Asda will launch a new value range in UK supermarkets, amid the cost of living crisis, as the grocer saw growth slow down due to customers returning to pre-pandemic habits.
The supermarket firm, which was bought by the Issa brothers and backers TDR Capital last year, said it will axe its Smart Price range and replace it with new Just Essentials by Asda products.
It said the new budget range will comprise 300 products, a 50% increase on the current Smart Price range.
Just Essentials products will initially arrive in stores from May and be rolled out to replace Smart Price over the summer.
Asda said it has designed the new range with consideration for customer concerns over the cost of living crisis.
It comes a week after the Office for National Statistics said inflation jumped to a 30-year-high of 6.2% in February, with food inflation at 5.3%.
Mohsin Issa, co-owner of Asda, said: “We understand that customers are increasingly worried about the cost of living and want help to keep their grocery bills in check, whilst still being able to buy healthy and nutritious food for their families.
“Our new Just Essentials range has been specifically designed with this in mind, combing our lowest prices with a much larger and more diverse range of great value products to meet all household needs.”
The shake-up of its product range came as Asda revealed revenues of £20.4 billion in 2021, representing a 0.6% increase in like-for-like sales, excluding fuel.
However, the retailer highlighted that like-for-like sales declined by 2.9% in the three months to December compared with the same period a year earlier, as customers returned to pubs and restaurants.
Online sales also declined by 5% in 2021 against the previous year, as the return to the office saw a reduction in home deliveries.
Asda said operating profits soared over the year, rising by 42% to £693.1 million due to a reduction in Covid-related costs.
Mr Issa added: “When we bought Asda we were clear that we wanted to grow this great business and our ambition is for Asda to regain its position as the UK’s second-largest grocery retailer.
“We are pleased with the progress made in the six months since we officially took over the business and are confident we can achieve this long-term ambition by providing customers with exceptional value wherever and however they choose to shop with us.”
The Issa brothers have continued to lead the supermarket group following their £6.8 billion takeover, with the firm’s already lengthy pursuit of a new chief executive officer yet to find a replacement for Roger Burnley.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules here