The 5 priorities Asda’s Sean Clarke must address

SEAN CLARKE starts as Asda chief executive next month and among the many things that will be clamouring for his attention, here are five issues he must address quickly.

1. New managers, new structure

Sean Clarke is not the only new face at Asda House. He will be joined by Roger Burnley, who will be his deputy, in October when his notice period ends from his job Sainsbury’s.

Yorkshireman Mr Burnley has more in common with Sean Clarke than at first glance, having also worked at Asda until 2002. He worked on the turnaround of the business under Archie Norman before its sale to Walmart.

Chief customer officer Andy Murray was appointed in April, and immediately courted controversy giving a £100m marketing account to his former company without a tender process. However the company had worked with the Publicis Group before, and a whole new team could be a good thing for the incoming Mr Clarke, a fresh slate to launch his plans for the turnaround.

Those changes came little more than a year after Andy Clarke had overhauled and streamlined his management team. Now the new Mr Clarke must work with a relatively new senior team as he sets about making his mark.

2. How to fight back against the discounters

Tesco, Morrisons and even Sainsbury’s have been attempting to compete on a price level with discounters Aldi and Lidl. Asda is now lagging behind the other Big Four, but all are set for a major fight on their hands.

The two leading discounters are continuing to take the fight to the major players and are opening far more space than the major retailers, who have mostly withdrawn from the so-called space race of a few years ago.

3. Tesco and Morrisons have at least an 18-month head start

At Morrisons, chairman Andy Higginson and chief executive David Potts started the revival at the Bradford-based supermarket in early 2015, while Dave Lewis took over at Tesco in September 2014. They are both resurgent – or at least out of intensive care – and have come through the painful process of addressing a lot of their problems.

Sean Clarke is at least 18 months behind his rivals, but lacks the obvious easy wins. Asda, despite its faults, has not set up misting machines for its fruit and veg.

4. Re-enthusing people about innovations and about Asda

Asda has been hanging its hat on its prices for 15 years and more, but now with the discounters taking over, customers no longer see Asda as first choice for low prices. The new Mr Clarke will also struggle because Asda has dabbled with and turned away from a number of innovations. His first moves, and how he will convey the changes to its customers,  current and lapsed, is not clear.

5. Recovering market share and fighting back

The fact that Andy Clarke lasted for seven consecutive quarters of falling sales shows that Walmart are willing to be patient and wait to see a strategy take effect. But with Aldi and Lidl having around 10% of the market between them, and with Asda’s share at its lowest level for more than a decade, time is no longer on its side.

Although he will not be under direct pressure from the City, as Morrisons and Tesco’s new chief executives faced, Sean Clarke will need to adopt a similar strategy of persuading staff, suppliers and customers to be hopeful – and then quickly getting the numbers to back up the rhetoric. For retailers, Christmas is now just around the corner and that will be his first big test.