Sainsbury has announced that it is ending its IT outsourcing deal with Accenture after five years.

Despite many of the supermarket's performance issues of recent years being blamed on Accenture’s systems, Sainsbury said it had been instrumental in improving the IT capability of the business. It had delivered “considerable improvements in system stability and operational cost reductions”, said the retailer.

In October last year, chief executive Justin King said it would be renegotiating the £1.8bn contract with Accenture. But, from this week, plans will be drawn up to begin transferring the services back in-house.

Sainsbury will treat all “termination and/or transition costs” as an exceptional item in this financial year. But it added that the costs of exiting the deal would be paid back in the short term through future costs savings.