Asda’s pledge in wake of horsemeat scandal

Andy Clarke, chief executive of the UK’s second biggest supermarket chain, described his shock at the recent horsemeat findings and said consumer trust has been damaged

“I’m going to leave no stone unturned,” he said. “We will make sure the products we procure from around the world are exactly what they say on the label.”

After Tesco estimated that testing meat for traces of horse could cost £1m, Mr Clarke said it is too early to talk about a figure.

“The cost will be whatever it needs to be to get testing in place,” he said.

Asked if the group has felt any impact on sales as a result of the scandal, he said yes there will be an impact if a product is taken off sale.

Earlier this month, Asda withdrew a beef bolognese sauce that was found to include traces of horsemeat. It also withdrew three other products from the sauce supplier Greencore as a precaution.

“We found a product that had a level of horsemeat in its make-up. What is clear is a significant adulteration of the supply chain. It’s not just the UK, it’s an issue across Europe.

“Customers need to have confidence about what’s in the product. I feel very responsible for that. I’m the chief executive. We have to fix it. We’re working very closely with suppliers. We’ll get to the bottom of it.”

Mr Clarke said customers are switching to vegetarian and meat-free products, which have both seen a lift in sales.

Asked if customers are demanding more British meat, Mr Clarke said that Asda sources meat locally wherever it can but production issues mean it can’t source all its meat from the UK.

Asda estimates that 75 per cent of the meat it sells comes from Britain.

Talking about the price of meat increasing as a result of the tests, Mr Clarke said: “We will work really hard to manage inflation out. I can’t say that nothing will be passed on to the consumer.”

Asda said it has checked everything the Food Standards Agency has asked to be checked, but it is continuing with other tests to ensure customers have confidence in its products.

“Right from the start we took a very transparent approach and, of course, embarked on what is a world-leading change for the industry and our organisation in terms of testing,” said Mr Clarke. He was speaking yesterday as Asda reported a 0.1 per cent increase in festive like-for-like sales over the 14 weeks to January 5, following a tough comparison with a strong Christmas 2011.

For the full year, like-for-like sales increased by one per cent.

Mr Clarke said: “We’re pleased with our results in a tough market. We continued to grow our sales while also investing in holding down the price of essentials, increasing access points to Asda’s value and putting money back in customers’ pockets when they need it the most.

“The last quarter was challenging but that’s because of the decision’s we took to drive volume. It has left us in a good position for this year.”

The group invested £100m in bringing down prices of its essentials ranges and plans to invest a similar amount this year.

Asda’s Mumdex research tool showed that 60 per cent of mums can’t keep the heating on as long as they need to and a quarter can’t buy the food they need to feed their family a healthy meal.

Chief financial officer Richard Mayfield said the group doesn’t see any improvement this year.

“It’s going to remain tough for customers. Retail is changing very quickly and we see opportunities out there,” he said.

In a separate announcement, Asda’s chief merchandising officer for George and general merchandise, Andrew Moore, said the group is to start delivering George.com products to 24 countries across Europe.

Following a successful pilot in the Republic of Ireland, the ecommerce expansion will be completed by July 2013.

Customers in Luxembourg, France, Belgium, the Netherlands, Denmark and Spain will be the first European shoppers, outside of the UK, able to access the full catalogue of George clothes and accessories.

This is the next move in George’s global roll-out.