Asda has announced plans to boost its organic and premium lines, while saving energy and maintaining low prices, in a bid to appeal to the full spectrum of shoppers.
Speaking at a company briefing yesterday, chief executive Andy Bond said the UK’s number two retailer had unexpectedly beaten its own sales targets, increasing its customer base by one million - eight per cent - to 13m.
He said Asda will stay committed to its core market of budget shoppers, intent on narrowing the gap with current market leader Tesco and knocking Sainsbury’s out of the running for the number two spot.
“I want it to be inconceivable that any other supermarket could compete with Asda on price,” he claimed.
But Bond said Asda is shifting its focus toward its “selective” shoppers, by introducing 1,000 additional organic products this year, before almost doubling its premium range, with 750 new lines to be rolled out next year.
An analyst at the meeting suggested Asda’s move would be unlikely to worry other retailers since most have voiced plans to push organics and Sainsbury’s and Waitrose are already significantly ahead in this sector.
However, a spokeswoman for Asda said the supermarket has discovered its shopper profiles match those of its more upmarket rivals and increasing organic and premium lines would give affluent shoppers more reasons to choose Asda for food rather than just its extensive range of non-food items, such as clothes and electrical goods.
As well as cost-cutting, which will come from increased logistics efficiency, Bond said he wants Asda to be “famous for seasonal, sustainable and local” food ranges.
As part of a five-year plan, the chain intends to extend its 5,000-strong locally-sourced product range, and will open a new hub in Lincolnshire this week, followed by another in Sussex next week, to allow suppliers to cater for their local stores.
In addition, the retailer is demonstrating its commitment to its “Zero waste to landfill by 2010” objective, with the first depot with a total recyclability policy going live this week.
And all future stores will have to conform to a sustainability model, which will include sunpipes and solar panels, wind turbines, and biomass boilers, the spokeswoman said.
Such is the company’s determination to make retailers more environment-friendly that Bond will be inviting the chief executives of all the major UK supermarket chains to attend a sustainability conference later in the year, she said.
The spokeswoman added: “It is a moral, as well as a business, opportunity so when it comes to sustainability we want to make this an open and sharing agenda.”
