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As the saying goes, "Fame brings trouble." When talking about the "top stars" in the cross-border e-commerce industry in recent years, SHEIN is definitely one of them. This fashion unicorn initially emerged in the cross-border circle with a valuation of US$15 billion. It took advantage of the early traffic dividend period and the online consumption boom during the epidemic, and won the favor of countless consumers and capital through its innovative digital flexible supply chain and powerful marketing. The speed and scale of its development have been moving forward, and every step has attracted the attention of industry insiders. As of 2023, SHEIN has not stopped its pace of progress. While other imitators are still struggling to find out how to break through the cross-border e-commerce track with fast fashion independent websites, SHEIN has taken another step, moving from the independent website self-operated model to further expansion into the platform model, and has opened up a new path for cross-border expansion - the dual model of self-operated + platform . The dual modes of self-operation and platform provide merchants with a "menu-style" choice According to media reports, the SHEIN platform model has successfully achieved progress beyond expectations in the United States, enabling it to achieve its highest semi-annual profit to date in the first half of this year, while also having the confidence to accelerate its expansion: after launching the platform model in Brazil, the United States, and Mexico, there is news that the SHEIN platform model will be launched in five European countries, including Poland, Germany, Spain, Italy, and France, in the third quarter of this year.
Although it is still in its infancy, judging from the feedback from sellers who have settled in SHEIN, SHEIN's platform model has received high praise. ▲ The picture comes from the seller communication group The industry generally only knows that SHEIN has a well-known independent fashion brand SHEIN, which is as popular among overseas consumers as ZARA and H&M. In the list of the most popular fashion brands, it even surpassed Nike and ZARA, becoming a fashion brand from China that is accepted by the mainstream Western market. You can imagine how difficult it is. For so many years, Japan has only produced the affordable light of Uniqlo, and ZARA, which came out of a small town in Spain, is also the pride of the local area. But what everyone doesn’t know is that, in addition to the SHEIN own brand, this cross-border independent site has also long begun purchasing products from other brands, using the OBM method to help these products and brands go overseas, while also enriching the product richness on its independent site. There are also some merchants who cooperate in a platform model, which is the VMI model that was previously well-known to everyone, and the platform model that everyone hears about now. From media reports, we can see that SHEIN's platformization pace began to accelerate in 2022. After a year of testing in Brazil, it has been launched in major mainstream markets this year. The SHEIN platform's investment promotion model also continues its previous menu-style style and cooperation model. Different types of merchants have different forms. One is a full-hosting model similar to agency operation, which is suitable for sellers without independent operation experience. The other is a completely independent operation model, where sellers can flexibly formulate their own operation strategies. ▲ Seller's comments The diversity and adaptability of the cooperation model, coupled with the generous support policies and the huge traffic dividends in the early stage of opening , make the SHEIN platform model attractive to countless sellers once it is opened. According to MarketplacePulse data, as of July 2023, thousands of sellers in the United States have settled in SHEIN Marketplace. There are also many well-known brands such as Anker Innovations in China who choose to settle in SHEIN after receiving the invitation to invest. But at the same time, as the cross-border e-commerce industry enters the second half, facing increasingly scarce market resources, the smoke of war has already spread to the invisible battlefield of going overseas. Under the undercurrent of change, SHEIN, as the "top player in the industry", not only has external worries: it is the first to bear the brunt of the various difficulties the United States has posed to Chinese companies, but also internal troubles: fighting wits and courage with the "Chinese fellows" who are going overseas together.SHEIN and Temu meet on a narrow road - top stars meet top stars Compared to tearful eyes, in the business world, it seems that "when fellow villagers meet, they shoot each other in the back" is more common.
It is learned that at the end of last month, Temu filed a new lawsuit in the United States, accusing SHEIN of violating US antitrust laws by requiring thousands of manufacturers to sign exclusive agreements with it to prevent them from cooperating with Temu. In response, a SHEIN spokesperson responded immediately: Temu's accusation has no basis, and the company will firmly deny it and actively respond to the lawsuit to defend its rights. As both parties are "top figures in the industry", this dispute inevitably caused a stir in the industry. Industry insiders pointed out that the cause of this incident might be that SHEIN sued Temu in a U.S. court, accusing Temu of suspected plagiarism and infringement , including trademark dilution, improper source identification and unfair competition, false advertising, commercial fraud, copyright infringement, commercial defamation and unjust enrichment. It is also worth mentioning that we have learned from the feedback of sellers that Temu merchants generally have weak brand awareness, and the platform's supervision in this regard is not strict enough, which has led to the continuous fermentation of infringement incidents on Temu. In addition to SHEIN, more and more Amazon sellers have also taken up legal weapons this year and sued Temu for brand infringement. "Late Post" also reported that Amazon publicly encouraged dozens of Amazon sellers to defend their rights. Regarding Temu's lawsuit against SHEIN, there has been a lot of discussion in the industry. Some netizens even summarized it as a showdown between the Chinese and Western development ideas. ▲ Netizens’ comments on the lawsuits filed by both parties It is learned that most sellers said that they have not heard of SHEIN requiring suppliers to sign an exclusive agreement. In addition, the cooperation between the two parties and clothing factories is originally two models. Shein cooperates with clothing factories mainly on its own brand products, that is, products with the Shein brand. The factory supplies according to the standards and requirements of the Shein brand; while the relationship between clothing factories and temu is that merchants supply goods to the platform. Some legal experts also pointed out that although SHEIN is one of the favorite fashion brands of consumers in the United States, it does not have a monopoly: on the one hand, there is still considerable room for growth in the American fashion market, and SHEIN does not have a dominant position; on the other hand, its predecessors who are also big players in the fashion market, such as Uniqlo, which occupies most of the market share in Japan, and ZARA, which ranks first in the Spanish market, have never been sued for monopoly. Based on this, everyone discussed that Temu's accusation that SHEIN violated US antitrust laws was more like a predatory means of competition. To this day, there is no sign of the battle between the two ending, but under the undercurrent of change, the increasingly thick smell of gunpowder among overseas companies is visible to the naked eye.Competition among Chinese companies going overseas is heating up It is said that the natural selection is inevitable, if you are not good, you will be inferior, and if you do not prosper, you will perish. In the overseas market, competition is inevitable between sellers and platforms. Both Temu and SHEIN, as "Chinese e-commerce companies", have reached the pinnacle in their respective areas of expertise. Judging from their recent new initiatives in the US market, both sides are extending their tentacles into each other's territory, and a narrow road encounter is inevitable. But as Marshall said: competition can be constructive or destructive. Healthy competition promotes development, while vicious competition easily leads to mutual destruction. Today, the cross-border e-commerce industry has entered a new stage of development. According to the data from the General Administration of Customs, in the first half of 2023, the import and export scale of cross-border e-commerce has reached 1.1 trillion yuan, a year-on-year increase of 16%. Among them, the export scale reached 821 billion yuan, an increase of 19.9%, maintaining a good development momentum. In the face of the cross-border e-commerce market, which still has promising prospects, Chinese companies want to go overseas and seize the upward development opportunities. They can only follow the development trend of the industry, take compliance as a spear, and pursue long-termism while adhering to the path of building core competitiveness: On the one hand, under the trend of increasingly stringent overseas supervision, "compliant and legal operation" has become a prerequisite for Chinese companies to go overseas; on the other hand, with the end of the era of wild growth, the growth rate of the overseas market has generally declined, and continuously improving one's core and comprehensive competitiveness has become the key for Chinese companies to go overseas. In the increasingly fierce international market, Chinese companies must avoid cost-effective internal homogeneity and promote the improvement and advancement of China's overseas brand image. In addition to accumulating technological and supply chain advantages and gaining insight into the psychology of overseas consumers, they also need to rely on the Chinese brand community consciousness of "prosperity and adversity together" abroad. Among them, the unavoidable vicious competition will not only easily make consumers lose patience, but also may cause companies to lose their "image" and exit the market due to improper competition, which will damage the "increasingly haggard" Chinese manufacturing industry. Moreover, under the intensified geopolitical situation, the fierce competition in the US may eventually affect the entire Chinese manufacturing industry and industrial chain. Here, we only hope that Chinese companies going overseas can compete in an orderly manner, jointly build a healthy and benign industry ecology, and promote the long-term development of cross-border e-commerce . We must not use the inertial thinking of vicious competition in the past to fight against our fellow countrymen in the international market, thereby damaging the image of Chinese overseas brands.
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