Greggs plc SWOT and PESTLE Analysis

Strength

1. Social media backed brand transformation made Greggs a leading ‘food-on-the-go’ choice: Greggs started brand transformation in 2018, transitioning from being a food store chain to marketing itself on social media and mobile apps, increasing stores to spread its wings across UK and expanding menu to include on-the-go options; Greggs has positioned itself as a leading food-on-the-go brand. The newly added food ranges helped grow total sales by 7.2%. The social media publicity of newly launched popular vegan sausage roll added another 9.6% sales growth. Greggs also launched Vegan steak bake which was awarded as Best vegan pasty by PETA. Greggs in a partnership with JustEat, delivered food from 1000 of its stores during the pandemic which could be ordered via its online app. This strategy helped reach 2.17 million customers with 8.5 million orders fulfilled in F.Y. 2021, besides creating brand awareness. For the second year in a row, Greggs’ long-standing partnership with Iceland saw record-breaking sales as more customers enjoyed their Greggs favourites at home in 2021. In Iceland, they expanded their product range to include Vegan Sausage Roll, Vegan Steak Bake, and exciting new Pie range, all of which were well received, and they are continuing to expand their range.

2. Strong trading performance led to speedy recovery from pandemic blows: Greggs plc has been successful in repositioning itself as a leading food-on-the-go brand, clocking an exceptional performance in like-for-like trading of 11.1% in FY19 and of 8.2% in FY21 despite being hit by pandemic. The company opened its store chain, in FY20, which accelerated the supply chain while operating at half the capacity and company also opened new stores during this period. Post re-opening, Greggs observed positive trading performance in April 2021. The strong trading performance along with competitors not opening their stores, allowed Greggs to take full benefit of its capacity to drive higher sales. This reflected in the all-time high valuation in its stock price with E/V sales increased by 2.1 times and P/E by 28.7x. With 2,181 open shops in FY21 Greggs managed to maintain leading UK food-on-the-go brand title.

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Weakness

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Opportunity

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Threats

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Political

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Economic

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Social

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Technological

1. Digital technologies are helping restaurants offer best customer experience: During the Covid-19 pandemic, the businesses were significantly driven by digital and technological innovations. Food and Drink industry leverages digital innovation to enhance their business model by including services like online delivery and take-away. These services have enabled the companies to connect with their customers, fulfil their demands and control additional costs. After the successful trial of ‘Next Generation Greggs’, a multi-channel digital transformation programme the company launched it on January 2020. With an increased demand of services such as Click + Collect and home delivery, Greggs accelerated its digital capabilities and plans. The company also introduced new services such as enhanced Greggs’s Rewards offer, Click + Collect services and nationwide delivery services with its partner Just Eat.

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Legal

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Environmental

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