Expansion of Greggs will create 800 Scottish jobs

Published on Tuesday 20 October 2009 21:36

GREGGS, the high street baker and takeaway chain, yesterday unveiled a huge expansion that will bring 800 jobs to Scotland.

Ken McMeikan, the Scots-born chief executive, will boost the number of Greggs outlets in Scotland by 70 or more as part of a five-year plan to develop the company across the UK.

The group also plans to expand its bakery in Glasgow, which it established two years ago, to supply the increased number of shops.

Greggs will invest 9.1 million in the new shops across Scotland. The bakery chain currently has 170 outlets north of the Border.

The expansion is part of a wider plan to open 600 more stores, create 6,000 jobs, and upgrade its supply chain at a cost of up to 300m, as it posted a rise in third-quarter sales.

The Newcastle-based firm, which sells sausage rolls, cakes and bread to over 6 million customers a week from about 1,400 UK outlets, said it intended to open 50 to 60 new shops in 2010 and from 2011 onwards at least 70 a year.

The group claimed this doubled its current rate of new shop openings. It will also double the rate of shop refits to 120 a year from 2010.

McMeikan said: "Currently more than 50 per cent of the UK population do not have a Greggs near by.

"It remains our belief that a further 600 plus shops can be opened in the medium term with little cannibalisation of sales from existing shops."

McMeikan said the cost of expansion would funded be from its own cash flow and would not require debt.

Many UK retailers have struggled during the recession but Greggs has done better than most and its shares have risen by nearly a half over the past year.

In an interim management statement yesterday, the group said third-quarter like-for-like sales increased 0.2 per cent – in line with the firm's expectations of "marginally positive" like-for-like sales growth in 2009.