Shein, the Chinese online fast-fashion retailer, has come under scrutiny. A related shirt listing on its localized .it website, which briefly displayed an image that appeared to be Luigi Mangione, turned many heads. The outrage gained significant traction on social media, leading Shein to announce they had launched a third-party investigation of the hiring process that led to the incident. The company is planning a big initial public offering on London Stock Exchange. If successful, this move would increase its valuation to up to £50 billion ($67 billion).
As a company, Shein is known for rapidly creating cheap clothes. It’s gained an international name for itself, mostly through its focus on Gen Z and younger millennials. The firm uploads new designs at the pace of thousands a day, epitomizing its speed to market in matching the fast changing style landscape. With the recent episode surrounding the shirt, it has prompted outsiders to question Nike’s quality control processes.
The ecommerce business Shein quickly took down a shirt with the offensive image after Google searches for “Luigi Mangione Shein” spiked. Furthermore, the specific time frame that the shirt was offered for sale is still unknown.
In response to the incident, a Shein spokesperson stated, “We have stringent standards for all listings on our platform. We are conducting a thorough investigation, strengthening our monitoring processes, and will take appropriate action against the vendor in line with our policies.”
Shein underscored its efforts to prioritize the safety and compliance of all products sold. The company later corrected the story, noting that it was a third-party vendor which provided the specific image under fire. True, they removed it right away after realizing the mistake.
This probe is launched as British MPs and investors are ramping up scrutiny on the labour conditions in Shein’s supply chain. Many stakeholders are questioning the ethical implications of the company’s operations, particularly as the UK government reviews regulations that allow goods valued under £135 to enter the country without incurring customs duties.
An idea for Shein to list its shares in Britain has already hit a wall. The company’s failure to gain approval from Chinese regulators for a proposed UK listing ultimately doomed the plan. Now, it’s scrambling for an alternative, actively pursuing a separate listing in Hong Kong. This change underscores the legal minefield Shein is wading through as it tests the limits of what it can get away with in markets worldwide.
Shein’s primary competition in this sector, Temu, has recently made strides to become a major force in the fast-fashion industry. Now authorities in the US and UK are reconsidering customs regulations for imports. In doing so, Shein’s fast design to consumer model may be stripped of its greatest advantage. Most notably, the US recently eliminated its “de minimis” exemptions. Now, goods worth less than $800 will no longer avoid customs duty and some inspections.