Asda boss ‘nervous’ about cost of living
The chief executive of Asda has said he is ‘nervous’ about the outlook for consumer spending this year, as the UK's second biggest supermarket unveiled plans to accelerate its opening of smaller format grocery and non-food stores over the next five years.
Andy Bond said that household budgets face rising costs in 2010, which those in work did not come up against last year. “Petrol is going up, VAT has increased and for some people taxation is increasing and some household staples are still in inflation. There is no good news to make people feel good so I think sentiment is dropping,” he said.
Mr Bond added: “I am really quite nervous for this year for consumers.”
His comments came as Asda posted underlying sales, excluding fuel, up by 4.6% for the fourth quarter to January 31. This represented a slow down on the 5.6% growth in its third quarter, although falling food price inflation has hit the big grocers' sales.
Wal-Mart-owned Asda has 13 stores employing 3,500 people in Northern Ireland and hopes to open three more creating 900 jobs in Crumlin, Larne and Antrim, and extend its Enniskillen store.
UK-wide, Asda plans to open at least nine food stores this year and extend 10.
The most recent industry data for the 12 weeks to January 24 showed that Asda, with 4.3% growth, had slipped behind Tesco's 5.5%, Sainsbury's 6.8% and Morrisons' 10.6%, according to Kantar Worldpanel. But Mr Bond said the heavy snowfall had taken a bigger toll on Asda because it has fewer stores and therefore customers have to drive a bit further to get to them.
There was good news for staff, who heard they will share a record £26m bonus pot as a result of last year's performance. Asda said the bonus pot was 18% bigger than the previous year after the firm served an extra 1m customers in 2009.
Store and depot workers will receive a payout of up to £437.50
Chet Kuchinad, the firm's people director, said: “To announce a record bonus payout and the creation of thousands of new jobs in a challenging economic environment is testament to the successful year that we have had here at Asda.”