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Asda set to invest despite sales slide

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Asda announced yesterday that like-for-like sales have grown by 0.7 per cent in the second quarter ending 5th July 2013, yet lost momentum following a stronger first quarter rise of 1.3 per cent.

The figures, which exclude VAT and fuel, come as the supermarket said it planned to accelerate investment in technology and infrastructure to increase its Click & Collect and mobile capacity.

Speaking at a results briefing, Andy Clarke, President and CEO of Asda said that he was ‘pleased with results in a tough market’.

He said: “We continued to grow our sales while also investing in holding down the price of essentials, increasing access points to Asda’s value and putting money back in customers’ pockets when they need it the most.

“Our focus on opening up more ways for more customers to shop with us, particularly in areas currently underserved by Asda, provides us with real opportunity to grow space and channels to adapt our business to today’s customer.

“I’m confident this focus will continue to drive growth in a sustainable way.”

Asda’s key pricing initiatives include its ‘Price Lock’, which offers permanently low prices, and its ‘Rollbacks’, which promise to beat its rivals’ prices for up to 12 weeks on thousands of items.

The retailer was recently named Britain’s lowest priced supermarket for a 16th year running and have become the first UK grocer to launch a same day grocery collection service at its Wakefield store.

It confirmed that its grocery shopping collection service will reach almost 250 sites by the end of 2013 through its ‘Access to Asda’ push as it aims to increase its multichannel sales above £1bn for this year, approximately double the level of last year.

George Scott, Retail Consultant at Conlumino, commented: While general merchandise continues to be Asda’s main bread winner, investments in grocery branding and multichannel capability will likely put it on a positive footing.

“Asda does face pressures from Tesco which is placing a renewed focus on its UK presence, and from sector-wide inflationary challenges; but, by achieving clear and consistent price competitiveness and broadening both its positioning and geographic access, Asda will be primed for grocery gains.”

Looking ahead to the end of the year, Asda said it expects 75 per cent of customers to shop through multiple channels this Christmas.

Published on Friday 16 August by Editorial Assistant

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