Asos surges past expectation during the Pandemic

Asos, an online fashion group, is one of the few retailers that benefit from the lockdown in this pandemic. For a long, long time, e-commerce has been growing,”, Said chief Executive Mr. Beighton.

“What we’ve seen over the last 12 months is a step-change in e-commerce as a mix of total sales. So we don’t think this is a high point, e-commerce is here to stay, but it can sit happily alongside stores.”

In the company’s results statement, Mr. Beighton said he was “delighted” with the “exceptional first-half performance”.

“Looking ahead, while we are mindful of the short-term uncertainty and potential economic consequences of the continuing pandemic, we are confident in the momentum we have built and excited about delivering on our ambition of being the number one destination for fashion-loving 20-somethings”

Asos, in the past six months, has added about half a million customers totaling up to 24.9 million. Sales also rose by 24% leading up to February 28, with profits rising to $106.4 million compared to $30.1 million last year. In the UK, sales have increased by 39%.
This increase in sales has resulted due to the company’s shift to casual clothing and beauty products. The normal target audience for Asos is usually teens in their 20s, that bought clothes for outings and parties. But since COVID restrictions don’t allow outings in most countries, the change to casual wear has certainly helped the company.
Mr. Beighton , during a conference call, said that there had been a lot of emphasis on casual wear during the lockdown which has helped the company in this pandemic. However, he also said that the company expects to return back to occasion wear once the lockdown restrictions have eased up.

With that being said, Asos is still very careful about this short-term plan due to the unsettled economic projections of its youthful audiences. However, the company added that “well-positioned to capture demand for an event-led product when lifestyles normalize”.
Arlene Ewing, Brewin Dolphin’s investment manager, said that the company had surpassed the analysts’ predictions on profits.
“The business is in great shape, with cash on its balance sheet and the acquisition and integration of brands such as Topshop yet to be fully reflected in performance,” she added.

“With greater geographical diversification and investment in customer fulfillment over the last year or so, Asos is in a very strong position – a fact demonstrated by the more than 400% increase to its share price since the start of the pandemic.”

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