Greggs’ chief executive Roger Whiteside has told MCA that the bakery food-to-go chain is keen to expand its drive-thru format following the successful opening of its first, in Greater Manchester, in August 2017.
He said the business was keen to open “as many as we can get” but that the scale of expansion was dependent on its ability to secure suitable sites. “We will be looking to open more drive-thrus in 2018, and beyond, as we start to compete for those sorts of locations with others who want similar types of formats,” he said.
The number “certainly won’t be in the 10s” but Whiteside is optimistic there will be several more this year.
“They are typically new developments and therefore take longer, but hopefully there will be a steady flow of openings once we get the pipeline up and running,” he said.
The chain is also looking to increase its rate of new shop opening, and plans to add an additional 110-130 net new shops to its estate, in 2018, which would take its total close to the 2,000 mark.
As at 30 December 2017, the chain had 1,854 shops, 202 of which were franchise shops operated by partners in travel and other convenience locations. It opened 131 new shops last year, 45 of which were franchise outlets, and closed 41 sites.
Whiteside told MCA, the chain was opening all over the country, but that more than 90% of its new shop openings are no longer in high street locations, because they are already well represented in those locations. Instead, it is opening in travel locations, as well as business and retail parks “where you wouldn’t historically have found a bakery shop, and where there is demand for food-to-go”.
“There are some parts of the country where we have been underrepresented historically - namely Northern Ireland and the south west of England,” he added. “We have opened in both those locations now but there are more openings to come there, because in those areas we are not even fully represented in high streets yet, so we are opening high street and non-high street shops in those particular geographies.”
In terms of the format for new store openings, the sole focus is on its ‘bakery food-to-go’ format “which has been very successful over the past five years”.
It will also continue to expand the franchise side of the business. Currently around half of its new openings are franchise outlets – “that’s what we envisage being the case for the foreseeable future”, said Whiteside.
“We are reliant on the franchise partner – it’s their decision whether to open new shops, but we have a very good partnership with both Moto and Euro Garages which have provided most of that opening pipeline over the last few years and show every sign of continuing it,” he added.
In its fourth quarter trading update yesterday, Greggs announced total sales growth of 7.4% and like-for-like sales growth up 3.7% across its managed shop estate.
