Zalando blames it on the sunshine

ZALANDO, EUROPE’S biggest online only fashion retailer, cut its 2018 outlook for a second time in as many months, saying a long, hot summer had taken its toll and wiping as much as 20 per cent off the value of its shares.

Co-CEO Rubin Ritter said a delayed start to autumn meant selling fewer higher-priced coldweather garments and more discounting. He noted that German fashion sales were down 17 per cent last week, year-on-year.

Zalando said higher fulfilment costs were another factor that weighed on profitability.

“We don’t know when the season will start and when fall/winter will actually kick in. This is a problem for the entire industry,” Ritter said.

Zalando has begun selling beauty products online and is also investing heavily in logistics and technology as competition heats up, both from e-commerce players like Amazon and big chains like H&M.

H&M, the world’s second-biggest fashion retailer, reported on Monday its sales bounced back in the third quarter, helped by a new logistics system, as a revamp to meet growing online and budget competition was paying off.

British rival ASOS also missed analysts’ forecasts for sales growth in its latest trading period, saying it had reined in marketing efforts as it focussed on ramping up warehousing space in Germany and the US.