Interesting but not unexpected news from Greggs. Something of a high street staple, Greggs performance over the last few months reflects the impact of huge declines in footfall. The gradual return of high street consumers should provide some comfort but the Governments' recent announcements regarding tackling obesity may add additional worries. Providers of comfort food will no doubt be taking notice of the Government's proposed interventions and the public's response in terms of buying behaviour.During the lockdown we saw many brands, such as Kipling cakes, experience something of a resurgence as people sought solace in treats. However, the well-publicised co-morbidity impact of obesity on Covid-19 has seen the Government adjust its position towards healthy eating considerably.Will this change the shape of the market with healthy options becoming staples and losing their 'premium' pricing tag? Last year nearly one third of new grocery and food products targeted the healthy-eating consumer (the impact of Gregg's vegan sausage role being one of the more notable examples), particularly those embracing more plant-based and vegan options even though only 1% of the UK population were vegan.Will public policy drive dietary changes? Could demand start to meet the level of supply? And, for brands like Greggs, what does this mean beyond providing meat-free alternatives to their staple products?
| 1 minute read
Will healthy eating campaigns excerbate the impact of lockdown?
With its shops closed for most of the second quarter, Greggs suffered a 49 per cent slump in like-for-like sales for the first half of its year. However, since then it has reopened most of its outlets and yesterday it said that sales last week, conducted with social distancing measures in place, were at 72 per cent of last year’s levels. The company said that it expected to break even when sales recovered to 80 per cent of 2019 levels.
Midsize companies face the same level of disruption as their larger rivals, but they are more likely to see themselves as disruption’s...