Allan Leighton’s Asda masterplan: Is it working?
It has been a turbulent year for Asda, and while 2024 ended with increased profit, the grocer has warned of a softer performance in the year ahead as it pushes on with an investment drive and turnaround plan.
Asda’s adjusted EBITDA increased by 5.8% to £1.14bn last year but total sales declined by 0.8% to £21.bn and like-for-like sales were down by 3.4%.
From industrial action by staff to leadership changes and declining sales, it seemed a welcome change for many when Allan Leighton returned to the grocer as executive chairman in November.
Leighton previously served as the grocer’s CEO from 1996 to 2001 and was chair of the Co-op for almost 10 years. At Asda, he is remembered for helping to turnaround the business in the late 1990s alongside current M&S chair Archie Norman.
Just this month, Leighton said the previous stewardship of the supermarket by co-owners the Issa brothers “ripped the heart out of the colleagues”, admitting that the wounds Asda is suffering now are “largely self-inflicted”.
However, he has focused on his objective to “restore Asda’s DNA” and turnaround the struggling supermarket. Despite admitting there is “not a quick fix”, after just four months in the role Leighton has been quick to make changes.
What has happened so far, is it working and what’s next in Leighton’s plan to win back shoppers?
What’s changed and is it working?
Price and availability
When Leighton first took back the reigns in November 2024, he made clear that one of his first priorities would be to improve prices and product availability.
In the first half of 2024, Asda made two additional investments in store hours, totalling £43m, and focused the additional working time on replenishment and improving store standards.
The retailer says this has made a positive difference for shoppers, with improvements in availability and an increase in customer satisfaction scores since the fourth quarter.
Leighton says: “We’re beginning to see incremental improvements in our price gap. Our availability is much better and we can see that in the stores. I think people in the business have a degree of hope.”
To build on this further, the supermarket giant re-launched its famous Rollback price proposition in January. This offers an average reduction of 25% and has now been expanded to roughly a quarter of Asda’s entire range.
Asda Rollback campaign
The retailer will add thousands more products to Rollback at regular intervals during the year. Leighton says it will take around 12 months to get 80% of the range down to the Rollback price.
It marks part of a strategic shift to switch its entire product range to a new low ‘Asda Price’ by the end of 2026 – a move GlobalData senior retail analyst Eleanor Simpson-Gould says is a “prudent decision that will create a compelling core offer”.
“Rollback lines are certainly playing a bigger part in customers baskets but the way people think about it is that it’s some sort of promotion. It’s not, it’s the way we do things around here, and it’s a consistent programme that goes on for a period of time”, he explains.
Simpson Gould adds: “While food inflation is creeping up again, we do not anticipate this will lead to large-scale switching to discounters, as was seen at the start of the cost-of-living crisis, and Asda is in a prime position to ramp up its renewed price and value-led image.”
Redline Retail consultant Andrew Busby agrees that while it’s still early days, bringing back Rollback was a “good move from Asda”.
“Every retailer needs to be known for something, they need to be famous for something. The best example of that is John Lewis bringing back, ‘Never Knowingly Undersold’. Consumers need to have that hook that they can identify a retailer with.”
Job and bonus cuts
In January, Leighton introduced a series of cost-cutting measures, including the axing of 13 regional managers as part of a senior shake-up.
At the time, an Asda spokesperson said: “These changes set us up to serve our customers in the best way for 2025 as we deliver Asda Price and other exciting propositions.”
Just this month, Asda added to the staff changes. More than 200 employees left the business as the company finished a long-running IT upgrade programme, for example.
More controversially, the company also scrapped bonuses for more than 10,000 managers, who were typically expecting payments in the first three months of each year.
One Asda employee told The Telegraph: “Morale will be rock bottom. Even Allan [Leighton] won’t be able to pick them up from this. This will mean some of the top talent looking elsewhere”.
However, Leighton told Grocery Gazette that, “Morale in the business is actually very, very good, particularly in the stores.”
Moving forward, Asda is putting in place a bonus scheme which looks at an individual’s performance, rather than taking a company-wide perspective, he says.
“This year in Asda, if you do your bit, you get your bonus. The company may miss its objectives, but if you hit yours, you get paid your bonus. That has gone down incredibly well within the organisation.”
Leighton says that this is “adding to the morale of the company, not subtracting from it,” while colleagues are “very much up for what we’re trying to do, because they believe in it, and that’s half the battle”.
Getting the right team on board
In January, Leighton looked to strengthen Asda’s leadership team with a raft of senior appointments.
This included promoting George lead Liz Evans to chief commercial officer for non-food and retail, and saw Ade McKeon re-joining the grocer as vice president for ambient.
M&S head of trade Gemma Lightbody also re-joined Asda as business unit director for impulse grocery, while Aldi buying director for pantry Matt Shields joined as business unit director for core grocery.
Many of these individuals have previously worked at Asda. When asked today (14 March) if this was a deliberate choice, Leighton answered that, “If the right person just happens to have been with us before, that’s good because obviously they know the system, and they know how Asda works.
“I think it’s very powerful for us, because we’ve had a lot of people who left the business want to come back to the business because they believe that what we’re doing today is what Asda does.”
While the senior leadership team is evolving, the grocer’s long-running search for a CEO has not been so successful.
While former chairman Lord Stuart Rose had been on the hunt to fill the position after Mohsin Issa stepped back from his executive leadership role last year, it seemed as though the funnel of candidates had largely dried up.
In January the search for a leader was back on, however. Almost two months on, “there’s no pressure to get a CEO”, according to Leighton, as he notes that finding the right chief executive is more important than speed.
“My number one measure of success is that people think this is a great business to work in again, and that is 50% of everything that makes Asda successful. It’s very important the person we bring can buy into that and add to that.
“It’s not about how good a retailer or how good a marketeer you are. That’s obvious. The most important thing is, do you believe, do you fit and can you drive this special culture, which is the Asda DNA.
“I’m looking for a great CEO and to be very clear, we will have no problem in finding one”, he affirms.
However, for Busby, finding a CEO as fast as possible would make much more sense.
“It needs that leadership. You look at other businesses, like Morrisons with Rami Baitiéh and what he’s done there and then John Lewis bringing in Jason Tarry. You need that almost talisman type of figurehead, a real leader really galvanizing the team effort and making very clear what the direction is.”
Improving the in-store experience
Asda has longer-term plans to update and transform its store state. It recently unveiled a glimpse of this through the £2m revamp of its Pillsworth store, which Leighton describes as Asda’s pilot site.
The store underwent several significant improvements, including a “fresh modern” look with new feature lighting and updated signage, the creation of a consolidated food hall, low-level chilled units in the produce section, a dedicated wine and spirits zone, and a transformed cafe.
“There will be elements of the store that will roll into the rest of the business,” says Leighton. However, he adds that Asda’s “number one thing isn’t shiny new toys”.
While he notes that his strategy might sound basic, Leighton says that the most important way Asda can improve the in-store experience is by offering an environment where “the prices are great, and shoppers can get everything they want”.
“I’m pleased with the progress we’re making, but we’ve got a long way to go, and we have to deliver it consistently,” he admits.
Busby notes that while a typical Asda store, in comparison with competition, is “quite clearly under invested” in terms of features such as gondolas and shelving, he says that “it would be very sensible to focus on the things that really matter”.
“Getting the basics right, the price, the assortment, the merchandising and the availability is important because otherwise it’s akin to putting lipstick on a pig. If you haven’t got those basics right, there’s no point in trying to invest in the stores.”
What’s next?
In the stores themselves, plans to improve the look, as well as the price and availability of products is well underway.
While these changes are likely to benefit Asda in the long term, carrying them out will not be easy, or cheap.
Leighton has warned of softer profits – an “investment warning”, as he describes it – in the year ahead, as the supermarket embarks on a “substantive and well backed programme of investment in price, availability and the shopping experience” to regain customer trust.
He explains that this will “materially reduce our profitability this year, which we expect to reverse as our market share recovers and improves over time.”
However, he says that in the long-term, “The impact it will have is putting great prices in our customers’ pockets.”
Ultimately, Leighton says, “There’s no pressure on me or the business to turn this into a quick fix”.
Busby agrees that “it’s not going to happen overnight,” and says that Leighton must take Asda “back to the basics” of what the business is about, “because it’s quite clear that it lost that sense of identity over the last few years”.
There is certainly a long road ahead for Asda. With the business yet to find a CEO to oversee the process, it’s unclear when the grocer will finally achieve the ultimate goal of restoring its DNA.
25 Comments. Leave new
High morale, he must be joking. Supermarket morale is at its lowest with staff trying to work 4 people’s jobs. Petrol stations throwing away a grand each of stock every week due to the influx of stock, staff from the co op get paid more then staff from the eg takeover to do the same job. Seems in order to make asda “great” they need to start with the people that do the leg work for them.
What about the equal pay, going on now for nearly eleven years, nothing said about that
Alan knows ASDA. . I worked for him during his last period with us and I am pleased to be working for him again. . The people moaning have a choice get stuck in and work with him or leave. . ASDA is coming back.
They have a good right to moan I work there and don’t blame them pleased I don’t work there now . bloody nightmare
Oh cuts – but how as a farmer and a producer absolutely no way in this earth I’m selling to this idiot- he honestly thinks he’s got farmers over a barrel . No , if you want quality pay for it. If you want cheap with a dose of chemical and environmental disaster and potentially child labour – go for Asda. Cheap won’t be British . This was their opportunity to do something different, and support British instead he chose cheap . For this I hope every person with money in their pocket considers the impact of their cash . Also he’s wearing a weird pretend to be trend hat -all out weirdo
The bloke is living in cloud cuckoo land if he thinks the morale is good in stores
There is absolutely NO store morale in the majority of Asda stores. As those greedy money grabbing Issa brothers thought solely about themselves.
Mediocre & uninspiring. Get your stock in, I’ve been waiting weeks! Only good thing is that you don’t rip off your customers like sainsbury’s does: 2 litre spring water up from 85p to £1.00, lidl’s is 39p.
To be honest the morale at the store I work at isn’t bad, my managers are in a good mood, and I think sales, at least in Home Delivery, are up.
Morale and job security in HO is at rock bottom, no one knows if they have a secure job, especially when meetings are dropped in the day before with no inclination. Focus is on stores and their morale and working great, not what drive sit from behind the scenes.
Its great having great leadership if there are people to lead and also the knowledge doesn’t walk out the door with them.
The approach to releasing people will lead to a lack of handover, lack of knowledge transfer and bringing people in / back when they can’ / don;t have the answers which will cost more in the long run.
There are only shortsighted plans.
Obviously hasn’t spoke to any members of staff because they would say otherwise, there is no morale left to give.
Absolute rubbish, get an email 2.45 pm telling how cash rich the company is and that the have still made profit, then another email at 2.50pm to say there is no bonus, which had been reported nearly 2 weeks earlier in the press.
We have just been through the toughest changeover of systems and ways of working and this is what you get, starting early leaving late, all unpaid to help get it landed, terrible treatment, then to say it had been briefed to GMS in January, when in fact our GM had no such call, morale couldn’t be any worse.
Staff were told by email two days ago that there would be no bonus. This is about ten days after the press reported the story.
That went down very badly. Morale at head office is terrible.
The discounters stole Asda’s lunch. Asda won’t be able to cut prices enough to compete with them and store standards are so poor that customers have no other reason to shop there.
Internally, the board has been claiming customer satisfaction and value perception have been improving for well over a year but sales carry on sliding.
Is that Allan Leighton? 🤣
Bring back the old Asda. When I worked there lots of promotions . You need to reduce prices & have more promotions . Rollbacks are only pennies & not always worth it.
When shopping around I’ve noticed Morrisons & sometimes Sainsburys . are a lot cheaper apart from Aldi and Lidl.
Come on Asda : more for you, for less ,
It has to be Asda ……….
Nor is it in distribution
If they want a CEO why not take Lyssa McGowan from Pets she is absolutely great at demoralising staff, cutting jobs and taking bonus from all store colleagues as well as managers… She will fit right in.
His masterplan involves paying ex co op staff are 4.7% increase ; scrapping it’s managers yearly bonus after they’ve out the graft in and giving managers either a 1% or 2% rise dependant on performance, leaving majority managers earning less then a section leader.. so well done for drastically reducing morale in thoose whom put the hours in and were passionate about their stores. To get nothing in return. But constant criticism
Nothing mentioned about the actual people who work the stores only the management. No shop workers no store. Equal pay now onto eleven years, it’s a joke
Asda stores are terrible and the staffing levels are terrible too I refuse to go to self checkout then again I prefer Aldi they’ve got it right
Store morale not good contract 6 needs to go swapping people’s hours at a drop of a hat
There is absolutely NO store morale in the majority of Asda stores. As those greedy money grabbing Issa brothers6 thought solely of themselves.
Morale is on the floor, this guys living in a fantasy world, mangers bonus a side they have now been told that a fully accomplished manger is only getting a 2% payrise with inflation at 3% the people he’s relying on the most to push his new incentives are the ones being treated like dogs.
Smoke and mirrors. Every quarter last year was DOWN over 5%. Reuters states overall sales down 4.2%. Leaked story about no managers’ bonuses coming out ten days BEFORE Asda emailed managers is disgusting. Staff levels slashed, hours slashed, stock levels low. Colleagues rumoured to be getting a rise to £12.45 Hr, then to £12.60 in August. Meanwhile lawbreaking demands on online drivers regarding their shifts continues. Maybe Mr. Leighton could focus on complying with the Working Time Directive?
Morale on the shop floor is rock bottom. Having worked for Asda for 26 years it’s completely fizzled out. His plans might look good on paper, but he’s ignoring the fact, that staffing levels on the shop floor are completely inadequate. If he encourages more shoppers to shop and spend more, that’s going to leave the beleagured staff even more broken, as they cannot deliver.