Greggs to axe 740 jobs
UK bakery chain to close four factories in cost-saving measure, despite 7.7% sales growth in latest quarter
Greggs, the UK's largest fast food business, has announced plans to close four of its factories, potentially resulting in 740 job losses over the next two and a half years. The closures are part of a cost-saving measure to ensure the company can grow in a cost-efficient manner.
The four factories that could be closed are located in Enfield, Penrith, Kelso, and Seaham. However, Greggs will continue to run distribution operations from Enfield, and the Treforest site in Wales will remain a distribution centre for business.
The initial cost of the closures, including disruption costs and redundancy payments, is expected to be £60m. However, the company believes that the closures could create £20m of savings each year by 2028.
Despite the potential job losses, Greggs has reported strong sales growth in its most recent quarter, with a 7.7% increase in sales. The company has also expanded rapidly this year, with 57 net new shop openings, and plans to open between 100 and 110 shops by the end of 2026.
## Why it matters The closures come as Greggs seeks to navigate greater inflationary pressures in 2024. The company's decision to close factories and reduce costs is likely to have a significant impact on the affected communities, with 740 jobs at risk. However, the company's commitment to growth and expansion suggests that it is taking steps to ensure its long-term sustainability.
The potential job losses will be a significant blow to the affected areas, and the company has stated that its immediate priority is to minimize the impact on its people. Greggs will enter into a consultation period with trade unions and employee representatives to refine and develop the proposals.
As the UK's largest fast food business, Greggs' decision to close factories and reduce costs will be closely watched by investors and customers alike. The company's ability to balance cost savings with growth and expansion will be crucial in navigating the challenges of the current market.
## What happens next Greggs will enter into a consultation period with trade unions and employee representatives to discuss the proposed closures. The company will work to refine and develop the proposals, with the aim of minimizing the impact on its people. The outcome of the consultation period will be closely watched, and the company's decision will have a significant impact on the affected communities.
