Greggs CEO Roisin Currie has stated that she is “very confident” in the food-to-go giant’s store expansion plans, despite growing analyst concerns.
The retailer, which today (29 July) posted a 14.3% decline in pre-tax profit to £63.5m, has been the subject of analyst discussions over its future, with some arguing that Greggs is reaching capacity at a time when trading momentum is weak.
Greggs, which operates 2,649 shops in the UK, has ambitions to achieve 140 to 150 net new shop openings in 2025, with a long-term goal of having “significantly more” than 3,000 sites.
Hitting back at analyst claims that the high street retailer had reached its “peak”, Currie responded: “Absolutely not, we don’t believe we’ve reached peak Greggs”.
She explained that the food-to-go firm is confident in its long-term expansion strategy, which will see it targeting under-represented catchments such as transport locations, roadsides, supermarkets and retail parks where it still penetrates ”very lowly”.
Currie added that despite the retailer’s store portfolio, which is significantly larger than a competitor like McDonald’s, which operates approximately 1,300 restaurants in the UK, “there are still many areas in the UK where you cannot access a Greggs”.
However, she added that the businesses plans are “not all about chasing top numbers” and said that store openings are “likely to slow down in several years’ time” to ensure it is selecting the right locations.
Analysts have also questioned how Greggs will combat the continued rise in competition in the food-to-go sector, particularly at a time when consumer sentiment has remained low.
"A lot of our competition will do promotions, high-low pricing and interestingly, when we look at some of the market share numbers, we continue to have a very robust market share and those high-low promotions don’t seem to be cutting through,” said Currie.
However, she acknowledged that the retailer “will continue to be in a challenging market”. In order to better compete, Greggs is watching market trends and ensuring that it is a “fast follower”, as Currie noted the expansion of its on-trend over-ice drinks, which are now available in 1,400 stores.
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