Nick Robertson could be forgiven for thinking he’s been down on his luck.
On December 11, a day before online fashion retailer ASOS’s (formerly As Seen On Screen) busiest week of the year, the company’s only warehouse was partially destroyed by the Buncefi eld oil depot explosions near Hemel Hempstead. The roof was lifted, the doors were blown off and a sprinkler pipe burst drenching £3.8m worth of stock. At the peak of Christmas trading, Robertson was forced to stop taking orders, refund 19,000 orders waiting to be shipped and suspend the companies share price. It remained closed until January 16. In terms of business disaster, does it really get any worse?
A surprisingly upbeat Robertson insists it does – and he doesn’t appear to be just putting a brave face on it. “Personally and from a business perspective we’ve been through worse – we can pay salaries and nobody was hurt,” he says. “We were absolutely insured to the hilt so with cover for loss of gross profi t and assets, we shouldn’t be any worse off at all.”
Even with losses covered, not all CEOs would be so calm. Besides tangible damage costs such disasters can have a major effect on brand value and reputation – if customers are let down once then they often don’t come back. Again, Robertson is unperturbed. “It was a national disaster and there wasn’t anybody on the planet who didn’t know what was going on and everyone was sympathetic,” he says. “And, if you take the positives out of it, we’ve had more coverage from this than anything else we could have done.”
ASOS’s sales fi gures on its first day back trading suggest Robertson is right to be positive. On January 16 it took a record 10,300 orders, double its previous best. Robertson adds: “On yesterday’s orders we have come back stronger than ever before and I’m confi dent of full recovery and a much stronger year. Our insurers are paying for an ad campaign we wouldn’t normally have had and our share price today is up 2p on the day the disaster happened.”
Disaster recovery
“As a one-warehouse company, insurance was an area we never scrimped on,” a vindicated Robertson says. However, no matter how well you’re covered for a disaster, you never know when one will strike. On Sunday December 11, Robertson was in a hotel celebrating his fi rst wedding anniversary.
“I got a call at 8.30 in the morning,” he recalls, “it was very patchy but the security guard on the site had seen it all from a distance and, thank God, we knew nobody was hurt.” Robertson was informed within a couple of hours that the warehouse had been partially destroyed but that he wouldn’t be allowed access to it until at least the Wednesday. That meant the company had to stop taking orders immediately. “It was a painful decision to make but the right one,” he says.
A board meeting was hastily scheduled for 8.30 the next morning but it was Robertson’s responsibility to suspend the company’s shares and prepare a press statement announcing the decision in advance of that. “I was still working blind and had no idea how bad it was or when we’d be selling again so there was no alternative but to suspend the shares,” he says.
At the board meeting the company put together an action plan. “There was a small disaster recovery plan in place but we’re a growing company; we hadn’t got the substantial DR plans other companies probably have in place. That said, when you’re forced to focus on sorting out a problem it’s surprising how quickly things come together. Within an hour of the meeting we started refunding the 19,000 orders, emailing customers and had changed the temporary message on the homepage.”
However, while the company was able to immediately resolve customer issues there was an anxious three-day wait until the premises could be inspected. “Ironically, if we’d known the warehouse had been totally destroyed we could have started sourcing a new one straight away,” says Robertson, “but we just had to wait.”