FULL CREAM AHEAD 2004-03-22 (1)

LYNNE MILLER

Favorite baked goods never go out of style, even when everyone seems to be watching their weight. Despite the national obsession with health and dieting, retailers told SN they are having no trouble selling special-occasion cakes and pastries, as well as old favorites like brownies, cookies and bars.

In some cases, retailers have simply repackaged existing products and generated new demand for smaller sizes and single-serve portions.

Officials at Kowalski's Market stores in the Twin Cities recently revamped the pastry and cake line, and initiated an extensive single-slice dessert program. The changes have attracted new customers to the bakery and boosted sales, said Steve Beaird, director of bakery for Kowalski's, Woodbury, Minn.

The company reduced the size of a special-occasion torte from four layers to make it "family friendly," Beaird said. The new torte is still eight inches in diameter, but only two to three layers high, and retails for about $15, he said.

Bars in eight flavors, including brownies, coconut macaroon and cream cheese, remain popular. Kowalski's stores sell them in six-count packages for $2.99. Yet, one of the biggest success stories for the nine-store chain is the slice program. "The biggest thing working for us now in the last six months is the slice," he said. "Anything from our pastry tortes to chocolate cake to a pie, anything in a slice is just exploding for us."

Last year, Kowalski's started slicing up all sorts of cakes, pies and pastries, and packaging the items in single-serve plastic containers. The single slices appeal to many different consumers, including dieters, families and small households, Beaird said. Pastry tortes, chocolate cake, fruit and creme pies, carrot cake, truffle cake and turtle cake are among the desserts available. All slices are packaged in either hinged one-piece clamshells or two-piece packages, the bases of which are black to create an upscale appearance, Beaird said.

"We always did slices to a certain extent, but not to the extent of the program we have now. In the last six months since we've rolled the program out, our torte production and cake production, I'd say, has increased by at least a third."

Selling products by the slice is "like a mini sample program," he said, noting it helps drum up repeat business. Furthermore, it is more profitable than whole product sales, he said. A torte, cut up into eight slices and retailing for $2.99 a slice, can bring in $24, vs. $15 for the whole cake.

"If you only sell five out of eight slices, you still made as much as if you had sold the whole cake," Beaird said. "It helps you cover your stales."

Unlike other retailers, Kowalski's actually bakes products specifically for the slice program. Many stores take products a couple days old and slice them up, hoping to save the last day of sale, he said.

"That's a common practice," he said. "I know it goes on. When we put slices out there, we take a fresh torte and slice it up. We're not going to sell them a day old."

Smaller cakes as well as single-serve items are also popular at Bashas' bakeries. Decorated two-layer ganache cakes, in eight-inch and four-inch sizes, are made fresh in the ISB. The Chandler, Ariz.-based operator rolled out the cakes, in five varieties, just over two years ago. The stores serve many retired consumers who have small households, and that helps explain why the stores sell more of the four-inch cakes than the eight-inchers, said Rodger Slater, who heads up the bakery division for the 80-store chain. The eight-inch cakes retail for $12.99, while the four-inch varieties are $8.99.

Just over a year ago, all cake decorators received training on making the high-end cakes. Since then, the bakeries have seen increased sales, Slater said. Associates are able to make the cakes at a good price, so they are a profitable item for the bakeries. Presentation is a big part of the program. Bakery associates place the chocolate and white ganache cakes on pedestals in service cases. Under the pedestals, associates lay out an assortment of fruit tarts, eclairs and cannolis -- also strong sellers. Stores purchase eclair and cannoli shells, and associates stuff them with sweet fillings.

"We make a colorful statement," said Slater. "It looks beautiful."

The ice cream cakes from Carvel can also drum up good business for bakeries, too, though they are not very profitable, Slater said. Those Bashas' units with an ice cream cake cooler in the bakery offer eight-inch round and quarter sheet cakes, retailing for $16 to $21. Stores are also starting to offer Lil' Love, a line of three, smaller-size rounds that were designed by the Atlanta-based manufacturer specifically for more casual events that may not warrant the purchase of an expensive full-size item.

"They sell well," Slater said.

Single-layer dessert cakes form the backbone of the bakery business for stores operated by Fresh Brands, Sheboygan, Wis. Every week, the company features one cake at a special price, $5.99 or $6.99, a dollar off the regular price. Flavors run the gamut from chocolate mint to Boston creme to lemon poppy seed and German chocolate.

Other popular flavors include seasonal favorites, like strawberry in springtime. The company's bakery facility in Platteville, Wis., supplies fully assembled cakes to the stores without decorating services, and blanks to the stores with decorators on staff.

"We hang our hat on our cakes," said Candy Kornitz, merchandising planner for bakery and deli for Fresh Brands, which operates 28 corporate stores, and serves 70 franchised stores.

The featured cake of the week can generate enough interest that the Platteville facility may ship out as many as 100 cases of the cake, ready to sell, plus additional sales at the stores that make their own, she said.

"It's a small enough cake that it won't sit around in the kitchen forever," Kornitz said. "And the price point -- it's not $10. [Consumers] don't feel guilty about it. It doesn't have to be a special occasion."

Cookies are perennial favorites, too. Stores carry nine varieties of soft cookies, weighing 2.3 ounces apiece. Three years ago, the company stopped baking off cookies and started outsourcing to ensure the bakeries had a constant supply of all the popular varieties. Cookies are delivered to the stores fully packaged in 10-count packs, so there's no labor involved, Kornitz said. Packages retail for $3.79.

"If we can save labor and get good-quality product, and done right every time, that's great," she said. "We have cookies on the floor all the time."

In the Northeast, stores operated by Syracuse, N.Y.-based Penn Traffic report increases across the board in sales of cakes, pies, cheesecakes, brownies and the cookie categories, a spokesman for the chain said. Penn Traffic operates 111 stores in four states under the banners of Bi-Lo Foods, Quality Markets and P&C Foods.

"It appears for these kinds of dessert items, taste is paramount," Penn Traffic spokesman Joe Ramirez said. "There are low-fat, low-carb versions of some of these products. Evidently, consumers have decided they don't taste as good as the regular ones, which is why they continue to sell strongly."