Asda comes out fighting to address plummeting sales

ASDA is to prioritise its core business in a move that will result in head office job cuts and a marked slowdown in its click-and-collect plans.

It is to cut its business-to-business division, stop expansion of its London Underground click-and-collect service and rein in its other plans. Currently it has 620 click-and-collect locations, at stores and petrol stations, including an experimental pod near St Helens that had been launched with great expectations.

Instead it will halt its expansion plans and refurbish about 95 of its largest stores, about one-in-three of its hypermarkets.

The Leeds-headquartered supermarket group has launched Project Renewal – a name it first used in the early 1990s during a period which re-energised the business – and the new 18-month programme is designed to reverse its falling sales.

It has endured four successive quarters of negative like-for-like sales, with each period getting worse and the latest quarter – for the second quarter of 2015 – showing a 4.7% drop.

Andy Clarke, who has been Asda’s chief executive since 2010, said: “Over the last two years, we have shown that we are ready to make necessary and early changes to match that ambition to the demands of our customers, especially at a time when the market is clearly undergoing permanent and rapid structural change.

“We need to simplify what we do by prioritising the first line of our strategy – improving our core business – and pausing activity in other areas so that we are not spread too thinly.”

29 jobs are expected to be lost at its Leeds head office