Shein may be using a partnership to bring goods made in India to its global consumers.
According to a Reuters report citing two sources familiar with the matter, Shein and partner Reliance Industries are planning to ramp up the number of Indian suppliers they use in an effort to ship products into other markets.
Today, Shein and Reliance have Indian suppliers, which they use to serve the Indian market. Most of what the fast-fashion purveyor serves to consumers in the United States, European Union and United Kingdom comes from Chinese factories.
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That setup is due to the fact that, in 2020, India banned Shein for five years as part of a larger crack-down on China-founded companies, though Shein is currently headquartered in Singapore. The company returned to the country earlier this year, using a partnership with Reliance. In effect, Reliance controls the consumer data—stored in India—and the operations of Shein’s India presence. The idea is that Shein is merely a technology partner in the partnership.
According to Reuters, Shein and Reliance currently contract with 150 Indian suppliers, but within the next six to 12 months, the companies are aiming to up that number to 1,000. Once those factories are operational, the goal is that they would create apparel to be exported to Shein’s other markets, Reuters wrote.
Reuters reported that strategy would see Shein listing India-made products on Shein’s U.S. and UK sites; the publication’s sources indicated that this recruitment began even before the U.S.’s de minimis provision on goods inbound from China collapsed, changing Shein’s easy-access, low-cost model to U.S. consumers.
Shein did not immediately return Sourcing Journal’s request for comment, but Reuters reported that the company indicated the partnership only entailed licensing Shein’s brand to Reliance Retail for domestic use in India. And late last year, India’s MInister of Commerce and Industry, Piyush Goyal, said the partnership could enable Shein-branded apparel to be sold “domestically and globally.”
The timing for the uptick in Indian suppliers could help the fast-fashion player benefit. For the moment, de minimis has only collapsed for good inbound from China; if Shein is able to list Indian-made products on its site, it could, at least temporarily, use de minimis to send some of its U.S.-bound parcels directly to consumers from India duty free. It remains to be seen whether, or how soon, President Donald Trump’s tariff and duties strategies will extend a de minimis ban to goods inbound from countries other than China.
Even if de minimis entry soon dissipates on goods inbound from countries across the globe, goods coming from India may see lower duty rates than products coming from other countries once the Trump administration sorts out tariff rates this summer. On the president’s “Liberation Day,” India saw the threat of 26-percent tariffs, markedly lower than other sourcing strongholds like China, Vietnam and Bangladesh.
Although the vast majority of its goods are made in China, Shein has also inked deals with suppliers in Brazil and Turkey, each of which saw a 10-percent tariff threat in April.
