Greggs won't slow growth despite increased costs from Budget, boss says

Increased costs from last month’s Budget will not derail Greggs’ plans to grow around the UK, the company’s chief executive has said.

In an interview with the Reuters news organisation, Roisin Currie, CEO of the Newcastle-based bakery giant, said a rise in National Insurance contributions and an increase in the National Living Wage would add tens of millions of pounds of costs to the company.

But she said that would not result in any slowdown of the company’s growth plans, which currently see it adding around 150 shops a year to its estate, with hopes to reach an estate of 3,500 in the coming years. It opened its 2,500th shop earlier this year and is targeting openings at petrol forecourts, retail parks and transport sites.

Greggs was one of 75 UK retailers that was last week signed an open letter to Chancellor Rachel Reeves waring that increased costs for businesses could cost jobs and lead to higher prices. Fenwick and Barker and Stonehouse also signed the letter.

But in her interview with Reuters, Ms Currie said Greggs was likely to only put up prices by “pennies” and that its employee bonus, which shares 10% of profits with staff, was “absolutely sacred.”

And on its growth plans, she said: “Our shop growth plan, our supply chain investment, none of that changes. We are still absolutely going for growth.”

In its most recent trading update, which was released at the start of October, Greggs said sales were up 10.6% in the last quarter, with that increase driven by new menu items, extended opening hours and increased digital sales. It also highlighted major investment in its production and distribution facilities, including sites in the Midlands and the South.

A number of business groups have highlighted the impact of the National Insurance rise. Rain Newton-Smith, chief executive of the Confederation of British Industry (CBI), said the Budget caught firms “off guard” and will undermine investment and jobs. The Chancellor is expected to tell the organisation later on Monday there is “no alternative” to tax rises as she holds firm against criticism of the £25bn increase in firms’ national insurance contributions (NICs).

A Government spokesman said: “Last month we delivered a once-in-Parliament Budget to wipe the slate clean and deliver change by investing to repair the NHS and rebuild Britain, while ensuring working people don’t face higher taxes in their payslips. That meant difficult choices to repair the public finances and to put public finances on a firmer footing. However, the alternatives were more austerity, more decline and more instability that would have left businesses and working people worse off.”