Asos unfazed by Berlin warehouse blaze

Asos has kept operations running smoothly after its German distribution centre was hit by a fire last week, and industry sources have expressed confidence that the business has suffered minimal damage.

The etailer said stock valued at £6.3m could be compromised after the fire broke out in one of four chambers in the first phase of development at its Eurohub 2 facility in Berlin in the early hours of last Monday.

Customer orders were rerouted to its warehouse in Barnsley, South Yorkshire.

None of the technology, automation or structure of the building was affected by the blaze. The business said it is fully insured for loss of stock.

Industry sources were confident brand relationships will not suffer as a result of the incident.

One agent said: “Every line is duplicated, and still dispatched to Barnsley, so I don’t think the fire would have made much of a difference.

“I think Barnsley would have been able to react quite quickly to maintain Asos’s promises of a 24-hour delivery service. As long as operations haven’t affected its services, it isn’t the end of the world.”

Independent analyst Nick Bubb agreed the fire would not have a lasting impact for the etailer: “It’s probably not a big deal in the long run. Share prices barely moved after the incident.”

Kantar Retail senior fashion analyst Anusha Couttigane said the blaze will have minimal impact on Asos’s finances, but customer perception remains an unknown factor: “It seems, at this stage, that the damage was relatively contained, but Asos has yet to declare the full extent [of the damage].

“With no damage to the infrastructure of the facility and the stock covered by insurance, the cost could well be absorbed in time. What’s harder to calculate is how this will impact future orders if customers think their shopping is at risk.”

Couttigane added: “It will also be a hassle for brands stocked at Asos to have to replace those orders, given the fast-paced nature of the business, so they may have to do some damage control, such as ensuring those brands affected are given special attention in marketing and promotions on the platform to make up for it.”

Asos moved into the Eurohub 2 Distribution Centre in March.

The warehouse fire marks the third blaze for Asos in 12 years, after a high-profile incident damaged its main distribution hub in Barnsley in 2014. The suspected arson attack caused losses of between £25m and £30m.

Asos’s Hemel Hempstead warehouse was damaged by explosions at the Buncefield fuel depot in 2005.

In its most recent results Asos sales increased 37% to £911.5m for the six months to 28 February, while pre-tax profit rose 14% year on year to £27.3m.

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