Boss of Greggs says breakfast deal a ‘compelling offer’

Roger Whiteside may be one of the most amicable FTSE bosses in the UK to have breakfast with, but that is still not going to stop him having a go at you if he thinks you are paying over the odds for the first meal of the day.

The boss of Greggs plc – the UK's largest high street bakery chain – cannot understand why consumers would choose any other option over its £2 breakfast deal – a roll with bacon/sausage or egg plus coffee.

He thinks it is simply a “compelling offer”, and latest figures from the food- on-the-go retailer suggest that thousands of Greggs fans feel the same way.

The group’s latest trading figures show the growing popularity of its breakfast deal is just one of the factors behind a 7.5 per cent jump in total sales for the first 19 weeks of 2017.

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In a trading update issued in advance of its agm, which takes place at Greggs House at its headquarters in Newcastle-upon-Tyne on Friday, the UK bakery group said customers “increasingly recognise the quality and value”of its breakfast deal, and as a result the group ,which first began trading as a family bakery in 1951, had “invested further in capacity to meet this growing demand”.

Gregg’s outlined in the statement that it had also enjoyed a sales boost from its Balance Choice menu which offers a range of products all under 400 calories.

The retailer said the increase in sales from its fast growing healthier options menu had encouraged it to add “new lines to the range”, including cold pressed juice drinks and a new selection of freshly-prepared salads and wraps.

However, the UK bakery chain has also warned that while it “made a good start to 2017”, the sales outlook for the rest of the year “remains uncertain in the context of slowing growth in disposable incomes”.

Margins

“Input cost inflation is having a modest impact on margins in the first half of the year as expected. However, we have increasing visibility of costs for the second half and anticipate this pressure to ease towards the end of the year.”

During the first 19 weeks of the year the group completed 87 shop refurbishments, opened 42 new shops, including 20 franchised units and closed 14 shops in the UK which left it with a total of 1,792 shops – only 13 of which are in Northern Ireland. Yet, according to Mr Whiteside, Greggs is seeking new locations to open more shops – “we’re looking right now”.

He said the group has been delighted with the response it had received in the North since the first Greggs opened in an Applegreen service station on the M2 just two years ago.

Despite Gregg’s expansive menu – from sandwiches to doughnuts, salads, soups and more recently gluten-free treats – it is the group’s classic sausage roll, selling at 85p, which has been one of the biggest hits in the North.

“People love their food in Northern Ireland, and we are very committed to sourcing locally with great food producers from Northern Ireland – whether for example it is milk or Tayto crisps which we sell in Northern Ireland. In time we would like to get more and more local producers supplying our shops.

Customers

“We’ve found that what people in Northern Ireland want from Greggs is the same as what all our customers want – fast, friendly service and freshly prepared high quality and great value food on the go,” said Mr Whiteside.

Despite the looming Brexit conundrum he is still open to the possibility of taking Greggs, its best-selling sausage rolls and a whole lot more across any potential border in the future to the Republic.

“I would like to go there one day – it might be complicated, for instance, with currency exchanges, but if the right opportunity were to open up in the future then we might look at it one day.”