Greggs to Close Four Manufacturing Sites and Cut 740 Jobs in Major Restructuring

High street bakery chain Greggs has unveiled proposals to close four of its manufacturing facilities and eliminate 740 positions as part of a significant restructuring of its production network. The Newcastle-headquartered company announced the plans on Tuesday, confirming that its retail shops would remain unaffected by the changes.

The proposed closures would affect manufacturing sites at North Lakes near Penrith in Cumbria, Pettigrews in Kelso, Scotland, Seaham in County Durham, and Enfield in Greater London. While production would cease at all four locations, the company indicated that distribution operations would continue to run from its Enfield site.

Additionally, manufacturing activities at Greggs' Treforest facility in Wales would be impacted, though the site would remain operational as a distribution centre for the business. The company stated that the changes would be implemented over the next two-and-a-half years, with portions of its manufacturing processes being relocated elsewhere.

Further adjustments to the company's production capabilities include reducing the range of products manufactured at its Clydesmill facility in Glasgow and its Manchester location. Production of tinned bread at its Gosforth site would also be discontinued entirely. Greggs noted that some products would be sourced from specialist suppliers as part of the restructuring.

Chief executive Roisin Currie explained the rationale behind the proposals, stating that the company needed to "keep evolving alongside changing customer expectations." She emphasised that Greggs' manufacturing and logistics network remains a fundamental strength of the business, and the proposed changes are designed to reinforce this network, enhance operational efficiency, and position the company favourably for future challenges while maintaining the quality, value, and service standards customers anticipate.

Greggs currently employs approximately 33,000 people across the United Kingdom, with the majority working in its retail stores. The company has confirmed that a consultation with affected staff is expected to commence shortly, and no final decisions have been reached regarding the proposals.

The restructuring is projected to cost the company approximately £60 million, a figure that includes both disruption costs and redundancy payments to affected workers. However, Greggs anticipates that the changes will generate savings of around £20 million across the 2028 and 2029 financial years, providing a longer-term financial benefit.

The announcement comes despite Greggs reporting positive sales growth in recent months. The company revealed that its sales increased by 7.7% in the three months ending September 26 compared with the same period the previous year. Greggs described this performance as progress amid "challenging market conditions," noting that consumer finances continue to face significant pressure.

Looking ahead, the company stated that positive trading results and continued cost control measures have led it to expect a "modestly improved outcome" for 2026. This outlook suggests confidence in the business's trajectory despite the current restructuring efforts.

In terms of its retail expansion, Greggs has opened 95 new shops and closed 38 locations in the year to date, bringing its total estate to 2,796 shops across the country. The company's retail footprint remains a central component of its business strategy, with the proposed manufacturing changes explicitly designed not to impact store operations.

The decision to consolidate manufacturing operations reflects broader trends in the UK food retail sector, where companies are increasingly seeking operational efficiencies to remain competitive amid rising costs and evolving consumer preferences. Greggs has positioned itself as a value-focused brand, and maintaining competitive pricing while managing production costs presents an ongoing challenge for the business.

The proposed closures will have significant implications for local economies in the affected areas, particularly in Penrith, Kelso, Seaham, and Enfield, where the manufacturing sites provide employment opportunities. The consultation process with staff is expected to address concerns regarding job losses and potential redeployment options where feasible.

Greggs' restructuring plan underscores the delicate balance faced by major food retailers in the current economic climate. While the company continues to expand its retail presence and report sales growth, the need to streamline manufacturing operations highlights the pressures of maintaining profitability in a competitive marketplace characterised by fluctuating input costs and cautious consumer spending.

The company's commitment to continuing distribution operations at both Enfield and Treforest suggests a strategic approach that preserves elements of its logistical infrastructure while reducing manufacturing capacity. This dual-purpose utilisation of sites may allow Greggs to maintain service levels to its retail network while achieving the intended cost savings.

As the consultation process begins, the focus will turn to how Greggs manages the transition for affected employees and whether the projected savings materialise as anticipated. The outcome of these proposals will be closely watched by industry observers, investors, and the communities affected by the potential closures.