Baking Up a Business

“Baking Up a Business !!!” with Greggs plc’s Raymond Reynolds, Director of Property and Business Development.

CHAPEL EN LE FRITH GOLF CLUB, Manchester Road, High Peak SK23 9UH 6 Oct 2017


Raymond Reynolds is Scottish and very tall. And slim – if he’s eating a lot of his firm’s pasties, he doesn’t show it. Changing roles after 10 years as Retail Director, he now has “a wide portfolio of responsibilities.” He’s been with Greggs since the 1980s, so he’s seen it grow and adapt as the traditional High Street has come under pressure. How does a bread shop business become the darling of the stock market?

At High Peak Business Club as we scoffed sausage rolls from Greggs in Buxton, we realised that the firm is, in Raymond’s words, “a success story in staying relevant; you can never rest on your laurels.” That’s a pertinent lesson for everyone in business (and, dare I suggest, in politics too).

The key was old Mr Gregg realising that when the trays came out of the bakery at the back of his shops, the food flew off them: customers wanted something absolutely fresh. Back in the 70s the main product was bread and cakes, and Greggs did not sell sandwiches. But gradually – mirroring closely the increasing proportion of women entering the jobs market – the focus has shifted to Food On The Go, with freshly made sandwiches as a primary product. We ladies don’t slice bread any more: we’re too busy.

It isn’t as easy as you’d think. Tesco, Boots and Marks & Spencer all offer sandwiches, factory wrapped and (these days) of high quality. But odds are, they were made three days ago. At Greggs a baguette is filled within an hour after being shop baked (how French!) so it’s a sophisticated operation, with labour costs at the point of delivery a significant factor.

But to keep prices competitive, behind the scenes Greggs’ own supply chain is being improved by a £100m bakery investment programme. When complete Greggs will have fewer bakeries but each will specialise in being a centre of excellence for key products. “Doesn’t this add to your carbon footprint?” asked one member, but overall the answer is no, for high-tech factories use far less energy, and central ordering produces less waste.

Raymond himself has been at the centre of much of this invisible revolution. By 2000 his charts showed that while turnover was growing strongly, profits were only creeping up; the supermarkets got in on the act with in-store bakeries, and by 2012, Greggs was being written about as another High Street name in trouble. New CEO Roger Whiteside, appointed in 2013, was clear: “Keep it simple, concentrate on what you do well” – another great lesson.

They simplified ranges and improved availability. They examined sacred cows – assumptions that were not justified – and slaughtered them wholesale. Today you can get healthy nosh from Greggs, while they still offer a £2 breakfast with real coffee and wifi. You’ll find them now in airports and garages, on motorways and railway stations. The focus on what customers want is ferocious. “Our people and our communities are at the heart of the business,” said Raymond, but it’s clear that vital commercial intelligence comes from those on the ground.

So we tucked in, and the verdict was highly favourable, apart from one member who has recently lost 5 stone and wasn’t touching the pastry! But when a business is churning out around 3 million sausage rolls a week, (more in the winter) you’d expect them to be good at what they do.