Greggs set to raise prices again in response to cost pressures

Greggs is the latest high street chain to raise prices on its products as cost pressures mount on UK businesses.

The high street bakery chain said the price of its breakfast meal deals are set to increase from Thursday, along with smaller rises for items like biscuits.

Staffing costs, including an unexpected £20m increase in National Insurance contributions, were to blame for these price rises, chief executive Roisin Currie said.

It will be the third time this year that the sausage roll maker has raised prices.

Both the two-part and three-part breakfast deal will increase by 20p each to £3.15 and £4.15p, respectively.

The Greggs boss said other price rises across other lines, like its biscuits would only be about 5p.

Greggs' famous sausage roll will be unaffected in this round of price hikes, having already increased to £1.30 earlier this year.

Despite cost pressures, the bakery chain will continue to open stores, and Ms Currie said there were opportunities to build more Greggs outlets in retail parks, roadside services as well as "compelling opportunities" to push further into southern England.

"Some were querying 'have we reached peak Greggs?' and we have gone out...to demonstrate that this is not the case," the food retail boss said.

Greggs has more than 3,000 shops across the UK. It plans to open a net 120 sites in 2025.

The bakery boss said she expected price pressures on the business to ease next year, but that the upcoming Budget could change that assumption.

"What's not helpful is when something comes out that surprises us - that's what happened with the National Insurance last year...it's quite hard to plan and manage a business when you have a £20m hit that you hadn't predicted," Ms Currie said.

Last year's Budget included an increase in employer National Insurance aimed at raising £25bn for the government, which faced criticism from businesses.

Ms Currie pointed to potential increases to the minimum wage as another reason why cost pressures and price rises may continue.

Sales in July were affected by the summer heatwave, the pastry and pizza slice seller told investors in an update.

Shoppers returned for their steak bake fix and sausage roll fix in August and September though, with overall sales for the year-to-date up 6.7% compared to last year.