Fast-fashion behemoth Shein is rapidly expanding its distribution network in the U.S. as it looks to speed up shipping times for customers domestically.
The online retailer, with a valuation reportedly at $100 billion, is already expanding its Midwest distribution hub opened in April and has plans for additional facilities in California’s Inland Empire and the northeast.
“In my 25-year career, I have overseen 4.6 million square feet of operations for some of the world’s leading retail brands,” Chuck Cornwell, general manager of Shein’s Whitestown, Ind. facility, said in a recently released economic impact report on the Indiana warehouse. “In those same 25 years, I have also witnessed a tremendous amount of transformation. Modern equipment has increased agility and improved safety, and the advanced technology has enabled global supply chains to become more interconnected.”
The Indiana hub is Shein’s largest facility in the country and is expected to serve as the halo of its industrial real estate portfolio, with Cornwell saying it will “serve as a model for other facilities to come.”
The study, done by Kelley School of Business economist Kyle Anderson, found Shein’s Whitestown facility will help generate $175 million annually in economic impact once its fully operational. That’s expected to increase to more than $200 million by the end of 2025 once a recently announced expansion of the facility, from 1 million square feet to 1.5 million square feet, is completed in 2023.
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Cornwell’s comments were made in a report released last week by the Indiana University’s Kelley School of Business, which Shein struck a partnership with in March to offer internship opportunities to students.
The building handles merchandise sorting, redistribution and returns processing. It’s expected to have more than 1,000 employees in the first year of operations and more than 1,415 by the end of 2025.
Workers there earn an average hourly wage of $19.68, according to the report. That compares to Indiana’s state average of $7.25.
The Indiana distribution center will be followed by a 1.8 million-square-foot warehouse in Cherry Valley, located about 80 miles east of downtown Los Angeles in Riverside County.
A job posting for a Shein general manager of U.S. logistics operations in Cherry Valley indicated a future East Coast location, which a spokesperson for the company confirmed would be in the Northeast. The spokesperson declined to offer any additional information about the two additional hubs after Indiana.
The job post indicated the position would oversee all three facilities.
Shein’s U.S. president George Chiao told the Wall Street Journal last week the company expects to have “well over several thousand employees in the U.S. by 2025.” That would include office workers in its U.S. headquarters in Los Angeles, along with a Washington D.C. office.
The domestic distribution network would help the fast-fashion firm, which does business in more than 150 markets globally, shore up a competitive advantage on shipping speeds to domestic customers.
Current standard shipping is in the range of nine to 11 business days, according to the company’s website. Shein told the Wall Street Journal delivery typically averages seven to eight days.