Company Vitae: Greggs

Retail baker Greggs has been cooking up a storm on the high street and stock market alike, thanks to its thrifty pies, pasties and sandwiches. So what is its recipe for success?

by MT Staff
Last Updated: 04 Mar 2015

Formative years

In 1939, Tyneside trader John Gregg got on his bike and started delivering yeast and eggs to local families. Twelve years later, he hung up his cycle clips and opened the first Greggs shop, in Gosforth, making fresh bread and cakes in a small bakery at the back. Ration-weary locals snapped them up and the business took off. By the mid 1960s his son Ian had donned apron and funny hat to begin an expansion drive, buying up regional rivals and introducing local delicacies such as heart-stopping Geordie favourite the pig stottie to new customers across Scotland, Yorkshire and Lancashire. By 1984, the business had 261 stores and was floated on the London Stock Exchange. It's now a stalwart of the FTSE 250 index.

Recent history

After listing, Greggs advanced rapidly and by the late 1990s was covering most of Britain, including Cumbria, the Midlands and London and the south-east. In 2008, it rebranded its 165 Bakers Oven stores as Greggs, followed by a national advertising campaign, fronted by comedian Paddy McGuinness. Sales in the crucial Christmas week last year rose 16% compared with 2009, with coffee sales up 26%. More than 60 new stores were opened in 2010, and there are plans for another 500.

Who's the boss?

As former retail director of Sainsbury's and boss of Tesco in Japan, CEO Ken McMeikan knows about making both kinds of dough, and chairman Derek Netherton was Schroders' head of corporate finance in the 1990s. They've assembled a high-powered board and a canny strategy that has seen Greggs' standing in the City rise faster than sales of its cheese-and-onion pasties.

The secret formula?

Greggs' array of inexpensive sandwiches, hot pies and snacks (plus the odd regional favourite) is a sure-fire winner in New Austerity Britain. For the price of a coffee from one of the big chains, workers across the country can breakfast on coffee plus bacon or sausage roll at Greggs. And its network of 10 regional bakeries supplying numerous stores is cost-effective and flexible.

Proudest achievement?

With almost 1,500 stores, Greggs has more outlets in the UK than fast-food giant McDonald's.

Don't mention...

Belgium. In the early noughties, Greggs opened shops in Belgian cities such as Antwerp and Leuven. But in a rare show of unity, both Flems and Walloons turned up their noses at the Greggs recipe and all 10 outlets have now closed.

Vital statistics
Revenues: £658.2m (2009)
Operating profit: £48.4m (2009)
Stores: 1,480
Employees: 19,000
Mince pies sold at Christmas: 8 million

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