Shein Is Now Calling Itself an ‘Empowerment Company’
Shein is trying to turn the narrative surrounding its fast-fashion business model on its head.
Often considered an exemplar of fast fashion’s excesses, Shein—via executive vice chairman Donald Tang—outlined an alternate story Tuesday. Speaking during a webinar hosted by management consulting firm APCO Worldwide, Tang instead positioned the most-downloaded retail app‘s success streamlining its supply chain as a win for the environment.
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“[We’re] really trying to focus on trial and error and to make sure there’s no waste,” Tang said. “If there’s no waste, you can compete if you pass all of those savings to the customers and you can grow…. At the end of the day the consumer wins… and then add in no overproduction, so the planet wins. So, if you can find a way to do good while you’re doing well, or do well while doing good, that’s a beautiful thing.”
Veronique Yang, managing director and senior partner at Boston Consulting Group (BCG), and Divya Demato, CEO and co-founder of the sustainable supply chain consultancy GoodOps, joined Tang for the webinar, which largely focused on a report BCG released in March on Shein’s agile supply chain strategy. The firm developed the report with the cooperation and consent of Shein, which it says is not one of its clients.
The report highlighted three main strategies fashion companies can employ to become more agile: using digital solutions, such as AI forecasting and virtual sampling, to fast-track development and production; rapidly adapting high-fashion trends for everyday designs; and on-demand manufacturing.
“The consumer is expecting larger product collections, faster product launches and better order fulfillment, all this while holding the expectation of quality and also competitive price,” Yang said. “All the fashion players are trying to optimize their supply chain to be agile and cater to these changing consumer needs.”
At TikTok’s most-mentioned brand, that has meant “digitizing” its small and medium factories, giving them a visibility into their own capacity, a continued order flow and greater liquidity thanks to faster payments, Tang said. These benefits, he claimed, allow these partners to make better choices when running their factories, while also enabling them to make more sustainable choices, though its suppliers have been linked to unsustainable labor abuses.
“We have a significant ability as an empowerment company to empower people to do more that they wanted to do,” Tang said.
With the consequences of climate change becoming ever-more apparent to the ordinary consumer—the webinar took place a day before smoke from Canadian wildfires squashed prior air quality records—Demato sees sustainability rising as a factor in purchasing decisions.
“In some countries—whether it’s in China or India, where have you—where the air is so polluted, where the waters are polluted, where your day-to-day life has all of a sudden changed, it’s not how your parents grew up or your grandparents, and so the more and more I think the consumer feels and sees that, you’ll start to see them asking and demanding more,” Demato said. “I think brands will respond because they will have to for their own survival.”
Though Tang regards “the sustainability issue” as “paramount,” Shein, which is looking to produce closer to market, remains widely criticized for fueling overconsumption. The company attempted to counter that image earlier this month with the release of its second-ever ESG report. The document included plans for the e-tailer to reduce its absolute emissions by 25 percent by 2030—well below the 45 percent targeted by the Paris Agreement. In 2022, Shein, which recently inked a deal to get back into India, generated 52 percent more emissions than the prior year thanks to a 57 percent increase in production volume. Elizabeth L. Cline, author and professor of fashion policy at Columbia University, labeled the report “mostly greenwashing.”
“Most of the report is greenwashing, including mentions of sustainability initiatives that are voluntary or highlighting one-off or charity projects that serve as a red herring for the core business model,” Cline told Sourcing Journal last week.
