Roisin Currie, chief executive of Greggs, has denied that the UK had reached “peak Greggs” and maintained that there was “significant opportunity” for the brand to open new stores in areas such as supermarkets, retail parks and transport hubs, as it aims toward a target of 3,000 sites.
It comes as the business reported pre-tax profits of £63.5m in its half-year interim results, down from £74.1m last year, which it put down to snowfall and heatwaves as well as higher costs that hit businesses this year.
The 2,649-strong company has plans to open about 150 stores a year and is testing out “bite-size” Greggs, a smaller outlet focused on a narrow range of its bestsellers – so that it can rent pricier locations in the south.
Currie said: “I don’t believe we’ve reached peak Greggs. If you look at the map of the UK, there are still lots of areas where you cannot access Greggs. Our trial of new concepts such as ‘bitesize Greggs’ aims to enable more convenient access to Greggs, driving greater visit frequency, and supports the scale of estate opportunity in the medium term.”
However, she acknowledged that growth is “not about chasing numbers”, adding that Greggs has seen its newer shops outperform its traditional estate, showing “we are choosing the right opportunities”.
Currie also said Greggs had “the flexibility that if you see a catchment has changed or high street has changed”, then it was able to move sites. Currie described conditions as challenging, with consumer confidence low and people “saving rather than spending”, especially those on lower incomes.
Currie said more than 30% of Greggs’ product range were now healthy options and that the company was mindful of the potential future impact of diet drugs such as Ozempic.
She said that there was “no doubt” that the injections were changing “what and how” people eat, and that the bakery chain was looking at adapting its range to suit these customers.
Russ Mould, the investment director at the broker AJ Bell, said that the lack of information on current trading has “left investors wondering if the business has become as stale as a day-old Belgian bun.”
He said: “This situation won’t stop the growing debate about whether Greggs has reached peak sausage roll. There are suggestions it has grown too fast, the menu is too bloated and consumer tastes are changing.
People want healthier options, and while Greggs has some of these in its stores, the core pastry-based items remain its bread and butter.”
