Boohoo looks to cut supply chain costs asking for supplier discounts

Online fashion retailer Boohoo has asked for a 10% discount on both delivered and undelivered clothing in a bid to cut costs in its supply chain.

One supplier, who spoke to The Times, claims it had received a call from the retailer yesterday “demanding” a discount on all outstanding orders.

“It turns all orders produced into losses,” the supplier said. “This is major self-harm. They are struggling to find suppliers and now they are screwing the ones they have.”

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The move follows the group facing backlash from suppliers and manufacturers after the company extended its payment terms from 30 days to 60 days.

Earlier this year, Boohoo reported a 11% drop in revenues to £637.7 million in the three months ended 31 December, blaming strong year-on-year comparatives and extended international delivery times to the fall.

UK revenues dipped by 11% year-on-year, with US revenues falling 17% to £129 million and international sales declining 10% year-on-year.

However, according to Boohoo CEO John Lyttle, the slip in revenue “reflects the normalisation of the channel shift online over the last 12 months.”

Boohoo features in RetailX 2023 European Fashion Sector Report, click here to download.

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