Why is Shein collecting fast fashion brands?

Last week, Chinese fast fashion giant Shein announced the acquisition of business rival Missguided, an English online retailer founded in 2009 by Nitin Passi. According to the companies, this is a joint venture, a different type of collaboration from the one launched by Shein and Forever21 last August but similar in its objective. The acquisition of a third of Forever 21's shares allowed Shein to place its products in the physical stores of the US brand, known for its strategic positioning in the country's shopping malls, while that of Missguided will offer unprecedented access to the UK market, where Shein currently has less media and commercial traction.

«The joint venture we have entered ushers in a new format of partnerships for Shein,» said Shein CEO Donald Tang. «Shein aims to reignite the Missguided brand, capitalising on its unique brand personality, and fuelling its global growth through Shein’s on-demand production model, unparalleled e-commerce expertise and global reach.» Taking advantage of an unstable time for the two brands - Forever 21 filed for bankruptcy in 2020, Missguided in 2022 received a winding-up order from its suppliers - Shein is beginning to gain ground both in the US, where members of Congress are trying to ban it, and in the UK. By doing so, the two companies get a relaunch on the Chinese retailer's site, while Shein can be present in their physical stores, expanding its distribution network.

Unlike the acquired brands, Shein's growth is relentless. While in 2022 the company received a valuation of $22.7 billion, this year it has managed to reach $66 billion, getting closer to the capitalisation of Uniqlo's owner group, its $69.7 billion business rival. In the case of Forever 21, the Chinese fast fashion company announced that the US brand will be able to keep its real estate and employees, but Shein will also be able to bring its production method to the other names in Forever 21's portfolio. Last week, the two brands launched their first co-creation collection on Shein's website, available only on the Chinese platform.