Walmart Inc.'s U.K. supermarket chain Asda plans to expand online grocery shopping capacity over the next year with up to 1 million grocery pickup time slots per week.
Asda, which Walmart is reportedly shopping to investors, saw online sales double in its second quarter despite the U.K. being on lockdown because of the coronavirus pandemic during much of that period. The performance mirrored its parent company, which said Tuesday that its e-commerce sales grew 97% in the second quarter.
Further, curbside pickup of grocery orders placed online, sometimes called click and collect, quadrupled in the quarter, Asda said in a news release. The company's transactional data showed most of these customers were new to Asda.
To meet the growing demand, Asda has increased its pickup capacity by 65% to 700,000 weekly slots since March, the company said. It plans to add another 40,000 slots per week by the end of the year and has set a goal to reach 1 million weekly pickup slots in 2021.
Roger Burnley, Asda president and chief executive, said in the release that the pandemic "has created a structural shift in customer behaviors toward grocery shopping."
"We have accelerated our online capacity expansion to meet levels we had anticipated reaching in eight years within a matter of weeks and we will continue to expand this offer," Burnley said.
According to research firm Kantar Worldpanel, Asda had the fastest-growing market share of any online grocery retailer in June. With 631 stores, Asda has been the U.K.'s third-largest supermarket chain by sales for several years, behind Tesco and Sainsbury's.
Asda's second-quarter same-store sales, excluding fuel, grew 3.8% over the previous year. Same-store sales, or sales at stores open at least a year, are considered a key indicator of a retailer's health.
Net sales fell 5.3%, largely because of reduced demand for fuel as travel was curtailed.
Doug McMillon, Walmart's president and chief executive officer, said in a call with investors Tuesday that "Asda's performance demonstrated the resilience of the business with growth in a challenging period."
In addition, Brett Biggs, the Bentonville-based retailer's chief financial officer, said in the call that Asda's same-store grocery sales grew faster than the market. Customers are responding favorably to expanded e-commerce offerings, he said.
Walmart confirmed in July that it had resumed talks with potential investors interested in acquiring a stake in Asda. Walmart agreed in 2018 to sell Asda to Sainsbury's for about $9.4 billion based on currency exchange rates at the time.
However, British regulators rejected the proposed sale in April 2019. The Competition and Markets Authority said in its ruling that the merger of the chains would decrease competition.