Fast fashion upstart Shein set the industry ablaze this month after reports it was seeking to raise $1 billion in funding at a $100 billion valuation, according to Bloomberg. Shein has upended fast fashion by making apparel at jaw-droppingly low price points and gaining market share, attracting major investors. But is it profitable? Follow The Debrief wherever you listen to your podcasts.

“Even if Shein isn’t profitable now, the thesis is that if enough people shop from the brand it would be able to leverage some of its operational costs … It could become a very lucrative business,” said Chen.

Key Insights
- While it is unknown whether Shein is profitable, the retailer drives ultra-high sales volume and razor-thin margins
- Shein is powered by a nimble, AI-driven supply chain, which allows it to produce a plethora of trendy items for an internet-obsessed young fashion audience almost instantaneously.
- The retailer’s app uses casino-like tactics and rewards to draw shoppers in and keep them buying, sharing and engaging.
- Despite its murky manufacturing process and reputation for amplifying rates of consumption, Shein is popular among young consumers — who purport to care about sustainability.

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ABOUT THE BUSINESS OF FASHION: The Business of Fashion is a next-generation fashion media company conceived for today’s global and hyper-connected world. Founded in 2007 by Imran Amed, BoF is known for its authoritative, agenda-setting point of view on the global fashion industry, and is an indispensable resource for fashion executives, creatives, students, and entrepreneurs in over 200 countries. It has been described as “The Economist of Fashion,” “A Daily Destination for Fashion’s Power Players”, and “The Industry Bible”, www.businessoffashion.com

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