Asda has told suppliers it is launching a full reset of its offer “bay by bay” as it looks to fast-forward its turnaround plan.
Around 600 suppliers attended a conference in Leeds on Tuesday, at which Asda chairman Allan Leighton and recently returned chief commercial officer Darren Blackhurst announced a major overhaul of its commercial strategy.
It is understood the supermarket told suppliers the reset would be based around SKU duplication removal, rather than a range cull, with a focus on core lines, more space and better buying by Asda teams.
Blackhurst said that as well as a drive for more simplicity, he wanted Asda buyers to reset the relationship with its suppliers, by focusing less on its own troubles and spending more time building partnerships.
Leighton reiterated Asda’s quest to become up to 10% cheaper than its supermarket rivals.
It comes as analysis of Assosia data by The Grocer shows Asda has reduced the number of SKUs on sale by 2,371 in the past year, and by 3,668 since March, when Leighton said the number would be cut by 6,000 by the end of 2025. Delistings have ramped up since July, with fresh SKUs down 17.8% from 4,172 to 3,429, and BWS down 21.6% from 1,736 to 1,361 SKUs.
With its market share also under threat from Aldi, Leighton argued that growth in the discount channel was limited in brands, with both Aldi and Lidl continuing to prioritise own label.
Suppliers said Blackhurst delivered a colourful and impassioned talk.
“Darren was at his best today,” said a supplier after the conference. “This is not a shakedown, it’s a full reset, bay by bay.”
Blackhurst is said to have told Asda buyers he wants them to feel more “empowered” and told them to “own every four feet”.
“He wants less internal focus, more time with suppliers. Asda wants to inject some pace and energy into the business. They recognise they had become too slow and cumbersome to deal with.”
A strong Asda ‘benefits everyone’
Speaking to The Grocer after the event, Blackhurst said: “I would like to say thank you to all the suppliers who joined us yesterday. As we shared at the event, a strong Asda benefits everyone and there is a big opportunity to build the right customer proposition together and unlock profitable growth.
“We’re focused on simplifying how we work by reducing duplication, making better use of space to sell more volume and improving choice by strengthening our own-brand and premium ranges. As we start to buy better and build better relationships with key suppliers, we can maximise efficiencies, reinvest in price, drive volume, and ultimately grow market share.
“We want to work with our suppliers, constructively and in a collaborative way to improve the offer for the 20m customers who shop with us every week. Our buying teams are looking forward to getting out to meet our suppliers in the coming weeks to build on their plans.”
The Grocer revealed last month that an invitation had been sent out to UK sales directors inviting them to attend the Asda Merchandising Centre of Excellence, in Leeds, sparking speculation of a major range overhaul.
Blackhurst’s return as commercial boss had sparked widespread speculation of a similar reset in brands to one he carried out in the late 2000s.
His previous tenure saw high-profile delists for brands including Princes Tuna, I Can’t Believe It’s Not Butter and several others, as he set out to remove duplication across a raft of categories to allow Asda to bring down prices.
In March, The Grocer revealed Leighton planned to axe around 6,000 SKUs to boost its suppliers’ volumes as he tried to create a price gap between the retailer and its rival full-range supermarkets.
Leighton told The Grocer at the time he wanted the supermarket to move from about 30,000 SKUs to around 24,000, admitting it was “ over-SKU-ed, with too many slow-selling lines which clog up everything”.
The Asda boss is understood to have told yesterday’s conference he believed the supermarket’s turnaround was “30% complete”.
No comments yet