The fast fashion brand Shein expressed interest last 12 months when it listed on the New York Stock Exchange (NYSE). But after meeting resistance from US politicians, including Republican Senator Marco Rubio of Florida, the time has come allegedly turned his attention to London.
While this could be a lift for the London Stock Exchange (LSE), which has lost several organizations to other international exchanges over the past five years, it raises questions as to why Shein was unsuccessful with its application to the NYSE.
Shein has gained significant global market share in online fast fashion since its launch in China in 2008. The company succeeded and accelerated the evolution of the already lucrative fast fashion business model into one ultra-fast fashion Retailer.
This Shein is the second hottest Fashion retailer for America's Generation Z is just not surprising given the big choice of as much as 10,000 New clothing items are uploaded to significantly day by day lower prices than fast fashion competitors like Zara and H&M.
But the strategies that enabled Shein's international expansion at the moment are likely hindering his NYSE bid. The low price of fast fashion basically has long been linked to potential labor exploitation, and the uncertainty of outsourcing fashion production to the most cost effective supplier inside a worldwide supply chain was highlighted through the 12 months Pandemic. And as awareness of unethical and unsustainable practices grows across the industry, activists should have the facility to disrupt Shein's growth.
The Swiss NGO Public Eye reported on alleged exploitation in factories allegedly utilized by Shein, which itself recently issued a comprehensive statement Answer It has made “significant progress” in improving conditions. In the US, Rubio introduced a law blocked imports of Uyghur slave labor in China in 2021 and has since ordered an investigation into Shein and Chinese low-cost retailer Temu to find out whether their goods violate the law.
climate emergency
The US goes even further in regulating the style industry. In New York the Law on sustainability and social responsibility in the style industry will, if passed, enact laws that fashion and footwear brands with sales of greater than $100 million (£79 million) must map 50% of their supply chain to make sure transparency. They must also develop plans to cut back their social and environmental impacts.
Likewise, the European Parliament declared in 2019 a climate emergencyand the European Commission responded by developing the European Green Deal. This also includes the planned laws that may force the style industry to take care of this sustainability Problems, meaning that through 2030 Fashion and textiles must turn into more durable, repairable and recyclable. Companies will even need this Strategies From the design process to the tip of life, all measures are in place to maximise resources and avoid contributing to landfill.
French politicians They are also “enacting laws to limit the excesses of ultra-fast fashion”, with a surcharge of €5 (£4.29) per item from 2025, rising to €10 by 2030. This is a recognition that ultra-fast and fast fashion contributes not only to labor exploitation, but in addition to the environment. Since fast fashion is seen as disposable, it has proven to be encouraging constant consumption.
While Shein's listing on the LSE could improve the corporate's repute and profits, it could have a negative impact on the brand in the long run. Shein could turn into more visible to a broader audience, and with more understanding of sustainability and business practices that contribute to the climate emergency, activists could begin targeting shareholders and other organizations and other people with ties to the corporate.
There is a precedent for this – activists who’ve targeted museums and galleries on account of their sponsorship by energy firms, as well Protests on campus In the USA and Europe, universities are demanding that they divest from Israeli firms due to Gaza war.
This trend of publicly criticizing brands for exploitative or unethical behavior has been circulating on social media amongst fast fashion retailers for years. In particular, Influencers that promote “fashion hauls” have been criticized for promoting unsustainable fashion consumption.
It could seem that the style industry is being unfairly scrutinized for failing to handle sustainability. After all, it is just not the one industry that harms the environment. But the test seems valid; The United Nations is now convinced that the style industry is the second largest polluter on the planet.
Additionally, as an industry, the industry openly flaunts its low prices and quick sales, with marketing tactics comparable to “last chance to buy” or “low inventory,” in addition to discounts that encourage frequent impulse purchases. Our research found that fast-fashion marketing on social media is “intrusive” and encourages mindless consumption of garments that always lie around in closets with the tags still attached.
Fast fashion retailers often promise sustainability to ease consumers’ “eco-guilt.” ambiguous and can’t be easily justified. But fast and ultra-fast fashion can never be sustainable on account of the speed of sales and items which might be often thrown away after one wear.
Although marketing attracts customers via social media, the messages consumers see as they scroll are increasingly competing with stories of activism and protests against the harmful effects of fast fashion.
As regulatory measures for the fast fashion industry expand to more regions, the impact will almost actually impact the industry's profits. While a London IPO by Shein might be a win for the LSE, it could spell trouble for the retailer because it – and its practices – face increasing scrutiny.
image credit : theconversation.com