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ASDA to cut hundreds of head office jobs

ASDA 725 x 500

Hundreds of jobs are reportedly set to be axed at Asda as Britain's supermarket price war intensifies and the march of discounting rivals Aldi and Lidl continues to reshape the grocery landscape.

The chain, which is owned by US retail giant Walmart, said it will make cuts in the 'low hundreds' at its Leeds head office, which employs 3,000 people.

The cuts come as the grocer is expected next month to post the worst sales figures among its major rivals for the key Christmas trading period.

While rivals Sainsbury's, Morrison's and Tesco last week saw better than expected Christmas results, Asda is expected to report a 3.5 per cent drop in sales in the three months to 3 January, bringing its market share down to 16.2 per cent, research firm Kantar Worldpanel has predicted.

That would comes on top of a 4.5 per cent falls in like-for-like sales for the 13 weeks to September 30, reported in November.

The industry's so-called 'Big Four' players - Asda, Tesco, Sainsbury's and Morrisons - have seen prices fall for more than a year under pressure from discounters such as Aldi and Lidl.

An Asda spokesman said: 'As a result, the industry faces major challenges and the certainty of permanent structural change. In the context of this, we also have to further change the way we do business.

'Today, we have started to talk to our colleagues in head office functions about what this means for them. We have made some difficult but necessary decisions but we must discuss these with our colleagues before we talk publicly.'

'As a result, the industry faces major challenges and the certainty of permanent structural change. In the context of this, we also have to further change the way we do business.

In July last year, Asda announced plans to cut 1,360 jobs as part of an overhaul of its store management structure which it said had to 'adapt to change.'

Asda announced a fresh 18-month overhaul in October which will see it slow store expansion in London, ease up on plans to build more stand-alone petrol stations across the UK and scale back the rollout of its 'click and collect' scheme as it seeks to cut costs.

However, it said its would speed up investment to revamp 95 of its largest stores and spend more money on offering customers lower prices in an attempt to take on the discounters.

Earlier this month, Asda announced plans to plough £300million into price cuts in the first three months of this year in a bid to close the gap with rivals Lidl and Aldi.

The Leeds-based supermarket giant is cutting the prices of over 2,500 'essentials', including fruit and vegetables, cereal, milk, meat, eggs, fish, nappies and toilet rolls.

Asda has struggled to keep up with the march of Lidl and Aldi, which now account for around £1 in every £10 spent in supermarkets across the country, according to data firm Nielson.

Reports of fresh job cuts surface amid growing speculation that Asda's current boss, Andy Clarke, could soon step down from the helm. Asda's appointment of former Sainbury's director Roger Burnley to a senior position at Asda last year is adding flames to the rumours.

Source: Jane Denton - This Is

18 January 2016

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