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Morrisons' new boss turns to son of founder to aid recovery

Published 15/05/2015, 11:50
© Reuters. People walk beneath a sign outside a Morrisons supermarket in Liverpool, northern England
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By James Davey

LONDON (Reuters) - David Potts, the new chief executive of Morrisons (L:MRW), has sought the counsel of the British supermarket's octogenarian former boss Ken Morrison as he seeks a formula to turn around the business.

Ken Morrison, 83, the son of the grocer's founder, ran Bradford, northern England-based Morrisons for half a century before stepping down in 2008 with the title of honorary president. His wider family own about 10 percent of Morrisons' equity.

Ken Morrison said on Friday he had so far toured about 10 Morrisons stores with Potts, a former Tesco (L:TSCO) executive who succeeded the sacked Dalton Philips as CEO on March 16.

"It's simply just going round some stores ... comparing notes and hopefully helping a little to bed him (Potts) into the business," Morrison told Reuters.

"If I can help at all, I'm more than delighted to," he said.

Morrison was a fierce critic of Philips, standing up at last year's annual shareholders' meeting to lambaste his strategy as "bullshit".

In March Morrisons reported its lowest profit in eight years and said it would cut its dividend. In common with rivals Tesco, Asda (N:WMT) and Sainsbury 's (L:SBRY) it is battling record food price deflation and waging a price war to stem the loss of shoppers to discounters Aldi [ALDIEI.UL] and Lidl [LIDUK.Ul].

Morrison said Potts had made a good start to the job, praising his move to add 5,000 shop floor staff to improve customer service.

"He's done very well in getting the density of staff in stores increased. That's a good move which has worked very well for morale in the stores," he said.

Morrison also welcomed Potts' decisions to bring back staffed express checkouts and jettison the previous management's computerised queue management system and misting machines for vegetables.

"A lot of jobs need doing and he's tackled them head on I think. Some of them will take a little more time to resolve ... There are policies to be established and routines to be sorted."

Last week, when the grocer reported another fall in quarterly sales, Potts said he would present his plans for the business in September.

At the time Potts told reporters he was able to call on the wisdom of Ken Morrison but did not give any details.

© Reuters. People walk beneath a sign outside a Morrisons supermarket in Liverpool, northern England

Shares in Morrisons, down 12 percent over the last year, were up 0.4 percent at 179.9 pence at 1010 GMT, valuing the business at 4.2 billion pounds.

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