Not so fast! Supply bottlenecks strain fashion chains


LONDON/LOS ANGELES Oct 13 (Reuters) - Supply bottlenecks, slower product deliveries and higher freight and labour costs risk shifting the fast fashion industry into the slow lane, as shown this week by British online fashion retailer ASOS (ASOS.L).

A business model that aims to bring new styles into stores every three or so weeks and where shoppers expect to see fresh, reasonably priced merchandise on each visit is discovering its limitations.

"When it comes to fast fashion, it's all about being first to market," said Gus Bartholomew, CEO and co-founder of SupplyCompass, a London-based firm that specialises in product development and delivery software for fashion brands.

"What we're seeing with most brands is that they're all still massively struggling with visibility and control around delivery certainty - knowing when things are going to be delivered and when things might be likely to go wrong and how that will actually impact them."

Shares in ASOS fell 16% on Monday after it warned annual profit could fall by more than 40% this year, partly because it expects delays in getting stock from partner brands to persist into next year.

Less than two weeks before rival Boohoo(BOOH.L) warned its full year profit would be dented by higher freight costs.

Attention will focus on Thursday on Fast Retailing (9983.T), the Japanese parent of Uniqlo, when it reports quarterly financial results.

The company said in late September that its clothing releases will be delayed due to COVID-19 lockdowns at partner factories in Vietnam.

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