Bakery chain Greggs has warned that higher business rates risk making some of its stores unviable. The statement comes at a time when the ministers consider overhauling the tax. Chief executive, Roger Whiteside said it was “coming to London with renewed vigour” as part of expansion plans to reach at least 3,000 stores. It currently operates across 2,150 outlets.
Like-for-like sales were 3.5pc higher than pre-Covid levels in the three months to September 30, prompting the company to raise its annual profit forecasts. Annual revenue is now expected to double within the next five years. However, Whiteside warned about the expected hit from business rates relief ending early next year. The relief was introduced at the beginning of the pandemic to help the high street and ministers are assessing whether broader business rates reform is needed.
Whiteside said, “The business rates system simply isn’t responsive enough to market conditions, it’s out of date. Once the business rates system is restored fully, then that will affect the viability of individual units. It will make some units not profitable when they really should be.”
He added, “Business rates are too high, that’s the bottom line. And hopefully this latest crisis will accelerate the government’s appetite to do something about it.” The comments come shortly after Greggs said it too has been affected by supply chain issues, which has affected both ingredients and labour. Whiteside said, “We’re all firefighting like crazy because everywhere we turn there’s another problem which needs immediate workarounds put in place to overcome the fact that those supplies aren’t coming through consistently.”
A Federation of Small Business spokesman called upon the Prime Minister to address the issue in his conference speech tomorrow. He said, “The Conservatives have been outflanked on business rates reform by the Opposition.”