Despite a better than expected trading outlook for the rest of this year, the road to recovery for UK retailers will be long and hard, Asda chief executive Andy Bond has suggested.
Bond said the last few weeks had seen good business for retailers, brought on by a rise in disposable incomes as a result of lower mortgage rates combined with a hot June.
But he warned that fears over unemployment, coupled with continued wage-growth stagnation and predicted mortgage rate hikes would see people saving more and spending less.
He told Reuters: “I think it’s going to be a long, long slow recovery. If this year is going to end up being a bit more benign than people expected, there’s every reason to believe next year will be hard.”
Hope that the `green shoots of recovery` are in sight have been fuelled by improved trading updates from big-name stores such as DIY specialist Kingfisher, fashion chain Next and supermarket Morrison.
But Bond predicted a harsher trading environment for supermarket groups in the coming months due to a predicted drop in food price inflation, though he believes this is more a return to normal conditions rather a major hurdle for the sector.
Meanwhile, in an interview with the Financial Times, Bond - regarded as a frontrunner for the chief executive role at Marks & Spencer when Sir Stuart Rose steps back to become non-executive chairman - said he has not been contacted about it.
He said: “If you put yourself in Marks & Spencer’s shoes for a moment, there is only a very short list of people who would ever be qualified to do that job.” He added: “I would imagine I would be qualified to do the job.”
He refused to rule himself out of the race for the Marks & Spencer role but said: “I am very happy doing what I am doing. Whilst on one hand I have been at Asda fifteen and a half years now, I’m as energetic about doing it as I ever was.”