Fast-Fashion Brand Shein Explained

Companies are exempt from paying US tariffs on products with a retail value less than $800 if they are shipped directly to individual customers. Shortly after the company’s $100 billion valuation in 2022, Shein’s sales took a downturn. Business of Fashion reported that the company’s sales declined for five months before slightly increasing in December, based on online spending data from Earnest Analytics. Shein gave fast fashion a whole new meaning by using AI technology to identify trends and an online-only model to churn out thousands of garments in record time. “Our artisans, all women in Nigeria, spend 4-5 days crocheting such beautiful piece of art. It’s quite disheartening to see such talent and hard work reduced to a machine made copy,” the brand wrote on Instagram back in July 2021. Fast fashion, which refers to inexpensive and trendy clothes being produced at an inhumane speed to meet public demand, especially damages the environment due to the mind-blowing abundance of clothing being produced in such a short time period.

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In China, however, LatePost reported that Shein has developed “a reputation for timely payment [to factories],” which is a rarity in the country. The retailer also appears to have a good rapport with the factory owners it employs, who were willing to relocate their operations alongside Shein in 2015. Targeting trend (and cost) conscious shoppers on social media, the online-only giant adds a staggering 6,000 new items to its range daily. It alleges that Shein violated antitrust laws by intimidating manufacturers not to work with the Boston-based company, Reuters reported. An interim report by the House Select Committee on the Chinese Communist Party found that Shein and online retailer Temu are responsible for more than 30% of all packages shipped to the US every day without payment of import duties.

An influencer trip to China in June proved to be a public relations catastrophe for Shein.

Because of this, there are as many as 600,000 items listed on the site at any given time, according to BBC. Social media users, various media outlets, and even the Mexican government have criticized some of the products that Shein has carried on its website due to cultural appropriation and cultural insensitivity. In July 2020, a scandal sparked when Instagram and Twitter users — notably Marissa Casey Grossman — shared posts that displayed what Shein called a “swastika pendant necklace” being sold on the website (via Refinery29).

Apart from the speed and abundance with which the company updates its website, Shein is also unique in its reliance on social media influencers for marketing. As Wired reported, the brand sends free clothes to influencers, who then make content featuring the items they receive — some of which become the famous Shein hauls — and offer discount codes to their followers, from which they often receive a commission. Shein is a huge name on social media, but there is a lot of information and history regarding the brand that most influencers aren’t mentioning. Before you consider adding another fitted mini skirt or crop top to your Shein cart, you should know a few things. The retailer has stayed mum on ethical fashion and sustainability, but it’s hard to imagine Shein embracing corporate accountability without widespread consumer pressure. Regardless, Shein seems poised to daytrading price volatility breakouts be the fashion giant of the decade, and investors are scrambling to look for other retailers that could copy its speedy supply chain.

Yet, Shein shoppers say they’re more environmentally conscious than the average consumer.

There are tens of thousands of styles on the retailer’s site, and each day, about 1,000 more are added. For context, this production pace is even speedier than the “ultra-fast” sites that dominate fast fashion’s Instagram era; Missguided and Fashion Nova, for example, reportedly release about 1,000 new styles a week. Shein’s business model, like that of its fast forebears, abides by the tenet that more is better, that excess can be made accessible through mysteriously low prices, with little care for environmental costs or transparency about its labor force. In July, a group of designers filed a federal lawsuit against Shein that alleges copyright infringement and racketeering.

The Times reported that Shein is considering buying Topshop, another fast-fashion retailer based in the US. Topshop is currently owned by online fashion site ASOS, which purchased the brand in 2021 for $364 million. CBC reported that lead exposure can damage the heart, mcdonald’s stock a buy dow jones giant gets rare rating from pickiest analyst brain, kidneys, and reproductive system; and contamination can be especially harmful to infants and children, making the levels found in the children’s jacket that much more dangerous. Miriam Diamond, environmental chemist and University of Toronto professor, pointed out to CBC that this contamination is not only unsafe for shoppers but also for the individuals actually producing these items.

By 2015, the company had shortened its domain name to Shein, a move that reportedly made the brand more memorable and searchable for shoppers. Yet, prior to these major changes in 2014, the company had a decent online presence and enough customers to expand its operations. It was an early adopter of social media marketing, partnering with fashion bloggers for giveaways and promoting products on Facebook, Instagram, and Pinterest as far back as 2012. Yet much remains unknown about Shein’s business practices, and timely payment alone should not be cause for praise or relief from consumers.

1. Since then, the program has worked with around 1,500 designers and artists from all across the world, according to PR Newswire.
2. Because of this, there are as many as 600,000 items listed on the site at any given time, according to BBC.
3. Miriam Diamond, environmental chemist and University of Toronto professor, pointed out to CBC that this contamination is not only unsafe for shoppers but also for the individuals actually producing these items.
4. However, the company releases little information regarding its business practices, scoring between zero and 10 per cent on the transparency scale regarding how well it treats employees.
5. Shein eventually removed the necklace from its website and apologized on social media, claiming on Instagram that the pendant represented a Buddhist symbol for “spirituality and good fortune.”

Shein sold wedding dresses before it became a fast-fashion retailer

In January 2021, after repeatedly being accused of ripping off independent designers, Shein launched Shein X, a program intended to “inspire and support young designers to chase their dreams,” according to the company’s website. Since then, the program has worked with around 1,500 designers and artists from all across the world, according to PR Newswire. Specifically, Shein helps its Shein X designers with manufacturing, marketing, and sales while allowing them ownership over their designs and a piece of their line’s profit. On more than a few occasions, Shein has been accused of ripping off designs from both well-known names in fashion and lesser-known, independent stores and individuals. The company has been in the news previously for paying workers as little as S4 USD per hour.

Of these products, researchers at the University of Toronto found that two Shein items — a jacket made for toddlers as well as a red purse — contained higher amounts of lead than is healthy. The jacket tested as having 20 times the amount of lead that is safe for children to be exposed to, and the purse, five. Along with this, a children’s tutu dress from Shein was tested as having an elevated (but not necessarily unsafe) amount of phthalates.

Shein purchased rights to a UK fast fashion brand

Despite the bad press, UBS analysts suggest that Shein could continue to take major market share from US apparel companies. Shein’s loyal customers are not only driven by its low prices, but by a strong community bolstered by in-person events. The low prices of Shein’s items — along with tags reading messages like “help” that have gone viral on social media (but have since fortrade review 2020 is it good been debunked) — have prompted questions and concerns about the work conditions in Shein’s factories. While the fashion industry — most specifically, the fast-fashion industry — isn’t the sole cause of the world’s environmental issues, it is a major factor. If its growth continues as it’s projected to, the Ellen MacArther Foundation predicts that its environmental impacts will be drastic. As Vauhini Vara wrote in Wired, “This [damage] isn’t unique to Shein, but Shein’s success makes it especially notable.”

A McKinsey Sustainability article found that clothing production doubled between 2000 and 2014, and people now keep their clothes for only half as long as they did back in 2000. A recent investigation into the fast fashion brand Shein uncovered flagrant mistreatment of their factory workers. But Shein is far from the only fast fashion brand that has come under fire for its practices. Shein has spent years cultivating relationships with Chinese garment factories and manufacturers, whereas most Western brands generally outsource this work. Inditex is similarly situated close to a garment production center in the northeast region of Spain, but according to Brennan, business in China moves much faster.

Although it’s based in China, the firm mainly targets customers in the US, Europe and Australia with its cut-price crop-tops, bikinis and dresses, costing just £7.90 ($10.70) on average. After posting glowing reviews of their trips, the influencers faced a lot of backlash for ignoring mounting allegations of questionable labor ethics and concerns about Shein’s role in climate pollution. In December, the company released findings from its 2023 Circularity Study, which surveyed 3,515 Shein customers ages 18 to 29 and 30 to 45 in the US, Mexico, Brazil, the UK, France, and Germany. As of this writing, H&M’s market cap was about $20.5 billion and Zara’s parent company, Inditex, had a market cap of  about $114 billion. In 2019, The New York Times reported that Fashion Nova was paying employees below the legal minimum wage by the Federal Labor Department.