Greggs the Bakers set to grow operation

Jun 9 2010 by Christopher Knox, The Journal

GREGGS plans to say goodbye to its original Gosforth factory as part of plans to grow its operation in the North East.

The Newcastle-based retail baker is looking to build a larger base beside its site at the Balliol Business Park in Longbenton in North Tyneside, where it has 20 acres of unused land to develop on.

Bosses say that the new bakery will create 30 new jobs and will include a new warehouse, offices and the base for a lorry delivery service.

The Longbenton site currently employs 15 people, who will be joined by more than 330 more under the plans, with most of the staff moving from South Gosforth.

The move, which is subject to planning permission by the North Tyneside Council, would allow Greggs to supply up to 200 stores, rather than the 160 now.

The firm also plans to make the new bakery a 24-hour operation. Council planners are expected to give the go-ahead for the new site.

Greggs was last year granted the Honorary Freedom of Newcastle by Newcastle City Council in recognition to its contribution to the economy of the city and support for charities.

A Greggs spokesman said that the planning application was a “first step” towards the opening of a new factory, and that its existing offices in Jesmond and Newcastle would be unaffected by the proposal.

Planners say the provision of jobs and inward investment to North Tyneside is a material consideration, which weighs heavily in favour of the proposal.

The growing popularity of the company’s baked products saw it increase sales by 2.6% for the 18 weeks to May 8, with like-for-like sales up 0.6%.

The popularity of the Greggs breakfast – bacon or sausage in a freshly-baked roll – of which two million have been sold since it was launched in February, is partly credited with the firm’s success.

Greggs shut 10 stores last year, leaving it with around 1,419 branches across the country.

When announcing the figures chairman Derek Netherton said: “I am pleased with our year-to-date performance in a trading environment that remains challenging.

“We continue to make good progress towards our strategic objectives and are on track to open a net 50 to 60 new shops and complete 120 refits this year.

“Our financial position remains strong and we are well placed to deliver further growth in 2010.”

The North East has also benefited from Greggs’ efforts to reorganise the supply chain and restructure during 2009, which included moving from 11 bakery divisions to seven retail regions and pulling out of the loss-making Belgian market.