Bakery chain to expand on back of strong sales

By staff reporter

- Last updated on GMT

Related tags Cost

The good wheat harvest and reduced energy costs contributed to strong sales despite continued cost increases in some ingredients, claims UK bakery chain Greggs

The bakery company stated that in the 42 weeks ending 17 October, total sales increased by 3.8 per cent, while in the first 16 weeks of the second half, up to 17 October, total sales increased by 2.5 per cent.

In August, Greggs reported a pre-tax profit of £16.5m for the first six months of the year, an increase of 7.3 per cent.


Greggs maintains that the growth opportunities within the UK are significant, and that it intends to open 50-60 new stores in 2010 and at least 70 new shops per year from 2011 onwards.

“It remains our belief that a further 600 plus shops can be opened in the medium term with little cannibalisation of sales from our existing shops.

“This will take our shop numbers above 2,000, making us accessible to many more consumers and creating some 6,000 new jobs,”​ stated the company.

Supply chain overhaul

The group also said that it has undertaken a fundamental review of its supply chain to determine how it can achieve the optimal production and distribution network to support its planned growth.

The company said that to fulfil its potential it plans to renew older bakeries to improve quality, efficiency and capacity for growth.

Moreover, it said that it intends to extend other bakeries to facilitate greater expansion than previously planned, provide the capability for new shop growth in the south by replacing its Twickenham bakery, and build a new bakery to support growth in the south of England.

‘The development of our supply chain will require an increase in capital expenditure over the next 3 to 5 years but deliver eventual annual efficiencies of at least £10 million per annum,​’ claims the bakery group.

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