Asda's Bold Strategy: No Quick Fix for Sales Recovery Amidst Fierce Competition

Asda’s executive chairman, Allan Leighton, has candidly admitted that there is no quick solution to the supermarket’s declining sales as it faces fierce competition from rivals like Tesco, Aldi, and Lidl. Despite a 6% increase in profits to £1.1 billion in 2023, Leighton acknowledged that sales fell nearly 1% to £21.7 billion, which he described as disappointing. He emphasized the need for significant investment aimed at reducing prices by 5 to 10% compared to competitors, enhancing product availability, and rebuilding customer trust. The company is also planning to hire more staff to improve service quality. Leighton views these changes not as a profit warning, but as necessary sacrifices for future growth. This strategy follows the recent reintroduction of the “Rollback” promotional campaign, aiming to stimulate sales and regain market share after a challenging period marked by leadership instability at the helm of Asda.