Asda cuts jobs, orders office return

Asda was bought from Walmart by billionaire brothers Zuber and Mohsin Issa

• Pramod Thomas
• 06 November, 2024

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By: Pramod Thomas

SUPERMARKET chain Asda has announced plans to cut 475 head office jobs and reduce remote work, aiming to streamline operations amid financial challenges and a declining market share.

The job cuts, affecting roles in Leeds and Leicestershire, were disclosed in a message to staff from Asda chairman Lord Rose on Tuesday (5), reported the Telegraph.

He stressed that the restructuring, which impacts less than 10 per cent of the head office workforce, will “simplify structures” and remove overlapping roles to strengthen the business’s long-term stability.

Lord Rose, acknowledging the impact of these changes, said the measures were necessary to position Asda for growth in 2025.

“Change is never easy and is unsettling,” he said, “but the executive team believes it is necessary to fully focus on serving our customers and driving long-term growth.”

In addition to the layoffs, Asda’s new work policy will require head office employees to work from the office for a minimum of three days per week, starting in January 2025.

This shift in policy aims to align Asda with competitors like Tesco, Aldi, and Morrisons, which have also brought in-office attendance policies post-pandemic.

According to an Asda spokesperson, the hybrid working change supports the creation of a more collaborative, high-performing team environment that addresses the business’s operational needs.

“This approach brings us in line with our competitors and the wider market, allowing us to build high-performing teams with a collaborative culture and respond to what our business needs the most,” the spokesman said.

“The change is effective from January 2025 to allow time for all colleagues to make any necessary arrangements.”

The decision follows a period of declining sales for Asda. Between April and June 2024, the company reported a 2.2 per cent drop in revenue (excluding fuel), with total sales for the quarter reaching £5.3 billion.

Since Asda’s acquisition by billionaire Issa brothers Zuber and Mohsin Issa and private equity firm TDR Capital in 2021, the supermarket’s market share has fallen from 14.6 per cent to 12.6 per cent, putting it under increased pressure to compete with larger players such as Tesco and Sainsbury’s.

Recently, Zuber Issa sold his shares to TDR Capital, raising its ownership stake to 67.5 per cent. Mohsin Issa also stepped back from his role in September, and former M&S executive Lord Rose assumed an interim leadership position, alongside TDR partner Rob Hattrell.

Meanwhile, recruitment firm Spencer Stuart has been tasked with finding a permanent CEO, though the process is reportedly slow, with candidates cautious about taking on the role due to Asda’s current challenges.