There’s “more momentum to come” on Greggs’ coffee sales as the bakery chain increases the scope of its coffee offer and adds more seating, according to chief executive Roger Whiteside.
Speaking to journalists following the company’s trading update, Whiteside said: “Coffee is one of our fastest growing categories.
“We have a massive business in our £2 breakfast meal deal and over the Christmas period we almost doubled the year before in terms of breakfast meal deal sales, and every time we sell those meals we sell coffee with them.
“Coffee is growing at 20% now and has been now for a number of years, and that shows no signs of slowing up. We sell fresh bean cup coffee - we intend to launch a new blend to our coffee in the new year. So there’s more momentum to come in our coffee sales.”
Greggs said coffee chains are “definitely among our competitive set”, behind supermarkets, convenience stories and fast food operators.
Last summer Greggs said it hoped to have added seating to between 75% and 80% of its sites over the next three to four years. It followed moves away from its Moment coffee shop brand, with the company viewing it as not differentiated enough from its new-style ‘Bakery food on the go’ format, which combines its local bakery and food on the go concepts.
Whiteside said yesterday: “We [refurbished] 216 stores last year and every time we do a store, we try and take as much space as we can from the back production area to create as much opportunity for seats out front as we can.
“In probably 80-90% of those shops we manage to create some seating, and where we do create seating it definitely helps drive sales, particularly outside the peak hours. We are always very busy at breakfast, we are always very busy at lunch, but if you’ve got seating people start to use you in the in-between times.”
Asked if he saw Greggs becoming a coffee chain, Whiteside replied: “No. We’ve set our sites on being a food-to-go operation, which predominately therefore will be takeaway. More and more of our shops will have seats but they won’t have more than normally around 10 or 12, maximum.
“We are not going down the full coffee shop route but we are wanting to offer as wide a service as we can within our units, knowing that ultimately they will be predominately food on the go operations with most people taking their food and drink with them.
“What we’re finding is coffee is growing on the go just as it is in sit-in.”
Whiteside confirmed that Greggs’ barista training academy in Solihull, developed for Moments, has remained in operation. “We are still keen to be experts in coffee and we’ve kept that facility going to enable us to do that.”
He also said that Greggs intends to launch its loyalty scheme in the spring. It’s currently in the trial phase.
The scheme will be mobile-activated and will offer “a range of incentives to be loyal to Greggs”, Whiteside said.
