---
title: "Sam's Swiss Rolls Sell 1 Billion Yuan, Hema's Durian Thousand-Layer Cake Goes Viral... Are Retailers' Bakery Businesses Taking Off?"
description: "Sam's Club's Member's Mark bakery products, such as Swiss rolls and croissants, have become bestsellers, with Swiss rolls alone generating over 1 billion yuan in annual sales. Meanwhile, traditional bakery stores are declining, as retailers like Hema and Dingdong Maicai leverage their scale, pricing, and one-stop shopping to capture the bakery market."
author: "FBIF"
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published: "2024-11-12"
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# Sam's Swiss Rolls Sell 1 Billion Yuan, Hema's Durian Thousand-Layer Cake Goes Viral... Are Retailers' Bakery Businesses Taking Off?

> Sam's Club's Member's Mark bakery products, such as Swiss rolls and croissants, have become bestsellers, with Swiss rolls alone generating over 1 billion yuan in annual sales. Meanwhile, traditional bakery stores are declining, as retailers like Hema and Dingdong Maicai leverage their scale, pricing, and one-stop shopping to capture the bakery market.

In the must-buy list at Sam's Club, there are always Member's Mark (Sam's private brand) bakery products.
"Many members even apply for membership cards just to buy croissants," Sam's official admitted in an interview, stating that its private brand Member's Mark bakery items have always been one of the most popular categories, with extremely high penetration and repurchase rates.[1]
Image source: Sam's APP
Take Sam's Swiss rolls as an example. According to reports, after its launch, Sam's Swiss rolls quickly became a hit due to their absolute cost-effectiveness, accounting for 8%–10% of monthly sales in some stores, with annual sales once exceeding 1 billion yuan.[2]
Sam's Swiss rolls also became a hot topic on social media. On Xiaohongshu, the #山姆瑞士卷 (Sam's Swiss Rolls) topic has reached 150 million views and still maintains high discussion.
This is just a glimpse of consumer preferences, reflecting a phenomenon: retailers are starting to "compete" in the bakery sector. Besides Sam's, Costco, Hema, Dingdong Maicai, Pangdonglai, and even traditional supermarkets are continuously launching new products in the bakery track, creating blockbuster items.
In contrast to the "boom" of retailers in the bakery sector, offline bakery stores have seen declining visibility in recent years, especially as many "internet-famous bakeries" quickly fizzle out after a short burst of market attention. Multiple bakery industry market reports and financial reports from bakery companies indicate that among channels where consumers purchase bakery products, offline bakery stores are on a downward trend.
Why have retailers been able to rise quickly in bakery? Compared to offline bakery stores, what advantages do retailers have in doing bakery?
To this end, FBIF interviewed retailers such as Hema and Dingdong Maicai to try to find answers to these questions.
## **Ice and Fire: Two Extremes**
In recent years, in the freshly baked goods track, the "ice" of offline bakery stores and the "fire" of retail supermarkets have formed a stark contrast.
**On one hand, news of offline bakery store closures and withdrawals is frequent.**
In recent years, whether positioned as new Chinese-style snacks or Western-style pastries, whether local or foreign brands, they have been continuously closing stores, withdrawing from regions or even national markets. For example, in early 2022, 85°C completely withdrew from the Wuhan market; in March 2024, the internet-famous brand Panda Unwalk Cake was also exposed to unpaid wages and store closures; around the same time, local brand Lisong Zhipin closed a large number of stores.
A report by Huafu Securities shows that the number of bakery stores in China decreased from 479,000 in 2019 to 437,000 as of October 2023.[3] At the same time, bakery stores have a fast update cycle and low survival rates. According to Meituan data, the average survival time of bakery stores in China is 32 months, with 57.7% closing within 2 years, and only 23.8% surviving more than 4 years.[4]
There are also more typical cases: the once-popular and heavily invested Momo Pastry Bureau and Tiger Head Bureau (Hutouju) now only have a few stores left in their home cities.
In 2019, Momo Pastry Bureau became famous with its original Chinese-style mochi, even popularizing the concept of "new Chinese bakery." Consumers flocked, and many were willing to queue for a long time to buy mochi.
On social media, you can still find posts from consumers queuing for mochi back then.
Image source: Xiaohongshu @谭谭谭啊
Today, consumers still maintain enthusiasm for mochi products, but the consumption channel has shifted from bakery stores to retailers like Sam's, Costco, and Hema. On social media, under topics about mochi, Sam's and Hema have become keywords in posts. Similarly, in netizens' self-made lists of must-buy retailer bakery items, mochi is a common product.
Image source: Xiaohongshu @橘子在深圳
In recent years, the share of bakery stores in the bakery food channel has declined. According to Euromonitor International data, the sales share of Chinese bakery foods in the Food/drink/tobacco specialists retail channel decreased from 55% in 2018 to 51.3% in 2022.[3]
Image source: Huafu Securities
But unlike the sluggish state of offline bakery stores, retailers such as Sam's, Hema, and Dingdong Maicai are gaining increasing popularity in the bakery field. While their hit products are snapped up by consumers, they also generate considerable discussion. The hotspots and blockbusters of the bakery industry are gradually shifting from offline bakery stores to supermarkets and other retailers.
For example, RT-Mart's "potato bread" sparked online discussion due to its interesting shape and packaging, with products selling out upon launch in many regions, and some netizens even resold it at a premium on Xianyu. Also, the durian thousand-layer cake, in the "price war" between Hema and Sam's, was snapped up by consumers and sold out upon launch.
Against this backdrop of frequent blockbusters, retailers' bakery business is "thriving." According to reports, Sam's mochi and Swiss rolls have consistently sold over 100 million units annually, and on average, for every 1,000 Sam's customers, 300 boxes of Swiss rolls are taken away.[2]
In addition, in an FBIF interview, Dingdong Maicai stated that its private bakery brand "Baoluo Workshop" was initiated in October 2021 and launched in early 2022. From an initial monthly sales of over one million yuan, it jumped to tens of millions by the end of the year, achieving nearly 19-fold growth on the Dingdong platform within a year.
Although offline bakery stores and retailers are in a state of "ice and fire" in the bakery business, it is worth noting that currently, the bakery channel is still dominated by circulation bakeries, but the supermarket channel is developing rapidly and may become mainstream in the future.[3]
## **What Makes Retailers' Bakery Products "Fragrant"?**
Compared to offline bakery stores, what exactly makes retailers' bakery products "fragrant"?
### **1. Wide Product Variety, Frequent Billion-Yuan Blockbusters**
Bakery stores often need a clear positioning, but retailers are not limited by positioning.
Bakery stores need precise customer positioning, either in specific categories like new Chinese-style or Western-style pastries. For example, Momo Pastry Bureau is positioned as new Chinese-style, while Holiland and Happiness Cake are more inclined to Western-style pastries.
FBIF learned from industry insiders that an ordinary bakery has about 50-60 SKUs. In addition, with clear consumer positioning, offline bakery stores tend to have a bias in their product offerings. Due to intensifying competition in the bakery market, brands' product strategies are also showing a trend of "extreme segmentation," with many brands building their product systems around a single main product (e.g., cheesecake, peach crisp, toast, cookies, cream puffs, etc.).
But retailers doing bakery cater to the channel's own customer base and can launch a wide variety of products. For example, Hema Bakery's main product structure includes four categories: bread, cakes, pastries, and light meals. Dingdong Maicai's private bakery brand "Baoluo Workshop" divides products into two categories: toast/bread and cake/pastry. According to FBIF statistics, under the Hema Bakery list on the Hema APP, there are 97 products; "Baoluo Workshop" has about 90 products.
Even Sam's Club, which focuses on selected SKUs, has about 40 Member's Mark bakery products, divided into four categories: cakes, bread, toast, and pastries.
In addition, retailers can leverage foot traffic advantages, using freshly baked bread samples and aroma marketing to drive volume, creating blockbusters with sales of over 100 million yuan or even over 1 billion yuan. In contrast, in the circulation bakery channel, a single manufacturer achieving a single category sales of 10 million yuan is already considered successful.[3]
In interviews with FBIF, both Dingdong Maicai and Hema mentioned that the channel's efficient feedback mechanism can quickly create hit products and continuously iterate and innovate on products.
"Dingdong Maicai's existing online data accumulation and rapid perception of consumption trends make this product development-feedback-upgrade optimization path faster and more efficient," Dingdong Maicai told FBIF.
### **2. "One-Stop Shopping"**
Compared to offline bakery stores, retail supermarkets have another obvious advantage: consumers are more accustomed to "one-stop shopping."
The difference is that consumers enter a bakery store only after they have a desire to eat bakery products. But supermarkets have a more complete range of categories and are places for daily consumption, suitable for "one-stop shopping."[5] When consumers enter a supermarket, they can be attracted to the bakery section by the aroma and samples.
In addition, in recent years, retailers have launched private brand strategies, which are gradually being recognized and accepted by consumers. Their private brands, like bakery store brands, have brand power. For example, the previously "hard-to-get" DL mooncakes, with the brand power of Pangdonglai's retail brand and its private brand DL, this large mooncake even became a scarce item.
When discussing the difference from offline bakery stores, Dingdong Maicai said that Dingdong Maicai is positioned as a sales platform for natural short-shelf-life fresh products. As an instant fresh e-commerce platform based on the front-warehouse model, users use it frequently and are more enthusiastic about fresh ingredients and buying as they eat. Therefore, Baoluo Workshop will leverage this characteristic to make keywords like quality, freshness, and health part of user perception, becoming the long-term competitiveness of Dingdong Maicai's bakery products.
### **3. Price**
Another more important reason why retailers' bakery products are popular is price.
FBIF randomly selected a location in Minhang District, Shanghai, and searched for "Swiss rolls" on major retail supermarket apps and food delivery platforms, creating the following table.
From the comparison, it is not difficult to find that most retailers' private brand Swiss rolls are priced lower than those in offline bakery stores. While offline bakery stores generally price Swiss rolls at 10 yuan per slice, some retailers have lowered the price to 5 yuan or even 3 yuan per slice.
Products like this are not uncommon. In supermarkets, you can see baguettes at 15 yuan for two, but in offline bakery stores, 15 yuan can only buy one baguette.
Consumers are also highly sensitive to bakery prices. Currently, on social media, the most common complaint about offline bakery stores is that they are "expensive." NetEase Shudu once conducted a statistic: bread under 10 yuan is gradually "disappearing."
Image source: NetEase Shudu
**Under the same category and similar taste, retailers' bakery products are relatively cheaper, or consumers perceive them as more cost-effective, so they start "voting with their feet."**
## **How Do Retailers Create "Low Prices" in Bakery?**
Since low price is one of the important advantages of retailers doing bakery, why can retailers do it while offline bakery stores cannot?
The most fundamental reason lies in the difference in profit models.
Offline bakery stores' basic profit model mainly relies on retail bakery products, achieving profits through sales, usually reflected in the difference between cost and selling price. Retailers, on the other hand, focus more on sales per square meter, emphasizing high turnover and sales volume to achieve higher overall profitability.
Simply put, the former "sells on price," while the latter "sells on volume," so their pricing strategies differ.
From a production model perspective, offline stores and retailers also differ. Currently, bakery products are mainly divided into two models: "front store, back factory" and "central factory + (wholesale/chain stores/e-commerce + offline distribution)."[6]
The "front store, back factory" model is represented by brands like Baoshifu and Momo Pastry Bureau. This production model features fresh products and relatively good taste, but low production efficiency. Retailers mostly adopt the "central factory +" model, which can improve bakery processing efficiency and optimize costs.[3] It is worth noting that many offline bakery stores, such as BreadTalk, Ganso, and Paris Baguette, also use the "central factory +" model.[6]
In this context, retailers are also continuously "competing on price" amid this round of retail transformation.
This brings us to the "price war" between Sam's and Hema over the "durian thousand-layer cake." In August 2023, Sam's popular bakery product "Durian Thousand-Layer Cake" (1kg), priced at 128 yuan, was available at Hema for only 99 yuan.
Sam's immediately lowered the price to 98.9 yuan. In the following days, Sam's and Hema engaged in a back-and-forth price war on the durian thousand-layer cake. Hema adjusted the price to 89 yuan, Sam's then lowered it by 1 yuan, Hema again reduced to 86 yuan, and Sam's followed suit with another 1 yuan reduction.[7]
At the end of the price war, the 1kg durian thousand-layer cake at Sam's stopped at 85 yuan, while Hema's price was 79 yuan. Subsequently, Hema also launched a 470g durian thousand-layer cake for only 47.5 yuan.
Now, Hema still offers two durian thousand-layer cakes: the Musang King durian thousand-layer (470g) at 49.9 yuan and the Sultan durian thousand-layer (1kg) at 99 yuan. Sam's product has been updated to Sultan durian thousand-layer (1kg) at 109 yuan.
Image source: Sam's APP and Hema APP
**Why, in the context of relatively "low prices," can retailers continue to compete on price?**
Take Hema as an example. In July 2022, Hema set up a full-chain production bakery factory in Kunshan, Jiangsu, called the "Sugar Box Factory." It is reported that the Sugar Box Factory can now achieve full-chain processing and production from flour to bread. By concentrating processes that previously required multiple factories, it saves upstream raw material procurement and transportation costs.
## **Conclusion**
As consumers' requirements for freshness of bakery products continue to rise, freshly baked and short-shelf-life bakery products have replaced traditional long-shelf-life products and become the market mainstream.
**Compared to offline bakery stores, which are mainly located in commercial districts, retailers offer greater convenience and faster reach, making them one of the main channels for bakery consumption for more and more consumers.**
However, for the large bakery market, no bakery giant has yet emerged, and the industry scale is still growing at a relatively high rate. Every brand and channel can serve its own users well, creating its own characteristics with distinctive products and services.
**References:**
[1] "Enxicun" Secures Series B Funding, Frozen Bakery Track Heats Up, April 2022, The Beijing News
[2] Everyone Is Learning from Sam's, But There Are No Secrets, September 2023, LatePost
[3] Comparison of Overseas and Domestic Bakery Category Differences and Channel Structure, January 2024, Huafu Securities
[4] New Chinese Bakery "Survivor" Luxihe Opens Franchising, July 2024, Jiemian News
[5] Blockbuster Bread Made by Supermarkets: Sam's, Hema, Pangdonglai Enter the "Bakery Top Tier," September 2024, Blue Whale Finance
[6] Analysis of Operating Models in China's Bakery Food Industry in 2023: "Central Factory" and "Front Store, Back Factory" Become Mainstream Models, September 2023, Forward Industry Research Institute
[7] Hema vs. Sam's Battle: Can "Moving Mountain Prices" Really Move Mountains? September 2023, TMTPost


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