As consumers and retailers have become more educated and aware of the environmental impacts of doing business, sustainability has become more critical for bakery and snack manufacturers to incorporate. Sustainable practices go beyond one department to encompass the entire operation. 

“Sustainability is no longer just an environmental focus; it’s now a key component of operational efficiency, aligning with long-term financial goals and positioning bakeries for continued success,” explained Rasma Zvaners, vice president of government relations at the American Bakers Association (ABA). 

What manufacturers have realized is that doing business sustainably often makes good business sense. Operational efficiency has benefits for both the bottom line and the environment. 

“Sustainability at its core is about being efficient,” said Margaret Ann Marsh, senior vice president, safety, sustainability and environmental, Flowers Foods. “Establishing processes that enable maximum production volume with the fewest number of resources will help companies operate as efficiently, and thereby as sustainably, as possible. This includes minimizing downtime, energy, waste and water.” 

While sustainability investments can cost capital up front, the efficiency benefits can save a bakery money. 

“As energy costs rise and market conditions shift, there appears to be a growing interest among bakeries to embrace energy management practices and sustainability initiatives that lower waste and improve ROI,” Zvaners said. “Energy Star certifications and advanced processes like heat recovery are helping companies cut costs while reducing their environmental impact.” 

Flowers Foods aligns its sustainability program with the company’s corporate strategy with a focus on ROI. In 2023, the company set its 2030 sustainability goals and updated its baseline to 2020. Flowers committed to reducing greenhouse gas emission intensity by 20%, lowering water intensity by 10% and diverting 98% of waste from landfills companywide.

“When setting these goals, we estimated savings opportunities based on the effectiveness of past projects across our network,” Marsh explained. “Our process considers a variety of factors such as current and forecast production output as well as the ratio of products that may be more energy or water intensive and available capital, among others.” 

Sustainability improvements to operations and equipment/technology investments can provide efficiency and cost benefits. The other side of the equation is the supply chain and consumers’ and customers’ expectations. These are often focused on ingredient sourcing and packaging. 

In the 2024 ABA Bakery Playbook on Buns and Rolls, one-third of bakery consumers reported that a commitment to responsibly sourced ingredients is a priority when it comes to their buns and rolls purchases. About 20% of consumers look for commitments in limiting packaging waste and community contributions. This packaging demand also shows up in PMMI’s research. 

“Consumers want packaging to be compostable or recyclable,” Marquez said. “They don’t want to see it in the ocean. They want packaging to be a certain way, and the brands must deliver what customers and consumers want. Those CPG (consumer packaged goods) companies want to work with OEMs (original equipment manufacturers) who also have those goals and practices in mind.” 

On the ingredient side, consumers and retailers are looking for bakery and snack manufacturers to source their ingredients responsibly and humanely and have the paperwork to back it up. This is an attempt to root out greenwashing and make sustainable change. 

“The primary drivers across commercial baking, ingredient manufacturers and equipment manufacturers to incorporate sustainability initiatives and supply chain verifications are part of a long-term risk management solution along with market and customer demand,” Zvaners said. “For example, in recent years, businesses have increased the frequency and scope of auditing not only their own operations but also their supply chains as part of the broader sustainability umbrella.” 

While sustainability initiatives often fall in line with good business sense, at the end of the day, ROI and cost can make or break a project. It’s been a barrier on the packaging side.

“Everything comes down to cost; we can’t just operate based on principle,” said Rebecca Marquez, director of custom research for PMMI Media Group. “If someone has been requested to package chips in a recyclable package with flexible films and they see the price difference in materials, that can sway the decision. There are so many factors that can contribute to the final decision on a sustainability initiative.” 

As baking and snack companies approach their target deadlines, they are evaluating their initiatives to ensure they’re adding to the business’s success. 

“From an ROI perspective, it’s important that any sustainability project makes business sense,” Marsh said. “We keep an eye on changing dynamics and update business cases for a particular project when appropriate.”