Porky Britain loses its appetite for Greggs sausage rolls

Telegraph

6 hours ago

Asked last year if she thought Britain was approaching 'peak Greggs', Roisin Currie laughed off the suggestion.
The bakery chain's chief executive said this point was 'a long way off' as she announced plans to open dozens of new stores across the country following a surge in sales.
Today, the prospect of Greggs' over-saturation is less of a laughing matter. After years of extraordinary growth, questions are being asked about whether the chain can maintain its upwards trajectory.
Shares in the company plunged by more than 15pc this week after it warned June's scorching heatwave had dampened demand for its hot pastries and sausage rolls, and would lead to lower profits this year.
In March, the company posted its slowest sales growth since the pandemic, warning it faces a tougher time in 2025. Investors' faith has been faltering all year, causing a slump of almost 40pc in its share price since January.
Though it still offers a cheap meal, the chain has been forced to raise the cost of many of its best-sellers as the burden of paying for labour, ingredients and energy soared.
Jonathan Pritchard, of investment bank Peel Hunt, believes these price rises are putting some shoppers off.
Other challenges are on the horizon. Labour plans to force takeaway chains to cut customers' calories in an effort to tackle the nation's expanding waistlines.
At the same time, Wes Streeting, the Health Secretary, has vowed to make appetite-suppressing weight-loss jabs easier to get on the NHS.
'We've had unseasonal weather or overly seasonal weather many times over the last 10 years, and they've sailed through that without too many problems. I do think it nods to something slightly more fundamental,' says Pritchard of last week's warning.
Recipe for success
Founded in 1951 in Newcastle, Greggs was largely a regional business until retail veteran Roger Whiteside took over in 2013 and led a march of expansion across the country.
By ditching the traditional bakery side of the business, improving the coffee, revamping the shops and focusing on takeaway food, Whiteside – a former M&S executive – grew the chain to more than £1bn in revenues by 2018.
He is widely credited with turning the once-hesitant British middle classes on to the wonders of the Greggs sausage roll.
The invention of the £1 vegan version in 2019 sealed Greggs' newfound dominance on the high street, turning the chain into a viral sensation and winning over millions of younger fans.
In 2022, Whiteside stepped down, passing the torch to Currie, a well-respected executive who previously led its people, retail and property operations.
Greggs' winning streak continued during the first few years of her tenure. While the cost of living crisis hit more expensive brands, it helped the low-price bakery chain as demand soared for cheaper food.
By the end of 2024, the chain's revenues had topped £2bn. Today it runs 2,649 shops – more than both McDonald's and Starbucks – and Currie has said she believes there is scope to reach as many as 3,500 in the long term.
Obesity crackdown
Yet the recent sales slowdown raises questions about whether this ambition is misplaced. Greggs was approached for comment.
Some observers are also sceptical of Greggs efforts to try to conquer dinner time. In recent months the chain has been pitching its pizzas as a cost-efficient alternative to Domino's, while simultaneously increasing its focus on chicken dishes to compete with the likes of KFC.
'In the evenings there is absolutely tons of opposition, and it's difficult,' Pritchard says. 'They've tried to come with a value proposition, but you're up against Domino's, and you're up against people that have got enormous marketing budgets and consumer loyalty.'
Simon Stenning, a hospitality industry expert and founder of Future Foodservice, believes Greggs is still good value and can give rivals a run for their money on price.
'If you're on your way to work, why wouldn't you buy a bacon roll and a coffee for £2.50, or whatever it is? I think in a world of comparisons where prices are known, they can get away with an extra 5p, 10p or 20p,' he says.
He is more worried, however, that increasingly interventionist legislation could hamstring the bakery and other hospitality firms at a time when costs are high and growth is imperative.
The Government is planning an ambitious clampdown on food companies that could see chains such as Greggs compelled to reduce diners' calorie intake.
'There's going to be taxation, legislation, nudging, nanny-state intervention to try to reduce our fast food consumption out of home,' Stenning says. 'That's going to be a slowing down.'
Then there is the question of GLP-1 weight-loss drugs, which are rapidly growing in popularity in the UK. An estimated 1.5m people now take them. Currie has called them 'something on the horizon we are watching closely and understanding and learning about'.
Greggs has made efforts to combat the perception that it is unhealthy and, under Currie, has been launching healthier options such as salads and lower-calorie bakes.
But the reality is that GLP-1 drugs work by suppressing appetites, meaning people on them will be eating less.
Currie insists that recent troubles are simply bumps in the road. But after a decade of dominance, the hard yards are ahead as Labour pushes Britons to ditch the sausage rolls.