Asda kickstarts supermarket price war, slashing prices on 1,500 ‘family favourites’

Asda has today revealed price cuts of up to 45% on 1,500 “family favourite” products , as it launches the next phase of a supermarket price war to try and regain its crown as the cheapest full-range grocer.

It said the latest price cuts meant nearly 10,000 products – almost a third of Asda’s range – had been reduced in price since it brought back its Rollback proposition at the end of January.

The Grocer exclusively revealed Asda boss Allan Leighton was to launch a massive Rollback campaign after seeing the supermarket market share come under intense pressure from the discounters and rival traditional retailers. It was the worst-performing supermarket over the Christmas period.

This week in an exclusive interview with The Grocer, Leighton said Asda and its owners TDR Capital were prepared to “throw a tonne of money” at recapturing Asda’s price crown and said it planned to bring down the cost of around 90% of its range over the next 18 months.

Read more:

• Q&A with Allan Leighton on deep pockets, loyalty cards, bench strength and online

• Asda cheapest in Grocer 33 without opening war chest

• Asda’s Allan Leighton axes 6,000 SKUs and warns of major profit drop

“Last week we signalled again our absolute commitment to lowering prices for customers and today we’re further delivering on that promise,” said Leighton.

“By rolling back prices on thousands more products we’re making it even easier for our customers to save. Nearly 10,000 products have now been rolled back and we will continue to invest in lowering prices across the rest of the year and beyond.”

Asda will also be carrying out a major range cull over the next 12 months, as a key plank in the supermarket’s fightback following a slump in sales and warning over a big fall in profits. 

Executive chairman Leighton said Asda planned to slash around 6,000 SKUs. A category-by-category review will be led by chief commercial officer Kris Comerford.

It comes after the struggling retailer announced like-for-like sales fell by 3.4% year on year in the 12 months to 31 December, with revenue falling by 0.8% to £21.7bn.

Leighton, who was parachuted into the business in November, having become a legendary figure at Asda during the 1990s alongside Archie Norman, warned profits would be “significantly” reduced by the investment required in prices and investment in improving its stores.

After the announcement, more than £4bn has been wiped off the value of Tesco, Sainsbury’s and Marks & Spencer stock amid fears that it would lead to a grocery price war.