ASOS & UK Fast Fashion Manufacturing and Supplier Operations

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Why was the fit so poor for ASOS that it drove returns?

They had multiple product categories. Traditionally, there were dresses, tops, and going-out dresses. However, they started to blur these categories. So, you would have day dresses, going-out dresses, and casual dresses. Each product had different garment techs and sizes were not standardized. This lack of standardization spiraled out of control. Because they were successful, everything they sold was selling, at least for a while. It didn't matter that returns crept up to 70%. This didn't happen overnight. People often say 40% is an average return rate, but I'd argue it's closer to 50%. Half of what you sell comes back because people are buying multiple sizes. There were many issues with fit. They also started to reduce prices too much, resorting to inferior fabrics. We use viscose elastane which should be about 220, but they were accepting garments at 180 to meet their price point. This is what we call engineering into price.

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Let's go back to the fitting and organizational problems at ASOS. How have you seen the buying function change over the years?

Over the past few years, the heads have become more powerful, reducing the control of the buyers. A new lady, Elena, has come in. Initially, I wasn't sure about her, but she's proven to be very competent. If given the responsibility and authority, I believe she can make a difference. I think ASOS did well under Nick, who was a genuine leader and very inspiring. He's now a sought-after consultant. I don't think José has the same reach or authority as Nick, although I've heard he's a good guy with impressive credentials from Inditex. However, the leap from Inditex to ASOS must have been huge, especially during difficult times.

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