Expert claims Asda could ‚ultimately disappear‘ following Sainsbury’s dealSome analysts think that it’s only a matter of time before Asda brand stores are deemed unnecessary11:07, 30 APR 2018Updated12:14, 30 APR 2018Asda Bristol (Image: Getty Images Europe) Get daily updates directly to your inbox SubscribeThank you for subscribing!Could not subscribe, try again laterInvalid EmailSainsbury’s this morning confirmed a billion merger with supermarket rivals Asda.The deal, which will face close scrutiny from competition bodies, will create the UK’s biggest grocery powerhouse bigger than current market leaders Tesco.Executives are targeting efficiencies and savings of an there’s talk of „operational efficiencies“. There are 350 people working in any given store.“Sainsbury’s said there are no existing plans to close stores on either side.The company also mentioned price reductions. The supermarket said food costs could be cut by 10 per cent.A spokeswoman said no branches of Asda or Sainsbury’s were forecast for closure.“[We will] maintain both the Sainsbury’s and Asda brands and enable them to sharpen their distinctive customer propositions and attract new customers,“ she told the Mirror.“There are no planned Sainsbury’s or Asda store closures as a result of the Combination“.What will happen to Asda? But leading retail analysts think it’s only a matter of time before some stores face closure and question the need for two separate brands under the same umbrella in an increasingly competitive and challenging market.Natalie Berg, retail analyst and founder of NBK Retail, told Mirror Online the deal between Sainsbury’s and Asda is about „scale and survival“.“The UK grocery sector is facing unprecedented levels of change,“ she said.“Over the past five years, Aldi Lidl’s combined market share has grown by 80 per cent, while online sales of non food products have doubled.“The only retailers that can sustainable compete on price with the discounters are other discounters.“Sainsburys and Asda went into this deal with the understanding that a significant number of store disposals will be required in order to gain the green light from the CMA.“In that sense, the deal is an opportunity to gain scale in face of rising costs and increased competition while simultaneously offloading some unwanted sheds [branches].“.
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