China's SHEIN to manufacture for other brands amid declining sales
What's the story
SHEIN, the Chinese fast-fashion giant, is now opening its apparel manufacturing network in China to other fashion brands. The move comes as a part of the company's strategy to diversify revenue streams amid challenges from US tariffs and inconsistent sales. To avail this service, interested brands are required to open a store on SHEIN's online marketplace.
Supply access
The service was launched after extensive testing
The fast-fashion retailer's supply chain includes factories that can produce new designs in just 5-7 days. This service was launched after nearly two years of preparation and testing. So far, around 20 brands such as French fashion label Pimkie and Filipino designer Jian Lasala's brand have availed the service. Apart from manufacturing, SHEIN provides sample development, warehousing, sales, and order fulfillment to the brands. These are services that smaller brands usually can't access at the low costs that SHEIN offers.
Market maneuver
Strategic move to expand marketplace presence
SHEINs new initiative, called Xcelerator, is mainly aimed at getting more fashion brands on board its marketplace. It is a strategic move to leverage its extensive apparel supply chain network in southern China amid growing competition and a volatile trade environment. Unlike Alibaba.com and 1688.com, which provide open access to Chinese manufacturers, SHEIN has made supplier access conditional on participation in its platform.
Financial outlook
SHEIN's financial performance and future prospects
The privately-held clothing retailer, which started in mainland China and is now based in Singapore, does not disclose its financial information. However, Bloomberg had previously reported that its net income surged to over $400 million with revenue nearing $10 billion in Q1 as consumers flocked to the retailer's products ahead of US tariffs. Despite external operational challenges and IPO hurdles, SHEIN remains a strong player in the fast-fashion industry.