How much should a fresh summer wardrobe cost in 2024? Well, as rising operating costs force fashion retailers to jack up prices on the high street, a handful of T-shirts, shorts and swimwear could easily cost you £100 or more.
But with Shein, the same order can be delivered straight to your home for just £50.
The Chinese fast-fashion giant is preparing to join the London Stock Exchange in a £50 billion deal that would be its biggest stock debut in more than a decade.
Reports suggest the online retailer is preparing to file registration documents with the Financial Conduct Authority ahead of a stock market listing this year, although sources close to the company have dampened speculation that Shein will join the market soon.
The news was welcomed by the Labor Party, which confirmed last week that its MPs had met with the retailer, among “a range of companies, including Shein, looking to invest in Britain”.
This isn’t the first time the company has set its sights on these shores: this year the fashion giant hired ex-PrettyLittleThing buying director Gemma Dunne, tasking her with building a new brand inspired by British trends.
So far, she has created the Musera clothing line, which includes a bikini for €4.99 and loose-fitting trousers for €11.49.
Shein’s meteoric rise can be confusing for anyone over 40, as the brand is almost exclusively reserved for Generation Z and young millennials. It is not known whether the retailer is profitable, but even within the broader context of fast fashion, its success is astonishing as other brands are visibly struggling to stay afloat.
In May it was reported that British rival Boohoo had taken on a £95 million debt burden, cutting around 1,000 jobs in its warehouses and administrative posts, while ASOS admitted that sales had fallen 18 percent year-on-year in the first six months. This contributed to an underlying pre-tax loss of £120 million, compared to £87.4 million the year before.
Shein has gone from strength to strength: it is the world’s most Googled clothing brand and is set to surpass Zara with a turnover of more than £1.3 billion in Britain last year. Central to the appeal are the low prices: a quick look at the men’s department yields T-shirts and tanks for just £1.99, and shorts for £2.49.
How Shein manages to so aggressively undermine its rivals without suffering a similar fate depends on who you ask. The company claims its smart supply chain efficiency allows it to reduce costs, while critics have suggested that Shein cleverly skirts international tax laws.
Even compared to its competitors, Shein has zigged where others have zigged. For example, in the early stages of its rise, the company spent very little on marketing.
Traditional advertising was eschewed in favor of sending clothing packages to social media influencers.
The retailer typically targeted TikTok and Instagram users with medium-sized but dedicated followers, who then filmed videos of them trying on different outfits in quick succession.
Shein does not operate traditional brick-and-mortar stores, greatly reducing overhead costs. The company also uses a very different design process than other fashion retailers. Rather than creating designs in-house and outsourcing production to manufacturers, Shein outsources most of its design work to outside companies, and most of its independent suppliers both design and produce clothing.
The result is that Shein’s website lists thousands of new designs every day. The number of claims is as high as 10,000, which is astronomical even by fast fashion standards.
Shein’s design pipeline is algorithmically driven, a company source said. Designs are suggested based on what customers are already looking for, and then made in small “test” quantities. If an item sells well, Shein will order more, while less popular designs are dropped.
A company source says some Shein orders may therefore take up to three weeks to arrive, unlike the fast shipping times of other fast fashion brands such as ASOS or Boohoo.
As a result, Shein says the company wastes very little and claims this is the main factor in its low prices. “It means that if you’re having a bad summer, you’re not stuck with a load of white T-shirts when everyone else wanted a black sweater,” said a company source.
Nevertheless, the brand has drawn criticism for allegedly poor working conditions in its factories. More recently, Marco Rubio, a US senator in the race to become Donald Trump’s presidential running mate, sent a letter to the chancellor this week calling for an investigation ahead of Shein’s potential £50 billion London stock market listing, citing accused the company of using “slave labor and sweatshops”.
A spokesperson said Shein “has a zero-tolerance policy for coercion [sic] labor” and “is committed to providing a safe and fair work environment for all employers of our suppliers.”
It is not the first time Shein has faced such criticism, and the company has repeatedly had to deny accusations that factory staff are overworked. Channel 4 documentary Untold: Inside the Shein Machine alleged staff in a factory worked thirteen and a half hours a day with no set structure for days off. Shein strongly denied the allegations in the documentary.
Experts have also pointed to Shein’s approach to international trade tax laws.
The company claims that it “complies with tax laws in the regions where it operates and is subject to the same tax rules as its peers,” but those peers have nevertheless accused Shein of exploiting loopholes.
In May, a chorus of executives including Boohoo CEO John Lyttle said Shein avoided import duties by shipping packages individually (companies don’t have to pay tax on shipments worth less than £135).
Theo Paphitis, owner of Robert Dyas, Ryman and lingerie brand Boux Avenue, said there was a “big slug” of foreign companies avoiding shipping costs by shipping orders directly from China.
“The government is not closing loopholes,” he said. “It becomes completely clear that the emperor has no clothes on.”
The Treasury said its customs and tax regime for low-value imports “balances reducing the burden on retail businesses and consumers buying goods from abroad with creating a level playing field for UK businesses.”
Shein, meanwhile, consistently maintains that its low prices are due to “supply chain efficiencies and operational skills” developed over the years.
For now, Shein’s ascent shows no signs of slowing down. That much is clear on TikTok, where nearly a million videos have been posted under the hashtag #sheinhaul, each showing a young woman wearing hundreds and hundreds of outfits.
In one clip, a TikToker named Abigail can barely hold her booty with both hands.
Scrolling through the comments, something soberingly illuminating emerges: that Gen Z is more than happy to put aside their usual sustainability concerns for bright red pants.