A Bakery Doubling Sales and Store Count in Five Years

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Greggs

Greggs is a leading bakery chain in the United Kingdom. Founded in 1932 by John Gregg, the company has grown to become a national institution, with over 2,000 stores across the UK and a significant online presence. It’s known for freshly baked pastries, steak bakes, pasties, and doughnuts; however, is loved for its sausage rolls, which nobody at MyWallSt has tasted, so we’re of no use to you for a taste review.

Primed to Grow

Greggs is embarking on an expansion strategy with the goal of doubling its sales within the next five years, a plan that includes significantly increasing its store presence to well over 3,000 locations. In line with this strategy, the company has set targets to open between 140 and 160 new shops in 2024. 

Alongside physical expansion, the business is extending its trading hours to capture evening food-on-the-go sales, introducing new menu items to entice customers, and leveraging digital channels like delivery and Click + Collect to enhance convenience. 

Additionally, Greggs is expanding its vegan-friendly options, catering to a wider customer base and demonstrating its commitment to inclusivity. These strategic initiatives demonstrate the company’s agility and willingness to adapt to evolving consumer preferences, positioning it for continued success in the competitive bakery market.

Greggs is financially healthy; it has a strong balance sheet and a history of profitability. In the fiscal year 2023, it reported revenue of £1.7 billion and net income of £408 million. It recently reported a significant jump in revenue, with like-for-like sales up 13.7% for the year and 9.4% in the final quarter of the previous year​​.

Throw a healthy dividend on top of a probably unhealthy sausage roll, and this could be a long-term winner.

In Their Own Words

Dive into 164 pages at the link below. We prefer the above chart, where you can see 10 years of revenue and return on equity.

 https://a.storyblok.com/f/162306/x/c32d30b30d/greggs-annual-report-2022.pdf

What Could Go Wrong?

Despite Gregg's strengths and prospects, the bakery market is highly competitive, with several established players vying for market share. The chain must continuously innovate and differentiate its products and services to stand out from the crowd to maintain its position. Additionally, it needs to be agile and adaptable to respond to the ever-changing preferences of consumers as dietary trends and tastes evolve over time. 

Final Word

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