Asda’s turnaround plan disrupted by IT overhaul
Asda has reported a 2.8% decline in like-for-like sales in its third quarter, although sales at its Express convenience stores rose by 3.5%.
In the three months to 30 September, total revenue (excluding fuel) came in at £5.1 billion.
The supermarket said trading was impacted by severe disruption to systems as it completed its Project Future major IT project. The programme required separating more than 2,500 legacy systems and migrating them onto Asda’s own IT platforms, which temporarily disrupted the flow of stock from depots to stores.
Asda’s online operations were also hit by functionality issues following the launch of a new app and website in August.
Allan Leighton, Asda’s executive chairman, said: “At Q2 results, we said that the cutover from Project Future, although completed, would likely have a negative impact on our performance.
Subscribe to TRB“This change severely disrupted our systems and materially impacted our progress, as we saw a step-back to inconsistent availability, operational issues at depot and in-store and a poor customer experience online and through the app that impacted our Grocery Home Shopping business in particular.”
“Since then, we have made good progress stabilising our platforms and the worst of the disruption is now behind us. Availability is back to where it was in June, operational issues are reducing and performance in recent weeks is improving, but we do not expect to re-establish our Q2 2025 position until Q2 of 2026.”
Asda said it continued to invest in price cutting in the period, which means it has reduced prices on more than half of all products since January through its Rollback to Asda Price programme. The retailer has also restarted its convenience store expansion programme and is on track to open up to 20 new sites by the end of 2025.
Leighton said: “We said it would take three to five years to turn Asda around. We made good progress in the first half of the year against our ‘Formula for Growth’ with the best availability in eight years, a notable price gap versus competitors and a return to like-for-like growth. Thank you to all our colleagues for their hard work and commitment and our customers for their patience.”
