How Shein Built a $66B Fast-Fashion Empire | WSJ The Economics Of

Shein says it’s able to make affordable apparel by monitoring user behavior to predict customer demand and producing items in small quantities. The Chinese e-commerce company known for its $5 T-shirts and $20 cocktail dresses controls 40% of the fast-fashion market share in the U.S., with an estimated $8 billion in sales in the country last year. Shein’s inventory turnover rate is twice as fast as other competitor retailers such as H&M and Zara.

WSJ explains how Shein has dominated the global fast-fashion market as it remains one of the least transparent fast fashion companies in the world.

Chapters:
0:00 Shein’s fast-fashion domination
1:02 Small batches and Shein’s online tech
2:24 Vast manufacturing network
4:26 Allegations of poor labor conditions
6:08 De minimis tax loophole
6:46 How Shein is managing its image

The Economics Of
How do the world's most successful companies generate revenue? In this explainer series, we'll dive into the surprising stories behind how businesses work--exploring everything from Costco's "treasure-hunt" model to the economics behind Amazon's AWS.

#Shein #Fashion #WSJ

[OnlyABlemish]

"Involuntary labor in their supply chain" is the wildest way to gloss over slavery 🤦‍♂️

[helloitsdaniel]

i hope shein starts selling houses soon

[purplepotato]

I'm surprised that no one has said that consumers bear a lot of the responsibility as well. If they're spending $100/ month on $2-5 items of clothing, how bloated are their closets getting? Just stop, and wear what you have.

[ryanlovesanimalcrossing]

“Involuntary labor” is a really interesting way to say slaves

[justineleconte]

On my channel, when I do videos about fast fashion and why that business model relies on exploiting people, I often get comments saying "Oh I had no idea...", "I didn't know garment workers aren't being paid properly", "I didn't know Shein was producing so much waste and promoting overconsumption". I think most people who live in the comfort of being able to buy new clothes very often look the other way. But the facts are there, and fast fashion is pushing the entire fashion industry in an extremely unhealthy direction... Consumers definitely have a role to play: we vote with our wallets.

[The_Quaalude]

Their quality is horrible, but they're great at making trendy designs. They're going to stay in business because no other company is giving you the latest fashion trends at a reasonable price with decent quality. People are always going to buy a cheap new outfit for an IG pic

[boskyp]

One point that Peter Pernot-Day and WSJ forgot to highlight is how Shein steals designs from small-scale designers on the internet. Infact, that seems to be their key to coming up with so many designs in such a short span of time. Sad one from WSJ. Disappointed that they are giving such companies platforms and legitimacy. Also, no mention of the court-cases against Shein?

Btw, Shein's online marketing is extremely invasive, at least in Asia. If you ever browsed Shein website on your phone, you'll be plagued with their ads in every other non-Shein website that you visit! Showing you the same clothes, which you had been looking at, in those ads on other websites. I won't be surprised, if in future, Shein is also found to be selling customer data to third parties... just like Temu.

[Gunshinzero]

If anyone feels bad about buying from them, consider that many of the retailers you buy from probably have the same supply chain but you feel safer giving them your money at a higher price so they get rich off the mark up.

[cleveful]

Lets be honest. This wouldn't be news if Shein weren't a Chinese company. From a business point of view, they just outcompeted the others.

H&M, Old Navy, Zara, and plenty of others have bad quality clothes, and they're most likely made from low-wage and child-labor countries as well.

[MinhNguyen-brvo]

Another fact is that they are accused of straight out stealing other small brand designers, not some fancy data analysis as mentioned in the video.

[mattstirling]

The Guardian did an amazing deep dive into Shein's business model and practices. It was...interesting to see how they acquire new designs.

[nineplustentwentyone]

I think it is insane how people who don't necessarily need fast fashion just buy from such brands simply because they are more affordable and cost-efficient. Let's be more aware of the goods that we consume and promote and make sure that we are only buying what we need, and not just what we want, especially if they are on impulse.

[Superfifty]

Here's the thing, if people are going to protest Shein, they better not have an iphone in their pocket. Obviously supporting hyper-consumption is always bad and unethical; however if you have eyes on Shein, you are obligated to have eyes on any other company which profits off of 3rd world labor that you consume. Which Apple certainly does profit off of 3rd world labor with it's lithium production. I'll give you a hint, 99% of companies making billions of dollars did not reach those profit margins without exploitation.

Consumers are the enablers, corporations are the exploiters; simple as that.

[keilamarin]

I’m getting the ick by hearing them talk about their “small batch system” to “reduce” inventory waste. They are producing insane amount of clothing that they know is made to be disposable, & waste can’t be reduced by feeding into micro trends.

[alejandragarciarmz]

SHEIN is also super popular in third world countries like Mexico due to its affordability

[Erickruiz]

Treasury rates are rising quickly, the markets are collapsing, inflation is skyrocketing, and the Fed is imposing a significant interest rate hike—all of which will result in further losses for portfolios this quarter. How can I take advantage of the present market volatility? I'm still undecided about whether to sell my $125, 000 worth of bonds and stocks.

[Sisslie]

The excess inventory waste doesn't sit in warehouses, but in landfills instead.

[ropro]

I love how gen Z crusades about climate change yet eats up fast fashion like Shein. 😒

[Userkzb]

The question is not why SHEIN making the price so low; it’s how others can keep the price so high (without facing severe competitions). Eventually all means to squeeze out the last penny will be exploited. Welcome to capitalism! And the Chinese are getting really good at it.

[avicohenk]

"Cheap fabric and dim lighting, thats how you sell goods" Marty Seinfeld 😂