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Asos releases first-ever economic impact report

By Danielle Wightman-Stone

17 Jan 2022

Business

Image: Asos

Asos is set to boost the UK economy by 3.8 billion pounds and support an additional 25,000 jobs within the next four years, according to the online retailer’s first-ever economic impact report.

The online retailer’s total economic impact in the UK grew to 1.8 billion pounds in 2019-20, providing vital support to UK GDP at the height of the pandemic, adds the report conducted by Oxford Economics to mark Asos’ 21st birthday.

The research adds that with Asos’ plans to reach 7 billion pounds in turnover in the next three to four years, it will further boost the retailer’s impact in the UK, with GDP contribution estimated by Oxford Economics to increase by 2 billion pounds to 3.8 billion pounds.

For every 1 pound in GDP generated directly by Asos in the UK, the online retailer creates 2.80 pounds in other parts of the UK economy and adds 9 pounds to the global economy.

With this boost in additional GDP contribution, the report states that Asos could add up to 25,000 new jobs, bringing the total number of jobs supported by Asos in the UK to 57,000.

Asos supported more than 31,000 jobs across the UK in 2019-20. It directly employed over 3,600 employees, with every direct Asos employee supporting 7.7 jobs elsewhere in the country, including within its own supply chain.

Image: Asos

Asos to boost the UK economy by 3.8 billion pounds and support an additional 25,000 jobs across the UK within the next four years

Mat Dunn, chief operating officer at Asos, said in a statement: “Since Asos began over two decades ago, we’ve grown from a tech start-up with just a handful of employees to become a truly global business, directly employing over 3,000 people. As we’ve grown in size and scale our economic and social impact in the UK has also dramatically changed, which is reflected in this new report from Oxford Economics.

“We’re incredibly proud of the positive impact Asos has on the UK’s society and economy – this is testament to the skill, dedication, and hard work of the ASOS team. As we continue our journey to reach 7 billion pounds of annual revenue, we’re looking forward to seeing how ASOS’ contribution to the UK will further grow.”

Asos’ procurement and apprenticeship hires contribute to the levelling up agenda in the UK

The online retailer also notes that in addition to supporting national and international GDP and jobs, it is also contributing to levelling up and upskilling across the UK. This is evident through spending 814 million pounds with UK suppliers, with 25 percent of this expenditure spent in 40 of the “most deprived” English local authority areas, such as Barnsley, and 21 percent in areas allocated to the highest-priority group for the Levelling Up Fund.

In the report, Dunn added: “Our economic footprint extends into other areas of the UK economy beyond retail, too: from our significant investment in transportation, warehousing, and logistics to our spend with technology and services partners and product suppliers within the UK.

“In fact, as this report by Oxford Economics shows, in our 2020 financial year UK suppliers accounted for about a third of all our procurement spend, with around a quarter spent in the most deprived parts of the country.”

Image: Asos economic impact report infographic

The online retailer is also committed to raising the skill levels of young people in the UK, through its participation in the UK Government’s Apprenticeship Scheme, and its partnerships with UK universities. As of August 2021, there were 187 Asos apprentices, equivalent to 59 apprentices per 1,000 employees, which is 40 percent higher than the industry average. For these current Asos apprentices, a total of 1.5 million pounds has been or will be invested in their training.

Asos Marketplace acts as a vehicle for SME growth

Asos is also supporting small and mid-size enterprises in the UK through its Asos Marketplace platform, which gives vintage and independent fashion brands an online space to grow their businesses.

The number of boutiques using Asos Marketplace stood close to 1,400 in May 2021, up from 711 in September 2018. That number increased by 40 percent between March and August 2020 at the height of the pandemic lockdown.

In 2019-20, the UK accounted for 78 percent of sales by value, by location of the seller, but boutiques in another 50 countries also benefited from the facility, adds the report.

Pete Collings, director of economic impact consulting at Oxford Economics, added: “Our research demonstrates the significant contribution that a large and successful British company like Asos can make to the economy, especially the jobs market and the UK’s public finances, as the UK recovers from the deepest economic recession in living memory. Asos provides crucial support for the UK economy across its supply chain and in all regions of the economy, including levelling up priority areas.”

In addition to its contribution to the UK economy and society, Asos also supports a significant volume of economic activity overseas, as 70 percent of its total supplies by value are sourced from abroad. This generates GDP and tax revenues globally and provides jobs across the EU, US, Asia and beyond. Combining its UK and international impacts, Asos’ activities supported a total of 4.7 billion pounds of GDP, 165,000 jobs, and 1.7 billion pounds of tax revenues in 2019-20.