Greggs decides against further price increases for 2023 despite a slowdown in sales during the third quarter.
- CEO Roisin Currie confirms stabilising costs have allowed the company to halt further price hikes this year.
- Sales faced a downturn over the summer but showed recovery in September, with expectations of growth due to new menu offerings.
- Greggs is actively expanding its presence, planning up to 160 new shop openings across various locations this year.
- Analysts forecast potential growth in Greggs’ profits, driven by strategic expansions and menu innovations.
Greggs, under the leadership of CEO Roisin Currie, has made a strategic decision to refrain from any further price hikes in 2023. This decision comes amid a period of sales slowdown during the third quarter. Currie indicated that stabilising costs have made it unnecessary to increase prices further this year, despite earlier inflationary pressures driven by rising wages. In response to these initial pressures, Greggs had increased the cost of its signature sausage roll by five pence in July.
Over the summer, the bakery chain experienced weaker sales, particularly in July and August, attributed to adverse weather conditions, economic uncertainty, and unrest impacting some city stores. This slump led to a 5.8% decrease in Greggs’ share price, falling to £29.42. However, it is noteworthy that the stock has seen a considerable increase of over 20% in the past year, showcasing investor confidence in the brand’s resilience.
September marked a turning point as sales began to recover, bolstered by employees returning to workplaces and the introduction of new seasonal menu items. Greggs’ autumn menu includes popular seasonal offerings such as pumpkin spice lattes and a newly introduced pumpkin spice doughnut, which are expected to attract customers seeking seasonal delights.
In line with its growth strategy, Greggs is significantly increasing its footprint, currently operating more than 2,500 outlets nationwide. The company plans to open up to 160 net new shops this year, targeting locations such as supermarkets, petrol stations, and travel hubs. Further complementing its expansion, Greggs has enhanced its delivery partnerships with platforms like Uber Eats and Just Eat.
Market analysts hold a positive outlook for Greggs’ long-term growth prospects, driven by ongoing expansion and innovative menu offerings. Some experts predict a potential 10% rise in pre-tax profits for the company, emphasising the effectiveness of its strategic initiatives.
Greggs’ strategic decisions and innovative expansions underscore its resilience in navigating economic challenges.
