Asda chief has warned that customers are buying fewer items and turning to cheaper products after witnessing a plunge in their household incomes. Other reports stated that he called the government’s £15 billion cost of living handout “drop in the ocean” saying it is not enough to help struggling families.
Lord Stuart Rose, the chairman of the UK’s third largest supermarket, said the group's shoppers are "making desperate decisions about spending" as the cost-of-living crisis continues to bite.
Lord Rose, a former chief at Marks & Spencer, told the PA news agency that some customers are "saying they can only spend £40 in a shop and will put anything back if it comes over that".
"I can't predict how long this cost inflation will continue for but it is not suddenly going to disappear," he said.
"I think there will be a levelling off at some point but we are seeing wheat prices still increasing dramatically, oil prices rising, butter too."
The boss added that product availability in some areas has been "patchy" as the Leeds-headquartered company continues to tackle supply chain issues related to the invasion of Ukraine and coronavirus restrictions in some regions.
Meanwhile, The Guardian reported that Rose has welcomed the one-off payments announced by Chancellor Rishi Sunak on Thursday (26) but also felt that “there is still going to be continuing pressure and a lot of toughness for people”.
Rose, who previously led Marks & Spencer, Argos and Topshop, said he expected inflationary pressures to last into next year and take some time to gradually diminish, putting a squeeze on household budgets and therefore on retailers’ profits for months to come.
“This is not going to suddenly stop,” Rose said. “I can remember the last time inflation was [like this] and it took nearly eight years to get under control. I’m not saying it is going to take eight years but it is not going to stop in a year.”
He said the priority should be “trying to get help to those who need it most”.
“You can give me £400 but I don’t need that off my electric bill. It is hard to focus but you need to dig harder for those people who are more disadvantaged,” he said.
According to the monthly Asda income tracker, average disposable income fell to £205 a week, the lowest figure since October 2008, as electricity prices soared 53 percent and gas 95 percent.
