Climate Change Blamed for Faltering Profits at a British Pie Chain

Guest essay by Eric Worrall

Who need horoscopes when you have climate models?

Greggs threatened by climate change

JUL 6, 2018, 3:19 AM

LONDON – Climate change could be hurting sales growth at Greggs, the gigantic baked goods chain, according to an analysis of Meteorological Office data by Barclays.

Broadly, Greggs is unstoppable. It has nearly 1,900 locations in the UK, dwarfing chains like McDonald’s, Starbucks and Pret a Manger. It is not uncommon to see multiple branches of Greggs on a single street, or two stores facing each across an intersection, such is Britain’s insatiable need for pies. The sausage-rolls-and-sandwiches company opens new locations in Britain at a rate of more than 10 per month. Its revenues are still growing: like-for-like sales were up 1.3% in May.

In May, Greggs issued a profit warning because sales were reduced by the “Beast from the East,” an unusually severe winter snowstorm that brought Britain to a halt for a few days. A large number of Greggs outlets were unable to open, and those that did saw lower foot traffic. The stock dropped 15% on the news.

So Barclays decided to find out just how much of a problem the weather is for Greggs. “Writing about the weather and its potential impact is never a proud moment for us, as we do not believe it affects the fundamental value of a company. However, we are regularly asked about recent warm weather, and share prices clearly react to this news,” Taylor told clients.

He discovered that Greggs has warned of the effect of weather on its business on three previous occasions, which coincided with the three greatest temperature anomalies since 2003.

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Its understandable that weather so nasty that shops can’t open correlates with lack of pie consumption, but warm weather shouldn’t be such a factor. There are plenty of pie shops which do well in the warm subtropics of Australia, in temperatures Britain only experiences for a few weeks every year.

The key as far as I can tell is quality – pies sold by successful subtropical pastry vendors generally taste so nice people are tempted to eat them, even when they are not shivering through a long cold commute home and desperate for some warm food. Not having multiple shops from the same chain within a few paces of each other probably also helps.

Concluding climate is to blame for Greggs’ problems in my opinion embraces some lazy assumptions. A better question might be why the moat of desirability for “unstoppable” Greggs pies seems so narrow.

80 thoughts on “Climate Change Blamed for Faltering Profits at a British Pie Chain

  1. The beast from the east was a week of mildly inclement weather, blown out of all proportion by the media.

    How about the winter of 2009/2010 when the NW of Scotland suffered almost six months of snow.

    As Billy Connelly says, in Scotland there’s no such thing as bad weather, just the wrong clothes. (I paraphrase).

    If climate change is the problem, Scotland could do with a lot more of it.

    • I was cracking up…..the news was reporting it was 90F…and the roads were melting
      ..I guess there’s no roads in south Florida either

      • Latitude : A Scot ( named McAdam ) INVENTED “macadamised roads”
        and another observant gent ( Edgar Hooley , from Nottingham ) ‘
        ‘serendipitiously’ perfected it by adding Tar and creating “tarmac” surfacing , so widely used now in Australia and other HOT places …..and it seldom ‘melts’ although it does soften !
        ALSO…….the WORLD’S BEST PIES are to be found at KIPLING’S BAKERY
        at Port Wakefield in South Australia .
        The only thing that can challenge their excellence in PIES is their PASTIES !!!
        AND you need to traverse a good bit of tarmac to reach them !!

          • Carbon Bigfoot : NOT as large as you sound from your alias BIGFOOT !
            Unfortunately for me I live a long way away from there !

            Port Wakefield, South Australia 5550
            27 hours driving time (2,595.1 km)
            via National Highway A1, National Highway 1 and National Highway 94
            from where I live !!

          • Revolution : Would you believe IT NEVER COMES to a challenge
            You just EAT ONE AFTER THE OTHER….with sauce !!

        • Crazy talk, Trev.

          Best pies come from the 24 hour Bakery on O’Connell St in South Australia.

          Not only are they the Best Pies ™, the staff all speak fluent Drunk. Very handy for when you swing past at 3am.

      • But now you all know the source of the nickname for teams from the University of North Carolina. They are know as the “Tar Heels”. That comes from hot weather which softens the roads so that when you walk on them the tar sticks to your heels. That nickname has been around a lot longer than the global warming scare.

      • Look closely at the picture of that hole after the truck was pulled out. You can see there is a cavity below the asphalt that had not yet collapsed. It was just a matter of time before a vehicle broke through.

      • Te problem down south was the massive closure of shops, schools and some factories before the weather even arrived. We have become a nation of such cowardly wimps it is depressing. In the 70’s I used to walk to school through a foot of snow and even punished by beating for throwing snowballs inside a classroom,during a French lesson. Now even if a single snowflake falls the country stops.

    • “… a week of mildly inclement weather,”

      WTF? Where were you when Scotland’s central belt and border areas were gettin blitzed thro’ March?

      “Connolly”, btw.

  2. I really liked Burger Chef when I was a kid. (You could order a plain burger and then go the “toppings bar” (or whatever they called it) and pile on everything you wanted. I usually had about an inch of pickles with lots of mustard.
    CO2 killed it?
    Yeah, right.

    • You’d probably like Fuddruckers then if you have a chance to try them, and their patties are fresh not frozen. I worked at a Burger Chef one summer as a teen. Brings back some fond memories.

    • We had three Burger Chefs in Alton, IL when I was a young adult. In 1977, my wife and I rented a house next door to the pie town neighborhood Burger Chef. The flame-grilled patties were incredible compared to Burger King, McD’s or White Castle. The smell made us continuously hungry. Sad that Carl’s Jr/Hardee’s bought and converted the chain.
      Oh, and Gunga that was the “works bar”.

      • Also, a culinary tip for cruising Historic Route 66 through the midwest US is to find a Steak-n-Shake or two along the way, and visit Fast Eddie’s Bon-Air when you reach St. Louis.

  3. Some folks like to believe in the unbelievable. I believe it is the God shaped hole in everyone, that if not filled by God (Jesus – oops, I said his name), and the pursuit of God, it leaves people looking for other things in which to believe. Look at the “UFO” phenomenon. Some people “see” (want to see) something in the sky that they can’t explain, even if it is rather odd and unusual, and have a need to project their loose interpretations onto the apparent visual apparition, and claim it must be extraterrestrial intelligence. Same goes with Global Warming. Don’t get all bent out of shape on me if you don’t believe in God. I’m not trying to put all non-believers in the same bucket. It was not long ago that I didn’t believe either, yet I didn’t believe in extraterrestrials visiting planet earth every time I saw a UFO at night (which are usually airplanes filled with terrestrial intelligence). And I sure would not have believed the CAGW crap that is being shoveled. I just hope I’m a little more circumspect about the nature of things nowadays. And if a long lived company’s well being is faltering (e.g. Kodak), I’m willing to believe it is not Global Warming, or whatever the latest liberal fad is, that has caused it’s troubles.

    • Lots of people have trouble with cause and effect, which is why they “see” things and apply loose interpretations that others have no problem distinguishing as normal.

  4. Remember the days when weather was just weather? If it was raining too hard, or if you got snowed in for a day or two, you just stayed home. No big deal, life went on, even for businesses, no one complained, well maybe just complained about the weather, not blaming pretty well everyone on earth for it.

    • I agree. Millenials have been led to believe that before there were “too many people on Gaea”, the weather was “just right” – like in those Disney videos Mom and Dad showed them.

    • Most of the posters here are too young to remember those days. When I attended Syracuse University during the 62-63 winter the city buses practically never stopped running through snow and subfreezing days. They carried plumbers torches and the driver would occasionally get out to unfreeze the brakes when they got frozen to the drums. You could go out for pizza and beer with six feet of snow on the ground.

  5. If you can’t sell your pies there is probably something wrong with your pies.

    Should you find youself in the area of Osseo WI, I highly recommend Norske Nook for excellent Norwegian American food and the best damn pies your taste buds will ever caress!

    • ” . . . if you can’t sell your pies there is probably something wrong with your pies . . .”

      Rubbish J Mac! Can’t you see what’s happening? The crumpet industry is next!

      • For Americans, we should explain that the crumpet is what AGW pseudoscientists are barmy in.

    • Greggs pies sell just fine. This isn’t their own warnings, but some university departkment (probably stocked with the sort of toffs who wouldn’t be caught dead munching on a cheese bake) deciding to declare Greggs dead without evidence.

  6. This is the kind of story that is a measure of the hysteria of global warming. It arises from the growing fear of funds being cut off in ever larger tranches. They get so far out and off the wall that it accelerates the decline and fall of the clime industry.

  7. “The fault, dear Brutus, is not in our stars, But in ourselves”

    Shakespeare, Julius Caesar, Act I Scene 2

  8. Im down in Australasia and you generally consider pies & baked savoury goods to be more desirable in colder weather. Although with recent developments in such things as Butter Chi ken Pies, the temptation is all year round!

    Not sure if it translates to actual sales data, though.

    Damn, stupid article making me hungry now…

  9. Sooner or later you’ve saturated your market and your clientele begin to tire of your products.

  10. For the uninitiated. Greggs provender consists of 2 layers of greasy puff pastry in which is sandwiched a layer of semi-digested vegetable sludge alleged to continue some animal protein. It’s fascination lies in its awfulness, and the chain has managed to move British fast food back in time for 50 years. If you must indulge, don’t spare the ketchup. Going hungry is probably the better option.

    • But definitely not the lowest rung of the pie ladder when there is the Pound Bakery which does 2 pies for a quid, with a bonus prize for the customer who finds the one with meat in! (I made the last bit up, there is no prize, just a dearth of meat).

    • OMG – shades of hit song “Watford Gap” :
      Just about a mile from where the motorways all merge
      You can view the national edifice, a monumental splurge
      It’s the lonesome traveller’s rotgut or bacteria’s revenge
      The great plastic spectacular descendant of Stonehenge
      And the people come to worship on their death-defying wheels
      Fancy-dressed as shovels for their death-defying meals

      It’s the Watford Gap, Watford Gap
      A plate of grease and a load of crap

      I thought things had improved. Do they serve Cornish Pasties or Steak and Kidney Pies?

    • What, no blueberry? No apple? How can they call themselves a “pie shop”? Where’s the pie-a-la-mode?

    • For a minute there I thought you were describing the English version of McDonald’s.

    • MY local bakers make their own pies and they are brilliant. The beef is cooked so much that the cubes break apart by pressing them to the roof of your mouth and there are still lumps of kidney plus nice Gravy. They are a little more expensive than other shops but so tasty.

  11. If a few days of reduced sales is enough to generate a profit warning, then I’d suggest there’s something wrong with the business model.

  12. In Australia I thought it was axiomatic that every degree rise in temperature increased the sales of hot meat pies by hundreds at football matches.

      • vegemites a 24/7 food weather doesnt matter a whit;-)
        us older imbibers remember the “proper” full salt versions fondly
        its not quite the same now.
        and cheesymite is an abomination!

      • ozspeaksup and Pop Piasa :
        The VEGEMITE has improved since “Bega” bought it back to Australia !
        Vegemite sales are UP I reckon !

  13. If you buy and sell stocks, there is opportunity here.
    Sell when news of severe weather coming is reported.
    Follow with a “buy” after the earnings hit is announced and the stock has dropped.
    Likely this could be applied to other companies.
    Good luck.

  14. Do they have rhubarb pie, or peach pie, or cherry pie, or blackberry pie, or raspberry pie??
    Those are the ones I like, and I haven’t had them for many years…
    Rhubarb pie is the one I miss the most…
    What is their best tasting pie? I have never been to the UK…

    I’ve been to Finland, Sweden, Norway, Denmark, Germany, and Switzerland – Zermatt for skiing…

    • You forgot strawberry-rhubarb with sugar crystal coated lattice top-crust…
      And sour cream cherry custard pie with Zwieback crust, buddy.

    • You wouldn’t go to Greggs for great pies, it’s very mass market stuff.

      Virtually any high street will have a bakers who will offer pies and pasties that are far superior to Greggs.

      Bakers will also have rhubarb pies and treacle tarts etc.

      Pubs are also a good place for pies savoury and sweet.

      Mind you the best rhubarb, cherry and apple pies or tarts are the ones cooked in store by the co-op supermarket, they are also extremely cheap


  15. From personal experience I find most of their wares OK but nothing to write home about and some look really good but disappoint when eaten.
    We are blessed with a bakers in the town which produces some lovely products so much so that my wife and I call it the accident shop as we keep going in for one thing and have an accident and come out with many more.

    James Bull

  16. Maybe sales were down because of the beast from the east but sliding sales are more to do with Greggs using barbarically slaughtered hahal meat in their sandwiches and rolls. The British public is finally waking up and rejecting ritually slaughtered meat.

  17. Having To many stores is not a really good business model to maintain same store sales and sames store control cost.

  18. I read a report of Greggs’ profit warning, but it was much more credibly blamed on the internet, or more specifically, the rise and rise of online retailing.
    Popular as Greggs is – I’m partial to their steak bakes myself – people don’t generally go out to eat there. Many, however, will pop into Greggs during a day’s shopping. Clearly though, this only applies to the shoe-leather, not the mouse-mat, variety.

  19. Greggs is doing just fine. The local bakery went bankrupt here in Northamptonshire, England after trading since 1856, and competition from Greggs was probably a large part of the reason why. The stores looked tired and old by comparison, where once they used to stand out on the local high streets around the county. Nothing to do with the weather or people ordering their pies on the internet.

  20. “It is not uncommon to see multiple branches of Greggs on a single street, or two stores facing each across an intersection”

    Wow, sounds like Waffle House. There’s one place in Atlanta, GA were you can sit in one Waffle House and see two others. But, unlike Waffle House, sounds like they don’t have as good a plan to stay open regardless of weather. FEMA even has a “Waffle House Index” where after a disaster or major storm/hurricane they survey the Waffle Houses and wherever they are closed they send help there first as those are the hardest hit locations.

    But really, how lame do you have to be to blame “climate change” for your own business foibles?

  21. Or could it be that their pies used to be pretty good quality and value but the last few I had before I stopped buying from them were fatty gristly rubbish meat in an overcooked gloop of mixed vegetables optimistically sold as a pastie.
    I suspect if sales were down I was not the only one who stopped buying.

  22. It’s not the only business. Sean Penn’s mother’s sisters bakery is going out of business.

    Then again, have you seen the pie rates of Penn’s aunts?

  23. Greggs average 2/5 stars on Trustpilot. Just about right in my opinion. They have bigger problems than the weather.

  24. All very well, but Greggs don’t sell pies. Bakes, pasties, rolls, sandwiches and something pretending to be a pizza slice, but no pies.

  25. Yes, Eric

    In May, Greggs issued a profit warning because sales were reduced by the “Beast from the East,” an unusually severe winter snowstorm that brought Britain to a halt for a few days.

    And VW had to do a profit warning because of “diesel gate”.

    We should rename them from ecoterrorists to “green monsters”.

  26. Greggs is hugely popular because it is much cheaper than specialist sandwich shops. As well as pies it does sandwiches and cakes. In the last few years it has gone into coffees (2/3 the price of Starbucks, though not as good.)
    Guido Fawkes and political staffers loved it when Greggs opened a shop in Westminster earlier this year. They could get a sandwich lunch for a lot less than the other local areas. Warning – following article has Guido eating a pie.

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