Greggs suspends new shop projects as it faces uncertain sales outlook

Roger Whiteside, CEO

Greggs confirmed this morning that it will reopen 800 shops to takeaway customers later this week – but also put the brakes on its new shop opening programme for the time being.

The chain, which runs 2,000 outlets, said the temporary suspension was down to uncertainty over future sales.

The only exception will be a “few” shops where it is already legally committed or it anticipates strong customer traffic.

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Greggs has been one of the most prolific high street operators in terms of new openings during recent years, averaging more than 100 projects a year.

Suspending the roll-out programme will mean it is likely to end the year with 60 new sites. However, with 50 shops closing it will give it net growth of just 10 sites overall.

In recent weeks, Greggs has operated a small number of shops and tested various operational changes, including new workwear, equipment and social distancing measures designed to support the safety of its teams and customers when shops reopen at scale.

More than a third of its estate will reopen from Thursday, with the rest poised to start trading once restrictions on the hospitality sector are lifted in July.

The company said it is not able to predict the impact of social distancing on its ability to trade or on customer demand.

However, it noted that its capacity to operate will be restricted by size of shop and it is anticipating that sales may be lower than normal for some time.

The company has also reviewed its existing estate and is approaching landlords making a variety of proposals in return for rent reductions.

All landlords have been informed of its plan to move to monthly rent payments from June. It made its full quarterly rent payment in March as usual.

Chief executive Roger Whiteside (main image) said: “Looking forward, although great uncertainty remains, we are excited to be resuming our service for many customers this week. We are confident of our ability to adapt to market conditions in the short term while continuing to invest in the long-term growth of our business.”

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Andrew Seymour

The author Andrew Seymour

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