When Roger Whiteside joined Greggs in 2013, he was already well-known in the sector as the CEO of Punch Taverns, then a 3,000-strong business still dealing with the toxic legacy of its licensee relationships.
Industry-watchers would have to look back further still in his career, to his early years at M&S Food and Ocado, to join the retail dots to Greggs, the bakery business based in Newcastle.
A well-liked leader seen as always on top of his brief, Whiteside cites a sense of achievement as a key motivating factor for taking on a new challenge.
When he joined, Greggs was facing its own challenges on the high street according to analysts, both macro-economic and as a result of structural decline in footfall.
While his predecessor Ken McMeikan (now at Moto) was generally thought to have done a good job, at the time Greggs was still more of a regional brand.
It was under Whiteside that the value-led operator begun to fulfil its potential as a business with a truly national footprint.
“Roger Whiteside undertook and delivered an amazing transformation of Greggs, from a Northeast icon into a national business with national recognition,” Peter Martin, MCA’s contributing editor, explains.
Whiteside shifted Greggs away from its bakery heritage, turning it into a food to go giant able to take on the likes of McDonald’s, Martin says, citing CGA data which shows it has become “a real contender” in the market.
Ambiguity over whether it is a retail or hospitality brand is a moot point, due to the overall strength of the brand and its offering.
Martin singled out the vegan sausage roll for particular praise, highlighting the product launch as “a massive coup”, with Piers Morgan writing columns about it as the kind of “PR that money can’t buy”.
Like McDonald’s and Wetherspoon, Greggs has set new standards for quality of coffee, at a more affordable price point than the high street coffee chains.
“One of the reasons we first started tracking Greggs is because Weatherspoon said it was becoming their biggest competitor at lunchtime,” Martin says.
“Your competition doesn’t always necessarily come from the obvious places, it can come from other areas.
“That speed and availability and quality at lunchtime is something Greggs has done so well.”
Mark Brumby, analyst at Langton Capital, has tracked Whiteside’s career since his Punch days, and credits him with doing “an outstanding job” – as well being a “very hard man not to like”.
Brumby said Greggs’ share price tells its own story, going from £4 when he joined to £26.
“Greggs has always punished people who’ve sold shares,” Brumby says. “I’m kind in that category, I have backed Greggs, made money and then sold, but it’s always been right to stick with it is as they’ve carried on building it.”
Brumby says key metrics such as share price and store numbers do not always tell the full story however.
While Greggs may have added 500-600 net sites, they have exited many as well, shifting the balance of the estate.
“The gross number of new sites added will be much greater than the 500-600 it looks like, the churn has been substantial,” Brumby says.
“He’s upgraded the quality of the stores and he’s moved south.”
Indeed, having established itself in London, Greggs is pressing go in new sites, Brumby points out.
Geof Collyer, an analyst at Lavender Bank Partners, heralded Whiteside’s leadership at Greggs as outstanding, and worthy of singular praise.
“When Whiteside took over Greggs, it was in a bit of a bind. His stewardship has been transformational,” he tells MCA.
During his tenure, the hospitality sector has had to deal with one of its “greatest existential threats”, the introduction of the National Living Wage, with most of Greggs’ major peers across the pub & restaurant seeing their operating margins fall in the four-five years (pre-Covid) following its introduction, Lavender says.
Meanwhile, there has been a major shift in consumer eating habits often towards healthier fare, which is not always a core part of the Greggs offering.
Lavender says Greggs has also succeeded in avoiding the profit warnings that have marred many other listed consumer groups.
“Driven by Whiteside’s business re-engineering programme and estate repositioning, Greggs’ labour/sales ratio shrunk by over 400 bps, and has been a major driving force in the group’s operating margin more than doubling during his tenure.
“Between FY13 and FY19 (pre-Covid), Greggs grew total sites by +23%, total sales by +53% and operating profit (LBP adjusted) by +186%. Even McDonald’s (UK), one of the sector’s very best performers over the same time frame coinciding with Whiteside’s tenure at Greggs, could only manage +48% operating profit growth.”
While Whiteside has made great strides towards making Greggs a national brand, and achieved its long term to reach 2,000 stores, Brumby reckons the company’s growth in the south is probably still a work in progress.
The product offering won’t appeal to everyone, but has been developed enough to attract new customers, while maintaining its competitive pricepoint, Brumby says,
“The product has evolved such that you’d expect the audience to change, as a result of slightly better coffee, vegan alternative and green offers.
“The fascia of the shops are still quite stark though, I’m slightly curious as to why that hasn’t changed much over the last decade because quite a lot of other things have changed regarding the shops.
“I would imagine that’s constantly being thought about, even if nothing happens.”
Ultimately Greggs has achieved that rare status of being a cultural institution of a brand.
“In the same way that students swear by Wetherspoon’s, it’s a rite of passage,” Brumby adds. “It seeps into the consciousness without a huge amount of advertising spend.”
Martin sees Greggs as “classless” brand, with a fun element. The product has grown in quality, “without being too fancy”.
“We now have our own homegrown competitor to McDonald’s in that fast food / food to go market, which is great news,” he says.
Its marketing is “incredibly simple”, with a British sense of humour which doesn’t take itself too seriously - which isn’t always easy to do, Martin says.
“People understand what Greggs is about. It’s a proper brand, people have an affinity to it, it’s not just a label.”
Having been given a boost by the pandemic, and staying open while others were closed, Greggs enters its next phase at an advantage.
Retail director Roisin Currie will take over from Whiteside in May, and also inherits a business with a competitive consumer tech proposition.
“Greggs is moving into a new phase, it’s no longer a challenger, it’s part of the establishment,” Martin adds. “It’s gone through that transformation.
“It’s now got to grow from this position of strength as one of the big British brands, and making sure that stays fresh,
“The question for the new CEO will be, how does the business continue to reinvent itself and stay in tune with its core market?”
