ROCKVILLE, MD. – Retail dollar sales of in-store bakery goods reached $13.4 billion in 2013, up from $12.8 billion in 2012, according to a new report from the market research firm Packaged Facts titled “In-store bakeries: U.S. market trends.”

Consumer perception of the freshness and quality of the products created in store bakeries is driving sales, said David Sprinkle, research director. The success of the departments has not been lost on competitors in the retail space, and in-house bakeries have become critical components in warehouse stores and supercenters. The Packaged Facts report added fresh baked goods are moving beyond the supermarket perimeter and into convenience and drug stores as well.

The supermarket industry’s reliance on in-house bakeries, combined with higher price points, has allowed the in-house baked goods market to experience a dollar sales increase every year since 2008. Packaged Facts predicts the gains will continue through 2017 despite challenges due to economic conditions and health and diet concerns.

The research firm doesn’t expect consumer spending to surge during the next few years, but the popularity of sandwiches as a staple of American-style, on-the-go eating will support sales, and most consumers still will want to indulge at least occasionally in sweet baked affordable indulgences.

Packaged Facts forecasts desserts should continue to drive overall growth with similar sizes, portion control, and on-the-go products leading the way. Breads and rolls, on the other hand, should lag, but artisan and higher quality breads, as well as different varieties of rolls, should stand out on shelves.

“Commodity breakfast bakery products will be challenged to remain compelling as consumers seek out these products in various other outlets, including food service,” the report said.