Greggs, a prominent UK bakery chain, has decided against further price increases this year, maintaining stability despite recent sales challenges.
- CEO Roisin Currie cited stabilizing costs as a reason for holding prices steady, even though earlier inflation led to a brief increase in July.
- Summer sales experienced a decline due to inclement weather and economic unpredictability, impacting Greggs’ market performance.
- Despite these challenges, a strong recovery was noted in September, aided by the introduction of new autumn menu items.
- Greggs continues to focus on expansion with plans to open numerous new locations and enhance its delivery services.
Greggs, renowned for its bakery offerings across the UK, has made a strategic decision to keep prices stable for the remainder of the year. CEO Roisin Currie emphasized that “there are no plans to put up prices for this year,” due to costs stabilizing more rapidly than previously expected. Earlier in the year, the company faced inflationary pressures, largely driven by rising wages, which necessitated a slight price increase, such as the 5p rise on its popular sausage roll in July.
The challenging economic landscape over the summer led to a decline in Greggs’ sales, which was reflected in a 5.8% drop in its share price, now at £29.42. However, it is notable that the company’s stock has seen an overall increase of over 20% in the past year, indicating strong performance despite the setbacks. Currie attributed the weaker summer sales to various factors including adverse weather conditions, economic uncertainties, and specific incidents in several cities that resulted in damage to some stores.
While the summer months posed challenges, September brought a promising rebound in sales as customers returned to work following the holiday period. Greggs also capitalized on the season by launching its autumn menu. The introduction of seasonal items, such as pumpkin spice lattes and a new pumpkin spice doughnut, played a significant role in boosting foot traffic and sales figures during this period.
Expanding its presence remains a core focus for Greggs. The chain currently boasts over 2,500 outlets nationwide and has ambitious plans to open up to 160 net new stores before the year’s end. Additionally, Greggs is strengthening its foothold in strategic locations like supermarkets, petrol stations, and travel hubs. The company is also enhancing its delivery partnerships, teaming up with popular platforms like Uber Eats and Just Eat to broaden its customer reach.
Industry analysts maintain a positive outlook on Greggs’ future performance, with forecasts suggesting a potential 10% increase in pre-tax profits for the year. This optimism is fueled by the company’s robust expansion strategy and innovative menu offerings, which are expected to continue driving growth.
Greggs showcases resilience through strategic decisions and expansion amid economic challenges.
