Asos [IRDX RASO] launched straight into its summer sale this morning, just a day after it reopened its website for business following a fire that destroyed an estimated fifth of the stock at its Barnsley warehouse.
The fashion website was offline over the weekend after fire broke out at the Barnsley site at 9.50pm on Friday night. But following a clean-up customers were able to place their first orders at 2am yesterday morning. And today the company heralded the start of its summer sale with an upbeat tweet: It’s the first day of the #ASOSSale! *Whistle* On your marks, get set, SHOP. Customers questioning whether the fire would delay orders were given the reassurance that deliveries would arrive by the date stated in their confirmation email.
It’s a fast turnaround from the message displayed on the Asos site over the weekend, when the company, headed by chief executive Nick Robertson, said it had “pressed pause” on the website.
Asos estimates that about 20% of the stock in the warehouse has been damaged by the fire or sprinkler systems. As of May 31, Asos held stock worth £159m, at cost price. Some 70% of its stock is kept in at the Barnsley site. “We are fully insured for loss of stock and business interruption,” Asos said in a statement yesterday morning.
South Yorkshire Police are treating the fire, in which noone was hurt, as arson.
Asos has said that none of its technology, automation or the structure of the building itself was affected by fire.
It’s the second time such an event has hit Asos. In 2005, the company’s Hemel Hempstead warehouse was hit by the explosion of the Buncefield oil refinery. Then the company was forced to stop trading and refund orders and its share price fell in response to the news. This time, it has recovered quickly and while its share price fell yesterday morning when markets opened, Asos is today trading ahead of its pre-fire valuation.
Asos’ £68m capital investment budget for this year includes work to expand its warehousing. Already the company has added 25% extra floorspace to the Barnsley site, previously 1.1m sq ft, which is scheduled to be fitted out in early 2015. The move is designed to increase storage capacity at the site to support sales of £1.5bn. Together with a Eurohub in Berlin, a warehouse in Ohio and one in Shanghai, the company is working to support a sales target of £2.5bn a year.
Norbert Dentressangle won a three-year contract worth £100m to manage the warehouse in 2013. At the time it said 1,200 people worked in the warehouse.