After a 10-month absence, Wonder Bread, one of the original white sliced breads, is back on store shelves.
Thomasville-based Flowers Foods, which completed a deal in July to buy the brand and several others from Hostess Brands, began rolling out Wonder Bread on Monday in major supermarkets in Flowers’ distribution network, including metro Atlanta.
Flowers has been a dominant force, especially in the past two years, in a major restructuring of the nearly $37 billion bread production industry, as estimated by market researchers at IBISWorld Inc. A major chunk of that business includes fresh-baked breads and cakes sold at retailers.
This summer, Flowers acquired 20 bakeries, 36 warehouses and the Wonder Bread, Merita, Home Pride, Butternut and Nature’s Pride brands from Hostess in a $355 million deal. In October, a deal with the largest U.S. bread producer, Grupo Bimbo, gave Flowers Sara Lee Corp.’s distribution rights in California.
Those acquisitions and others — there have been a dozen since 2004 — helped make Flowers the No. 2 producer of everything from sliced breads, buns, muffins and bagels to cakes, behind No. 1 Grupo Bimbo, the company behind Entenmann’s and other brands, according to IBISWorld. In 2007, Flowers ranked No. 4.
White bread accounts for 22 percent of the fresh bread market, and Flowers hopes to take a bigger bite out of the category with the reintroduction of Wonder Bread.
Flowers, which had $3.1 billion in sales last year, will produce Wonder Bread at its 45 bakeries across the country, but not at the 20 bakeries it acquired as part of its deal with Hostess. Flowers spokesman Keith Hancock said consumer demand will determine “when and if and where we bring those bakeries back on line.”
Hancock said Wonder Bread will taste the same. “We are using the original recipe,” the spokesman said. “It’ll have the same taste and freshness.”
Wonder Bread, however, will be competing in a market where consumers’ tastes are changing, increasingly for bread made with whole grains and other natural ingredients, and bread that is gluten-free. According to researchers at Nielsen Co., wheat bread sales surpassed white bread sales for the first time in 2010
One investment analyst who covers Flowers, Timothy Ramey of D.A. Davidson & Co., said Wonder Bread, which will come in white and wheat varieties, will be fighting an uphill battle for market share.
“On the one hand it’s an iconic brand,” Ramey said Monday. “On the other hand it’s one of the worst-performing brands of the last 10 years.”
At a conference in Boston earlier this month, Flowers Chief Executive Officer Allen Shiver said the company’s new markets offer the “greatest potential for incremental sales.”
“Many white-bread consumers are brand-loyal,” Shiver said, “so we have calculated the incremental volume we expect once these brands are available again.”
Flowers is also reviving a more retro packaging for Wonder Bread from a decade ago.
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