The retailer has reported a drop in like-for-like sales of 7.5% in the past three months.
Asda’s total sales slumped by 5% during the three months to the end of June, while footfall tumbled 6%.
The fall in sales, which excludes new stores opened during the period, was even worse than the 5.7% drop the retailer reported in the previous quarter, and also outstripped the 4.7% drop that ex-chief executive Andy Clarke described as the supermarket’s “nadir” last summer. The drop also marks the retailer’s eighth consecutive quarter of falling sales.
Walmart chief executive Doug McMillon blamed the dip on food deflation and “the competitive environment”. The retailer is now relying on £1.5bn of price reductions over five years to win customers back from discount retailers such as Aldi and Lidl.
“Our strategy to turn things around is focused on improving the retail basics,” Doug said. We are simplifying and strengthening our offering through improved availability and assortment discipline, reducing costs and driving sales through strategic price investments. While our turnaround will take time, I’m confident in the new leadership team there and want to assure you we’re addressing this with urgency.”
In addition to this, a new management will be assembled around Mr Clarke, with Roger Burnley joining from Sainsbury’s in October as deputy chief executive. Meanwhile Lidl’s chief operating officer Chris Walker has taken up the role of vice president of supermarkets, charged with reinvigorating Asda’s smaller stores.