Asos shuts down Atlanta warehouse as part of major US restructure
- Asos will cease operations at its Atlanta warehouse to optimize US distribution.
- The closure will impact seven Asos employees directly, along with transportation workers from logistics partners.
- The decision is part of a larger turnaround effort to improve profitability and service in the US market.
Online fashion retailer Asos has announced the closure of its distribution center in Atlanta, Georgia, as part of a broader strategy to optimize its operations in the United States. Asos achieved profitability in the US market during the financial year ending September 2024, prompting the decision to mothball the Atlanta facility. Orders will now be processed from Asos' existing warehouse in Barnsley, South Yorkshire, along with a smaller, flexible site in the US. This strategic realignment is expected to enhance product availability and improve delivery efficiency for American customers. This operational change will directly affect seven employees based in the Atlanta warehouse, along with many logistics workers employed by third-party partners. To mitigate the impact of these layoffs, Asos has stated its intention to offer alternative roles to affected staff members wherever possible. Moreover, logistics partners are looking to redeploy their employees to other nearby facilities, reflecting the group's commitment to support the workforce during this transition. Despite the warehouse closure leading to an impairment cost of approximately £190 million in the 2024-25 fiscal year, Asos anticipates a financial turnaround, predicting a boost in pre-tax earnings ranging from £10 million to £20 million by 2025-26. The company explained that these changes will streamline operations, reduce costs per order, and, ultimately, provide a better shopping experience for customers in the US market. Asos's moves come in the wake of its recent financial struggles, which saw the company report substantial pre-tax losses for the year, amounting to £379.3 million. Market challenges, including a significant overstock issue, have prompted drastic measures as CEO Jose Antonio Ramos Calamonte aims to guide Asos back to profitability. The group's commitment to enhancing its presence in the US market remains steadfast, bolstered by the opening of a local office in the previous year. Through this realignment, Asos hopes to deliver superior service to its American consumer base and reignite growth in a competitive retail landscape.