Asos asks suppliers for three percent discount to cut costs

Asos has reportedly asked suppliers for a discount on its orders as the online giant continues to cut costs.

In a letter sent to suppliers and seen by Drapers, Asos asked for a three percent discount on the prices of all stock it receives after 1 September.

In the letter, Asos said: “We have recently reviewed the current status of our supplier arrangements, also taking into account the significant investments we have made over the last few years and will continue to make, to lay the foundations for future growth.

“We have set our sights on becoming one of the few companies with truly global scale in the market, and we are confident that we will achieve this.

“Our future growth aspirations not only benefit us but also benefit you, our valued partner. We hope you will understand this necessary change and on behalf of Asos we would like to thank you for your continued support.”

For the four months to June 30, total sales at Asos grew by 12 percent on a reported basis and 11 percent on a constant currency basis to 919.8 million pounds (1,144 million dollars). While sales in the UK and ROW remained robust, sales in Europe and the US were held back by “operational issues” associated with the opening of a new warehouse in the US.

Photo courtesy of Asos