Business Organisations Case Study: Greggs plc

1. Types of Business Ownership

1.1 Sole trader

One person owns and runs the business.

• Advantages: quick and cheap to set up, the owner keeps all profit, and the owner has full control (GOV.UK, 2026a).
• Disadvantages: unlimited liability, so personal assets can be used to pay business debts. Raising large sums of money is difficult.

1.2 Partnership

Two or more people share ownership, profit and risk.

• Advantages: shared skills, shared money and a shared workload (GOV.UK, 2026b).
• Disadvantages: partners can disagree, and in an ordinary partnership each partner is personally liable for the debts.

1.3 Private limited company (Ltd)

• Advantages: limited liability and a separate legal identity.
• Disadvantages: more paperwork, and accounts must be filed publicly under the Companies Act 2006.

1.4 Public limited company (plc)

Greggs floated on the London Stock Exchange in 1984, when it had 261 shops. Anyone can now buy its shares (London Stock Exchange, 2024).

• Advantages: it can raise large amounts of money for bakeries, distribution centres and shops. It also gains trust and a strong public profile.
• Disadvantages: owners (shareholders) and managers are different people. Jensen and Meckling (1976) explain that this can create “agency costs”, because managers may not always act in the owners’ best interest. Greggs must also publish results regularly and meet shareholder expectations for profit and dividends.

1.5 Franchising

Greggs does not own every shop. In May 2026, 2,141 shops were company-managed and 618 were franchised, which is about one in five (Greggs plc, 2026b).

• Benefit: faster growth with less of its own money. Franchise partners often already control sites such as travel hubs and forecourts. Combs and Ketchen (2003) found that firms use franchising to overcome shortages of capital and local management.
• Risk: less direct control over shop standards, so the brand must check quality carefully.

Comparison table

Evaluation: Greggs shows that ownership can change as a business grows. The plc status gave it money to grow nationally. Franchising now gives it extra speed. The cost is shareholder pressure and less control over some shops.

2. Organisational Structure: Tall vs Flat

2.1 Tall structure

• Many levels of management and a long chain of command
• Narrow span of control, so each manager has few staff
• Strong control, but slower decisions and slower communication

2.2 Flat structure

• Few levels of management and a wide span of control
• Faster communication and more freedom for staff
• Risk of overloaded managers (Meier and Bohte, 2000)

2.3 Application to Greggs

Large organisations often need standard rules to work at scale (Mintzberg, 1979). Greggs appears to use a mix. This is the analysis of the writer, so students should check the exact structure in the Annual Report.

• Inside each shop, the structure is flat. A small team works under a shop manager, and daily decisions are quick.
• Across the company, the structure is taller. Shops report to area managers, then regional management and head office. This keeps food safety, prices and quality the same everywhere.

2.4 Evaluation

• Strength: the tall layer gives control, which matters in food safety.
• Strength: the flat shop teams give fast service.
• Weakness: head office decisions can be slow when trends move fast. In 2026 Greggs is trialling new formats such as “Greggs Express”, a self-service coffee and food offer (Greggs plc, 2026a). New formats need quick decisions.

3. Business Functions

3.1 Human resource management (HRM)

HRM covers recruiting, training, rewarding and keeping staff (Armstrong and Taylor, 2020).

• Huselid (1995) found that strong HR practices are linked to lower staff turnover and better productivity and financial results. Guest (2011) agrees that HR matters but says the exact link is still debated.
• Greggs employs around 32,000 people (London Stock Exchange, 2024).
• Greggs shares 10% of profits with its colleagues and offers share plans. This supports loyalty and effort (Greggs plc, 2026c).
• Challenge in 2026: Greggs expects cost inflation of around 3% (Greggs plc, 2026b), and staff pay is a large part of that cost.

3.2 Production and supply chain

Production turns inputs (ingredients, labour, energy) into outputs (bakes, sandwiches, drinks).

• Skinner (1969) argued that manufacturing should be treated as a core part of strategy, not a back-office task.
• Greggs has invested heavily in its own supply chain. The London Stock Exchange (2024) describes it as vertically integrated. In 2026 it is adding capacity with distribution centres in Derby and Kettering (Greggs plc, 2026a).
• Barney (1991) explains that valuable resources that are hard to copy can create lasting advantage. A large, owned supply chain is one example.
• Greggs has also fixed prices for about 85% of its 2026 energy needs and most food and packaging needs (Greggs plc, 2026b). This reduces the risk of sudden cost rises.

3.3 Operations

Operations is the daily running of the business: opening hours, stock, service speed and layout (Slack, Brandon-Jones and Burgess, 2022).

• Greggs is opening later to attract evening customers (Hargreaves Lansdown, 2026).
• It is adding drive-thrus and Express units, and it opened its first international travel shop at Tenerife South Airport (Greggs plc, 2026a).

3.4 How the functions connect

• Good HR gives well-trained shop teams.
• Good production gives fresh, low-cost products on time.
• Good operations turn both into fast, friendly service.
• A weakness in one function hurts the others.

4. Organisational Culture

Culture means the shared values and habits that shape how people behave at work (Schein, 2010). It is shown by what leaders do, not by posters.

4.1 Positive effects of a strong culture

• Staff retention: people stay longer and hiring cost falls.
• Teamwork and service: staff work better together.
• Brand strength: customers notice friendly shops.
• Performance: Denison (1984) linked a culture of staff involvement to better financial results. Kotter and Heskett (1992) found that cultures that fit the strategy and can adapt tend to perform better.

4.2 Greggs example

• Greggs has shared profit with colleagues for many years, which supports a “we succeed together” feeling.
• It has a strong community link through the Greggs Foundation.
• Its Chief Executive says its value leadership makes it a “go to” brand and helps it outperform the market (Greggs plc, 2026a).

4.3 Possible weakness

A strong culture can make change harder. As Greggs adds franchise partners and new formats, it must keep the same values in shops it does not directly manage.

Conclusion

Greggs shows how a business changes as it grows. Its ownership moved from a small local trader to a plc with a franchise network. Its structure mixes flat shop teams with a taller head office. HR, production and operations must work together, and a strong culture holds them together. Students using Business Assignment Help can explore these business concepts through real-world examples. The main challenges in 2026 are rising costs, changing customer habits and keeping standards across a larger estate. Current results suggest Greggs is managing these better than most of its market.

References

Armstrong, M. and Taylor, S. (2020) Armstrong’s Handbook of Human Resource Management Practice. 15th edn. London: Kogan Page.

Barney, J. (1991) ‘Firm resources and sustained competitive advantage’, Journal of Management, 17(1), pp. 99–120.

Combs, J.G. and Ketchen, D.J. (2003) ‘Why do firms use franchising as an entrepreneurial strategy? A meta-analysis’, Journal of Management, 29(3), pp. 443–465.

Companies Act 2006, c. 46. Available at: legislation.gov.uk.

Denison, D.R. (1984) ‘Bringing corporate culture to the bottom line’, Organisational Dynamics, 13(2), pp. 5–22.

GOV.UK (2026a) Set up as a sole trader. Available at: gov.uk (Accessed: 29 October 2026).

GOV.UK (2026b) Set up a business partnership. Available at: gov.uk (Accessed: 29 October 2026).

Greggs plc (2026a) 2026 Interim Results. Newcastle upon Tyne: Greggs plc.

Greggs plc (2026b) Trading Update, 12 May 2026. Newcastle upon Tyne: Greggs plc.

Greggs plc (2026c) Careers: benefits and colleague rewards. Available at: greggs.co.uk (Accessed: 29 October 2026).

Guest, D.E. (2011) ‘Human resource management and performance: still searching for some answers’, Human Resource Management Journal, 21(1), pp. 3–13.

Handy, C. (1993) Understanding Organisations. 4th edn. London: Penguin.

Hargreaves Lansdown (2026) Greggs (Trading Update): good progress, 12 May.

Huselid, M.A. (1995) ‘The impact of human resource management practices on turnover, productivity, and corporate financial performance’, Academy of Management Journal, 38(3), pp. 635–672.

Jensen, M.C. and Meckling, W.H. (1976) ‘Theory of the firm: managerial behaviour, agency costs and ownership structure’, Journal of Financial Economics, 3(4), pp. 305–360.

Kotter, J.P. and Heskett, J.L. (1992) Corporate Culture and Performance. New York: Free Press.

London Stock Exchange (2024) London Stock Exchange celebrates Greggs 40th anniversary. Available at: londonstockexchange.com (Accessed: 29 October 2026).

Meier, K.J. and Bohte, J. (2000) ‘Ode to Luther Gulick: span of control and organisational performance’, Administration & Society, 32(2), pp. 115–137.

Mintzberg, H. (1979) The Structuring of Organisations. Englewood Cliffs, NJ: Prentice-Hall.

Schein, E.H. (2010) Organisational Culture and Leadership. 4th edn. San Francisco: Jossey-Bass.

Skinner, W. (1969) ‘Manufacturing: missing link in corporate strategy’, Harvard Business Review, 47(3), pp. 136–145.

Slack, N., Brandon-Jones, A. and Burgess, N. (2022) Operations Management. 10th edn. Harlow: Pearson.