Greggs is now looking at job cuts as the impact from the government’s furlough scheme ending is set to shock their balance sheet.
Greggs is one of the familiar faces on most high streets employing circa 25,000 people and in a recent statement said it expects business activity to ‘remain below normal for the foreseeable future’.
The statement revealed the business is currently looking at employee costs and in discussion with employee representatives. The priority is to save jobs and to potentially do so by cutting employee hours rather than numbers, safeguarding workers.
Most of Greggs 25,000 workers throughout recent months have been on furlough and now it is unclear if they will now move to using the Chancellor’s Job Support Scheme. The new scheme was announced last week and is designed to ease the transition back to work for employers and employees.
With high street footfall still significantly down, it is hard to see how many Greggs outlets and employees can maintain their positions amidst reduced custom.
The scheme will replace the existing furlough programme which is coming to an end on 31 October. The vast majority of Gregg’s 25,000 workforce had been placed on furlough during lockdown. Since reopening in July, like-for-like sales are down circa 30% on the same period last year.
Shining some light on a challenging outlook Greggs said September sales had improved on the months prior from an increase in customer visits.
This time last year Greggs’ meat-free sausage roll has been the biggest vegan food launch of 2019 to date and helped raise profits significantly. In March 2019 Greggs announced sales had topped £100 million for the first time alongside a 15 per cent rise in profits.
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Hospitality & Catering News: Greggs eyes balance sheet – 29 Sept 2020 – Greggs eyes balance sheet