• Wednesday, May 29, 2024

Business

Asda posts flat growth, market share shrinks

FILE PHOTO: Customers arrive and leave from an Asda supremarket store in Ashford, south east England on October 2, 2020. (Photo by BEN STANSALL/AFP via Getty Images)

Shajil KumarBy: Shajil Kumar

Supermarket chain Asda has slipped in terms of profitability and market share during the last three months, amid intense price wars in this segment.

Promoted by billionaire Issa brothers and private equity firm TDR Capital, Asda’s sales growth was flat at 0.8 per cent in the last three months when compared to last year, reports The Telegraph.

In comparison, Sainsbury’s and Tesco recorded rates of 7.9 per cent and 6.3 per cent respectively over the period, while Marks & Spencer posted a double-digit growth of 11.2 per cent, according to analysis firm NIQ.

Asda’s market share shrunk to 11.7 per cent compared to 12.3 per cent a year earlier, while German discounter Lidl has now inched closer to Asda with a market share of 10.2 per cent, up from 9.8 per cent.

The latest figures will increase pressure on the Issa brothers, who are battling a huge debt following a £6.8 billion takeover in 2021.

NIQ said there was “intense competition” among supermarkets in the past 12 weeks, all of which have tried to draw customers in with price cuts.

Waitrose recently announced price cuts, while Sainsbury has added more products to its ‘Low Everyday Prices’ range.

NIQ’s UK head of retailer and business insight, Mike Watkins claims retailers are now focusing on increasing customer visits amid lower inflation.

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