Shein is trying to take on Amazon. Some say it should be cleaning up its act, instead
CBC
There's a buzz in the air as young people line up for Shein's Montreal retail pop-up.
"It's cheaper," said Diana Quentero, who lined up to shop. "I can find everything … If I want something for a special occasion, I go Shein."
The line on Thursday was hundreds of people long and snaked around the corner of an outdoor mall. Online fast-fashion giant Shein, founded in 2008, doesn't have any brick and mortar stores other than a few in Asia. So a pop-up is novel for shoppers.
Shein, a Chinese company based in Singapore, has seen its popularity explode on social media for its $3 tops, $5 dresses and nearly endless webpages of styles. According to Business Insider, Shein has more than 74.7 million active shoppers, and in 2022, the company was worth $100 billion US.
Now, the company is expanding from selling its own branded apparel to become a global online marketplace to compete with some of the biggest online e-commerce brands. Its online marketplace will see third-party vendors sell everything from housewares to appliances, directly to the consumer, similar to Amazon.
It's one of many companies moving into the marketplace business. This week, The Wall Street Journal reported that TikTok is also building an Amazon-like marketplace. And Temu, a Chinese owned e-commerce platform, launched in the U.S. in 2022 and in Canada this February.
But some say Shein needs to clean up its act first. The company has faced tough scrutiny over its environmental impact and its human rights track record, and an expansion could make things worse, say experts.
"The fashion industry is already complex enough. There are already enough problems for Shein to solve to improve," said Sheng Lu, an expert in the global textile and apparel industry at the University of Delaware.
In its May press release, Shein said it's expanding to meet consumer demand. Shein did not respond to CBC News' request for an interview.
"Shein is committed to delivering the best shopping experience for customers," Sky Xu, Chief Executive Officer, said in the release.
Shein became the largest fast-fashion retailer in the U.S. in 2021, according to Ernest Analytics. And now, with its sights set on expanding, some experts say that looks to be just the beginning.
"I don't think there's any reason why another company couldn't rival what Amazon is doing … It seems like Shein is trying to do that," said Elizabeth Cline, a New York-based author and journalist who covers fast fashion and sustainability.
It's already launched its online marketplace in Mexico, Brazil and the U.S., and plans to roll out in Europe later this year. There is no word yet on when the marketplace could roll out in Canada.
Shein's ability to deliver on dirt-cheap prices will make a stiff competitor in the e-commerce space, said Cline.
