Published: 06 Oct 2010
Last Updated: 06 Nov 2012
Have Greggs customers only just been told that breakfast is the most important meal of the day? Apparently, their new-found enthusiasm for bacon rolls has helped to boost sales at the bakery chain during what could otherwise have been a fairly challenging few months. The company has just reported a 0.2% increase in like-for-like sales during its third quarter - lower than the yearly average of 0.7%, but nothing to be sniffed at, given the ‘increasingly challenging trading environment’. So it's going even bigger on breakfast, branching out into pastries and porridge. May be a bit la-di-da for some of its punters...
According to Greggs, this passion for breakfast began back in February, when the company introduced a special early-morning offer. Since then, the humble bacon roll has become its best-selling sandwich. Now it’s planning to expand its breakfast range to include such sophisticated foreign fare as pains au chocolat and croissants, and is even thinking of introducing porridge. You wouldn't naturally associate Greggs with the healthy option, admittedly, but we're all for experimentation.
Despite our enthusiasm for bacon rolls, though, Greggs has had a tough few months. Chief exec Ken McMeikan says the company has been struggling with ‘constrained’ consumer spending, and he expects inflation in food prices to cause problems in the final quarter of the year. With the price of wheat still putting pressure on bakers, McMeikan says he doesn’t expect the three months to Christmas to be an easy ride. With a forecast of ‘broadly flat’ sales in the last few months of the year, it expects a ‘marginally positive’ outcome for the full year. So nothing for investors to get excited about.
Those forecasts haven’t stopped the company’s seemingly unstoppable expansion, though. With 32 new shops opened so far this year, it’s on track to hit its target to open ‘between 50 and 60’ new stores this year. And, with plans to conquer the South West, North East Scotland and North Wales too, the company is also planning to open at least 70 new outlets a year from 2011 onwards. That’s pretty ambitious, whichever way you look at it. Though we're not entirely sure what the good people of the South West will make of Greggs’ pale imitation of a Cornish pasty...
According to Greggs, this passion for breakfast began back in February, when the company introduced a special early-morning offer. Since then, the humble bacon roll has become its best-selling sandwich. Now it’s planning to expand its breakfast range to include such sophisticated foreign fare as pains au chocolat and croissants, and is even thinking of introducing porridge. You wouldn't naturally associate Greggs with the healthy option, admittedly, but we're all for experimentation.
Despite our enthusiasm for bacon rolls, though, Greggs has had a tough few months. Chief exec Ken McMeikan says the company has been struggling with ‘constrained’ consumer spending, and he expects inflation in food prices to cause problems in the final quarter of the year. With the price of wheat still putting pressure on bakers, McMeikan says he doesn’t expect the three months to Christmas to be an easy ride. With a forecast of ‘broadly flat’ sales in the last few months of the year, it expects a ‘marginally positive’ outcome for the full year. So nothing for investors to get excited about.
Those forecasts haven’t stopped the company’s seemingly unstoppable expansion, though. With 32 new shops opened so far this year, it’s on track to hit its target to open ‘between 50 and 60’ new stores this year. And, with plans to conquer the South West, North East Scotland and North Wales too, the company is also planning to open at least 70 new outlets a year from 2011 onwards. That’s pretty ambitious, whichever way you look at it. Though we're not entirely sure what the good people of the South West will make of Greggs’ pale imitation of a Cornish pasty...
