local suppliers
Mercadona announced a strategic shift in its bread production model. Over time, the company will reduce in-house bread manufacturing within its logistics blocks and rely more on local specialist providers. The plan follows a lengthy testing phase that brought together about 20 suppliers and aimed to boost bread quality while streamlining production to drive efficiency and profitability across the chain.
Bread remains the only category in Mercadona that has historically produced in its own style, with multiple lines designed for use in its warehouses. The company explains that continued collaboration with local specialists will help maintain the promise of high quality at the lowest possible price in this category.
The initiative began with a pilot project in 2018, supported by many specialist suppliers who assumed responsibility for production. Through this collaboration, more than 20 million kilos of specialty breads were produced annually, including varieties such as milk bread, rustic loafs, and wholemeal options. Following the pilot, Mercadona progressively expanded the network of local suppliers as part of a broader strategy to strengthen competitiveness in the bread category through deeper knowledge of production processes and tighter management of raw materials.
Among the collaborators are Valero making peasant bread in Catalonia since 2021, PandeCan producing pan de millo and matalahuva in the Canary Islands since early 2022, and Mondat, an Andalusian supplier creating holistic sandwiches in recent months. Each partner has contributed to a more resilient supply chain and a more efficient use of resources, reinforcing the category’s ability to deliver top quality at accessible prices.
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The ongoing plan maintains twenty bread lines spread across eight logistics blocks and is designed to gradually replace in-house bread production with the engagement of specialized external providers. The transition is being managed to ensure continuity and stability across stores while new suppliers scale up their output.
The company emphasizes that the shift will not affect the 650 employees currently working on bread furnace lines. Legal representatives for workers have been kept informed throughout the process as displacement considerations are addressed and appropriate measures are put in place to support staff during the transition.
As the restructuring unfolds, space within logistics blocks will be reallocated to support the core operations of receiving, storing, and shipping products. The aim is to free up capacity for the day-to-day activities that keep the supply chain moving smoothly while preserving the quality standards customers expect.
Mercadona’s bread production manager, Ariana Gonzalez, notes that nearly four years of close collaboration with suppliers have provided the data and insights needed to develop this strategy. With the planned improvements in quality and efficiency validated, the company decided to phase out most of the in-house bread lines. The overarching goal remains simple and clear: offer an effective range of products of the highest quality at the lowest possible price, while maintaining reliability and consistency across the network.