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According to the Institut Français de la Mode (French Fashion Institute, IFM), ultra-fast fashion from the Asian trio SHEIN, TEMU and AliExpress now accounts for 6% of clothing purchases by volume, with SHEIN the fifth-best-selling brand in France by volume. While traditional fashion houses struggle to adapt to shifting trends and global trade tensions, SHEIN is thriving, selling millions of $2 T-shirts in over 150 countries, excluding China. However, a month or so after the landmark opening of SHEIN at BHV Marais in Paris, very few shoppers continue to flock to the department store, as word-of-mouth suggests customers aren’t finding what makes the brand successful. For BHV, what was presented as a winning strategy and a tremendous business opportunity appears to be fatal.

What was intended as strategic validation for SHEIN instead became a test case of whether ultra-fast fashion can coexist with traditional retail. The French battleground raises questions that extend far beyond just a store. Can SHEIN’s hyper-efficient online model translate to brick-and-mortar success? Will European markets mount effective resistance to business practices they deem harmful? And most provocatively: if SHEIN’s model can deliver unmatched value in the eyes of cost-conscious consumers, should it be stopped at all?

The silent revolution: how SHEIN rewrote fashion’s rules in just 15 years

SHEIN’s brief history

SHEIN debuted in China in 2008 as ZZKKO, initially focused on wedding dresses, before pivoting to fast fashion in 2012 and rebranding as SHEIN. Founded by entrepreneur Chris Xu, the company evolved from a modest online retailer into the world’s largest fast-fashion platform within 10 years.

The COVID-19 pandemic has accelerated SHEIN’s growth as online shopping has become more prevalent. In parallel, SHEIN quickly expanded its product offerings, adding accessories, beauty products and home goods. Since 2022, SHEIN has operated from Singapore and maintained a deliberately low public profile. That same year, building its empire entirely online, SHEIN began venturing into brick-and-mortar, as many DTC brands eventually seek physical outlets.

SHEIN’s meteoric growth has disrupted the global fashion industry, reportedly increasing revenue from $610 million in 2016 to $32.5 billion and profit to $2 billion in 2023. Despite being valued at more than the combined market capitalisations of H&M and Inditex with a $100 billion valuation by 2022, SHEIN has seen this valuation decline to $50 billion as of early 2025. IPO projects were troubled by concerns over intellectual property rights, corporate governance and sustainability, as well as allegations of forced labour in the company’s supply chains.

Innovation: the on-demand model that makes Zara look slow

With most items between $8 and $30, SHEIN’s low pricing is a key component of its strategy, significantly undercutting traditional fast-fashion retailers. SHEIN pioneered an “on-demand”, speed-to-market, ultra-fast fashion model that fundamentally differs from traditional fast fashion. Compared to Zara’s 3-to-4-week design-to-market, SHEIN achieves a 3-to-7-day delay. Their highly flexible model allows them to:

• Launch small-batch test production (100-200 units per design) to minimise financial risk,
• Add 2,000-6,000 new items daily to their website,
• As a result, offer an unparalleled product choice: for example, they introduced 1.5 million products between November 2022 and November 2023, 37 times more than Zara and 65 times more than H&M.

With a network of around 5,400 suppliers, mainly in Guangzhou, innovation also comes from SHEIN’s supply chain architecture. Proprietary software provides suppliers with real-time sales data and customer preference analytics. At the same time, AI and machine learning algorithms predict “micro-trends” by tracking online user behaviour (clicks, viewing time, searches).

Sales models: from self-managed to marketplace

SHEIN operates different sales models. First, they operate a self-managed model, selling their own brands and covering product development and design. This model accounts for 70% of SHEIN’s apparel sales. This model enables them to launch unique styles and attract young consumers.

They also have two managed models, representing 20% of the transaction volumes:

• Fully managed services are designed for merchants selling small goods without having online operation experience. Products are owned by the supplier and stored in SHEIN’s domestic warehouse, and SHEIN is responsible for packaging and delivery. Approximately 7,000 merchants operate under this model. Merchants can list thousands of products, as SHEIN doesn’t limit the number of SKUs.
• Semi-managed services are designed for merchants selling bigger products and having operational capabilities. These merchants have warehouses abroad where the goods are stored. They are mainly companies engaged in cross-border e-commerce business, already selling on Amazon. The number of merchants in the semi-managed model is about 13,000.

They also launched a third-party marketplace in 2023, accounting for 10% of sales as of 2024. Brands independently manage inventory, pricing, and customer service, similar to how Amazon operates. SHEIN offers special conditions, such as zero commissions for the first month. Third-party brands typically achieve a 10%-15% gross profit margin, while the same merchants on TEMU achieve 8%-13%.

Expansion left, right, not in the centre

SHEIN is not operating in its home market, China, either online or offline. The company’s expansion is exclusively international and includes establishing a physical presence just ten years after its inception. After several pop-up stores across Japan, SHEIN opened its first permanent space in Tokyo’s Harajuku in November 2022. At the opening, the 200 sqm showroom featured 800 items, changing rooms and a photo booth for shoppers to capture their outfits. This first permanent location is not a store per se, as customers must place orders online. Shoppers scan a product’s QR code, which directs them to SHEIN’s website or app, where they can make purchases and organise delivery. The space is still open to this day.

That same year, multiple 4-9 day weekend pop-ups in high-traffic locations opened around the world to test physical environments. In 2023, SHEIN planned 30 pop-ups across the EMEA region, driving immediate purchases and social media buzz. In 2024, pop-ups were organised in Australia, in 2025 in Toronto and Dubai, but also in secondary cities such as Dijon in France (or Indianapolis, U.S., in 2023). These pop-ups provided SHEIN with data-driven insights to inform expansion decisions. They also allowed customers to touch, feel and try on products to address persistent quality concerns and build trust and credibility.

In 2023, SHEIN also announced a partnership with Authentic Brands Group’s Forever 21. SHEIN would design, manufacture and distribute a line of Forever 21 co-branded products under the Forever 21 x SHEIN name. In 2025, French apparel brand Pimkie launched a joint venture with SHEIN to boost its digital sales and expand into 160 international markets. What those deals have in common is that both brands were, and are still, struggling.

Breaking stereotypes: customer demographics

SHEIN’s global customer base went from 2.8 million in 2017 to 88.8 million active shoppers (people who made at least one purchase) in 2023. Contrary to popular perception, SHEIN’s customer base is older than commonly believed. According to Statista, in 2025, the largest segment of website visitors is 25-34 years old, nearly 26%. The 35-44-year-old group accounts for almost 20% and the 45-54-year-old group is close to 16%. On its side, UBS Securities research shows that the average U.S. SHEIN customer is a 35-year-old woman with an annual salary of approximately $65,000.

In France, the platform’s core demographic comprises women aged 30-45, with a strong presence among 18-35-year-olds. The company’s remarkable penetration into the French market is an interesting example of how SHEIN transforms customer dynamics. The brand’s success is particularly pronounced in rural areas, with some regions experiencing twice the customer concentration of traditional retailers such as Zara. This geographic distribution challenges conventional retail assumptions: only 2.8% of Shein’s customers are in Paris, compared with 14% for Zara.

SHEIN’s French battleground

SHEIN’s conquer strategy

Before SHEIN sealed the deal with Société des Grands Magasins (SGM) and opened its permanent store in Paris’ BHV Marais, it conducted an intensive two-year lobbying campaign, just the time they needed to become indispensable, as 40% of the French population had at least made one purchase on one of the ultra-fast fashion platforms. SHEIN hired former Interior Minister Christophe Castaner (a French President ally) as a consultant from December 2024 to June 2025. He aggressively defended SHEIN, calling critics “disgusting moralists” and warning that the law would “penalise the most modest consumers.” The company also actively courted members of Congress with meeting invitations and deployed lobbyists in government offices to counter anti-fast-fashion legislation, promising environmental commitments and claiming to be decarbonising its supply chain. They targeted the French President’s office, the Prime Minister’s officials and various ministries, arguing the law was incompatible with E.U. free trade rules. Prime Minister’s advisors, among others, were heard repeating SHEIN’s arguments and characterised the law as voted against by the working classes. On its side, the Ministry of Economy openly opposed the legislation, citing E.U. trade regulations. Despite this intense lobbying, Congress voted unanimously in favour of the law, though it included reduced taxes.

The SHEIN-SGM deal: a calculated risk that backfired

In October 2025, SHEIN announced an unprecedented partnership with SGM for permanent spaces first in BHV Marais, then in seven affiliated provincial Galeries Lafayette stores.

It is no secret that BHV Marais was struggling, even more so since SGM took over. CEO Frédéric Merlin tends to be regarded as a questionable businessman, even more so now that he has actually become SHEIN’s lobbyist in chief. He’s known for operating real estate and malls and for having numerous unpaid vendor invoices. He expected the SHEIN partnership would boost traffic, attract younger shoppers who tend to avoid department stores, generate significant rental and commission revenue and benefit the other store floors.

SHEIN’s 1,000 sqm store opened on the sixth floor of BHV Marais on November 5, 2025. The product range included women’s, men’s fashion and accessories. According to SHEIN shoppers visiting the store on the first days and checking the QR codes on garment labels, items were priced significantly higher than on the website (€11.99 for a sports bra, €32.99 for a top, €35.49 for a denim pants, €48.99 for a pullover, €118.99 for a coat, for example), which was disappointing for customers. Seven thousand visitors came on the first day, 50,000 over the first five days, 300,000 over the first month, but did not find the very low prices SHEIN is known for. The average basket was reported at €45 per transaction (well above the online average purchase price of €10), which seems accurate given the price point. Frédéric Merlin reported to various media 15% to 30% cross-selling rates among SHEIN customers making additional purchases in other BHV departments.

In parallel, BHV mentioned difficulties: a 10% drop in foot traffic during the fourth week and a conversion rate below expectations. In other words, people are coming but not buying. The few pictures attached to this article show how empty the space was during the IADS visit (a weekday lunchtime). While Frédéric Merlin reports that approximately 10,000 people visit SHEIN daily as of mid-December, the IADS recorded only 20 customers during its visit (also see a video shot by the president of the French RTW federation on Saturday, 6 December here).

Provincial expansions were initially planned for SGM-operated provincial Galeries Lafayette stores in Dijon, Angers, Grenoble, Limoges and Reims, but these openings have been postponed to unknown dates.

For SHEIN, the BHV partnership was a new step toward establishing a permanent physical presence and validating brand legitimacy ahead of troubled IPO attempts. It also provided an opportunity to address quality concerns by allowing consumers to examine products. Ultimately, the partnership was designed for SHEIN to test a hybrid model that combines online convenience with in-store engagement and to counter French anti-fast-fashion legislation by demonstrating local job creation and economic contribution. Ultimately, the controversy reportedly caused a 38% drop in online orders the very next day the SHEIN space opened, according to data from cashback specialist Joko, which examined one million transactions. Most importantly, the figures show a 45% decline in orders placed on the site between October and November. Finally, when comparing November 2024 and November 2025, the sales decline would be as dramatic as 54%. This decline in SHEIN sales should be interpreted with caution, however.

What happened with SHEIN and SGM: everyone said no

360° pressure: politics, retail, culture and even customers against one store

As soon as BHV and SHEIN unveiled the deal, pressure mounted from all sides, triggering unprecedented opposition, often highly emotional, from the French retail, political and cultural sectors. Controversies were not new, though, with factory workers’ working conditions issues, child labour cases, 16.7 million metric tons of CO2 emissions in 2023 making them the biggest polluter in fast fashion, 76% of products made in polyester fabrics, 32% of clothing containing hazardous chemicals violating E.U. limits, intellectual property violations and copyright infringement cases.

However, pressure reached an unprecedented level. Shortly after the partnership announcement, Galeries Lafayette Group terminated its partnership with SGM, refusing to have its venerable name become synonymous with SHEIN, with SGM’s provincial stores to be rebranded as BHV. Caisse des Dépôts’ Banque des Territoires (a French public investment bank), which was due to finance the acquisition of the BHV building, withdrew from the deal.

Street protests were organised. Disneyland Paris cancelled the 2025 Christmas window display project with BHV. Then, numerous brands withdrew from BHV in protest, including LVMH brands, Diptyque, SMCP brands, Armor Lux, Figaret Paris, Le Slip Français, Aime Skincare, among others. Galeries Lafayette is also set to withdraw its private-label brands, except for La Redoute bed linens, which will continue to be sold in-store as of December 2025.

Retail federations escalated their actions. Retail industry body Fédération des Enseignes de l’Habillement (federation of apparel retailers) announced it was expelling Pimkie. A coalition of more than 100 French brands and 12 retail federations filed a landmark legal action against SHEIN, alleging the fast-fashion giant engaged in systemic unfair competition. The coalition cites a pattern of illegal practices, including misleading advertising, non-compliance with product standards, counterfeiting, and breaches of data protection laws. These actions, they argue, have destabilised the French retail landscape, threatening thousands of jobs and undermining local businesses.

On the political side, although relatively muted in recent years, reactions flooded in as soon as the SHEIN-SGM deal was announced. The Ministry of Economy acknowledged that SHEIN paid almost no taxes or VAT, resulting in a loss of billions of euros to the country. The Paris Mayor denounced the partnership, as did the Prime Minister and the Commerce Minister, among other officials. Mayors of Dijon, Angers, Grenoble, Limoges, and Reims publicly opposed the planned expansion of SHEIN in their cities.

The situation escalated in November 2025 when child-like sex dolls and Category A weapons were spotted on the platform. The French government suspended SHEIN’s marketplace. The suspension was later lifted after SHEIN removed illicit products. The French government also launched actions on product compliance, blocking thousands of parcels at Paris airport, revealing that 80% of inspected Chinese products were non-compliant.

Finally, France sought a three-month suspension of the SHEIN website in a court hearing (rejected since then), abandoning its bid to suspend SHEIN’s website entirely. Also, the E.U. noted that the Digital Services Act (DSA), which regulates the activities of online platforms and imposes fines of up to 6% of their global turnover, would not permit the suspension of SHEIN. The decision rests with the country in which the platform is based (Ireland in the case of SHEIN). It would occur only in the event of systemic risks, not merely due to a limited number of illegal activities.

Despite politics and officials’ protests, France cannot and would not ban SHEIN even if it could: companies like SHEIN are, so far, the only answer to the overwhelming French purchasing power problem. Also, banning SHEIN would emphasise the profound disconnect between wealthy cities and unprivileged secondary cities and rural territories. As Michel-Edouard Leclerc (owner of the large Leclerc French supermarket group) explained, SHEIN cannot be banned now that it has operated for several years without having been seriously questioned by governments or states.

What SHEIN’s Paris experiment reveals about fashion’s future

The SHEIN-BHV deal has sparked considerable debate about the strategic direction of both companies. For SHEIN, the Paris store’s underwhelming performance raises critical questions about the viability of physical expansion. The success of SHEIN stems from its DTC model, an endless, low-priced product offering, numerous promotional deals, and influencer-led, seductive social media campaigns, all of which drive customer excitement in the online shopping experience. However, this formula doesn’t translate seamlessly to brick-and-mortar retail, where customers encounter a limited selection at relatively higher prices and low quality, a stark contrast to the brand’s online promise. This disconnect appears to be reflected in declining foot traffic, with the SHEIN space showing sparse customer presence about a month after opening.

Rather than maintaining the brand’s characteristic low prices and treating the store as a marketing investment, SHEIN chose to increase prices to present a more upscale brand image, preserve margins, and likely comply with French regulations prohibiting loss-leader pricing. The choice of Paris as the location for SHEIN’s first permanent store is also worth examining. While the symbolism is undeniably powerful, demographic data suggest that secondary cities, where SHEIN’s core customer base is concentrated, might have yielded better results. That said, the elevated pricing strategy would have posed similar challenges regardless of location. Evidence from previous pop-up stores, which outperformed the BHV space, indicates that the limited-time excitement factor is crucial to SHEIN’s physical retail success. Based on current performance, permanent locations may not be the optimal strategy for SHEIN to establish a meaningful presence in key cities.

From a department store, retail and brand perspective, the SHEIN-BHV deal is also interesting. First, SHEIN is not the solution to department stores’ problems. In BHV’s case, it appears to be in a worse position than before the SHEIN deal. Store sources say the store lost 70% of its turnover, and brands continue to withdraw as of mid-December 2025, leaving the shop floors very airy (even though BHV responded quickly by changing layouts to conceal the empty spaces).

Moreover, after Caisse des Dépôts’ Banque des Territoires withdrew following the announcement of SHEIN’s arrival, SGM has been seeking partners to raise the €300 million required to purchase the building from the Galeries Lafayette Group. The acquisition deadline was set for 19 December 2025. “On that date, exclusivity lapses and we reserve the right to explore all the options open to us,” a Galeries Lafayette spokeswoman told AFP. The Paris city hall even declared that it was exploring the possibility of acquiring the property to safeguard jobs and maintain activity. In the end, Canadian fund Brookfield, Galeries Lafayette Group and SGM sealed a deal under which Brookfield would acquire the building for €250 million. While it’s unclear whether the SHEIN space will survive the acquisition, Brookfield is not planning to radically change the building’s purpose; rather, it plans to revive it, requiring a strategy to recreate value over several years.

Finally, from a broader perspective, how should we prepare for the future, given that SHEIN or a similar company could leverage its highly efficient business model to sell responsibly produced products or build full-fledged brands?

SHEIN represents a fundamental paradox: a company recognised for technological innovation and significant consumer demand, yet facing unprecedented regulatory hostility, and a business model that achieves market dominance while struggling to gain legitimacy. SHEIN’s trajectory will likely depend on three factors: its ability to navigate escalating regulatory frameworks, the success of omnichannel expansion in legitimising the brand and addressing quality concerns, and its capacity to address labour and environmental controversies while maintaining an ultra-low-price positioning in a credible way. The France experiment’s low-to-mild commercial success amid fierce political opposition encapsulates these tensions and will serve as a critical test case for SHEIN’s broader physical retail ambitions. Whether SHEIN represents the future of fashion retail or an unsustainable model facing imminent regulatory constraint remains the industry’s most consequential question.

Credits: IADS (Christine Montard)