Asda reports increase for Q1, but non-food sales fell

Published on: 20th May 2020

Sales of general merchandise saw a big decline, and consumer sentiment is now dominated by fears of a financial depression. 

Asda has reported a 3.5% rise in like-for-like sales for the first quarter, on the back of coronavirus stockpiling and a surge in demand for its online delivery services.

The results, which exclude petrol, for the period 1st January – 31st March 2020, reveal received more than 3,500 visits per minute during the week beginning 18th March. The results followed a 1.3% decline in like-for-like sales in the fourth quarter in February, after Asda struggled over the Christmas period.

However, CEO Roger Burnley said despite the initial boom in sales, consumer sentiment was now being dominated by fears of a financial depression. He vowed Asda would continue to concentrate on fighting inflation and keeping prices down in a period he warned would continue to be dominated by Covid-19 for months to come.

During the period, the supermarket said it had seen its smaller stores, located in the heart of communities, perform strongly as customers preferred to shop locally and avoid travel during the early weeks of lockdown.

However, there was a big decline in demand for non-essential items, such as fashion, fuel and general merchandise, he added. The retailer was also required to close 33 of its Asda Living stores in March, in response to government guidance on non-essential retail.

Roger also stressed the work Asda had done to support colleagues and customers during the crisis. It was the first retailer to confirm it would provide full pay to any colleague that needed to self-isolate, has offered more than 150,000 home delivery slots to extremely vulnerable customers, and donated £5m to FareShare and The Trussell Trust. The supermarket has also extended the capacity of its Food Box delivery service for vulnerable customers to 10,000 boxes per day.

“It has become increasingly clear that Covid-19 is set to be part of our lives for months to come and we know that customers have moved on from an initial worry about the virus, to more longer-term concerns about the implications of lockdown on their family, wellbeing and finances,” said Roger. “As more people return to work, they are juggling the demands of cooking more and having less time to shop for groceries. Our latest income tracker data shows that household incomes declined 0.6% in March, the first drop since 2017, and 90% of customers told us they are worried about a depression in the economy.”


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