Walmart (WMT) is throwing its weight behind its ailing U.K. division, conceding it wasn't fast enough to respond to low-cost rivals in Britain's fiercely-competitive market.
Walmart said it will ensure Asda, which has 630 locations across the U.K., leverages its parent's purchasing strength, allowing it to buy everything from refrigerators to own-brand products to real estate for a cheaper price driving down costs, Walmart's Chief Administration Officer Scott Price told Reuters.
Walmart has been losing ground in the U.K. for some time and Asda is the worst performing division for the world's largest retailer.
Asda sales fell 1.9% to £4.3 billion ($5.3 billion) for the 12 weeks to Jan. 29, making it the only grocery store experience a decline. Asda saw its market share drop 0.6 percentage points to 15.6%, according to industry data from Kantar Worldpanel.
However, Asda's decline has started to slow, with Kantar noting the retailer managed to increase the number of shoppers visiting store compared to the same time period last year.
In Walmart's third-quarter earnings, released in November, Asda sales had decreased 5.8% an improvement from the 7.5% drop in the second quarter.
Walmart releases its fourth-quarter earnings on Feb. 21, analysts are forecasting a decline in sales of 2% to 3% in the quarter.
Asda is the U.K.'s No. 3 supermarket behind Tesco (TSCDY) and Sainsbury's (JSAIY) with Morrisons (MRWSY) rounding out the top four, together the group is known as the "Big Four".
