Smart Cookie Newsletter - Issue #13

What we learned from the Midterm Elections about 2026 for Bakeries

The 2025 midterm elections revealed that uncertainty and consumer anxiety remain high, but opportunities abound for bakeries prepared to adapt. Win in 2026 by leaning into these proven strategies:

What Bakery Owners Should Do Next

^{1. Embrace Strategic Flexibility and Product Innovation}

The era of "one-size-fits-all" bakery menus is over. Just as centrist candidates outperformed ideological extremes in recent elections, bakeries that balance core strengths with strategic innovation are capturing market share. Start by auditing your existing menu. What are your genuine bestsellers? Build on those, but test new offerings in a disciplined way.

Seasonal and limited-edition products generate excitement without requiring permanent shelf space or long-term commitment. A rotating selection of flavors—think lavender-honey in spring and pumpkin-cardamom in fall—creates urgency and gives customers a reason to return. But here's the key: be intentional. Each new flavor should connect to consumer wellness trends, seasonal rhythms, or cultural moments that resonate with your community.

Speaking of wellness trends, don't ignore the data. Gut-health breads with sourdough, sprouted grains, and active cultures are seeing sustained demand. High-fiber options appeal to health-conscious consumers. Gluten-free and plant-based treats are no longer niche—they're mainstream expectations. Develop signature versions of these items that feel authentic to your brand rather than like afterthoughts. Quality over quantity always wins.

The lesson from the midterms? Moderation, practicality, and clear value propositions succeed. Apply that same philosophy to your product strategy. You don't need to reinvent your bakery overnight, but you do need to evolve deliberately and stay attuned to what customers actually want.

2. Invest in Smart Operations and Staff Development

Rising labor costs, ingredient inflation, and supply chain complexity mean that operational excellence is no longer optional—it's your competitive moat. Bakeries that invest in intelligent systems and well-trained teams will outpace those trying to cut corners.

Start with technology. Online ordering systems, inventory management software, and customer relationship tools aren't luxuries anymore; they're table stakes. These platforms reduce errors, streamline communication with customers, and free your team to focus on what matters: baking exceptional products and delivering excellent service. A mobile-first ordering system is particularly critical. Customers expect to place orders from their phones, and the convenience drives loyalty.

Your team is your most valuable asset, but only if they're equipped to succeed. Invest in training programs that help staff understand your brand, master your processes, and feel valued. Cross-training bakers and front-of-house staff reduces bottlenecks and creates flexibility. When your team feels supported, they take pride in the work, and customers notice.

Supply chain resilience matters more than ever. Don't rely on a single supplier for critical ingredients. Build relationships with multiple vendors, negotiate long-term pricing when possible, and consider strategic partnerships with local suppliers. Local sourcing isn't just good marketing—it's also a practical risk management strategy. It reduces transportation delays, supports your community story, and can actually improve cost stability in volatile times.

Cost management requires quarterly discipline. Sit down with your financials every three months. What's your food cost percentage? Where is waste occurring? Are prices aligned with your competition and your value proposition? Don't be afraid to adjust pricing when costs rise—customers understand inflation and appreciate transparency. A bakery that maintains margins stays in business longer and can invest in growth.

3. Build Deep Community Connection Through Authentic Storytelling

Consumers are exhausted by polished corporate messaging. They're drawn to authenticity, local ownership, and businesses that genuinely connect with their communities. This is your bakery's most significant advantage over national chains and mass-produced competitors.

Social media should be your storytelling platform, not just a promotional channel. Share the real story: family recipes passed down through generations, the inspiration behind your signature items, the people who work in your bakery, the suppliers you partner with. Show the process—the early morning prep, the artistry of shaping dough, the care that goes into every batch. Customers don't just want baked goods; they want to be part of a story.

Behind-the-scenes content performs exceptionally well because it humanizes your business. A video of your team prepping for the morning rush, a photo series showing how you source your chocolate or flour, or a short clip of a baker explaining why they chose a particular technique—these moments build connection and loyalty. People become customers, then fans, then devotees.

Use pre-orders strategically. For festive season holidays such as Thanksgiving, Christmas, Valentine's Day, and Easter, encourage customers to place orders for specialty items in advance. Pre-orders solve multiple problems: they smooth production planning, reduce waste, build anticipation, and generate revenue early. They also give customers a reason to engage with you more frequently.

Loyalty programs don't have to be complicated. A simple punch card, a text message-based rewards system, or a straightforward email newsletter keeps your bakery front and center. Regular communication—maybe a weekly email about what's fresh this week or what's coming next—turns casual customers into habitual ones.

4. Prioritize Convenience and Build Trust Through Transparent Service

Modern customers are time-poor and value-conscious. They want great products delivered conveniently, and they want to trust that your business has their best interests in mind.

A frictionless ordering experience is non-negotiable. Whether customers order in person, online, or by phone, the process should be seamless. Mobile ordering, online pre-ordering for pickup, and delivery partnerships (DoorDash, local couriers) expand your addressable market beyond people who can physically visit your location. Not every bakery needs all these channels, but it's advisable to offer at least a few.

Staff training in customer service is directly tied to trust. When a customer has a question or concern, how your team responds determines whether they return or tell ten friends to avoid you. Train your team to listen effectively, solve problems efficiently, and communicate clearly. When something goes wrong—a special order isn't quite right, a delivery is late—your response matters more than the mistake itself.

Transparency builds loyalty. If you're raising prices, explain why (e.g., ingredient costs, better quality sourcing, or wage increases for your team). If you're discontinuing a beloved item, explain what's replacing it and why. If you're dealing with a temporary shortage, communicate proactively. Customers are forgiving when they understand what's happening behind the scenes.

5. Plan for Resilience and Build Flexibility Into Your Business Model

Uncertainty is the new normal. Election cycles, policy changes, economic fluctuations, and supply chain disruptions will persist. Resilient bakeries survive and thrive through these cycles because they've built flexibility into their model.

Start with your physical location. If you're locked into a long-term, inflexible lease with escalating rent, you're at a significant disadvantage. Negotiate terms that allow for adjustments or early exit clauses. Consider whether you have backup production capacity or alternate revenue streams (catering, wholesale, farmers’ markets) that reduce dependence on retail foot traffic.

Financially, maintain a buffer. A cash reserve covering three to six months of operating expenses gives you breathing room when revenue dips. This buffer also allows you to take advantage of opportunities—such as buying ingredients at a discount, upgrading equipment, or investing in marketing when the timing is right.

Diversify your revenue streams. Retail sales are the foundation, but wholesale relationships with coffee shops, offices, and boutique grocery stores add stability. Catering events, custom cakes for celebrations, corporate orders, and online shipping (if your products travel well) spread risk across multiple customer segments.

Regular business planning—not just annual, but quarterly—keeps you ahead of problems. Review what's working and what isn't. Are certain products consistently underperforming? Is staffing a bottleneck? Is rent consuming too much of the revenue? Early detection of issues means you have time to adjust rather than react in crisis mode.

Looking Ahead to 2026

The bakery industry is evolving, and the businesses that will succeed are those that combine timeless values—such as quality, craftsmanship, and community—with modern tools and business discipline. The 2025 midterms taught us that moderation, transparency, and clear value win. Customers are tired of extremes; they want simplicity, authenticity, and genuine benefit.

Your bakery can be that beacon. By staying agile, investing in your team and operations, telling your authentic story, prioritizing convenience and trust, and building resilience into your business model, you'll be positioned not just to survive 2026 but to thrive.

The time to act is now. Don't wait for perfect conditions or complete certainty. Start today: audit your operations, test new ideas, deepen customer relationships, and plan deliberately for the year ahead. Your 2026 success depends on the decisions and investments you make over the next few weeks.

Bake well. Build better. Your best year is ahead.

Keep rising,

Jimmy MacMillan

Principal Chef, Consultant, Successful Bakery

P.S. If you found this helpful, forward it to another bakery owner who could benefit from it. Growing together makes us all stronger.