There’s no clear winner in the election, but there is in the grocery market..
I love general election night, staying up late and watching the results come in - even if it did mean enduring the appalling celeb chit-chat on Andrew Neil’s boat - but I’m still struggling to work out who had a good election. As a Tory supporter, I’m delighted that the party has come out with the most seats but I can’t help but feeling that given the lead they had in the polls six months ago and the events of the past two years, they should have won an overall majority, and that a leader with wider appeal and with a little less spin and more substance would have done. Labour are obviously a busted flush, but it was also gratifying that voters saw right through the Liberal Democrats’ opportunism and lack of substance.
A hung parliament won’t be good for the economy though and the pound and the FTSE have taken a hammering today. Retailers talked a lot about the uncertainty an election creates in consumers’ minds, and the result and lack of a a clear vote for one party is likely to prolong the sense that the country is in a state of limbo at a time when it really needs a strong leader with a strong mandate.
Back on retailing, and interesting times in the grocery world, where there does appear to be a clear winner at the moment and that’s Tesco, and they’re hurting everyone else.
Morrisons reported a weak like-for-like performance yesterday, up 0.8% in the first quarter, but claimed to be gaining market share, which to be fair seems to be backed up by the TNS numbers. We’re bound to see grocery retailers’ lfls coming off significantly because inflation has come out of the market, but nevertheless, Morrisons new boss Dalton Philips won’t be happy with that showing.
Apparently he’s really making his presence felt in the business, having met all the store managers already, and also going through the central functions in Bradford with a real focus on costs. Under Marc Bolland, trading and retail directors Martyn Jones and Mark Gunter apparently had a pretty free rein, but apparently everything is really coming under the microscope now.
If Morrisons is gaining market share but its comps are only up 0.8%, then it makes you wonder how Asda in particular are doing, as they’ve been the weakest performer in the TNS data. Trading director Darren Blackhurst’s departure this week is being read as paving the way for Andy Clarke taking over, although I’m a bit surprised Blackhurst is so piqued seeing as no-one has been talking seriously about him as a candidate to take over from Andy Bond.
It has to be Clarke now really, as if he didn’t get the job he’d have to leave too and that would leave Asda with virtually no senior management. Clarke’s got a lot of experience, not just at Asda but also Matalan and Iceland too, and is well liked, but whether he or someone else gets the job, they will have a big task on their hands.
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