 0.6 percent. He cited location downsizing, competition, and customers looking for healthy alternatives, and increasing product costs as reasons for the decline.

Regional favorites play a role

Some markets have regional pastry favorites. One of the more notable regional lines is Tastykake, a Philadelphia, Pa. favorite which is now carried by Flowers Foods Inc. Flowers Foods acquired Tasty Baking Co. last year. Tastykake Butterscotch Krimpets and Peanut Butter Kandy Kakes are still the top selling pastries for One Source Office Refreshment Service Inc. in Pottstown, Pa., according to Bob Betz, owner of the Philadelphia area company.

For Betz, pastries remain a top seller. He said consumers see it as a good value because the vend pastries he carries are competitively priced with what’s available in convenience stores. “The consumer sees that as value,” he said.

Betz did not have a lot of luck with Hispanic pastries when he offered them three and four years ago, even in accounts with a lot of Hispanics.

Nor did he have luck with the low calorie pastries when he tried them five years ago. The wellness products mostly came in smaller portions and carried hefty price points in relation to the package size. “The vending customers don’t seem to see value in that product,” Betz said. “They don’t see the value of that price point in a vending machine.”