Asda owners the Issa brothers are still attempting to separate the supermarket’s IT systems from previous owner Walmart, three years after it snapped up the grocery chain.
Delays to migrating the digital systems have meant the business is having to pay Walmart to use the old IT systems, The Telegraph reported.
The supermarket, which has hired hundreds of employees to work on the process, is understood to have missed its target to stop using the platforms of its former owner by late 2023.
An ex-Asda employee told the publication that the supermarket “has to pay a fixed sum [to Walmart] for using the systems” and that “there is a penalty if they go beyond a certain date”.
However, a source close to the supermarket chain rejected this and said “there was never an expectation” to complete a handover before 2024.
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It is understood that Asda is planning to move away from Walmart’s systems by the end of 2024 to newly created IT platforms.
The source said: “As everyone knows, these projects don’t take place overnight.”
It is unclear how much Asda is paying Walmart but additional costs related to the migration place more pressure to the balance sheet that’s already burdened with more than £4bn.
Asda is in the process of bringing its online grocery business in house after it partnered with digital business transformation company Publicis Sapient to move onto its own state-of-the-art platform.
The implementation of the new tech solution is expected to be completed by April 2024.
The supermarket also signed a multi-year partnership with IT specialist Tata Consultancy Services (TCS) last October to implement a new organisation-wide IT operating model as part of its divestiture from Walmart.
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