The surprise at the end of the year is like a blind box, just after experiencing a big promotion on the Black Friday Network and the trademark thunderstorm, I am still unsettled, and suddenly it is rumored that SHEIN is about to realize the "American dream".
Since SHEIN became a unicorn, there have been more rumors of going public in the United States. Although officials have denied the plan to go public several times, attention to the possibility has not diminished, including on Wall Street.
Goldman Sachs, JPMorgan Chase and Morgan Stanley have been hired as the lead underwriters for IPOs, and SHEIN's U.S. listing could be one of the largest IPOs in recent years, according to Wall Street.
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The rise of SHEIN is quite magical. When most overseas e-commerce companies are still relying on e-commerce platforms, SHEIN has already begun to build its own brand independent stations around the world. In 2022, SHEIN will become the world's third largest "unicorn" with a valuation of $100 billion, and this news has made overseas markets call it amazing. Digitalization and flexible chain management have made SHEIN stand out in the era of cumbersome traditional chains and established its own competitive barriers.
Unlike other fast fashion brands, SHEIN has not been eroded by the impetuosity of the fast fashion industry, but has shown long-term planning and investment in market expansion and global layout. In recent years, although many overseas brands have emerged, it is still rare for companies like SHEIN to localize emerging markets to the extreme through the "blood exchange" of the first-chain layout and high-level appointments.
Although Shein officials have always been "unclear about the specific situation of the IPO", the news about its upcoming listing at the end of the year has spread in the industry. As early as May, there were rumors about SHEIN's listing, and there was speculation about "bloody financing" with a valuation of $66 billion during the same period, which SHEIN insiders subsequently denied. However, recently** once again disclosed that SHEIN has secretly submitted listing materials to the US Securities and Exchange Commission, and said that some investors have received an official roadshow invitation, and the brand will seek a valuation of up to $90 billion in this IPO.
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In May this year, U.S. Congressman Mike Lawler co-signed more than 20 U.S. congressmen to submit a letter of inquiry to the SEC about SHEIN's listing filing, pointing out that "SHEIN is ambitiously preparing for a listing plan before the end of the year." Although SHEIN has maintained a consistent official statement on the specific situation of the IPO, the outside world has paid significantly more attention to this rumor than in the past.
SHEIN's uniqueness lies in its impact on the global market, especially in the context of the dual impact of the epidemic and the growth of online consumption in the local apparel retail market in Europe and the United States. The revenue and valuation of local apparel retail brands in Europe and the United States have shrunk as a whole, while SHEIN has risen against the trend.
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Judging from the market size and profit performance, SHEIN seems to be no longer the low-key fast fashion giant. As of February this year, SHEIN has achieved profitability for four consecutive years, with a profit of $1.1 billion in 2021 and a profit of $700 million in 2022 under the impact of the general environment. However, industry sources revealed that SHEIN's revenue in the first three quarters of this year increased by more than 40% year-on-year, which has far exceeded H&M, and is expected to replace ZARA as the top of the industry by the end of the year.
Since its rise to fame, SHEIN's transformation path has been resisted. This year, SHEIN has completed the full-category expansion and third-party merchant entry policy, trying to realize the transformation from an "independent station for fast fashion brands" to a "full-category e-commerce platform". Compared with integrated e-commerce such as Amazon and apparel retail brands such as Zara and H&M, SHEIN's overall customer unit price is low, coupled with its deep understanding of social ** marketing, which will inevitably lead to the controversy of "low-price competition". In addition, the U.S. lawsuit with Temu caused a stir, and a settlement was reached in October this year.
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In this year's shopping season, many overseas ** called SHEIN "a Chinese fast fashion company headquartered in Singapore" in their reports, and even pointed out that SHEIN can only attract people who "just watch and don't buy", which is lower than 4The 5% conversion rate is nowhere near Amazon's 56%. These reports make SHEIN face not only commercial competition in the market, but also doubts from the ** and the public.
In the face of doubts from the outside world, SHEIN did not sit still. In terms of environmental protection and social responsibility, SHEIN has taken positive actions. By incorporating environmental issues into decision-making, SHEIN has successfully "turned waste into treasure" in packaging bags and reduced packaging waste. The official ** also details the use of more environmentally friendly technologies and solutions to optimize the processing process, through the production of on-demand flexible ** chains, effectively reducing inventory waste.
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In addition, SHEIN has expanded its "localization" strategy to the first chain and warehousing location. Last year, in order to consolidate the markets in Western Europe, the Middle East and Eastern Europe, SHEIN built a local ** chain in Turkey and located its warehousing and distribution center in Poland. In September this year, SHEIN significantly enhanced its strategic position in the Latin American market, cooperated with more than 2,000 local ** merchants in Brazil, and invested equivalent to 1$500 million in local currency, committed to achieving 85% finished products** across Latin America by 2026.
After a long tug-of-war, SHEIN's profitability has been fully demonstrated.
If the rumors come true, the upcoming plan to go public in the United States will provide SHEIN with richer financial support to further expand its global business. At the same time, the changes in stock prices will also reflect market and industry trends more quickly, so that SHEIN can obtain more flexible strategic adjustment capabilities in an uncertain market environment.
In the global environment of economic downturn, competition in the fashion industry is harsh. In the face of a new round of upgrading in the fashion industry, it is obvious that SHEIN is actively promoting its globalization strategy.
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In addition to the listing plan and equity changes, Shein is also adjusting its organizational structure, looking for a "fulcrum" that can not only maintain its own stability, but also leverage more long-term development. The recent launch of new projects such as the global talent linkage, the designer incubation cooperation project "SHEIN X", and the million-seller program "Accelerashein Xi Gravity" all show that SHEIN intends to build more regions and more comprehensive capabilities, and integrate the development agenda of global enterprises into the brand's blood.
Of course, maybe the news of going public in the United States will be denied in the end, but SHEIN wants to become bigger and stronger.