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The head of Asda has promised that a fresh push into technology will lead to more products being available on its shelves as the UK’s third-largest supermarket chain aims to catch up with rivals following a botched £1bn IT upgrade.
The group said on Friday it wanted to boost sales and improve its efficiency with tech after it reported that like-for-like sales fell 2.3 per cent in the second quarter to June. Group revenue, including fuel, over the same period rose 0.4 per cent to £6.5bn.
Asda, which is backed by private equity firm TDR Capital, pointed to tech such as AI-powered cameras that check for out-of-stock gaps on shelves in its stores as part of the efficiency drive.
The fresh push comes as Asda aims to recover its sales performance following a multiyear IT overhaul, known as Project Future, to move its business off ageing systems operated by previous owner Walmart.
The company had promised it would give Asda “the best systems in the grocery sector” but resulted in serious disruption to stock availability, particularly online, and dented Asda’s sales.
Although the project has been completed, the supermarket has sought to further upgrade its systems. In May it also licensed software from Ocado that would allow it to more efficiently pick orders from stores and deliver them to shoppers’ homes.
Allan Leighton, Asda’s executive chair, said there would be two main benefits from its new technology push, which, as well as gap-scan cameras, will include electronic price displays.
“The number one thing is it’s a massive piece of productivity and number two, availability will improve. And as availability improves, sales go with it,” he told the FT.
The supermarket also said it was on track to record its first quarter of growth in two years in like-for-like sales, excluding fuel, with growth of 0.2 per cent in the seven weeks to August 18.
In recent years it has lost market share to rivals such as Tesco and Aldi, although it has stabilised in recent months at around 11.9 per cent, according to data from industry group Worldpanel.
Leighton, who ran Asda in the 1990s, returned to the supermarket in 2024 with a brief to reverse the years of losses under its owner TDR, a project he has estimated could take between three and five years.
He attributed the better performance to improving Asda’s prices, products and the availability of stock, which was bringing more shoppers into its stores.
“So we’re 18 months in, a third of the way through [the turnaround],” he said. “There’s a hell of a lot to do as we were coming from a long way back, but it’s an important milestone for the business to get back into growth as it shows progress.”
