Asda has announced it will be investing £500m in lowering prices as the supermarket’s CEO predicts a “challenging year” for retail in 2016.
The retailer says it is changing the way it purchases products, becoming a member of EMD – a buying alliance, pooling the power of 250 supermarket chains. Asda is mainly looking to develop its own label ranges, such as Extra Special.
Andy Clarke, CEO at Asda, commented: “Fundamentally changing how we buy products means we can realise significant savings from our cost base and pass these directly to customers through a rebased pricing model.”
He added that the company was bracing itself for another challenging year ahead in retail. “We are not complacent. We remain cautious and we expect that 2016 will be another year of intense pressure at macro-economic level in addition to sales remaining under strain from price deflation, a continued competitive background throughout the sector and radically changing customer shopping habits.”
