Asda profiting at rivals' expense

Click to follow
The Independent Online

Asda hit out at J Sainsbury and Wm Morrison yesterday, claiming its nascent recovery had not come at the expense of its profit margins.

Andy Bond, the chief executive, said the group had grown its like-for-like sales without sacrificing any profits. He was speaking a week after Wal-Mart, Asda's US parent, said the UK chain had missed its profit expectations.

"Since we were acquired by Wal-Mart in 1999, our operating profit margin has been flat," he said. Sainsbury's and Morrisons have seen their profits dwindle as they have invested in lower prices in an attempt to boost sales.

Mr Bond also had a dig at Tesco as he sought to claim the upper hand in the quest to be the UK's greenest supermarket. "Sustainability is the new buzz term and green is the new black," he said, insisting Asda had been in the ethical "game" for the past five years.

Tesco launched its high-profile green campaign in June, prompting other supermarkets to shout about their ethical efforts.

Mr Bond hopes Asda's push into areas such as organic food, where it is tripling its lines to 1,000 this year, will help it attract more upmarket customers. The chain has lifted its number of weekly shoppers by 1 million to 13 million over the past 12 months.

As part of this drive, the chain is seeking to more than triple the proportion of UK food sales it gets from its premium line, Extra Special, to 10 per cent over the next three to four years.

Mr Bond also said "at least one" of the three new formats Asda is trialling - its Living stores that sell just non-food, its George clothing-only outlets and its Essentials chain that sells only Asda own-label - had the potential to be a national chain. All three formats are still being tested, he added.

Comments