Asda Q1 Sales Slump Amid UK Price War
UK grocer Asda has reported a 5.7 per cent drop in like-for-like sales during the first quarter of the year to the end of March.
The Walmart-owned chain is still reeling after its 5.8 per cent slump in the previous quarter, which was the biggest sales fall in the company's history.
In a statement released by the US giant, Walmart's chief financial officer Brett Biggs said: "The UK continues to struggle, due primarily to fierce competition."
The ongoing price war in the UK grocery market has seen most major retailers make drastic moves to slash their prices and costs. "Improvements in price and product availability throughout the quarter were not enough to overcome traffic and food volume declines in our large format stores," added Biggs.
The Q1 drop in sales is the seventh-straight quarter of declining sales for the group.
Commenting on its performance, Duygu Hardman, analyst at Verdict Retail, said, "While Asda has traditionally attributed his suffering market position among the Big Four to the short-term tactics of its competitors, this is no longer the case with the focus shifting to value rather than price. Asda needs to achieve the right balance of price, quality and service if it wants to 'better address the fast-changing needs of its customers'."
© 2016 European Supermarket Magazine – your source for the latest retail news. Article by John Golden. To subscribe to ESM: The European Supermarket Magazine, click here.