morrisons match and more

Morrisons CEO David Potts has revealed a six-point turnaround plan after reporting a 47.2% fall in half-year profits and a 2.7% fall in like-for-like sales.

The six strategic priorities identified by Potts are: to be more competitive; to serve customers better; to find local solutions; to develop popular and useful services; to simplify and speed up the organisation; and to make its core supermarkets strong again.

In terms of competitiveness, Morrisons said it had already invested £181m in sharpening its pricing proposition in the first half of the year, with more to follow. This was on top of £300m last year. 

Potts also hinted strongly that Morrisons’ loyalty/price-matching scheme Match & More, which is currently under review, could be ditched. “Match & More is very popular with some of our customers but not understood at all by others. We have to offer value at the shelf-edge. Real value for more customers.”

As for serving customers better, Potts said that having recruited 5,000 extra in-store staff in the first half of the year, Morrisons was now rescheduling the mix of hours for 10,000 staff to serve customers better at busy times of the week.

“The immediate priority is to deliver a better shopping trip to stabilise trading performance,” Potts said. “Our six strategic priorities will then deliver improvement in the core supermarkets, where we have the greatest opportunity.” 

He added: “It will be a long journey. We approach the challenge with energy, confidence and many strengths, particularly our strong balance sheet and cashflow, which enables investment in improving the customer trip.”

Morrisons this week reported profits before tax had fallen to £126m for the six months to 2 August, down from £239m last year. Total turnover fell 5.1% to £8.1bn, with like for likes in the second quarter down 2.4%.

The day after it sold its M Local convenience chain to industry veteran Mike Greene, the retailer also announced it would be closing a further 11 supermarkets. 

Potts declined to provide details on which exact stores were earmarked for closure as staff were still to be informed, but said these were mainly smaller supermarkets and mainly those the retailer had picked up through acquisitions. Earlier this year, Morrisons closed 10 supermarkets as well as 23 M Locals.