New Shein Executive Aims to Expand Supply Chain Outside China

livemint.com:

Fast-fashion giant Shein is expected to announce Friday new leadership overseeing its global growth initiatives as the company seeks to diversify its supply chain beyond China. Marcelo Claure, a former SoftBank Group executive, will serve as group vice chairman, a New York-based role that involves expanding manufacturing beyond China to be closer to Shein consumers, he said. “We’re not saying that we’re replacing China," Claure said.

“We’re saying that we’re finding countries where you can have a competitive advantage by being more local." Singapore-based Shein was founded in China in 2012. Over the years, it has disrupted markets globally and grown to become one of the world’s biggest fast-fashion brands with its ultra-affordable clothing. Shein sells in more than 150 countries though not in China, where the bulk of its suppliers are.

Shein’s explosive success relies on an on-demand manufacturing model. It subcontracts thousands of small manufacturers in China. They make products in small batches to test market appetite and replenish orders as demand increases.

Claure joined Shein in January to oversee the company’s operations and strategy in Latin America and steer efforts to expand its reach to suppliers and partners in the region. Before joining Shein, Claure made a personal investment of about $100 million in the online marketplace. This year, Claure has launched Shein’s marketplace in Brazil and the localization of its operations, working with 220 factories there.

The company now seeks to source fabrics and build supply chains in other markets where they operate to be closer to customers. This would shorten the delivery time and, in some cases, save production and logistics costs, Claure said. Claure’s promotion