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    Retailer’s announcement relaunches price war into 2016 while CEO Andy Clarke says ‘radical and logical action’ is needed

    Asda has invested £500 million in further price cuts in the first major move this year for price war between the top four retailers and discounters.

    Chief executive Andy Clarke said the business must take “radical action” to win back customers and said he expects 2016 to be another year of intense pressure.

    The investment into prices comes on top of the £1 billion over five years Asda said it would invest into price in November 2013.  It is part of Project Renewal – a two-year programme within Asda’s five-year strategy to reinforce its value proposition.

    The news comes as Asda also announced it has joined European buying alliance EMD, which will help develop the company’s own-label range. EMD is made up of 14 national buying structures and pools the collective buying power of 250 supermarket chains. 

    EMD membership will help develop a “radical shake-up” of its approach to buying, Asda said, and alongside leverage from IPL it will be able to “release significant savings from its supply chain”.

    Clarke said: “Asda is unquestionably the UK’s lowest price full range supermarket business and we intend to strengthen that position. Indeed, we reaffirmed this as 2016 began when we became the first retailer to cut unleaded and diesel prices below £1.

    “The structure of UK grocery retailing has permanently changed to reflect the way that customers shop today. Being part of Walmart also gives us insight into similar trends in the rest of the world and it’s clear that this is a global phenomenon.”

    Clarke said Asda saw the change coming and responded in 2013 but “didn’t move fast enough”. “There is currently no growth in the food market and the rise of the limited assortment discounters means that we must take radical action to win back our customers. Today, from our strong financial position, we are taking another bold step forward in our five year strategy,” he said.

    “Fundamentally changing how we buy products means we can realise significant savings from our cost base and pass these directly to customers through a rebased pricing model. Joining forces with the huge EMD network of 250 European supermarkets will give us significant economies of scale. We’ll continue to work with our suppliers to lower costs in our supply chain and return sales to growth in partnership.

    “But we are not complacent. We remain cautious and, as the chancellor warned on Thursday, we expect that 2016 will be another year of intense pressure at a macro-economic level in addition to sales remaining under strain from price deflation, a continued competitive background throughout the sector and radically changing customer shopping habits.”

    Alongside the price cuts, Asda will also invest in 95 of its largest stores to make them “more relevant”, removing “fringe ranges” and investing in own-label.

    Clarke continued: “We know our customers better than anyone else and we need to structure our offer to meet their changing needs. This knowledge has shaped our plans to make our bigger stores easier to shop, laying them out in a way that’s relevant to today’s customers by removing fringe, marginal ranges, significantly investing in our own label ranges and providing services that they need.”

    He warned that industry faces “more turbulence” in the short-term, but insisted that in the long-term he has the “right and winning strategy”.

    “We expect that 2016 will be another year of intense pressure at a macroeconomic level, in addition to sales remaining under strain from price deflation, a continued competitive background throughout the sector, and radically changing customer shopping habits,” Clarke said.

    The news comes as both Aldi and Lidl begun 2016 by reducing the price point of select promoted fresh produce items from 39p to 29p. Trading figures for the key Christmas period are due this week (w/c 11 January) for several of the major retailers, with Asda due to report in mid February.

    Asda invests £500m into new price cuts

    Ayrshire meat company, We Hae Meat, has rolled out its single-portion Scotch pie range to 62 Asda stores across Scotland.

    Asda described the range as a “revolutionary” take on the Scotch pie, with fillings including BBQ Pulled Pork, Balmoral Chicken, BBQ Pulled Beef and Chicken Curry.

    “Through the single-portion pie range, we’ve given the Scotch pie a contemporary makeover, using the kind of flavours and fillings that we – as a young modern family – would like to eat,” said Carlyn Paton, director of We Hae Meat.
     
    “As butchers who are relatively new to the industry, we are proud to look at product development with fresh eyes and pick what we think will give the very best result – whether that’s a recipe inspired by tradition or current trends.”
     
    The pies use quality-assured meat from the Paton family farm based at Cairnhill near Girvan.

    “We’re hugely excited to bring our innovative pies and butcher’s shop roots to the convenience of the supermarket. Here’s to introducing a new wave of Scotch pie to the Scottish people!” added Paton.
     
    Brian O’Shea, regional buying manager for Asda Scotland, commented: “The Scotch pie is a huge part of our national identity, but is at risk of getting stuck in the past if it remains bridled by convention.
     
    “We are delighted to be exclusively stocking this revolutionary new take on the traditional Scotch pie.
     
    “The innovative flavours, made with delicious ingredients, are exactly what our customers want. We Hae Meat has really hit the nail on the head with their exciting new range.”

    The pies will be launched exclusively in Asda at a retail price of £1.50.

    Scotch pie line rolled out in Asda

    Sainsbury’s has announced a £150m investment in price cuts as it revealed a 2.1% fall in like-for-like sales.

    Sainsbury’s released its interim results for the 28 weeks ending 27 September 2014, showing underlying profit before tax down 6.3% to £375m from £400m in 2013/2014. Underlying basic earnings per share were also down significantly, by -12.7% to 14.5p compared with 16.6p in 2013/2014.  

    The supermarket, alongside Tesco, Asda and Morrisons, has been hard-hit by the success of discount brands Aldi and Lidl. 

    To combat this, Sainsbury’s said it would invest £150m in reducing prices, half of which will fall in the second half of 2014/15 and the remainder in the first half of 2015/16. 

    Moreover, Sainsbury’s stated it would work closely with its suppliers to provide lower prices for it customers and “deliver value chain efficiencies which can be reinvested in price”. 

    Chief executive Mike Coupe said Sainsbury’s would continue to put customers first: “We will continue to differentiate ourselves from a position of strength by offering great products and services at fair prices, investing in the quality of our food and investing in price in areas where our customers tell us it matters most. By knowing our customers better than anyone else, we will continue to serve them through multiple channels and in ways that make their lives easier, regardless of changes in the market. Our colleagues will remain our greatest asset; we will invest in their training and development to ensure they can continue to deliver industry-leading service.”  

    David Tyler, chairman, said: “The UK grocery sector has become increasingly challenging in recent months. As a result, we have evolved our strategy and believe this will allow us to build on our heritage and past success, especially as it will be delivered by the most experienced management team in the industry.”

    Sainsbury’s set to invest £150m in price cuts

    Retailer launches new price match scheme that compares with Aldi and Lidl as well as top four on branded and own-brand items

    Morrisons has launched the first-ever price match scheme that compares with discounters Aldi and Lidl, as well as Tesco, Sainsbury’s and Asda.

    The scheme, named ‘Match and More’, will refund any differences in price of comparable products as points onto cards, using price data from independent analysts Profitero.

    The retailer said that if Lidl is 60 pence cheaper than Morrisons then 600 points are added to a shopper’s Match & More account.

    It will launch as a phased roll-out starting today (3 October) and will be in stores in time for Christmas.

    When 5,000 Match & More points are collected the customer receives a £5 voucher at the till, while shopper information from the cards will be collected and used to tailor future offers.

    Morrisons CEO Dalton Philips said the retailer has learned from other price match programmes so customers will not collect lots of small vouchers or have to redeem them online when they get home.

    “Because it price matches the discounters, the Match & More card will provide the ultimate guarantee about Morrisons’ value-for-money,” he said.

    Morrisons said it also has plans to allow points to be redeemed as vouchers for leisure activities such as eating-out and travel.

    Price matched products will cover branded and own-brand products as well as items that are on promotion elsewhere.

    Morrisons strikes as first retailer to price match discounters

    Morrisons was celebrating after scooping the top title in the annual British Turkey Awards last week. 

    The Bradford-based business took home the title of Retailer of the Year, beating off strong competition from Asda, Tesco, Sainsbury’s and The Co-operative, with judges unanimously deciding the chain offered a great range of turkey products year-round, with Asda following a close second.  

    Morrisons was also successful in the Best Christmas Traditional Product, with its Fresh Turkey, while rival Asda took home the Best Christmas Premium category with its Blue Slate Turkey.  

    Sainsbury’s also did well on the night, with its Turkey Breast and Thigh Joint with Cranberry and Apple Stuffing, Topped with Cranberry and Apricot being declared the Best Christmas Convenience Product, while its Thigh Joint with Herb and Cranberry Crumb took the title of Best Meal Solution.  

    Paul Kelly, chair of the British Turkey Federation, said: “The 2014 British Turkey Awards has once again been very exciting and I would like to extend my congratulations to all the deserving producers and retailers who are working hard to put the very best turkey products on our plates both at Christmas and the rest of the year. Winning products will be flagged up to customers on packs using a British Turkey Awards winner logo to show they really are buying the best of British.”  

    The evening also raised money for the children’s medical charity Sparks, and Dravet Syndrome UK, with entertainment provided by comedian and television host Patrick Kielty.  

    The winners in full:    
            
    Best Meal Solution (sponsored by Hybrid Turkeys)
    •    By Sainsbury’s Thigh Joint with a Herb & Cranberry Crumb

    Best Christmas Convenience Product (sponsored by Securcom)
    •    Sainsbury’s Turkey Breast & Thigh Joint with Pork, Cranberry & Apple Stuffing, Topped with Cranberry & Apricot

    Best Christmas Traditional Product (sponsored by Easichick)
    •    Morrisons Fresh Whole Turkey

    Best Christmas Premium Product (sponsored by Clarke Group Construction)
    •    Asda Butchers Selection Blue Slate Whole turkey  

    Best Innovation Christmas (sponsored by ABN)
    •    Sainsbury’s TtD Norfolk Black Free Range Turkey Parcel. Layered With Chestnut, Maple and Thyme stuffing, Cranberries and wrapped in Oak-smoked Bacon

    Best Innovation All Year Round (sponsored by ABN)
    •    Asda Chosen by You Turkey Mini Fillets with Brie, Cranberry Sauce & Bacon

    Best Foodservice Product for Cost Sector (sponsored by Noble Foods)
    •    The UK Foodhall Ready to Roast British Turkey Breast

    Best Foodservice Product for Profit Sector (sponsored by Noble Foods)
    •    Mitchells & Butler – Toby Carvery – Carvery Turkey Crown

    Best Ready-to-Eat Product (sponsored by Calor)
    •    Adlington Roasted Turkey Breast Stuffed with Ham & Wholegrain Mustard

    Foodservice Operator of the Year (sponsored by Coveris)
    •    Mitchells & Butler – Toby Carvery

    Best Blogger Recipe (sponsored by Red Tractor)
    •    Foodycat Alicia – Turkey B’stilla

    Student Chefs of the Year (sponsored by Aviagen Turkeys)
    •    David Pullin of South Staffordshire College for his ‘Oasis of the Middle East’ Turkey Bonbon, Yellow Split Pea Hummus Shredded Turkey Thigh in Moroccan-Style Chutney, Saffron Couscous, Arabic Flatbread Shard and Mint Yoghurt Dip

    •    Jessica Marshall of Hull College for her Golden Saffron Potato Surprise with a Blanket of Rice topped with Fried Spinach and Spiced Turkey Batons coated in a Pomegranate Reduction with Ground Pistachios, surrounded by a Crab Apple and Blackberry Jam Sauce with Poached Rose-water Rhubarb

    Retailer of the Year (sponsored by Zoetis)
    •    Morrisons

    Morrisons takes top turkey title

    Retailer confirms job losses after 45-day consultation period and interviews with staff as part of restructure strategy

    Asda has today announced it will cut up to 1,360 jobs following an “intense consultation period” as it sets out to cater for new shopping habits.

    The UK’s second largest retailer said the final outcome of the management restructure plan will create 5,670 roles, as it moves to emphasise e-commerce, puts more staff on shop floors and removes back office administration tasks.

    But those who chose to leave after their roles were removed, or who did not meet the selection criteria, will take a redundancy package over the coming weeks.

    “As much as it is my job, and privilege, to be CEO of this business and to do what is right for Asda as a whole, this is one of the most difficult decisions I’ve had to make,” said Andy Clarke, Asda chief executive. “While I genuinely believe that it is the right decision for the future of Asda, knowing that it will result in valued colleagues leaving us is not easy.”

    Clarke said every supermarket must adapt to the intense changes in UK retailing or they will get left behind. 

    He first publicly outlined a proposal to restructure store management in May of this year, and the 4,100 staff directly affected entered a formal 45-day consultation period.

    During the consultation, managers affected by the proposal were involved in influencing the final version that was considered by its executive team yesterday. 

    Asda said that all staff members affected had at least three individual discussions about the proposal and the roles potentially available to them.  Each executive team member also visited stores to meet affected colleagues and listen to their views.

    Asda to cut 1,360 management jobs

    UK’s second largest retailer will store golden delicious apples under the Italian Alps as alternative to high-energy storage system

    Asda has announced it will store up to 50,000 golden delicious apples in caves under the Italian Alps to reduce its carbon footprint.

    The initiative, a world-first for a retailer, is in partnership with Italian apple supplier Melinda.

    It aims to save 60% of electricity needed to store the same quantity in a refrigerated warehouse, and is designed to reduce water consumption, land use and decrease C02 emissions.

    The cave space in Val di Non, in the Trentino region of northern Italy, is located around 800 metres into the mountain. Each of the five storage spaces are around 144 by 60 metres, comparable to the size of two Boeing 747 aeroplanes.

    “This is a really exciting project which we’ve been working on for over two years,” said IPL category manager Martin Smith. “The first time I visited the mountain site it was a completely unique and unforgettable experience, and it’s really exciting to know that our shoppers have the chance to enjoy apples with such an innovative story.”

    The project is due for completion in 2019.

    Asda to store apples in mountain caves
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