Greggs makes ‘good’ start to year
Bakery chain Greggs has reported making a good start to the year with total sales up 5.7% in first 18 weeks of 2016.
Company-managed shop like-for-like sales increased by 3.7% in the period as improvements made to the retailer’s stores and product range continued to drive growth in trade.
Greggs said its hot sandwich range and extended breakfast menu had proved particularly popular and the introduction of flat white coffee had helped to maintain double-digit growth in sales of hot drinks. In addition, the company has been encouraged by trials of its upgraded range of salads.
During the period, Greggs completed 55 shop refurbishments and in total will refit around 200 shops this year. In the year to date, it has opened 43 new shops, including 23 franchised units in transport locations. In addition, some 21 shops were closed to give a total of 1,720 shops trading at 7 May.
Greggs’ shop openings continue to focus on new food-on-the-go locations and the relocation of existing shops to support further growth.
At the time of its preliminary results in March, Greggs announced that it would be entering into consultation with trade union and employee representatives to consider proposals to close three bakeries as part of a proposed £100 million investment programme in its manufacturing and distribution operations. With the formal collective consultation on the proposals now ended, Greggs is proceeding with plans to close the three bakeries involved.
In a statement, Greggs said: “Our people impacted by these proposals have demonstrated their commitment and professionalism during a difficult period and our focus now is to work with them individually to ensure that we manage these changes in line with Greggs’ values as a responsible employer. Alongside these closures we will continue to develop our plans to invest in our remaining supply chain network over the next five years in order to create centres of excellence serving our growing shop estate.”
Looking ahead, the company added: “We have made a good start to the year. Input cost inflation remains low despite increased wage costs and, with a strong pipeline of product initiatives and plans to invest in our shops and supply chain, we expect to make progress in line with our previous expectations.”
