Asda Says UK Consumer In Recession
UK retailer ASDA Grocery Online says consumers in Britain are in recessions, and have less money to spend, fear losing their jobs and worry about interest rate hikes. Judith McKenna chief financial officer of Asda speaking at a conference on retail organized by Reuters said the outlook for retail seems tough, as incomes are squeezed and they fear the future.
“Do I expect it to improve anytime soon? – no I don’t,” she said.
Asda runs an income tracker to model its customer behavior, and according to Ms McKenna, British shoppers has £14 less to spend compared to a year earlier.
“It is a really biting effect on how people are shopping and spending….particularly in the area of discretionary spending.”
A couple of years ago, when the UK economy was mired in recession, consumers were equally as worried but did not actually feel a squeeze on their spend. This time around, austerity measures have kicked in, and inflation is beginning to bite.
McKenna said the difference now was that consumers physically had less money.
“I do think the consumer is in recession,” she said. “How long for is difficult to call.”
Tight budgets as a result of higher taxes and rising prices have made consumers much more careful about how they spend their cash.
“People have changed their shopping habits as well … they have started to ration their behaviour about how they spend and what they spend it on … there is a new norm developing,” McKenna said.
In this tough climate, food retailers are seeing consumers switch to their lower-priced own-label ranges from brand names.
McKenna said there was a marked shift into own- or private-label by shoppers. She said ASDA’s own-label range “Chosen by You” was the fastest-growing private label in the market.
“We ask 2,000 people a week how are you feeling … one in 20 people do not believe they will get a pay increase this year …. it was one in 10 last year.”
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Asda Launches Premium Meat Range
ASDA Grocery Online the UK’s second largest grocery retailer has expanded its range of fresh meats, launching a new line of premium quality cuts of meat.
Asda has dubbed the range “The Butchers Selection” which includes a selection of steaks that have matured for 15 days in a bid to make the meat extra tender. The range is already available at most stores throughout the country, with steaks on special offer and rump steaks marked down to £7 from an original price of £11.97.
Earlier in the month Asda launched a marketing campaign to promote the launch of the range on television, and features Asda’s head of meat quality Jim Viggars, explaining to consumers how the selection is specially prepared.
Viggars said: “Our customers told us that steak is one of their favourite meals when eating out, so the Asda meat team and I have worked hard to get the cuts to restaurant quality, without the hefty price tag.”
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The Mystery Of The Great Asda Trolley Robbery
UK supermarket chain ASDA Grocery Online regularly advertises the virtues of its competitive pricing, with adverts regularly featuring a mix of celebrities, employees and ordinary customers, all of whom pat their pockets, smile and say
“That’s Asda price!”
Someone really took that advice to heart and in an effort to save some cash decided to steal around 800 trolleys over the course of a couple of weeks and at £80 a pop, the £64,000 the key question is who on earth would go about stealing supermarket trolleys.
The trolleys were stolen from Asda’s Eastgate shopping centre branch in Essex over a 12 day period, all were fitted with refundable coin deposit slots that encourages shoppers to return the trolley to its correct collection point. That was ignored and the robbers simply cut through chains holding all the trolleys together, and with no CCTV cameras and an unmonitored car park bay, the theft remains a mystery.
So now we know the trolleys have been stolen, this then begs the question, what on earth are the thieves planning to do with this inconvenient haul batman?
Holy stainless steel Robin. According to Simon Nickson who runs a company that supplies this type of equipment to other retailers, the haul is certainly now worth the pain.
“You’re not going to get a vast amount of money for scrap – probably only about £5 to £7 a trolley – which is hardly worth stealing,” he says. “With that sort of quantity, I’m just wondering whether they’re buying to sell to third-world countries, second-hand. They may have a customer in Asia or Europe who might give them 25 quid each for them.”
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Supermarket Shoppers Increasingly Opting For Healthier Brown Bread
Customers of supermarket chains like ASDA Grocery Online are increasingly substituting white bread for the healthier option of brown bread according to market research firm Kantar Worldpanel.
According to the data, sales of loaves of white bread declined by 1 per cent last years, whilst sales of brown bread climbed 6 per cent, and seeded bread and even more impressive 9 per cent.
Tesco the UK’s largest retailer said it was the first time sales of white bread, a staple in the UK had ever declined, and the fall was attributed to a shift in consumer preferences towards more healthier options.
Alex Sillars, Tesco’s bread buyer, said: “The recent sales figures are a significant move and reveal that more shoppers are looking for healthier options when buying bread.
“There is more choice now than ever before and the emergence recently of half brown and half white bread looks like it has been instrumental in encouraging people to make the switch, albeit gradually.
“Not only is there more choice but the quality of wholemeal bread has greatly improved over the last 10 years.”
She added: “In recent years we have increased our range of brown and seeded bread as well as launching other healthier alternatives and while sales of white are still roughly double to that of wholemeal it appears that a change has now begun.”
Whilst it is clear that brown bread is indeed gaining in popularity, the data suggests that it is far from dominant, accounting for roughly 27 per cent of the 12 million loaves of bread sold in the UK as opposed to the 66 per cent of 7.9 million loaves of white bread sold each day in Britain.
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Asda To Focus On Prepared Fresh Foods
UK retailer Asda expects an increase in demand for prepared potatoes on Tuesday as demand spikes as a result of East Midlands Potato Day.
ASDA Grocery Online Director for Category Rick Bourne says the supermarket chain has specifically singled out the prepared fresh food format, and speaking at a QV Foods event said that the retailers customers were now making a number of choices regarding their product mix, buying across premium and budget categories, prioritizing what and where they buy, with fresh produce being the most important.
“Consumers are prepared to pay for someone else to prepare their vegetables,” he said at the joint QV Foods, Potato Council and McCain sponsored event. “I tried to sell dirty carrots and I couldn’t understand why people weren’t buying them. I was told that people don’t have the time to wash them at the sink.
“I tried to sell naked cucumbers for a while but customers didn’t like it. Loose product has the perception that lots of people have touched it.”
Mr. Bourne added that wastage of food had a huge negative impact on the supermarket chain’s customers and what they buy, and that prepared portions as a result has an end feel good factor.
“The £1 price point is important to our customer and is a motivator,” he continued. “It helps people budget but it’s also the right portion, meaning less waste of food in the home.”
According to Mr. Bourne, Asda controls 20 per cent of the market for prepared potatoes, and he is keen to expand.
“Together we can inspire growth for prepared potatoes,” he said. “You have to understand the market.”
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Asda Reverts Back To Imperial Measurement System In Strawberry Trial
Asda has begun to offer its customers punnets of strawberries by the pound and ounce, the first such offering by a supermarket in over 16 years.
The retailer has under trial a 1lb punnet of strawberries offer, which displays both the metric and imperial measurement on the package, as it seeks to respond to growing demand by customers who also want to know the imperial measurement.
According to research from ASDA Grocery Online, 70 per cent of shoppers found the metric system confusing, and preferred product information to be labelled in pounds.
Research by the retailer found that 70 per cent of its shoppers were confused by the metric system and would prefer products to be labelled in pounds.
strawberry buyer Andy Jackson said: “Customers had been badgering us to sell our fruit in pounds and ounces.”
“No one wants to order a litre of beer in the pub, so why do we have to buy 453.39g of strawberries?”
If the strawberry trial proves to be successful, then says it will consider the roll out of imperial measurements on other fruit and vegetables.
By law, the fruit and vegetable packaging must display metric measurements, however imperial measurements can also be included as “supplementary indication” following a change to EU legislation on weights and measures in 2007.
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