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Asos to close UK storage facility and optimise Lichfield fulfilment centre as sales dip


Asos plans to close three storage warehouses, including one in the UK, as it implements a £300m cost mitigation package.

The fast fashion retailer has seen sales drop by 8% year on year in the four months into 31 December, citing “weak consumer sentiment”.

Asos will therefore wind down three “ancillary” storage facilities, one in the UK, one in Europe and one in the US in the second half of this financial year.

It also aims to optimise the use of its Lichfield fulfilment centre to eliminate UK split orders. While, the etailer will also “rationalising” office space and removing 35 unprofitable brands from its platform by the end of the first half of 2023.

José Antonio Ramos Calamonte, chief executive officer, Asos, said: “We are undertaking necessary strategic and operational changes, with our focus shifting from prioritising top-line growth to building a more relevant and competitive fashion business with a disciplined approach to capital allocation and ROI. At the same time, we are working to reinforce our credibility as a leading destination for our fashion-loving customers.

“We have made good early progress against a number of measures to simplify the business, including re-positioning our inventory profile, reviewing our operational model in our top markets and reducing our cost base. While there is more to do, I am pleased by the progress made in this period and am confident in the direction we are going. We retain ample balance sheet flexibility and reiterate our expectations for FY23.”

Asos had previously announced that it will reduce staff costs by 10% in a series of redundancies. But the fashion firm stressed that “significant progress” had been made against its Driving Change agenda, and it expected to see “significant improvement in profitability” in the second half of the 2023 financial year.

The etailer has also invested in technology to streamline its warehouse operations. In November 2022, it announced the introduction of robotic sorting solutions at its Eurohub distribution centre.

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