Allan Leighton, Asda’s former CEO, is spearheading efforts to revitalise the supermarket chain. He acknowledges the turnaround may take up to five years and is actively seeking a new CEO to lead these efforts.
- Leighton replaced Lord Stuart Rose and prioritises restoring Asda’s core identity, focusing on pricing and availability improvements.
- A strategic plan is set to be completed by January, with the search for a leader who understands both consumer behaviour and effective team management.
- Shareholders TDR Capital and Mohsin Issa support Leighton’s vision, highlighting a need for organisational growth amidst IT challenges post-Walmart.
- Current challenges include a decline in sales and market share, with Asda striving to bolster customer experience and competitive pricing.
Former Asda CEO Allan Leighton has returned to guide the supermarket through a significant transformation, with expectations that this process will require three to five years. Replacing Lord Stuart Rose, Leighton’s immediate focus is on re-establishing Asda’s foundational strengths, which include enhancing price competitiveness and product availability. A pivotal part of this strategy is the recruitment of a new CEO who might not be a traditional retailer but possesses a strong understanding of consumer dynamics and team leadership.
By the end of January, Leighton aims to have developed a comprehensive revival plan. He emphasises the importance of choosing the right leader, one who is capable of navigating the complexities of retail management and customer engagement. Leighton himself will play a hands-on role over the next few years, emphasising the time required to achieve meaningful results.
Leighton has the full backing of Asda’s shareholders, TDR Capital and Mohsin Issa. Both parties are aligned with the view that Asda’s growth is imperative. A particular area of concern is the supermarket’s IT infrastructure, which has faced challenges since Asda’s separation from Walmart’s systems, impacting its competitive edge.
The supermarket’s recent struggles underscore the urgency of these efforts. A recent financial report indicated a downturn in sales as well as an anticipated £100 million increase in the tax bill following governmental budget changes. These financial pressures highlight the need for Asda to bolster its market standing.
Despite these hurdles, Asda has made strides to improve customer satisfaction, focusing on bettering product availability and value proposition. Still, competition remains fierce, with Tesco, Sainsbury’s, and discount giants Aldi and Lidl capturing larger market shares. Recent data from Kantar reveal a 5.5% drop in Asda’s sales over a recent 12-week period, with its market share declining to 12.5%. The retailer is facing significant challenges in regaining its foothold in a highly competitive market.
Despite current challenges, Allan Leighton’s leadership lays out a clear pathway for Asda’s recovery and potential growth over the next few years.
