Asda shoppers cut spending on clothes as households squeezed

SHOPPERS have been cutting back on clothes amid the tightest squeeze on incomes since the financial crisis, Asda said.

The supermarket chain recorded a steep fall in clothing and general mer- chandise sales in the three months to the end of March, compared with last year.

It came as households’ disposable income dropped by £40.38 each week in April, the largest fall since its income tracker was launched in 2008.

Lord Rose, the former boss of Marks & Spencer who now chairs Asda, warned of long-term inflation and “significant price increases that are going to have a dramatic effect on those people who are less advantaged”.

“Those who are on lesser incomes have to make very tough choices,” he added. “We are seeing people now who are telling us they are worried about making their budgets meet.”

Asda shoppers have been buying less food as well as switching to own-brand products to save money.

The grocer, owned by the billionaire Issa brothers, posted a 9.2pc fall in likefor-like sales, excluding fuel, to £4.6bn during the period, compared with last year when restrictions were still in place. Asda’s food sales fell by 7pc. It recently injected £90m in a new, lowcost range – Just Essentials – and vowed to cut and lock in the price of 100 everyday products until the end of the year.

Mohsin Issa, who runs the grocer, said: “The latest income tracker highlights the stark reality facing millions of families in the UK right now with household incomes more squeezed than ever. We are investing in helping our shoppers manage the challenges of the here and now.”

Lord Rose welcomed the Government’s measures to alleviate the cost of living crisis, but said it didn’t go far enough. “I’m fully in favour of [a windfall tax], it’s a start. To be honest, it could have been done a bit quicker, secondly I don’t think it’s enough. We will find it’s a bit of a sticking plaster.”