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Dear Xxxx
Thank you for your email.
Returns are one of the biggest costs faced by ASOS. During covid we saw our return rates decline for a number of factors including change in behaviour, and a mix into more casualwear products, which have a lower returns rate compared to formalwear. With a return to normality, we have naturally seen our return rate increase back to pre-pandemic levels, which was expected, as customer demand shifted back into formalwear and tailoring and out of casualwear products.
Some level of returns is, of course part of doing business for an online retailer. Key to making the cost of processing returns sustainable is to grow our basket size, and we disclosed at our H1 results on 10th May, that our average basket value increase +5% on a constant currency basis (and +8% on a reported basis) versus the prior year.
We are working to reduce our return rates and costs. Some of our initiatives include strictly enforcing our 28 days returns policy, consolidating customer returns, improving size and fit information on our website, as well as addressing “serial returners”.
In our half year results, we mentioned that we have identified a small group of customers that have a disproportionately negative impact on our profitability. This group accounted for 6% of our active customers in FY22 and generated a loss of c£6 per order due to heavily reliance on discounted product, a high return rate, and high frequency rates. We are refining our approach, focusing on using a personalised approach to incentivise positive behaviour, and improve the profitability of this customer cohort. However we are, of course, looking at initiatives that address our returns rates, as a whole, rather than just the return rate of specific customers.
We welcome feedback from our customers and shareholders, and I will pass on your suggestions to the relevant team.
We are grateful to all our shareholders and would like to take this opportunity to thank you once again your ongoing support.
Many thanks,
GP7 I am not a holder here but ave interest in the company next door 8 and also in the one you are in U**.
Its sad to see people like you knock other shares when the one you’re in ain’t no different (All talk). Lets no knock other companies and peoples investment. Karma is always watching. Be nice dude!!!