(Bloomberg) -- Greggs PLC has defied the decline of the U.K.'s retail districts with a popular range of cheap pastry products. Now it's facing a new threat from a possible no-deal Brexit.
The largest bakery chain in the U.K. is preparing to alter its recipes if its supply of perishable ingredients such as lettuce and tomatoes is delayed by a disorderly departure from the European Union. It's also stockpiling longer-lasting ingredients such as bacon and tuna.
If there are any disruptions at ports, “we'll be able to last a few days and then hopefully it will settle down,” Chief Executive Officer Roger Whiteside said on a call with reporters as the company reported a slowdown in sales growth that prompted a fall in the shares. “Should there be any short-term pressures on some ingredients then there are alternative recipe suggestions we can fall back to.”
Greggs has already tried to reduce its dependency on European suppliers, sourcing more of its cheese and sugar from U.K.-based companies. It has also brought forward purchases of trucks from continental Europe to limit the effect of any delays at the borders on its own distribution network.
“A lot of what we sell clearly has a level of substitution involved,” Whiteside said. “People won't go without food. They'll make different food choices dependent on what's available.”
To contact the reporter on this story: Greg Ritchie in London at gritchie10@bloomberg.net
To contact the editors responsible for this story: Eric Pfanner at epfanner1@bloomberg.net, John Lauerman
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