Case Study- SHEIN

<10 milestones>

1. 2008: Chris Xu (Sky Xu) founded the company, initially focusing on wedding dresses. 
2. 2012: The company expanded to women’s clothing and rebranded as “SheInside.” 
3. 2015: The brand name was shortened to “Shein”. 
4. 2019: Shein’s gross value evaluation reached $5 billion.
5. 2020: Shein became the world’s largest online-only fashion company.
6. 2020: Shein was the most mentioned brand on TikTok and YouTube in 2020.
7. 2021: In November, Shein’s valuation grew from $15 billion to $30 billion
8. 2022: In May, Shein was the most downloaded app.
9. 2023: Shein was downloaded 238 million times in 2023, making it the most downloaded fashion app of that year. 
10. 2024: Shein’s revenue is projected to continue growing in 2024, following the trend from previous years.

<Business model>

Shein operates as an ultra-fast fashion retailer with an online-only approach, offering trendy clothing and accessories at meager prices to a global audience, primarily targeting younger consumers like Gen Z. The company’s business model is built on rapid production cycles, utilizing a ‘large-scale-automated test and re-order’ (LATR) system and data-driven decision making to respond to fashion trends quickly. Shein leverages influencer marketing, especially nano- and micro-influencers, to connect with its target audience. The brand maintains low costs through efficient supply chain management and bulk production, selling to customers in over 150 countries. In 2022, Shein began expanding its platform to include third-party sellers. With a strong focus on mobile users, Shein prioritizes its app experience, contributing to its consistent revenue growth and high valuation, which reached $100 billion in 2022.

<Key success factor>

1. Supply Chain: Xu Yin collaborates with thousands of suppliers and 200 suppliers in Guangzhou, China. The time from design to production is three to seven days. Given that it takes three to four weeks for competitors like Zara, it has dramatically shortened it.
2. AI system: About 6,000 new products are updated every 24 hours, and about 100 items are produced for each item. Data is aggregated in real time to order additional items. The remaining inventory after 90 days is about 6%, which is a strategy to minimize unnecessary investment.
3. Affordable pricing: Shein offers lower prices than Western fast fashion brands, appealing to budget-conscious consumers.
4. Effective influencer & Social media marketing: Shein extensively uses micro-influencer marketing, offering free products in exchange for social media exposure. Shein has over 250 million social media followers and maintains an active presence across multiple platforms.
5. Customer-centric approach: Shein emphasizes customer experience, convenient shopping processes, fast logistics, and good after-sales service.

<My suggestion for growth strategy>

As most of the fast-fashion companies does, Shein’s environmental impact is quite significant. Shein is responsible for 6.3 million tons of CO2 emissions yearly. ​​Between 35,000 and 100,000 items are produced daily for Shein, contributing to high carbon emissions and waste. I think that as much as Shein has high growth potential continuously in the future, they must implement a policy or regulations within their company to lessen the carbon emissions and may donate and recycle those non-biodegradable synthetic fibers.