Asda has got its house in order for what it hopes will be its best-ever Christmas, while suppliers need not fear another round of tough negotiations soon, according to senior management.

Speaking to The Grocer, chief operating officer Dave Cheesewright and retail director Andy Clarke said Asda had fixed the basics and was back to like-for-like growth. Formats were motoring, with Living in roll-out mode, George standalones at full trial and a decision on Essentials due early next year.

Cheesewright said following its sharp negotiations with suppliers earlier this year, 25% of companies had opted out of its "investment for growth" programme. "This was a one-off opportunity to say there are additional opportunities to drive the business harder. If a line was not running at full capacity or a company wanted to promote a new line, this was a win-win."

However, companies that hadn't co-operated were not being penalised with delistings.

Cheesewright added that sales were getting a lot better, with successive and sustainable growth this year.

"We're optimistic about Christmas," said Cheesewright. "We're under no illusion that there's not a hell of a lot to do, but we've fixed a lot of the basics and we're getting back to what we're great at, which is being innovative."

Clarke said Asda was fully geared up for Christmas with a newly restructured retail team, an overhauled premium Extra Special range and a relaunched 1,000-strong organic line - all hitting stores in the run up to December. "The visibility of Christmas in our stores will be better and own label more clearly defined," he said.

"Last year, Extra Special was not a strong enough range. People often trade up at Christmas, so they were doing the majority of the shop with us, but then topping up in Waitrose or M&S."

Over the year, £15m had been invested in store facilities improvements, he said, and Asda had been trialling similar technology to Tesco with infra-red sensors to monitor queuing times.

The M25 would be key for new stores but it was a case of finding locations. "Our core engine is superstores but we are still exploring our different formats."

Its two Essentials stores are currently merchandised differently, with one having fresh food first as shoppers enter, the other having ambient upfront. Clarke would not talk about a potential roll-out as a decision would be made next year, but no further store would open in the next six months. An "aggressive" format strategy is scheduled to kick off in 2008.