A great recipe is not the same as a great business. Across Southeast Asia, bakeries produce remarkable croissants, sourdough, and pastries. Many of those products are excellent. Fewer of the businesses behind them are built to grow.
The commercial bakery sector in Asia Pacific is expanding steadily, supported by urbanisation, rising incomes, and growing demand for premium baked goods across retail, hospitality, and foodservice channels.1 But scale brings its own pressures. Maintaining quality when output increases, reducing dependence on skilled labour that is hard to find and harder to retain, controlling costs that rise faster than prices can follow: these are the operational challenges that determine whether a bakery remains a single location or becomes something larger.
We spoke with Chef Dech Sangsrijan, President of the Thai Bakery Association, to understand what commercial bakery operators across the region are up against and what the businesses navigating it well are doing differently.
The Gap Between a Great Recipe and a Scalable Business
The most common mistake bakery entrepreneurs make is starting with the wrong question. Chef Dech sees it regularly: a founder who knows their product well but has not yet defined who they are selling to or what makes them different from the bakery two streets away.
As he puts it, "I would recommend not starting with the question, what pastries should I sell, but rather, who are we selling to, and what makes us different? Before investing, clearly define your target consumer, product positioning, and hero product."
This matters especially in commercial bakery, where the stakes of a wrong bet are higher. Chef Dech frames the essentials around four areas: product, process, people, and profit. A business that excels at product but has not thought seriously about the other three is not built to scale. It is built around its founder.
And the distinction is important. "A delicious recipe that cannot be replicated is difficult to scale, and a best-selling product with unknown true costs is not a sustainable business."
Knowing the true cost of a product, including labour time, ingredient waste, energy, and packaging, is a foundation that many smaller bakeries skip. It becomes a problem at scale, where margins compress and inefficiencies that were manageable at low volume become damaging.
Why Consistency Is the Commercial Bakery's Hardest Problem
Quality in a small artisan bakery is personal. It depends on a baker who knows the dough by touch, reads the oven by smell, and adjusts instinctively on every shift. Producing that same quality consistently across higher volumes, multiple shifts, and a growing team is much harder.
Labour is a central challenge. The bakery sector across Southeast Asia depends heavily on skilled workers, and those workers are increasingly difficult to recruit and retain. Labour shortages across the region's hospitality and foodservice sector have been well documented, and commercial bakeries are directly affected.² Training takes time. Turnover is expensive. And a product that tastes different depending on who made it is a commercial liability.
For Chef Dech, growth therefore cannot be measured by sales alone. "The key question is not just how to sell more. It is how to ensure consistent production, reduce labour dependency, minimise waste, and maintain quality, all at the same time."
Rising raw material costs, energy prices, and rental rates add to the pressure. Commercial bakeries face the same ingredient inflation as smaller operators but with less flexibility to absorb it in pricing. Their margins increasingly depend on how efficiently the operation is designed and managed.
Technology's Role on the Commercial Bakery Floor
Equipment investment in commercial bakery is not new. What is changing is the type of equipment available and what it can do. Chef Dech sees technology entering bakery operations at three levels: production, management, and customer experience.
On the production floor, programmable deck ovens, fermentation control systems, retarder-proofers, blast freezers, and automated dough-handling equipment can reduce the variability that comes from manual processes. A programmable oven can replicate a baking profile across shifts, regardless of who is operating it. A retarder-proofer can manage fermentation time and temperature without requiring a skilled baker to monitor it overnight.
These tools do not remove the need for expertise. They reduce the dependence on that expertise being present on every shift, every day.
The same principle applies to management. Point-of-sale data and inventory systems are giving commercial bakeries the ability to forecast demand more accurately, plan production accordingly, and reduce overproduction that ends the day in the waste bin. As AI-driven tools become more accessible to small and medium businesses, that forecasting is becoming more precise.
But Chef Dech is clear about where technology should sit within the bakery: "Technology should not completely replace craftsmanship. Use technology to manage tasks that require consistency, so that people have more time for thought and creativity."
The goal, then, is not to automate craft away. It is to protect the parts of the business that depend on human skill by removing the repetitive work that does not.
Local Ingredients as a Commercial Differentiator
One area where Southeast Asian commercial bakeries hold a genuine structural advantage is local ingredients. Palm sugar, coconut, pandan, jasmine rice, tropical fruits, and regional spices are available at commercial scale across the region. They carry flavour profiles and cultural associations that imported ingredients cannot replicate.
For Chef Dech, however, the opportunity goes beyond simply adding a local flavour to an existing recipe. He argues that commercial value comes from developing those ingredients properly: standardising them for consistent use, understanding their functional properties in baked goods, and building a product story around their origin.
"The use of local ingredients should not stop at simply adding ingredients to a recipe. It must develop into local ingredient innovation. This means studying scientific properties, processing for ease of use, establishing standards, and designing narratives and identities."
For a commercial bakery, this is a practical business decision as much as a creative one. A standardised palm sugar extract that performs consistently in laminated dough production is a commercially useful ingredient. A locally sourced pandan extract with a documented flavour profile can become the foundation of a distinctive product range. These are competitive assets that businesses outside the region cannot easily replicate.
What Commercial Bakery Operators Should Prioritise Now
The pressures Chef Dech describes, from rising costs and labour dependency to the need for consistency at scale, are not going away. The businesses that build operational discipline into their foundations now will have an advantage over those that address it later.
Start by knowing your numbers. Understanding the true cost of every product, including labour time per unit, waste percentage, and energy cost per batch, is the basis for every pricing and investment decision that follows. Bakeries that grow without this visibility may only discover margin problems once they have become serious.
Build for replication from the beginning. Equipment, written processes, and documented techniques allow a bakery to train new staff efficiently, maintain consistency across shifts, and expand to new locations without rebuilding the operation from scratch each time. A process that lives only in someone's head cannot scale.
Treat equipment investment as a margin decision. The right equipment can reduce labour time, improve consistency, and cut waste. The return is not always immediate, but the operational effect compounds over time. As Chef Dech's examples of programmable ovens and fermentation control show, the real value of these tools is their ability to make quality repeatable.
Explore Commercial Bakery Solutions at THAIFEX – HOREC Asia 2027
THAIFEX – HOREC Asia brings together commercial bakery equipment manufacturers, ingredient suppliers, automation specialists, and technology providers across its Bakery and Ice Cream, Kitchen, and Tech segments.
For operators looking to invest in production capability, improve consistency, or explore new ingredient partnerships, the exhibition is an opportunity to evaluate solutions side by side and speak directly with suppliers.
Chef Dech sees this exchange as important to the industry's next stage of development. "I want to see all sectors from Thailand and abroad meet and exchange experiences, whether about raw materials, equipment, or business collaboration, to further develop the bakery industry in Southeast Asia."
Join us at THAIFEX – HOREC Asia
2–5 March 2027 | IMPACT Challenger Hall 1-2, Bangkok, Thailand
www.thaifex-horec.asia
Sources
- Bakery Products Market Size, Share & Forecasts, 2026–2034, Fortune Business Insights, 2026
- Southeast Asia's fast-growing hospitality industry has a people problem, Fortune, 2026
by Chanya Colevas
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A great recipe is not the same as a great business. Across Southeast Asia, bakeries produce remarkable croissants, sourdough, and pastries. Many of those products are excellent. Fewer of the businesses behind them are built to grow.
The commercial bakery sector in Asia Pacific is expanding steadily, supported by urbanisation, rising incomes, and growing demand for premium baked goods across retail, hospitality, and foodservice channels.1 But scale brings its own pressures. Maintaining quality when output increases, reducing dependence on skilled labour that is hard to find and harder to retain, controlling costs that rise faster than prices can follow: these are the operational challenges that determine whether a bakery remains a single location or becomes something larger.
We spoke with Chef Dech Sangsrijan, President of the Thai Bakery Association, to understand what commercial bakery operators across the region are up against and what the businesses navigating it well are doing differently.
The Gap Between a Great Recipe and a Scalable Business
The most common mistake bakery entrepreneurs make is starting with the wrong question. Chef Dech sees it regularly: a founder who knows their product well but has not yet defined who they are selling to or what makes them different from the bakery two streets away.
As he puts it, "I would recommend not starting with the question, what pastries should I sell, but rather, who are we selling to, and what makes us different? Before investing, clearly define your target consumer, product positioning, and hero product."
This matters especially in commercial bakery, where the stakes of a wrong bet are higher. Chef Dech frames the essentials around four areas: product, process, people, and profit. A business that excels at product but has not thought seriously about the other three is not built to scale. It is built around its founder.
And the distinction is important. "A delicious recipe that cannot be replicated is difficult to scale, and a best-selling product with unknown true costs is not a sustainable business."
Knowing the true cost of a product, including labour time, ingredient waste, energy, and packaging, is a foundation that many smaller bakeries skip. It becomes a problem at scale, where margins compress and inefficiencies that were manageable at low volume become damaging.
Why Consistency Is the Commercial Bakery's Hardest Problem
Quality in a small artisan bakery is personal. It depends on a baker who knows the dough by touch, reads the oven by smell, and adjusts instinctively on every shift. Producing that same quality consistently across higher volumes, multiple shifts, and a growing team is much harder.
Labour is a central challenge. The bakery sector across Southeast Asia depends heavily on skilled workers, and those workers are increasingly difficult to recruit and retain. Labour shortages across the region's hospitality and foodservice sector have been well documented, and commercial bakeries are directly affected.² Training takes time. Turnover is expensive. And a product that tastes different depending on who made it is a commercial liability.
For Chef Dech, growth therefore cannot be measured by sales alone. "The key question is not just how to sell more. It is how to ensure consistent production, reduce labour dependency, minimise waste, and maintain quality, all at the same time."
Rising raw material costs, energy prices, and rental rates add to the pressure. Commercial bakeries face the same ingredient inflation as smaller operators but with less flexibility to absorb it in pricing. Their margins increasingly depend on how efficiently the operation is designed and managed.
Technology's Role on the Commercial Bakery Floor
Equipment investment in commercial bakery is not new. What is changing is the type of equipment available and what it can do. Chef Dech sees technology entering bakery operations at three levels: production, management, and customer experience.
On the production floor, programmable deck ovens, fermentation control systems, retarder-proofers, blast freezers, and automated dough-handling equipment can reduce the variability that comes from manual processes. A programmable oven can replicate a baking profile across shifts, regardless of who is operating it. A retarder-proofer can manage fermentation time and temperature without requiring a skilled baker to monitor it overnight.
These tools do not remove the need for expertise. They reduce the dependence on that expertise being present on every shift, every day.
The same principle applies to management. Point-of-sale data and inventory systems are giving commercial bakeries the ability to forecast demand more accurately, plan production accordingly, and reduce overproduction that ends the day in the waste bin. As AI-driven tools become more accessible to small and medium businesses, that forecasting is becoming more precise.
But Chef Dech is clear about where technology should sit within the bakery: "Technology should not completely replace craftsmanship. Use technology to manage tasks that require consistency, so that people have more time for thought and creativity."
The goal, then, is not to automate craft away. It is to protect the parts of the business that depend on human skill by removing the repetitive work that does not.
Local Ingredients as a Commercial Differentiator
One area where Southeast Asian commercial bakeries hold a genuine structural advantage is local ingredients. Palm sugar, coconut, pandan, jasmine rice, tropical fruits, and regional spices are available at commercial scale across the region. They carry flavour profiles and cultural associations that imported ingredients cannot replicate.
For Chef Dech, however, the opportunity goes beyond simply adding a local flavour to an existing recipe. He argues that commercial value comes from developing those ingredients properly: standardising them for consistent use, understanding their functional properties in baked goods, and building a product story around their origin.
"The use of local ingredients should not stop at simply adding ingredients to a recipe. It must develop into local ingredient innovation. This means studying scientific properties, processing for ease of use, establishing standards, and designing narratives and identities."
For a commercial bakery, this is a practical business decision as much as a creative one. A standardised palm sugar extract that performs consistently in laminated dough production is a commercially useful ingredient. A locally sourced pandan extract with a documented flavour profile can become the foundation of a distinctive product range. These are competitive assets that businesses outside the region cannot easily replicate.
What Commercial Bakery Operators Should Prioritise Now
The pressures Chef Dech describes, from rising costs and labour dependency to the need for consistency at scale, are not going away. The businesses that build operational discipline into their foundations now will have an advantage over those that address it later.
Start by knowing your numbers. Understanding the true cost of every product, including labour time per unit, waste percentage, and energy cost per batch, is the basis for every pricing and investment decision that follows. Bakeries that grow without this visibility may only discover margin problems once they have become serious.
Build for replication from the beginning. Equipment, written processes, and documented techniques allow a bakery to train new staff efficiently, maintain consistency across shifts, and expand to new locations without rebuilding the operation from scratch each time. A process that lives only in someone's head cannot scale.
Treat equipment investment as a margin decision. The right equipment can reduce labour time, improve consistency, and cut waste. The return is not always immediate, but the operational effect compounds over time. As Chef Dech's examples of programmable ovens and fermentation control show, the real value of these tools is their ability to make quality repeatable.
Explore Commercial Bakery Solutions at THAIFEX – HOREC Asia 2027
THAIFEX – HOREC Asia brings together commercial bakery equipment manufacturers, ingredient suppliers, automation specialists, and technology providers across its Bakery and Ice Cream, Kitchen, and Tech segments.
For operators looking to invest in production capability, improve consistency, or explore new ingredient partnerships, the exhibition is an opportunity to evaluate solutions side by side and speak directly with suppliers.
Chef Dech sees this exchange as important to the industry's next stage of development. "I want to see all sectors from Thailand and abroad meet and exchange experiences, whether about raw materials, equipment, or business collaboration, to further develop the bakery industry in Southeast Asia."
Join us at THAIFEX – HOREC Asia
2–5 March 2027 | IMPACT Challenger Hall 1-2, Bangkok, Thailand
www.thaifex-horec.asia
Sources
- Bakery Products Market Size, Share & Forecasts, 2026–2034, Fortune Business Insights, 2026
- Southeast Asia's fast-growing hospitality industry has a people problem, Fortune, 2026
