The Chinese fast fashion giant launched Shein Exchange on Monday to “make it easy for customers to access [the] circular economy,” according to Caitrin Watson, sustainability for the e-tailer once valued at $100 billion. The mobile-first peer-to-peer experience, currently available only in the U.S., is built right into the company’s heavily downloaded app so that customers interested in reselling their Shein buys can quickly access their purchase history and populate a listing with all the relevant data related to that SKU. Users can add their own photos to supplement the original product photography and give potential purchasers a better sense of any “wear and tear,” Watson said.
Beyond prohibiting items such as swimwear and intimates that pose potential risks at resale, the platform takes listings not just for men’s, women’s and kid’s products for homewares as well.
Items ship through USPS with either the buyer or seller covering the cost of dispatch, though asking a purchaser to absorb that expense is likely to deter sales. “We’ve pre-negotiated the shipping prices for them and send them the shipping label so they don’t have to do any of the work,” Watson pointed out.
The company isn’t turning a profit from the new launch as sellers fees on Shein Exchange “barely cover our costs for actually operating the platform,” Watson said.
Shein says the platform, pre-seeded with product from beta testers, is simply trying to bring some structure to behavior that’s been happening for years. Its proprietary survey showed that about half of participants had either bought (47 percent) or sold (53 percent) its pre-owned products on sites such as Depop, which showed 110,000 results for the brand on Monday. Newly acquired Poshmark, among the best-known peer-to-peer names in a fashion resale market where Urban made moves last year, also turned up a seemingly endless list of Shein clothes, accessories and more. ThredUp, which doesn’t let people buy and sell directly with each other, currently hosts about 1,800 Shein items on its multibrand marketplace. Earlier this year the headcount-cutting Bay Area company urged followers to boycott the Chinese juggernaut’s popup in San Francisco, using the event as “an opportunity to educate consumers and provide them with the context they need to make responsible fashion choices,” Erin Wallace, vice president of integrated marketing, said at the time.
Development of the resale platform was already underway when Shein reached out to Treet, the not quite two-year-old startup that works with brands including men’s T-shirt expert Cuts and helped Tentree create a resale and recycling program.
Treet initially “grappled” with the idea of working with a company like Shein which frequently attracts “negative press.” But the young startup quickly “leveled up,” cofounding CEO Jake Disraeli said. “What’s our mission? Our mission is to make sure that every item that can be resold [gets resold] and has its longest life.”
Treet, which powers about 70 brands and claims it’s responsible for the most branded resale sites globally, “came in and got our hands dirty” to help Shein build the new offering the “right way,” Disraeli said.
“Creating peer-to-peer is really tricky,” he said. “A lot of it was helping them map out the entire product flow from an automation perspective.” That involved a lot of “digging into the weeds” and guiding decisions on minutiae from copy and fees to design experience and making clear distinctions between “how resale is different than traditional shopping,” said Disraeli, describing Shein as a “technology company that makes clothes.”
Every resale model comes with differing environmental impact, he added. “Peer-to-peer is technically the most sustainable from an emissions standpoint” because the product is moving from point A to point B, skipping the middle-man warehouse that brings its on impact to bear, he said.
Then there’s the economics of it. Shein’s decision to get into resale at the peer-to-peer level makes sense because it’s “tough to make take-back work at lower prices,” Disraeli pointed out, noting the lower margins available to help grease the model’s wheels.
A company like Shein, he continued, has the reach and name recognition to advance the secondhand fashion economy. “When brands get behind [resale], what we’ve seen is it opens up this idea of secondhand to someone who maybe wasn’t even doing it in the first place,” Disraeli said. “They can actually help move more people toward shopping and selling secondhand to make it a no-brainer for them to do that.”
Treet is “excited to work with Shein on such a big scale to make something like this actually come to fruition,” he added.
Though Shein Exchange is baked into the app, the company isn’t ruling out integrating it elsewhere at some point. “We’re launching the minimal viable product right now,” Watson said. “A separate feature is a lot easier to kind of test and control and see how it’s going and make sure it’s being received well and make sure that everyone is having the best experience. But there’s so much that you can build from here that is really exciting.”
Shein has also discussed extending Exchange into its popup shops, which already offer take-backs from any clothing brand, Watson said. This early launch will help inform what users want from the resale experience.
“The idea is that we’re going to iterate and continue to make it better and then we hope to share it with many more markets,” Watson said of Exchange’s potential expansion outside the U.S.
Watson said critics will find something to pick apart with the Shein Exchange effort. “I think everyone is going to scream ‘greenwashing’ no matter what you do,” she said. “Everyone in [the industry] knows that circularity is the future of fashion and finding places to engage in the circularity movement is really important.”
“People are going to say what they’re going to say,” she added. “It’s not going to keep us from trying to do the right thing.”
“There’s a world of circularity out there,” Watson said, noting that resale works hand-in-hand with Shein’s $50 million extended producer responsibility commitment aimed at curbing textile waste polluting the Global South. “This is one piece of a puzzle.”