Greggs sees opportunity for expansion
December 10, 2008
by Eric Schroeder
LONDON – Ken McMeikan, chief executive officer of Greggs, said the U.K.-based bakery retailer is poised for considerable potential for future growth, but in the near term will remain focused on simplifying the business to prepare for accelerated expansion.
As part of its expansion plans, Greggs said it intends to move into more locations away from high streets and shopping malls. In addition, the company plans to move to a single Greggs fascia throughout the United Kingdom, with its Bakers Oven shops being rebranded as Greggs. This will enable Greggs customers to enjoy instore bakeries and cafés as well as allowing the former Bakers Oven shops to leverage the full benefits of national advertising and buying.
"My initial review has confirmed the strengths of the Greggs business, its employees and the many opportunities for growth," Mr. McMeikan said. "The Greggs brand inspires great loyalty based on its reputation for value, taste, freshness, quality and friendly service. Over the coming year our priority will be to simplify the business and strengthen its capabilities to ensure that we are ready for accelerated growth and expansion."
In a trading update issued Dec. 9, Greggs said total sales in the 25 weeks ended Dec. 6 rose 6.6%, including like-for-like sales growth of 3.8%. This compares with total sales growth in the first 16 weeks of the period of 6.7%, including like-for-like sales growth of 3.9%.
"I am pleased with the progress we have achieved given the difficult trading conditions," Mr. McMeikan said. "As ever, the final outturn for the year remains dependent on the important Christmas trading period. Our customers will not be immune to the effects of the economic downturn; however, I believe that our value positioning and great quality products give us a competitive advantage in the current trading climate. As a cash generative business with no debt we are in a strong position not only to weather the current downturn but also to exploit the opportunities for future growth."