Asos to mothball US distribution centre
By Abigail Townsend
Date: Wednesday 15 Jan 2025
(Sharecast News) - Asos is to close its Atlanta distribution centre as part of an overhaul of its global network, the fast fashion retailer confirmed on Wednesday, at a cost of nearly £200m.
The London-listed firm said the bulk of US orders will now come from its UK fulfilment centre in Barnsley from the second half onwards, supported by a "smaller, more flexible" American site.
It will therefore mothball its Atlanta distribution centre.
Asos said the move would give American shoppers "an enhanced product offering...while offering competitive delivery speeds and lowering the total fulfilment cost per order".
It is expected to benefit annualised earnings by £10m to £20m from 2026. However, the overhaul will also occur one-off charges of around £190m, which Asos said it would take in the current financial year, "resulting in a corresponding negative impact on reported profit".
The company's US arm has faced stiff competition from brands such as Shein in recent years, as well as a global inventory surplus.
However, Asos said in the last two years it had reduced stock levels by around 50%, launched a new commercial model requiring lower inventory and "successfully transformed the US into a profitable market".
It continued: "Asos remains excited about the opportunity in the US market and believes that its new operating model will better serve its US customer base while generating a better return on investment.
"Asos opened a local US office in 2024, and will continue to grow and build its local presence, which it sees as crucial in building greater customer experiences."
Last year, rival fast fashion online brand Boohoo announced it too would cease using its US distribution centre, a year after it first opened.
Its US customers are now served through its UK distribution centre.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN