Ever wondered whether budget-friendly fast fashion giant Shein managed to keep trending overnight with trends? It all depends on Shein’s “micro production” model, which allows for lightning transformation based on real-time demand, said Peter Pernot-Day, head of strategy and corporate affairs.
Speaking at the Vancouver Network Summit today (May 30), Pernot-Day said: “We are customizing the supply of products for the actual demand in the market.” Unlike traditional retailers who usually produce 50,000 to 100,000 units per month ahead of schedule, Shein started in small batches of emerging trends (just 100 to 200 pieces of clothing).
Shein then uses data from its e-commerce platform to assess interest, track metrics such as product hovering, shopping carts and social media share. This real-time feedback allows designers to boldly experiment and help companies maintain styles while minimizing overproduction, Pernot-Day said.
Founded in China and now headquartered in Singapore, Shein is known for its low-cost, trend-driven clothing. The company is worth up to $100 billion in 2022. But potential public offerings in the UK are approaching and growing economic challenges, including Trump-era tariffs and the removal of “minimum exemptions” that previously allowed goods under $800 to lower their valuation of $3 billion, reportedly the commodity has to be under $800. The company also continues to face criticism of labor practice, intellectual property disputes and environmental impacts.
Nevertheless, Pernot-Day believes that Shein’s on-demand production model actually reduces waste. He said that since the company only produces what consumers may buy, excess inventory is still in “very low unit numbers.”
In response to the claim that Shein fuel is over-consumption, Pernot-Day also defends the durability of its products. “About 68% of shoppers wear Shein products multiple times,” he said, delaying the idea of retailers to produce “disposable” fashion. “When you look at the data, when you talk to our customers, they keep our clothes for longer, and the main way they dispose of them is through gifts.”
