Popular UK bakery chain Greggs continues its growth by planning to open a number of new outlets in the coming months, creating new retail jobs in the process.
The company plans to open around 100 new stores by the end of the year, with expectations it will create about 500 jobs.
Sales at Greggs rebounded to pre-pandemic levels in the first half of the year, bringing the firm back into profit. It now believes the profits for the full year will end up “slightly ahead” of previous predictions, as sales are stronger than expected.
In the six months to 3 July, Greggs reported £55.5m in profits, compared with the previous year’s loss of £65.2m.
The chain say the recovery in trade in recent months is helped by the lifting of Covid measures, making it “stronger than we had anticipated”. Easing restrictions “made a significant difference to footfall”. Sales in the second quarter of the year are up 2.8%, in comparison to the same period in 2019, prior to the pandemic.
However, performance varied between shops in different locations. Stores in public transport hubs and large city centres were among the weakest. This suggests that a lot of workers are still working from home and not yet returned to the office. The knock-on effect of this is benefiting other areas though. Greggs say, “customers staying closer to home are supporting our heartland shops in suburban and High Street areas”. Meanwhile, the outlets performing strongest are those “typically accessed by car”.
Areas of growth
At the start of July, Greggs had 2,115 locations, and is now looking at ambitious growth plans. It currently has the opportunity to expand its UK presence to at least 3,000 stores.
The results show the underlying strength of the business. Greggs boss Roger Whiteside says the figures are proof of the chains “resilience in a challenging first half”. The firm are “emerging from the lockdown months in a strong position and rebuilding sales” as social restrictions relax.
The chain is targeting growth areas such as delivery and drive-thru sales.
The company is experiencing the effects of a return to normal life, along with the benefits from investments made during the pandemic. Like many other businesses, Greggs had to adapt to customers forming new habits during lockdown, and focus more on digital initiatives.
Greggs has made good progress as workplaces reopen and staff return to city centres. But now the pressure is on to keep up the momentum, as they cannot afford to slow down.
Customer passion for its food is a big boost to success, but if Greggs hopes to get back to previous heights, it needs more. Covid restrictions need to end permanently, pandemic contingency plans need making, and a new product or viral PR campaign would go down a treat. Maybe then the chain can resume giving employee bonuses.
Last week Greggs launched a new vegan sausage, bean and cheese melt, which they hope will help increase sales in the coming months.
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