The UK bakery sector is facing further cost pressures as companies review their operations and production networks. Greggs has announced plans to reduce its workforce and close several manufacturing sites as part of a wider effort to reduce costs.
Greggs Announces Manufacturing Changes
The bakery chain said around 740 jobs could be affected over the next two and a half years as four manufacturing locations are proposed for closure. Greggs said the planned job cuts are linked to changes in its manufacturing operations.
The company described the proposals as difficult but necessary, explaining that the move is designed to reduce production costs while adapting its network for future growth.
A consultation process has been launched with affected employees as Greggs reviews the future of the sites involved. The company has not yet announced the final closure dates for the four locations.
Cost-Saving Plan Comes As Inflation Pressures Continue
Greggs said it expects continued pressure from inflation in the coming year, affecting the cost of running its operations. The restructuring plan is expected to generate around £20 million in annual savings once completed.
However, the company estimates the changes will require an initial cost of around £60 million, including redundancy payments and other expenses linked to the transition. Greggs said the changes are intended to support its long-term expansion plans while keeping operating costs under control.
Bakery Chain Targets 700 More Stores
The manufacturing changes come alongside plans to expand Greggs’ retail presence. The company has announced an ambition to increase its number of shops by 700 locations, reaching around 3,500 bakeries in total.
Greggs said it wants to achieve this growth while building a production network that supports its future store expansion. The company said its proposals reflect the evolution of the business and its focus on maintaining value for customers, reports The Sun.
Sales Growth Continues Despite Operational Changes
Greggs reported stronger sales performance in the third quarter, with sales increasing by 3.4%. The company said more stable weather conditions during August and September contributed to improved trading.
So far this year, Greggs has opened 95 new shops and closed 38 locations as part of ongoing changes to its retail network. The latest manufacturing proposals mark another stage in the company’s efforts to adjust its operations while continuing its expansion across the UK.
