MORRISONS new chief executive David Potts said yesterday that it would take more weeks of listening to customers and staff to understand how to bring the “British underdog” back to life, as it reported a further drop in sales.
In his first trading update since taking over the reins in March, Potts said he had spent the first seven weeks visiting 90 of the retailer’s 500 stores and would present his plans for Morrisons in September after gathering feedback.
“I honestly believe that if we listen hard to customers and staff then we won’t go so far wrong. They already hold the keys to the kingdom...they know why people choose Morrisons. We need to work to bring that to life in more stores on more days,” the former Tesco executive said.
Shares closed down 1.55 per cent to 176.9p as Morrisons reported sales at stores open more than a year fell 2.9 per cent in the 13 weeks to 3 May, despite this being slightly better than analysts had been expecting.
Sales at all the major grocers have been hit hard by intense competition from the German discounters, record food deflation and falling footfall at their larger stores as shoppers move to convenience stores and online.
Morrisons has been particularly hard hit after being slow to move into convenience and online and facing rising competition from newer arrivals Aldi and Lidl, who moved into its northern heartland.
Potts, who was brought in by new chairman Andy Higginson, has already taken the axe to its management board, getting rid of five executive and cutting 720 staff from its head office. At the same time he has also recruited 5,000 shop floor staff to improve customer service, ordered a spring clean of the stores and to better stock its shelves.
“[We are] the British underdog in many ways – we should rejoice in that position and bring shops to life,” he said.
The group expects underlying profit before tax to be higher in the second half than the first and said it was comfortable with analysts expectations for full-year profits of £356m.