Why do Greggs have shops near each other?

[DaveShoelace]

Wandering through town today and there are three instances where there is a Greggs bakery within about eight shops of another Greggs. Literally you could hurl a sausage roll from one and it would land in the other.

I'm sure there is a really good business reason for this, anyone got any ideas why they can afford to open so close to each other? Seems counter intuitive, but they are obviously doing really well from it.

It's simple business logic really, Barry, or it is in my view.

The nature of their shops means they have a maximum capacity, adding extra assistants does not help, they just get in each others way. The business has several "rush periods" (on the way to work, mid-morning, lunchtime, mid-afternoon, on the way home from work, before/after going out for ther evening), & in between those periods, is relatively quiet, so extra staff is a bit of an expensive solution.

Entry costs to the sarny/sausage roll shop market are very small - anyone can set up a barrow, or burger-bar type place, or lease an empty shop nearby. 

So Greggs develop the local market, then parasite traders nick their business.

Best answer is to open several shops close to each other = bugger off parasite traders.

I must say, I think they are a wonderful Business, they have effectively created a market, & are now serving it well. In my eyes, they are nearly up there with GB & Ireland's Greatest Business. They are SO successful, the haters are on their case. And that is seriously successful.

I doth my cap to you sir, very good explanation.

[tikay]

Hmmm did they create it? I'm inclined to think the coffee shop brands have created more of it and greggs have turned more from a bakery type business into a sandwich/lunch type place to nick their slice of that market.

Adapted it, then. They exploited a hole in the market better than anyone else. Everyone has to eat. We like convenience food.

[tikay]

Wandering through town today and there are three instances where there is a Greggs bakery within about eight shops of another Greggs. Literally you could hurl a sausage roll from one and it would land in the other.

I'm sure there is a really good business reason for this, anyone got any ideas why they can afford to open so close to each other? Seems counter intuitive, but they are obviously doing really well from it.

It's simple business logic really, Barry, or it is in my view.

The nature of their shops means they have a maximum capacity, adding extra assistants does not help, they just get in each others way. The business has several "rush periods" (on the way to work, mid-morning, lunchtime, mid-afternoon, on the way home from work, before/after going out for ther evening), & in between those periods, is relatively quiet, so extra staff is a bit of an expensive solution.

Entry costs to the sarny/sausage roll shop market are very small - anyone can set up a barrow, or burger-bar type place, or lease an empty shop nearby. 

So Greggs develop the local market, then parasite traders nick their business.

Best answer is to open several shops close to each other = bugger off parasite traders.

I must say, I think they are a wonderful Business, they have effectively created a market, & are now serving it well. In my eyes, they are nearly up there with GB & Ireland's Greatest Business. They are SO successful, the haters are on their case. And that is seriously successful.

I doth my cap to you sir, very good explanation.

I made it all up Barry, but it seems to fit the facts.

[Woodsey]

Hmmm did they create it? I'm inclined to think the coffee shop brands have created more of it and greggs have turned more from a bakery type business into a sandwich/lunch type place to nick their slice of that market.

Adapted it, then. They exploited a hole in the market better than anyone else. Everyone has to eat. We like convenience food.

Well better is subjective, they are cheap sure, but better?

[tikay]

Hmmm did they create it? I'm inclined to think the coffee shop brands have created more of it and greggs have turned more from a bakery type business into a sandwich/lunch type place to nick their slice of that market.

Adapted it, then. They exploited a hole in the market better than anyone else. Everyone has to eat. We like convenience food.

Well better is subjective, they are cheap sure, but better?

How does "most successful/profitable" fit, then?

I can't think of a similar business which is as successful.


It is bigger than McDonalds in the UK.

More than Meats The Pie.....



http://en.wikipedia.org/wiki/Greggs

[Jon MW]

Nobody really created the market - isn't it just the result of the shift away from sitting down meals and towards convenience food?

And like Tikay suggested I think Greggs just managed to get good enough quality at low enough price to take advantage of this - although taking over a lot of their rivals probably helped

[tikay]

Nobody really created the market - isn't it just the result of the shift away from sitting down meals and towards convenience food?

And like Tikay suggested I think Greggs just managed to get good enough quality at low enough price to take advantage of this - although taking over a lot of their rivals probably helped

exploited

[Woodsey]

Ok successful fair enough, but there are better places to eat for sure, I spend my entire week eating from these types of places. Guess they have won the war at the cheap end of the market.

[tikay]

Ok successful fair enough, but there are better places to eat for sure, I spend my entire week eating from these types of places. Guess they have won the war at the cheap end of the market.

I would not argue with that, but I answered the OP's question.

There are better Airlines than Ryanair - arguably..... - but none in the world are more successful.

[DMorgan]

Bakery Commission only allows 3 ovens per shop = Greggs taking over the high street

Oh wait...

[StuartHopkin]

Ok successful fair enough, but there are better places to eat for sure, I spend my entire week eating from these types of places. Guess they have won the war at the cheap end of the market.

I would not argue with that, but I answered the OP's question.

There are better Airlines than Ryanair - arguably..... - but none in the world are more successful.

Did you see the Ryanair email this week, they are finally trying to avoid everyone hating the Ryanair experience!

[tikay]

Ok successful fair enough, but there are better places to eat for sure, I spend my entire week eating from these types of places. Guess they have won the war at the cheap end of the market.

I would not argue with that, but I answered the OP's question.

There are better Airlines than Ryanair - arguably..... - but none in the world are more successful.

Did you see the Ryanair email this week, they are finally trying to avoid everyone hating the Ryanair experience!

I most certainly did, I have Priority e-Mails, see?

It won't stop the haters, of course, the more successful they become, the more peeps will chunter. (See also Apple, Microsoft, Tesco, Man Utd).

Here is the e-mail, proper cooey-wooey stuff too. 



In 2014 we’re changing for the better. You can still book our very low fares and enjoy our on-time flights, but this year we are working hard to improve our customer service to bring you and your family an easier to book website, a free 2nd carry-on bag and allocated seating from 1st February which we hope will eliminate queues and stress at our boarding gates.

In the coming months we hope to roll out new products for family and business passengers, a brilliant new website from late April and mobile boarding passes in June.

This summer we’re launching exciting new routes, adding frequencies on existing routes, as we continue to lower fares to save you, your business and your family more money than ever before.

So thanks for flying Ryanair, I hope you’ll enjoy these service improvements as much as we’ll enjoy welcoming you on-board in 2014.

Best Wishes

Michael O'Leary

[david3103]

I was told some years ago that the flour and other ingredients delivered to Gregg's overnight was converted into cash in the bank by the end of the day. Highly efficient ordering systems and a very clear idea of who their customers are and what they want.

Nobody makes a Steak Bake quite like Gregg's and their packaged sandwiches are a cut above the offerings from their competitors.

[Woodsey]

I was told some years ago that the flour and other ingredients delivered to Gregg's overnight was converted into cash in the bank by the end of the day. Highly efficient ordering systems and a very clear idea of who their customers are and what they want.

Nobody makes a Steak Bake quite like Gregg's and their packaged sandwiches are a cut above the offerings from their competitors.

Really? Do you like Nando's too by chance? 

[tikay]

I was told some years ago that the flour and other ingredients delivered to Gregg's overnight was converted into cash in the bank by the end of the day. Highly efficient ordering systems and a very clear idea of who their customers are and what they want.

Nobody makes a Steak Bake quite like Gregg's and their packaged sandwiches are a cut above the offerings from their competitors.

Correct, & they pay their suppliers promptly in 60 days. What's not to like about managing cash-flow like that? Free cash flow for 60 days, BOOM!

Airlines do a similar thing, of course, except they take the cash up front, & provide the service much later.