ASDA to Eliminate 1,400 Jobs in Bid to Reduce Costs, Win Back Market Share

LEEDS, United Kingdom -- Wal-Mart-owned ASDA, the second-largest supermarket chain in the United Kingdom, says it will pare 1,400 jobs, 200 of them at the company's headquarters here and 1,200 at stores, as it attempts to lower costs and catch up to No. 1 U.K. grocer Tesco, according to published reports. ASDA executives revealed their plans at a press briefing in London yesterday.

Of the 1,400 employees whose jobs will be eliminated, 400 will be relocated, an ASDA spokeswoman told just-food.

Spurred by the grocer's failure to achieve its first-quarter profit goal because of stiff competition from Tesco and other rivals stealing away market share, ASDA c.e.o. Andy Bond has embarked on a strategy of slashing costs and lowering prices, despite the company's consistent ranking as the country's cheapest supermarket. According to Bloomberg News, Bond, who succeeded former c.e.o. Tony DeNunzio in March, said he anticipates that business will improve in the next few months, but declined to say by how much he would reduce costs.

Additionally, the company is to adopt such structural changes as store management teams that will refocus on customer service, and the creation of a new board position, customer and strategy director. Angela Spindler will fill the new position, effective Oct. 1, in which she will be responsible for marketing, the ASDA brand, customer service, format development, and business strategy.

Other senior executive changes include the returns of David Cheesewright from his 12-month stint as c.o.o. of Wal-Mart Canada, to take the position of c.o.o. and trading director, effective Oct. 1, and Andy Clarke, to resume the role of retail director and head up the company's expanding financial services business, effective Sept. 5. It was Clarke who came up with the concept of the customer and strategy director position, the company said.

Although it has recently experienced such setbacks as the defection of some of its top executives, the company notes that it has also created more than 40,000 jobs in the United Kingdom over the past six years.

ASDA currently has 2,000 employees at its head office and about 130,000 workers throughout the United Kingdom.
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