Lancashire-based Cherrytree Bakery has invested close to £1m in new technology and expanding its premises to meet demand from a major coffee shop chain.

The company plans to invest £425,000 with support from NatWest, on a new dispatch area and freezer storage, which will add another 6,000sq ft to its 22,000sq ft production facility in Burnley. Around £500,000 has also been invested in the past year in new production equipment.

Turnover at the company has trebled in the past four years to £6m and the investment is expected to further increase sales to reach around £10m in the next two years.

"We’ve seen volumes grow by 50% each year for the past two years, so we needed to increase capacity," said MD Gary Entwistle. "Growth is being driven by sales of premium cakes to one of the major coffee houses. The coffee shop format seems to have bucked the recessionary trend and is expanding rapidly."

Products supplied to the coffee shop chain include muffins, biscuits and loaf cakes.

Cherrytree, which was founded in 1984, also supplies retailers such as Sainsbury’s, Morrisons and Asda with ginger buns, parkin, Chorley cake and ginger cake.