// Asos has had cover for its suppliers pulled amid concerns about falling profits
// The retailer said the move “has not seen any adverse impact on trading relationships” with suppliers
A major credit insurer has reduced its cover for Asos’ suppliers following concerns about the retailer’s recent drop in profits.
Atradius withdrew some of its cover a few weeks ago after the online giant posted an 8% drop in UK sales and 3% fall in group sales in the four months to 31 December with further losses expected in the first half of 2023, Drapers reported.
The online retailer has cut office space, closed down warehouse storage and cut 35 unprofitable brands from its site in a bid to save £300m through cost mitigation measures.
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Commenting on the recent credit insurance cut, Asos told the publication it “has not seen any adverse impact on trading relationships with our suppliers due to changes to cover”.
“We stated in our latest trading update in January that we have retained financial flexibility with cash and undrawn facilities of circa £430m.”
Atradius UK underwriter manager Owen Bassett said: “We are unable to comment on the details of policies related to specific businesses in order to protect the confidentiality of our customers, but we continue to underwrite firms on a case-by-case basis.”
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