Ahead of its long-awaited IPO, Chinese fashion retailer Shein, known for its bargains, is experiencing a slowdown in sales growth, according to a media report. The cause is the bitter competition with rival Temu.
The turnover increase slowed to 23 percent in the first half of this year, after 40 percent last year, industry service ‘De Informatie’ reported on Tuesday, citing two people familiar with the matter. The slowdown coincides with increasing competition from Chinese bargain website Temu, which has become increasingly popular in the US in recent years.
Profits fell by 70 percent
According to the report, the company’s profits fell by more than 70 percent to almost $400 million in the first half of this year. Sales reached $18 billion during this period. Shein previously enjoyed rapid growth, fueled by its low-cost business model, shipping packages directly from factories in China to customers around the world. Last year, the company was valued at $66 billion in a financing round. Shein does not publicly announce its global results. The company did not immediately respond to a request for comment.
Temu and Shein are discredited among European consumer groups and trade associations for their sales practices, products with poor safety standards and circumventing customs controls by packaging below customs limits. Shein, one of the world’s largest players in the young ‘fast fashion’ market segment with cheap and quickly changing collections, is in discussions with its advisors about a listing on the London Stock Exchange, according to information from Reuters.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
