Greggs launches consultation to reduce staff hours

Greggs is launching a consultation on staff costs, which could see job losses minimised by negotiating reduced hours in shops.

The bakery retailer said with the furlough scheme ending, and business activity remaining below normal for the foreseeable future, it was taking steps to ensure staffing met demand.

Greggs has completed a review of its business and is proposing changes with unions and employee representatives and will update in November.

The announcements comes as the company reports September like-for-like sales improved to 76.1% of 2019 level in the four weeks to 26 September 2020.

Since reopening its full estate on 2 July, like-for-like sales in company-managed shops have averaged 71.2% of the 2019 level in the 12 weeks to 26 September.

With activity improving, Greggs is restarting its shop opening programme, and now expects around 20 net openings in 2020.

Greggs was not able to participate in the Eat Out to Help Out scheme as its seated offer remained closed, which alongside the hot weather, made August a “difficult month”.

Increased out-of-home activity in September drove a recovery in customer visits, Gregg’s said.

In response the brand is bringing back a broader sandwich range and classic favourites such as Belgian buns.

Around 100 larger shops have now reopened seating with appropriate social distancing in place.

Click & Collect offer is now available in all shops, allowing customers to pre-order and pay ahead of visiting to collect their order.

Delivery with Just Eat is growing, and represented 2.6% of company-managed shop sales in the most recent week to 26 September.

In the 39 weeks to 26 September 2020, the company opened 38 new shops and closed 49, giving a total of 2,039 shops (1,720 company-managed and 319 franchised).

Of the net 20 shops due to open in 2020, they will be predominantly in locations accessed by car.

Greggs has experienced two coronavirus outbreaks, one in August at its distribution centre in Leeds, which had some impact on product availability in the region.

In the past week there was an outbreak at a manufacturing centre in Newcastle upon Tyne, which was temporarily closed as a precaution, though stock distribution was unaffected.

Greggs said this pattern of disruption to supply-side operations is likely to be an “ongoing challenge”.

The company, which continues to pay rents monthly in advance, returned to a positive net cash position during September.