More on Shein’s success - if only CCX would take note and do...

More on Shein’s success - if only CCX would take note and do just a fraction of what Shein has achieved-


“For a first-time shopper scrollIng Shein, the initial shock is the prices: a pair of kiwi- and lemon-bedecked swim trunks for $6, a glittery one-shouldered women’s jumpsuit for $10, a three-pack of children’s shorts for $6.56. Then there’s the sheer volume. Unlike other retailers, Shein breaks its “new arrivals” section into individual days. On June 2, for instance, the retailer added 2,257 new women’s styles—a tally that doesn’t include whatever men’s, children’s, and home items hit the site that day. Some estimates have put the influx of new designs at about 6,000 to 8,000 a day.”


”The company attributes its low prices and vast selection to what it refers to as its “on demand” business model. While traditional apparel retailers forecast trends and order items based on what they hope will sell, fast-fashion companies look at what designers and retailers are offering and try to jump on whichever trends are taking off. Shein follows the second model, but with a significant twist. The company says it relies on user activity on its app to determine in real time which products are attracting the most interest and uses that information to quickly iterate on and make more of the most popular designs.

“This is kind of the product of the digital age,” says Sheng Lu, associate professor of fashion and retail studies at the University of Delaware. “It’s a study on how to leverage digital tools and data science to…create new products based on the market trends observed from interacting with consumers.”Too produce a new design, most retailers need to place bulk orders in the tens of thousands per item to meet manufacturers’ minimum requirements.

That means, at best, the need to store and distribute that inventory, and, at worst, thousands of unsold pieces that eventually need to be marked down, eating into profits.

The Shein model miniaturizes that approach. The company partners with tens of thousands of small Chinese manufacturers, which allows it to produce thousands of styles in batches of just 100 to 200 items.

If a design is popular, Shein can crank up production quickly, often in less than a week. If it bombs, the company is left with just a handful of stinkers. As a result, the company says it maintains low-single-digit inventory levels, well below the industry average.”

Last paragraph- if only CCX did this, we would have avoided a peak $190m investment in stock calamity that transpired over last 18 months