What: Shein is embracing a variety of new strategies in order to increase its traction and ensure market dominance.

Why it is important: New countries, new formats, new approach, including trying to seduce young designers by offering them the possibility to manufacture and sell their designs: it is time for department stores to consider Shein’s new approach and make sure that they are fencing off their market.

Shein gained ground as a leading player in the fast-fashion market in 2022, with global revenues of $22.2 billion, an increase of nearly 50% year over year, according to Coresight Research estimates. Comparing to recent sales metrics from ASOS, Boohoo Group and Inditex (owner of Zara), they believe that Shein’s estimated sales growth substantially outpaced its key competitors’ sales growth in 2022.

Shein’s recent plans for business expansion will help the company reach a broader consumer base in 2023 and beyond. These plans include forming an expansive business matrix by continually incubating new brands, testing an e-commerce marketplace model, opening new distribution centers to enhance delivery capabilities and extensively growing the Shein X incubator program. International expansion is also on the map, including Brazil and Mexic, or Japan with their first-ever permanent physical store in Tokyo.

Currently, Shein is reportedly raising $3 billion in funding at a valuation of $64 billion and has revived its plan to debut on the New York Stock Exchange (NYSE) via an IPO (initial public offering) in 2023. If executed, Shein’s IPO would be the first major equity deal in the US by a company founded in China since Chinese regulators clamped down on overseas listings in July 2021.

While Shein has a long way to go in terms of environmental, social and governance (ESG) initiatives, it has taken some visible steps recently toward ESG, including an investment of $15 million in upgrading nearly 400 of the factories in its supply chain by 2026 and the launch of its Shein Exchange resale platform in the US in October 2022. The company’s recent sustainable measures and existing appeal to Gen Z consumers could help the company to generate a considerable investment appetite for any share flotation in the event of an IPO.

Shein is exploring new strategies to assert dominance in fast fashion