Asda faces a legal wrangle with Waitrose after unveiling a new £45m cut-price grocery range with a similar name to its pricier rival’s established discount brand.
Waitrose, which has used the Essential Waitrose brand for about 13 years, said it had sent a legal letter to its bigger rival over its new brand name Just Essentials by Asda on Monday.
“We were surprised to hear that Asda is launching an essentials range as the Essential Waitrose brand has been in use since 2009 and has built up a strong reputation for value, quality and higher welfare standards in that time,” said a spokesperson for Waitrose, which is part of the employee-owned John Lewis Partnership.
“As we’ve also protected the name as a trade mark, we have raised this with Asda and are awaiting a response.”
An Asda spokesperson said: “The word ‘essentials’ is a generic and commonly used term by retailers to describe their value product ranges.”
Asda, which was criticised by food campaigner Jack Monroe over shortages of its cheapest items, is launching the cut-price range of 300 items from May after announcing a 42% surge in profits. It will cover household essentials such as toilet roll and shampoo as well as fresh meat, fish and poultry, frozen items and cupboard staples such as tinned tomatoes.
The retailer, which said it has hiked supermarket prices by about 5% as it wrestles with rising food inflation, said the full range would be available in all its 581 stores and online and would eventually replace its existing Smart Price budget range.
In its first full year of ownership by petrol station tycoons Mohsin and Zuber Issa, Asda said sales rose just 0.6% to £20.4bn in the year to 31 December 2021 but profits swelled 42% to £693.1m, which it said was mainly down to cutting pandemic costs. The supermarket struggled to beat strong sales in 2020 when families were forced to stock up for home cooking as restaurants, bars, cafes and many workplace and school canteens were closed for long periods.
Asda said its uptick in sales for the year was driven by strong trade in homewares, garden kit and clothing after pandemic-related disruption in 2020. However, the retailer is also facing increasing competition from fast-growing discounters Aldi and Lidl, which continue to open stores and have stolen Asda’s crown as the cheapest option on many groceries.
Asda’s sales were particularly poor during the busy Christmas period, falling 2.9% in the final three months of the year on the same period a year earlier. That performance compares with a 0.6% rise in sales at Tesco and strong growth by Aldi and Lidl over a similar period but is better than rival Sainsbury’s 5.3% fall in sales over the Christmas quarter.
Mohsin Issa said he hoped its new cut-price range would help Asda overtake Sainsbury’s to reclaim its position as the UK’s second-biggest supermarket, behind much bigger rival Tesco.
“We understand that customers are increasingly worried about the cost of living and want help to keep their grocery bills in check, while still being able to buy healthy and nutritious food for their families,” he said in a statement.
“Our new ‘Just Essentials’ range has been specifically designed with this in mind, combining our lowest prices with a much larger and more diverse range of great value products to meet all household needs.”
The Issa brothers, who made their fortunes building the EG Group petrol station empire, bought a majority stake in Asda in a £6.8bn deal that completed last year. US retailer Walmart, which had controlled Asda since 1999, retains a minority stake and a seat on the board.
The Issas have opened 31 Asda convenience stores in partnership with EG Group and have also injected their food service brands including Leon and Cinnabon to 17 Asda stores as a way to increase their attractiveness and use up spare space.
