Regional pasty retailer Cornish Bakehouse has kicked off a major UK-wide expansion plan.
The retailer, which has shops across the south-west and Wales, opened its 19th store this week on North Street in Brighton. Another store is set to open in Bude, Cornwall on 10 April, with more to follow.
“We’re aiming to open probably four or five shops a year,” general manager Kevin Mitchell told The Grocer. “But that will accelerate if we are successful.”
“There’s a lot of bakehouses and pasty shops when you go down south-west, but there’s not many that are wanting to venture further north and move out into unfamiliar territory.”
Mitchell, a former B&M and Asda regional manager, was appointed in 2023 to lead the next stage of the business growth under owner Bridgewater Brothers Holdings, which acquired the business in 2022. Current president of the British Frozen Food Federation Karen McQuade is also a shareholder in the retailer.
To make sure its offer stands out, the baker has been trialling new formats as part of the rollout. It’s seen the addition of digital screens at the new 1,200 sq ft site in Brighton, which is also its first to feature a 28-seat sit down café.
It’s also been expanding its menus, adding new products like frappes, matcha teas, as well as a gourmet vegan onion bhaji roll, which launched in Brighton. In total its range has grown by more than 10%.
“We want to weatherproof the business,” Mitchell said. “As the business has grown up it’s been reliant on seasonal locations in places like Cornwall. We’ve got to even those bumps out.”
The retailer would increasingly target city centre stores as part of the rollout, with the aim of reaching as many as 50-60 new locations over the long term, Mitchell said.
Compete on taste rather than price
The expansion comes at a time when retailers, particularly high street operators, struggle against a combination of declining footfall and surging costs. The barrage of employment costs as a result of Rachel Reeve’s budget from April will add further pressure.
However, Mitchell is confident the business can succeed. Together with his team Mitchell has spent the last year “modifying” the business and its supply chain, to be able to cope with the increase in its operations.
“We’ve done a lot of work on how we’re going to mitigate cost impacts. How we’ll improve our gross margins, what our route to market looks like and how we’re going to deal with price perception,” Mitchell said.
Stores have also begun a programme of work to improve price perception, for example by making the price more prominent in stores, as well as the launch of a new suite of promotions and offers. As a result Cornish Bakehouse had in January enjoyed its most successful sales for a long time.
Nevertheless, Mitchell concedes that Cornish Bakehouse will struggle to compete with the likes of Greggs on price. However, he’s adamant that it can win by highlighting the “higher quality” of its products.
“Our sausage roll is 50p more expensive compared to Greggs, but if you weighed up our sausage roll there’d be more meat content,” Mitchell said. “Taste is absolutely king.”
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