Nursery Today magazine

Morrisons ousts chief executive

Boss to leave after poor Christmas sales

A slump in Christmas sales has forced Morrisons chief executive Dalton Philips out of his job.

The announcement came as the supermarket giant revealed that total sales excluding fuel were down by 1.3 per cent in the six weeks to 4 January and like-for-like sales excluding fuel down had fallen 3.1 per cent.

Phil Dorrell, director of retail consultants, Retail Remedy, commented: “If other members of the Big Four supermarkets are the squeezed middle, Morrisons is being steamrollered flat. The departure of its chief executive was grimly inevitable.

“With the most dated stores and weakest business strategy of the old guard grocers, Morrisons has haemorrhaged both sales and share to the brash young discounters who took its cheap prices USP, improved it, and then unceremoniously yanked the rug from underneath it.

“Despite a big improvement on a disastrous Q3, Morrisons's like-for-like sales continued to plummet over Christmas.

"The biggest surprise in these grim results is the decision to close just 10 stores. The brand's property portfolio is one of few 'get out of jail' cards - and it is busy playing it by unloading up to £500million of property assets this year.

"Other props for the stumbling business are few and far between. It has finally completed a million internet orders, but Morrisons is so late to the online party that its rivals have already polished off the cheese course, leaving it hovering awkwardly by the door. Trumpeting its on-time delivery stats is a distraction in a business which has to be first and foremost about volume.

"Falling sales is not the biggest issue, rather the problem is that its sales are falling much faster than those of Sainsbury's and even Tesco. Dalton Philips will be relieved not to face another bruising AGM; last time he was heckled by his own chairman.

"Despite its multiple problems, Morrisons remains a solid business - or at least it would be if it could get its offer right. It just needs some real muscle to convince people it is attractive again. The marketing over the last few years has been dire, and has done nothing to change its tired public image. The brand needs to be much bolder if it is to recapture the distinctive market niche that it created and then lost."

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