LONDON – UK online fashion retailer Asos has reported larger-than-expected losses as shoppers cut back on spending amid the cost of living crisis. The company’s latest results show an £87.4m loss in the six months to the end of February, compared to a profit of £14.8m in the same period last year. Asos said trading has been “very challenging.” Sales in the UK are down 10 per cent, and 7 per cent in the US.
One notable take from the company’s latest results is the impact of product returns. Asos states that a “small number of customers” are having a “disproportionately negative impact on Asos’ profitability.” In fact, Asos says this small number is 6 per cent of its customer base of 25 million – equating to 1.6 million people. With Asos estimating its loss per order as being around £6 (this seems on the optimistic side to us) the scale of this problem becomes apparent.
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