Asda has appointed David Potts, the former chief executive of Morrisons, as its group chief executive with immediate effect, handing day-to-day control of the UK’s third-largest supermarket to a turnaround specialist two years into a five-year recovery plan.
Allan Leighton, who had combined the chairmanship with executive leadership since 2024, returns to the role of non-executive group chairman as previously planned.
Why the change has been made
Asda employs 116,296 people and has lost market share to Aldi and Lidl for most of the past decade. Leighton said the past two years had stabilised the business, returned it to some growth and begun establishing Asda as more than a supermarket through its Formula for Growth strategy.
The company has invested in price, in its own-brand ranges and in convenience stores, and it has refurbished stores at a pace its predecessors did not attempt. The results have been mixed: customer numbers have recovered in some regions, but the discounters have continued to open new stores and the gap in price perception has not closed.
Potts, 69, led Morrisons for nine years and is credited with improving store standards and availability after a period in which the chain had lost its way. He said significant opportunities remain and pledged improvements to the weekly shopping trip, with a focus on keeping Asda prices low over Christmas.
What the job involves
Asda’s ownership structure is unusual. It is controlled by the Issa brothers and TDR Capital, and its balance sheet carries the debt from the 2021 acquisition, which has become more expensive as interest rates have risen. That constrains the money available for investment and puts pressure on the company to generate cash from its stores.
The new chief executive inherits a business that is large, cheap and popular with families, but operating in a market where the two fastest-growing competitors run simpler, lower-cost models. Matching them on price without matching their cost base is the central problem.
Store standards and availability are the areas where a new leader can move most quickly. Customers who cannot find what they came for do not return, and the effect on sales is immediate.
What the analysts expect
The Institute of Grocery Distribution’s senior analyst, Alex Rowberry, said the first 12 months will be less about catching up and more about giving shoppers compelling reasons to choose Asda. That is a realistic framing: the company is unlikely to close the gap with Tesco and Sainsbury’s quickly, and it does not need to in order to be viable.
The wider grocery market is entering its most important trading period. Christmas determines a large share of annual profit for the supermarkets, and price positioning during December shapes perceptions for the following year.
The context
The appointment comes as the grocery sector faces renewed questions about consolidation, with reports of merger talks between two of the largest chains and a suppliers’ body asking the competition regulator to examine buying power in the market.
Asda is not part of those discussions, but it would be affected by any deal that created a larger competitor. A combined rival with a quarter of the market would have more purchasing power and more ability to fund price cuts.
For Potts, the task is familiar in outline and different in detail. Morrisons was a listed company with an investment-grade balance sheet when he took over. Asda is privately owned, heavily indebted and under pressure from two discounters that did not exist at scale when he began his career.
