Greggs: “We can do more”

There is a lot more that Greggs can do with coffee, CEO Roger Whiteside has told MCA.

Responding to a question from MCA in a press conference following its half-year results yesterday, where he announced an “exceptional” performance with sales up 14.7% to £546m, Whiteside said the business knows there is “more to go for with coffee – flavoured coffee, decaf coffee, all these things we don’t do well yet.”

He said breakfast-on-the-go is currently the fastest growing element of its trading day, with coffee the fastest growing part of that. Sales of its freshly ground Fairtrade coffee put it third in the UK out-of-home coffee market, behind Costa Coffee and McDonald’s, but that it’s coffee offer was still just covering the “basics” and “we know we can do more with coffee and we know we can do more at breakfast.”

Though Whiteside said Greggs was leading the way when it came to sales of bacon rolls, and already has a strong range of sweet pastries, he explained it wanted to grow sales of all the other things that people want for breakfast, such as fresh porridge, protein pots, yoghurts and fruit pots. “All these other areas are opportunities for us,” he said.

And while there was no question there was more competition in the market when it came to breakfast, “everybody is trying to do more and more for breakfast, and that includes us,” he said.

The evening opportunity

Whiteside said he was also keen that Greggs became as popular in the evenings as it now is for breakfast, with its evening hot food offer currently being driven by its post-4pm slice of pizza and a drink for £2 deal.

The retailer is to extend trials of its later opening hours, where it opens until 9pm, this autumn. Although Whiteside would not drawn on the number of sites this would be available in, he said the trials would be nationwide and across different type of catchment area.

Around 90% of its sites currently close at around 6pm, and although its travel hub locations sell the existing range of Greggs products into the evening, Whiteside said these trials, which began last year, were about putting new meal deals and hot food options into shops to see whether people would choose Greggs over another fast food operator or independent takeaway at that time of day.

“It’s that business that we are competing for and we think there is every reason why we ought to be able to compete,” he said. “We want to do the same thing in the evening that we have done at breakfast. We were not in the breakfast market ten years ago, now we are number two.”

Commenting on its click and collect trials, which are now available from shops in seven cities, Whiteside said it has discovered “customers want click and collect, and customers want delivery”. He said the trials were working out how to manage multiple queues at the same time, in order to service all three customer bases effectively.

“What we don’t want to do is go hell for leather and upset customers in the normal queue, so we are moving cautiously, extending the pilots to more cities,” he said.

Pork sausage roll sales stronger than ever

While much press coverage has been given to the boost to Greggs sales from the launch of its vegan sausage roll, Whiteside said that customers coming in to buy the product – of which one in eight are new customers to Greggs – they are not just buying the vegan sausage roll. He said customers were often buying a mix of products, some of which contained meat, and that it had actually had its best year of sales in terms of its traditional pork sausage roll and meat pasties.

“People are still discovering that Greggs has changed and that we have become a modern food to go brand with options for breakfast and lunch and, hopefully, if we get our menu right, more options for dinner in the evening,” he said. “It is fulfilling a different mission for a lot of people and some people are still to recognise that.”