How logistics can make you billionaire: the Asos case by Eva Cardenas

How logistics can make you billionaire: the Asos case

Asos, founded in London in 2000, is a global online fashion and beauty company that sells more than 850 brands as well as its own range of clothing, and that nowadays is worth over a billion dollars. This company is a clear example of how a good investment in efficient logistics and shipments system can make you go from just another standard company to a market-leader one.

Their mission is to make sure everything is delivered on time and in perfect conditions in an ever-changing environment – so customers can buy what they want, where they want, when they want it. They own a warehouse big enough to fit six football pitches from where they ship more than 24 million garments every year, that are fully tracked during the process, and that arrive to every part of the world.

To do so, Asos has a Delivery Solutions team that makes sure that every item is delivered on time and in perfect condition. They do not only offer to the UK customers a variety of delivery options, but also deliver to nearly 200 territories worldwide. And, with over 250,000 parcels handled every week, they’re always looking for new and innovative ways to improve the way they do things, building strong relationships both internally and externally, as they work in partnership with Unipart Logistics to help them with this process.

Some of the main shipments options Asos offers are the following:

• the Standard Delivery, where your delivery is within 3-5 working days since you submit your order.
• the Next day Delivery; where your product is ready the next day if ordered before midnight.
• the Click&Collect Delivery service, where your order is placed to a selected store, you can collect your order at your convenience.
• the Precise Delivery service, where you can choose an exact day and hour to deliver your product within 10 days in advance.

But now the main objective of Asos is implementing the Same-Day Delivery option, the next evolutionary step in parcel logistics that is already being offered in some major companies as Amazon.

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Right now they only have available this Instant Delivery service in some London postcodes and at a cost of nearly 13$, which is quite high taking into account that a market survey about the topic showed in 2013 that more than 70% of European consumers would be willing to pay just about 3-4€ for a standard parcel. According to this study, consumers seem to perceive same-day delivery as attractive only if it costs less than 7-8% of their total basket value.

Some of the advantages this same-day delivery can bring to online retailers are the improvement of their position versus stationary retailers, as a reduced delivery time will make their products almost immediate and makes them a better choice thanks to their higher convenience (you don’t even have to leave home to get them), and in most cases, thanks also to the lower prices online shopping provides, which makes them more appealing.

This is a clear example of how good companies shouldn’t set up even if they already have an efficient logistics system. We live in a fast-forward world that is changing constantly, and companies need to do the same to keep up with consumers needs and maintain their number one position.