M&S snaps up Asos warehouse as it seeks to double online sales

Marks & Spencer has snapped up a giant warehouse from Asos as it seeks to double online sales.

The retailer said that it will create 600 jobs after agreeing to buy a distribution centre in Lichfield from the online fashion group for £67.5million.

The 437,000 square foot site was mothballed by Asos in 2023 as it cut costs while grappling with a downturn in demand from young shoppers.

But now M&S says it will be ready to start processing fashion, beauty and homeware orders there from 2027 – as it seeks to boost its online business.

The High Street chain has already increased its efforts to compete with fast fashion rivals by speeding up how quickly clothing ranges are refreshed in its shops.

In March, the group said it was beginning to bring between 20 and 30 new outfits into its branches every month.

This saw M&S echo a similar venture taken by rival Zara – owned by Spanish clothing group Inditex – of selling smaller lines that sell out rapidly.

M&S managing director for fashion, home and beauty, John Lyttle, said the retailer’s distribution network ‘needs more capacity’ for it to achieve its ambition to double online sales.

The former Boohoo boss added: ‘We’ve always said that we’ll deliver our transformation with highly disciplined capital investment, always mindful of spending shareholder money wisely. 

‘This acquisition does just that, delivering tangible business benefits that move our transformation forward, at a much lower cost compared to a new build option.’

M&S lost out when a cyber-attack at Easter last year left it unable to sell products online for nearly two months, prompting some shoppers to turn to rival fashion group Next instead.

But chief executive Stuart Machin has since declared the worst is behind the retailer.

Under Machin’s leadership, M&S has seen its clothes storm back into fashion after years in the doldrums, with campaigns fronted by Sienna Miller and Gillian Anderson.

The business said in November last year that online sales make up nearly 50 per cent of its fashion, home and beauty sales. 

It is due to update the City on its recovery from the cyber attack and wider turnaround in its full-year results next week.