boohoo group plc has announced a fundamental change to its operations in the US market.
The Manchester-headquartered eCommerce fashion retailer is broadening its product offering for customers Stateside by ceasing to supply them from its US distribution centre in Pennsylvania.
It will now fulfil all US orders from its automated UK distribution centre in Sheffield.
The move follows a recent trial of increasing the product range offered to US consumers by also fulfilling from the UK, which it says has led to encouraging results.
Before the trial, US consumers were being offered only around 60% of the styles on sale in the UK.
It also plans to expand its routes to market.
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“The group remains excited about the opportunity in the US and has been developing wider routes-to-market strategies, the first of which is the recent launch of Nasty Gal in Nordstrom stores,” read a notice to the London Stock Exchange.
“The group is also in advanced talks with major US brands with regard to new routes to market for other brands within the group.”
The moves are described as the latest steps in the firm’s strategy to reposition for sustainable, profitable growth.
It said they will result in a write-down on the group’s balance sheet against the investments and costs associated with the US operation as well as certain one-off exceptional cash costs.
“Importantly, these changes will result in a significant reduction in ongoing costs over the medium term,” boohoo added.