nickshanagher

Starbucks provides a cheap place to meet or an expensive place to buy coffee, depending on the shopper's outlook. Aggresively expanding bakers chain Greggs says it plans to increase the number of its outlets selling lattes and cappucinos. While the media says this is a threat to Starbucks, Greggs appears to be operating in the part of the market where McDonald's is operating and that is its natural competition. What is clear about its strategy is that it is tapping into the same "out of home" food and beverage opportunity that is available to local shops. Greggs says it sold 10 million breakfast rolls last year and 300,000 pots of porridge. "Convenience is getting more crowded and everyone is our competitor," chief executive Ken McMeikan told independent retailers at an ACS summit earlier this month. Sandwiches and drinks are now 50 per cent of his sales and coffee is the biggest growth opportunity. His focus is on delivering outstanding service, value...

Sales of sandwiches and coffee continue to rise and news this week that Greggs, the bakery chain, plans to open 600 new stores at the rate of more than one a week from next year demonstrates confidence in consumer demand. Interestingly, the stock exchange listed company says it will fund the £300m it expects to spend on expansion out of its cashflow! It is a useful reminder to c-store and newsagent operators to check that they are not neglecting local demand. Coffee sales, in particular, offer attractive margins and are easy to provide.