Fast fashion giant Shein announces its first branded credit card, marking a new phase in its global strategy.
- In collaboration with Mexican fintech Stori, Shein to offer reward points on purchases, doubling on clothing orders.
- The move comes as Shein’s sales growth decelerates to 23% in the first half of the year.
- Shein’s profits have significantly declined, dropping over 70% to below £308m ($400m).
- Preparations for a potential IPO are underway, with key appointments made for the London Stock Exchange launch.
Fast fashion leader Shein is on the brink of launching its first-ever branded credit card as part of its global expansion strategy. This financial venture is being arranged in partnership with Mexican fintech company Stori, which will enable consumers to earn points on purchases made through Shein’s platform, with an added incentive of double points on clothing orders. This development, reported by Reuters, aligns with Shein’s broader objective of expanding its footprint globally and improving customer engagement.
The introduction of the credit card coincides with a noticeable slowdown in Shein’s sales growth, which tapered to 23% during the first six months of the current year—a considerable dip from its previous growth rate of 40% in the last year. This slowdown is reportedly part of a broader set of challenges facing Shein as it navigates the complexities of rapid international expansion and market saturation.
Financially, Shein has faced a significant downturn with profits plummeting more than 70%, resting at just under £308 million ($400 million), as revenues reached £13.8 billion ($18 billion). This stark profit decline highlights the pressures of scaling up operations and the investments required to sustain growth in a competitive retail environment.
Amidst these financial dynamics, Shein is actively progressing towards a potential initial public offering (IPO) on the London Stock Exchange, a move that could provide the company with a fresh influx of capital and enhanced market visibility. Informal investor meetings have been held recently as part of this strategic preparation. Notably, Shein has appointed Barclays Plc and UBS Group AG as bookrunners, with additional advisory roles being filled by Goldman Sachs Group Inc, JPMorgan Chase & Co, and Morgan Stanley.
These strategic maneuvers underscore Shein’s commitment to solidifying its position within the global fashion retail industry, despite current financial contractions. By leveraging partnerships and strategically planning financial operations, the company is striving to overcome current hurdles and position itself favorably for future expansions.
Shein’s credit card launch and IPO preparations reflect its strategic adaptability in an evolving retail landscape.
