Baker sets out plans to upgrade supply chain

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Greggs, the Newcastle-based bakery retailer, has set out plans to upgrade its supply chain to support future growth. It intends to open about 70 new shops a year around the UK to take to total to more than 2,000 over the coming years.

The group’s sales have held up in the face of the recession – up 3.8 per cent in the 42 weeks ending 17th October.

The supply chain is built around regional bakeries supported by a national savoury manufacturing facility and two national distribution centres. A review of the supply chain concluded that “continuing to make and bake our products was a competitive advantage as well as being a profitable part of our business. It has also highlighted the potential for us to supply substantially more shops through our existing supply chain, thus achieving significant efficiency improvements.”

Greggs plans to renew its older bakeries to improve quality, efficiency and capacity for growth and extend other bakeries. It will also add capacity to support its growth in the south of England.

The group expects to invest £50-60m a year in this growth but said the development of the supply chain would deliver eventual annual efficiencies of at least £10 million a year.

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