Shein has become one of the leaders in the fashion market in just a few years. What is the secret of unprecedented success? 

In less than three years, from January 2020 to November 2022, the share of sales of the Shein online store in the American fast fashion market grew up from 12% to 50%. Online retailer Shein has grown rapidly, winning over shoppers with its unbeatable prices and kaleidoscope of new products. Along the way, the online retailer has also received vocal critics who, among other things, questioned its ties to China, accused it of stealing designers' work and pointed out how its cheap goods contribute to pollution.

By given According to the Financial Times as of March of this year, Shein's annual profit reached about two billion dollars, and the value of the entire enterprise was more than 60 billion dollars.

What is Shein and how did this online retailer come about?

Chinese online retailer Shein specializes in selling fashion clothing and accessories at affordable prices. It was founded in 2008 by Chris Xu in Nanjing. Initially, Shein was positioned as a site for selling wedding dresses, but over time, the company expanded its range to include clothing for men, women and children, shoes, accessories, household goods and other categories.

At the same time, Shein's website says that Shein was founded in 2012 by four people who now hold senior positions in it.

Shein is active in the international arena, selling products in more than 220 countries and regions. It is widely popular in the United States, Europe, and Latin America.

The main advantage of Shein is the very low prices of products, which attracts a young audience, especially in low-income countries. Shein has also achieved great success thanks to its active work with social networks and bloggers, as the company uses influencers and social platforms such as Instagram and TikTok to promote its products.

According to Shein representatives, the company's rapid success is explained by Xu's innovative business idea. He was the first in the fast fashion industry to reduce batch volumes and speed up production. Shein does not have its own production, but it cooperates with thousands of small suppliers. Unlike competitors who ordered fewer unique products in large volumes, Shein asked suppliers to send small batches (100-200 pieces) of different models. If the product was popular, new batches were ordered.

Fashion researcher Sheng Liu estimated that from December 2022 to December 2023, Shein offered 1.5 million unique products, Zara 40 thousand, and H&M 23 thousand.

Along the way, Shein has also received vocal critics who, among other things, questioned its ties to China, accused it of stealing designers' work, and pointed out how its cheap products contribute to pollution.

The fact is that Shein contributes to an increased level of waste and environmental pollution. This business format supports overconsumption, which is a concern among environmentalists.

После выхода документального фильма Channel 4 о неэтичном производстве Shein заявил о «чрезвычайной обеспокоенности» и обещал инвестировать миллионы долларов для улучшения контроля на всех этапах. Однако в 2024 году компания сообщила, что проверила лишь 2796 из 5800 поставщиков, и только 29% из них получили высокую оценку за «ответственное снабжение». У 20% обнаружены серьезные нарушения, такие как задержки зарплаты и проблемы с пожарной безопасностью.

Criticism comes not only from human rights defenders. In 2019, German illustrator Tiina Menzel discovered her drawings on Shein products, sometimes even with captions that were not completely erased. She was offered $600 in damages, but she refused without signing a contract prohibiting criticism of the company.

Shein, which is regularly accused of copying designs, recently held a one-day summit in Los Angeles with hundreds of designers, trying to show that she wants to work with them, not against them. The event was part of a $55 million initiative Shein launched in 2021 to hire and fund artisans to create clothing lines for its website.

The program was launched months after designer Justin Romero, co-founder of fashion brand Freak City, joined a chorus of designers in 2020 accusing Shein of selling clothes that looked like replicas of their products.

After several preliminary conversations with Shein's legal team, Romero spoke directly with George Chiao, president of Shein's U.S. business. Romero asked for data on how much Shein had sold the clothes in question. It was a revelation, he said.

Shein avoids uncomfortable questions and conquers the market in the United States thanks to loopholes in American law. The retailer has even started selling its technology to other stores

According to the Swiss human rights group Public Eye, in 2021 and 2024, workers who produced goods for Shein worked 75 hours a week, which violates not only the company's rules, but also the laws of China. In November 2022, Bloomberg News journalist Sheridan Prasso reported that cotton from Xinjiang was found in some Shein items delivered to the United States. This violates the American law prohibiting the use of materials related to the forced labor of Uyghurs, which was signed into law by President Joe Biden a year earlier.

In response to the allegations, Shein said it had improved working conditions and intensified inspections at suppliers' factories by increasing penalties for violations. An anonymous source said that the company accessed Prasso's recordings without permission to find out exactly what things she was analyzing. In December 2022, Shein conducted its analysis and stated that the cotton was from other regions, but did not provide detailed results of the investigation.

A former employee of the US Department of Homeland Security said that due to the huge volume of shipments, it is impossible to check all Shein products. The company circumvents the restrictions thanks to the de minimis rule, which allows duty-free import of goods worth up to $ 800. Since 2018, when new duties on goods from China were introduced, Shein and other companies have begun to send goods through third countries, dividing them into small batches. This allowed them to avoid additional taxes and inspections.

В 2023 году Конгресс США сообщил, что Shein и Temu доставляют в США более 30% всех посылок по правилу de minimis. В отличие от таких компаний, как Gap и H&M, которые платили сотни миллионов долларов пошлин, Shein и Temu избежали таких затрат.

Несмотря на обвинения, популярность Shein в США продолжает расти. Согласно отчету McKinsey, за последние 12 месяцев более 40% американских покупателей совершили покупки на платформах Shein и Temu. Маклафлин отметил, что пандемия, когда многие люди остались дома и искали недорогие товары, помогла Shein укрепиться на американском рынке.

In recent years, Shein's influence on the fast fashion industry has become more and more noticeable

In recent years, Shein's influence on the fast fashion industry has grown significantly. Many companies began to copy the working methods developed by Xu. In March, it became known that Shein plans to sell its technology to other stores. H&M is trying to speed up production to keep up, and Amazon is looking to reduce delivery times. Fashion critic Ken Packer, a former Timberland executive, called this phenomenon the "scheinification" of the industry.

Critics such as Shein's Shut Down group, set up in March, say Shein avoids U.S. Customs and Border Protection inspections and billions in tariffs by sending goods directly to its customers at a certain price threshold. Group Approvesthat they don't register these shipments in bulk like most other U.S. retailers.

Shut Down Shein also claims that the company violates human rights. On Monday, two members of Congress wrote to the U.S. Securities and Exchange Commission demanding that, as a condition of its pending offer, Shein be required to certify, through an independent party, that it does not use Uyghur forced labor.

In a statement, the company said it conducts business "legally and with full respect for the communities we serve."

The statement also said: "As a global company with customers and operations around the world, Shein takes transparency throughout our supply chain seriously."

In 2020, Shein created team in the U.S. to investigate potential intellectual property infringements. Previously, such checks were carried out in China. The company also invested in image recognition technology to identify cases of potential infringement and required third-party suppliers to certify that their products do not infringe on the intellectual property rights of others. She refused to give exact figures.