Wal-Mart Stores Inc.’s U.K. arm Asda reported a 4.7% fall in same-store sales in the second quarter, as the company continued to be hammered by a change in customer behavior and a vicious price war that has buffeted the U.K.’s largest grocers.
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Its 4.7 percent decline in like-for-like sales in the 11 weeks to June 30 followed a fall of 3.9 percent in the first quarter.
He also blamed the demise of Tesco, as the industry leader, for “creating sufficient oxygen” for Aldi and Lidl to grow and said that rate at which they gain more market share will depend on how fast the traditional retailers get back into shape. “Although we have hit our nadir, we are on an upward curve”.
However Mr Clarke said the supermarket was already seeing “green shoots” in its third quarter, and insisted it retained the support and understanding of US parent company Wal-Mart.
“We remain firmly committed to narrowing the price gap to the discounters”, Mr Clarke said.
“I’m here to stay”, said Clarke (Toronto: CKI.TO – news) who launched a five-year strategy in 2013 focused on lower prices, while eschewing the money-off vouchers touted by its rivals, along with better service and product quality.
Clarke said: “The market is in exceptionally challenging times…”
Before Asda revealed their ealier second-quarter end result Sainsbury’s put it will potentially stretch a cost twin system to really over the internet determination, current round inside an soaring enterprise price competition.
“Behind the negative sales number lies a more positive story for Asda”, he said.
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Separately, Wal-Mart posted weaker than expected quarterly earnings and lowered its full-year forecast.
