Greggs Sales Rise to £1.1bn Amid New Product Success

Greggs has announced a significant increase in sales, reaching £1.1bn in the first six months of 2024. This figure represents a 7.2% rise compared to the corresponding period in the previous year. The growth is partly attributed to the company's ongoing expansion strategy, which saw the opening of 34 new stores. By the end of June 2024, Greggs operated a total of 2,773 outlets across the country.

Sales at existing stores also saw an increase, growing by 2.1% between January and June. The Newcastle-headquartered company stated that its newly opened shops have performed well, a success it links to a focused approach on selecting high-quality locations. This expansion continues despite a challenging economic climate and the growing popularity of weight-loss drugs, according to financial and real estate advisory group BTG.

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Profit and Product Innovation

The bakery chain's pre-tax profit for the first half of the year climbed by almost 20%, reaching £76m. Greggs attributed this profit increase to effective cost management and the successful introduction of new product lines. These included an expanded 'bake at home' range, which launched in Tesco, and a wider selection available in Iceland supermarkets.

New menu items have played a key role in attracting customers, including those seeking healthier options. A chicken roll, launched in April, was described as a "standout success" by the company. Additionally, a relaunched salad range, featuring more protein options such as chicken caesar and prawn layered pasta salads, has broadened the appeal of Greggs' lunchtime offerings.

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The introduction of new drinks, such as iced matcha lattes, lemonades, and refreshers, has also helped Greggs appeal to younger consumers. These additions align with evolving tastes and trends, contributing to the company's ability to outperform the market, as stated by Greggs' CEO Roisin Currie.

Currie commented that the company remains committed to expanding its shop network and providing convenient access to its products. She also highlighted the ongoing efforts to innovate the menu in response to changing consumer preferences. This strategy appears to be a response to previous challenges, such as sales being affected by hot weather in the prior summer, which led to questions about whether the market had reached 'peak Greggs'.

Julie Palmer, managing partner at BTG, noted that Greggs must carefully balance pricing and cost control to maintain and grow its market share as the preferred food-to-go provider. She suggested that any price increases could quickly impact demand, requiring the company to navigate this carefully.