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Morrisons fires commercial director as sales decline deepen Morrisons fires commercial director as sales decline deepen
(about 1 hour later)
Morrisons has axed its commercial director after a weak run of promotions turned the Bradford based supermarket giant into cannon fodder in an intensifying supermarket price war. Morrisons has axed its commercial director after a weak run of promotions turned the Bradford-based supermarket into cannon fodder in an intensifying supermarket price war.
Its chief executive Dalton Philips blamed disappointing sales on a failure to stand out from a supermarket crowd that is bombarding shoppers with money off vouchers every week. Philips said it needed to "improve the effectiveness" of its special offers after suffering a bigger than expected drop in third quarter sales. Like-for-like sales fell 2.1% in the 13 weeks to 28 October which was a marked deterioration from the 0.9% decline recorded in the first six months of the year. Its chief executive, Dalton Philips, blamed disappointing sales on a failure to stand out from a supermarket crowd that is bombarding shoppers with money-off vouchers every week.
In addition to sharpening up its promotions, Philips said it needed to shout louder about what made Morrisons "different" such as its staff of more than 5,000 butchers, fishmongers and bakers. Richard Hodgson, who joined from Waitrose in 2010, has left the business with his duties picked up by Martyn Jones, the corporate services director, until a replacement is found. The company said Hodgson would receive a pay-off in line with his contract. Philips said it needed to "improve the effectiveness" of its special offers after suffering a bigger than expected drop in third quarter sales. Like-for-like sales fell 2.1% in the 13 weeks to 28 October which was a marked deterioration from the 0.9% decline recorded in the first six months of the year.
Some analysts have blamed Morrisons' problems on a move upmarket that has alienated its most loyal shoppers. A refurbishment programme is introducing extras such as cake shops, pizza counters and in some cases sushi bars into its supermarkets which were previously famous for their "pile-it-high-sell-it-cheap" aesthetic. It has also missed the boat on the current big shopping trends of home delivery and convenience shopping. Philips insisted the new look stores were a hit with shoppers, adding: "There is only one sushi bar in the country, it's in St Albans, and the sales are really strong." Though sales were lower than anticipated, Morrisons still expects annual profits to meet City expectations of around £913m. The shares closed down 1.5% at 263.5p. In addition to sharpening up its promotions, Philips said it needed to shout louder about what made Morrisons different, such as its staff of more than 5,000 butchers, fishmongers and bakers.
Richard Hodgson, who joined from Waitrose in 2010, has left the business with his duties picked up by Martyn Jones, the corporate services director, until a replacement is found. The company said Hodgson would receive a payoff in line with his contract.
Some analysts have blamed Morrisons' problems on a move upmarket that has alienated its most loyal shoppers. A refurbishment programme is introducing extras such as cake shops, pizza counters and sushi bars into its supermarkets which were previously famous for their "pile-it-high-sell-it-cheap" aesthetic.
It has also missed the boat on the current big shopping trends of home delivery and convenience shopping. Philips insisted the new look stores were a hit with shoppers, adding: "There is only one sushi bar in the country, it's in St Albans, and the sales are really strong."
Although sales were lower than anticipated, Morrisons still expects annual profits to meet City expectations of about £913m. The shares closed down 1.5% at 263.5p.