Greggs - Who's more hungry.. Management or Customers?

Updated: Sep 28, 2020

Greggs Plc a UK High Street baker has done very well given its cost, situational convenience and quality as a function of price.

However, they never seem to have the basics available for purchase. Try getting a Steak Bake. The display shelves are generally empty or the product is 10 minutes + away while they replenish via their ovens. Even then there is questionable warmth of baked products.

Looking at their current practices it would be assumed that they have very low levels of waste. But at what cost of lost sales? Fail me on a Stake Bake, then I'm not buying complementary items such as a coffee; Fail me on a second visit and I won't be coming back.

Greggs should take a look at their operational replenishment times. Once they used microwaves to speed timings up but that was evidently banned after a customer or two got their mouths burned. Why would I even go into to the store if I can clearly see that they have hardly any product for sale?

So what should they do?

Firstly designate some trial stores. Secondly, start altering available product on display so it is available at all times. Thirdly, test to see how in store demand changes over time and whether on a cost benefit basis it is sufficient for any waste.

Various metrics can be analysed such as primary and complementary product sales. Total Sales, Store visits as a function of time.

And lastly, look at turnaround times for heated product items. At bottleneck constraint times (Saturday mornings) there is a real issue of getting product warmed and put out quickly enough. Is the thermal mass of the ovens sufficient to rapidly heat product? Is there enough ovens? Could product be prewarmed? I.e. Could the ovens be on low heat and warming product from 7am etc? There are a whole multitude of potential aspects to look at.

On a related topic, Greggs has closed the shop pictured below which was situated on the main high street right beside bus stops and has relocated to the image pictured above which is in a lower footfall arcade further up the high street, which in turn is a lower footfall region, and there are substitute competitors offering hot foot along the way. The new shop does have seating although that has to be contrasted against their lower cost offering.

So the question becomes, was this location change driven by their inability to deliver sufficient volume of product at the higher footfall location? I think so.

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