Asda Warns of Price Increases Due to Tax Changes

Asda, the UK's third largest supermarket, is facing challenges with a 4.8% decline in like-for-like sales for the third quarter, alongside a projected £100 million hit from increased National Insurance contributions. Chairman Lord Stuart Rose acknowledged that the company has 'lost the plot' in meeting customer expectations and has committed to investing in store operations to improve service. The recent Budget changes, which raise employer National Insurance contributions from 13.8% to 15%, add further financial strain on retailers, including Sainsbury's which expects a £140 million rise in costs. Rose emphasized that while Asda will strive to mitigate these costs, they are likely to impact prices for consumers. The company has recently undergone leadership changes and operational restructuring, including the reduction of 475 head office jobs. Despite the setbacks, Asda remains committed to enhancing customer satisfaction and operational efficiency.