The relocation by Asda's Chief Operating Officer (COO) to parent company Wal-Mart may not have grabbed the headlines in the supermarket industry on Friday, but one analyst believes that the move has positive read-through for Asda's rivals in the UK.
Judith McKenna, who has worked for Asda for many years, took up the COO position in July 2011 but is to move to Bentonville, Arkansas, to work as Wal-Mart's Executive Vice President Strategy and International Development.
Asda, one of the Big Four supermarkets in the UK (with Sainsbury, Morrisons and Tesco), had a 17.3% market share in the 12 weeks to December 23rd, down from 17.5% a year before, according to data this week by Kantar Worldpanel.
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Analyst Dave McCarthy from Investec's Investment Banking & Securities division said this afternoon that he regards McKenna as "top drawer", so while this is a loss to Asda, it is good news for the competition. "We credit her with some significant improvements at ASDA, as well as her keeping a tight financial control of that business," McCarthy said.
"Judith oversaw the successful conversion of Netto stores to ASDA (these stores have reportedly doubled sales) and is held in high esteem in the trade. Many suppliers have commented on the improvements to in store standards since her appointment to COO. Ms McKenna is one of a rare breed, a Finance Director that understands retailing and is in touch with the consumer."
He said that Wal-Mart appears to share this opinion too and could be prepping her for "bigger things in the future".
McCarthery said the impact of her departure from Asda "will not be obvious nor immediate, but as we have said before, judge a decision on how the competition view it.
"We believe that Asda's competitors will be pleased to see McKenna depart for the US, so bad news for ASDA, good news for Morrisons in particular."
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