Greggs hit by ‘weak consumer confidence’ as growth slows to 2.5%

Greggs has claimed dwindling consumer confidence is to blame for a a sharp slowdown in sales.

Sharing results this week, the high street giant said its like-for-like sales rose 2.5% in Q4 in 2024, down from 5% for the previous quarter.

Growth had also slowed due to “tough headwinds” including inflation and higher national living wage rates, according to CEO Roisin Currie.

Though “disposable income has increased, consumer confidence has fallen”, said Currie. “We stay very focused on our value proposition, but we have to pass the minimal price rises.”

As a result, the chain has raised prices across its entire menu by 4%, with the price of its sausage roll increasing for the second time in six months from £1.20 to £1.30.

Currie added that she remained “very confident in the management team”, following the news of Greggs share prices dropping 9%. 

“We’re in it for the long-term opportunities, and I’m sure there have been various share price points in our history that we could point to where there was a short-term depression across the market, but I still think we’ve got lots of reasons to be optimistic in 2025 as retailers.”

Despite challenges, the chain surpassed the £2bn sales mark for the first time. It also opened a “record” 226 new stores and is “well on track” to meet its 2,500 future store openings target.

“The chain passing £2bn for the first time is a clear sign of its enduring appeal on the high street,” said Julie Palmer, partner at management consulting company Begbies Traynor.

“However, the like-for-like slowdown in Q4 sales highlights how subdued footfall impacts everyone, even value players like Greggs.

“As we start the new year, rising costs, particularly employee-related tax pressures introduced by the autumn budget, could be a real headache if the slowdown extends through Q1 2025,” added Palmer.

Greggs’ new national distribution centre in Kettering is on track to open in FY26 to keep supporting the chain’s expansion plans.

The new site will add 29,000 sq ft, which will be dedicated to distribution logistics and frozen production.