Chinese fast-fashion retailer Shein has reportedly started preparations for a possible $ 47 billion IPO and is expected to submit a prospectus for listing in the near future.
While Shein has denied rumors emanating from the entire Chinese investor community, the hot IPO market may yet see Shein join Poshmark, Dr. Martens and ThredUp, who have all showcased their fashion offerings to the public markets this year. .
Shein’s revenue for 2020 is expected to be around $ 10 billion and the growing popularity of the fashion retailer saw the fast fashion e-commerce app take Amazon’s crown last month for the most popular shopping app. downloaded on iOS and Android in the US based on data from app tracking companies App Annie and SensorTower. He’s been sitting at No.2 since February.
Shein’s assessment skyrockets every year. In January 2019, Shein raised $ 500 million from Sequoia China and Tiger Global for a valuation of $ 5 billion. In August 2020, he raised an undisclosed amount from an also undisclosed investor at a valuation of $ 15 billion. Now it could be worth more than three times that.
In May, Shein was the best iOS shopping app in 54 countries and ranked number one on Android devices in 13 countries, according to App Annie.
Founded in 2008, Nanjing-based Shein caters to Gen Z customers, luring young shoppers through Instagram and TikTok influencers and a barrage of discount codes for her low-cost styles, bringing new products online. by the hundreds every week.
However, the story really begins in early 2012, when Shein’s notoriously hardworking founder and CEO Chris Xu (sometimes known as Yangtian Xu) – an American graduate of the University of Washington – abandoned his company. of wedding dresses to acquire the domain. Sheinside.com. Initially selling women’s clothing, in 2015 he renamed the company Shein, focused on overseas markets, and started acquiring domestic fashion competitors.
Operating in the shadows and barely known outside of his Gen Z fans, Shein reportedly considered an offer for Topshop when it went on sale earlier this year, sparking rumors he might consider taking physical stores. to complete its online offer. .
In the meantime, Shein was content to open pop-up stores, the last in May, when Shein opened a pop-up store at Paso Interlomas Mall in Mexico City.
Shein sells from China to the US market
To serve the US market, the products are sent from Shein’s warehouse in Foshan, Guangdong Province to a warehouse near Los Angeles, California, and execution may take more than ten days, which is extremely slow by Amazon Prime next day delivery standards. But its affordable price has ensured a loyal following, drawn by an ever-changing line of women’s clothing and accessories added to an average of 2,000 SKUs each day.
The United States has become Shein’s largest market, while also delivering to 220 countries, with dedicated websites for Europe, the Middle East, Australia, and the United States. in 2020.
The latest hefty assessment is for a company that didn’t even have its own supply chain until 2014, preferring to buy directly. However, in the face of growing demand, Xu switched from sourcing through the Guangzhou Shisanhang clothing wholesale market and created an in-house design team and, within two years, had built an army of 800 dedicated to the design. and prototyping for ultra-fast production.
When Shein moved her supply chain operations center from Guangzhou to Panyu in 2015, almost all of the factories she worked with moved. Shein and the hundreds of factories that work with the company have come together in a production cluster with many similarities to La CoruÃ±a in northeastern Spain, where Inditex’s headquarters are surrounded by its suppliers in upstream and downstream.
It also has six logistics centers in Foshan, Nansha, Belgium, India and on the east and west coasts of the United States, as well as seven customer service centers, based in Los Angeles, Liege, Manila, Yiwu and Nanjing, and employs more more than 10,000 people.