In fashion, the name of the game is speed. And fashionistas cannot be left in the dust when it comes to catching up on the latest trends.
In an effort to speed up shipping times, Chinese fast-fashion giant Shein is sending more of its inventory from China to their warehouses in the United States, per a report in Reuters. Previously, American customers faced shipping and processing times of up to two weeks, which puts it at a disadvantage to retailers such as Amazon (AMZN) -), whose Prime service can deliver goods as fast as the next day.
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The retailer known for its cut-price, trendy clothing selection has traditionally flown goods directly from China, where a network of suppliers all over the country produce its extensive catalog of items. It's large collection of several hundred thousand individual items undercut those from traditional brick-and-mortar fast-fashion retailers like H&M (HNNMY) -) and Urban Outfitters (URBN) -).
According to data from ImportGenius, Shein has been shifting more of its transportation from the air to to the sea, as the retailer’s bulk ocean shipments of apparel via cargo ship have increased by 2,000 times over the past two years, from 312,385 pounds of clothes in 2021, to over 6.8 million so far in 2023.
This mass of clothing is brought over to support Shein’s “QuickShip” program, which dispatches items from inventory stored at its Whitestown, Indiana warehouse to American shoppers within 4-7 business days, instead of the usual 9-14 days it takes to ship from China.
The majority of items sold through Shein, however, is still shipped via air from China in individually addressed packages — the bulk of which enter the United States under the “de minimis” trade provision that is exempt from tariffs. A June 2023 report by a U.S. House of Representatives committee estimated that Shein and another Chinese app-based retailer Temu, import nearly 600,000 packages a day through the borders without paying any tariffs under the provision.
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The founder of e-commerce analytics firm Marketplace Pulse, Juozas Kaziukenas told Reuters that “Shipping goods by air directly from China is a strategy that helps the e-tailer avoid unsold inventory piling up in warehouses,” but as retailers try to be fastest and the cheapest, Shein will try to catch up.
Shein plans to expand its warehouse facility in Indiana and it is months away from opening a new warehouse in Cherry Valley, California.
According to past reports by Reuters, Shein is reportedly in talks with Goldman Sachs (GS) -), Morgan Stanley (MS) -) and JP Morgan Chase (JPM) -), as it eyes an initial public offering.
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