Asda, the supermarket bought by the billionaire Issa bothers and the London-based private equity firm TDR Capital for £6.8 billion in 2021, is slowing down its convenience store openings.
Since announcing in December 2022 that it planned to open 300 convenience stores by the end of 2026, Asda has opened shops at just nine sites. The supermarket chain was planning to open about 30 this year, but that target has been scaled back to just 12.
An Asda spokesman said that the company still plans to open 300 stores “in the medium term” and that it has identified a pipeline of 100 sites.
Asda, now majority owned by TDR, has slashed its capital expenditure budget for this year by £100 million, redirecting funds into improving the availability of its goods, making the stores cleaner and reducing the length of check-out queues. Capital expenditure is being cut to between £350 million and £370 million, The Times reported.
Poor store standards, partly driven by a highly disruptive change in IT systems, have contributed to a 6 per cent drop in sales over the past 12 weeks.
Chairman Lord Stuart Rose said this month that he was “embarrassed” by Asda’s performance and that it was time for Issa to step back from his operational duties.
Earlier this month, workers at Penryn’s Asda store staged a demonstration in protest over what they describe as “asset stripping” and claims of reduced hours. Workers with the GMB Union stood outside the store in Jennings Road, Penryn - now referred to by the company as Asda Falmouth – with placards and leaflets. The union claims “asset stripping” has led to health and safety issues, “dirty” stores and declining standards.
GMB said, “Under TDR Capital, Asda’s private equity owners, millions of hours have been slashed from the shop floor. This is leading to health and safety issues, dirty stores and declining standards.
“In Asda Falmouth alone, GMB estimates approximately nine per cent of hours have been cut during the past two years, nearly nine per cent of the hours in the store.”
They also claim that Asda's shop floor workers – described as “predominantly women” – are owed money in back pay through their equal pay claim.
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