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... and why it's bad news. 

Where does Shein come from?

Shein is now the second most popular fashion website in the world, but little is known about its origins. 

founded in 2012 as "SheInside", the platform began as wedding dresses distributor from its quarters in China. The company states that its founder, Chris Xu, was born in China, while a deleted press release describes him as US native. Either way, the retailer is focused on export rather than local Chinese market. Now Shein is rumoured to be worth $30 billion dollars, accounting for 28% of all fast fashion sales in the US. 

How? ultra-fast fashion business model!

It unites about 6000 Chinese clothing factories through internal management software. The system instantly collects data about user's responses to new styles, if it's a hit - Shein orders more virtually on demand. It's called “large-scale automated test and re-order (LATR) model.

Another way to source new clothes is focusing on "what's hot" on TikTok or Depop. While Zara looks at high fashion for inspiration, Shein looks at TikTok & Instagram, and literally "knocks off" the looks at a much faster pace. According to investigations conducted between July & December 2021, Shein added around 2k-10k new styles to the app per day. It offers 20 times more new items than Zara and H&M. 

shein takes zara

 

Why is Shein a problem?

$11 bikinis and $7 crop tops are being made by people working under brutal conditions, while those items are usually being worn only once before getting thrown. Shein's lead time for orders is 7 days (opposed to the most common 2 weeks period). The lack of transparency within the company is hiding 15-hour shifts (as reported by some workers) just for the orders to arrive in time.

Shein claims that it is ISO certified, criterion that does not exist as ISO does not issue certificates by themselves. The items are from synthetic materials, non-stop produced and then loaded on cargo ships an planes, further polluting the environment. According to a non-profit organization RemakeShein scored a very round ZERO on their sustainability assessment. 

It has opened the doors for similar business models, which are all racing each other, including Alibaba, ByteDance, and Cider. Cider has recently received an investment from Silicon Valley firm Andreessen Horowitz. The firm described the platform as a "marketplace of global factories that make it possible for users to have more selection than Zara, at the price point of Forever 21, on-demand". 

Shein takes Zara

This blogpost is based on investigation by Louise Matsakis, Meaghan Tobin and Wency Chen, which was first posted on Rest of World.