Shein, a struggling low-cost fashion brand, its president writes a "letter from the heart"

(Dan Tri) - Executive Chairman Shein affirmed that the company's growth remains strong despite the US ending its tax-free policy for low-value packages from China and increasing import taxes.

Shein is planning an initial public offering (IPO) in London, but US President Donald Trump's decision to scrap the "de minimis" policy - which exempted Chinese goods worth less than $800 in import duties - has raised concerns about the company's business model.

Some analysts say Shein and rival Temu, owned by PDD Holdings, will be forced to raise prices.

Reassure investors

According to Reuters , the letter from Mr. Donald Tang, Executive Chairman of Shein, aims to reassure investors that Shein, a brand famous for $10 dresses or $15 sneakers, will maintain its competitive advantage in the fierce low-cost fashion market in the US, the company's largest market.

"As I write this, despite recent challenges, our growth remains strong, driven by our ability to consistently deliver a wide range of fashion and lifestyle products at affordable prices," Mr. Donald Tang wrote in the letter.

He also stressed that Shein is investing in supply chain improvements to increase efficiency and responsiveness, as well as improving logistics systems to ensure faster, more reliable deliveries.

Shein did not respond. Donald Tang's letter did not mention growth figures or specific financial information.

Some analysts say Shein and Temu will be forced to increase product prices (Photo: Reuters).

Impact of new US tax policy

According to PitchBook, Shein's investors include Sequoia Capital, General Atlantic, Declaration Partners, Brookfield, and Claure Group. These investors have not yet responded to the incident.

Reuters , citing three sources familiar with the matter, said Shein is expected to reduce its London IPO valuation to around $50 billion. The end of the “de minimis” policy, which allows U.S. shoppers to avoid import duties on most Shein purchases, had been widely expected.

However, the executive order has made it difficult for international supply chains to adapt, leading to delays as packages back up at airports. Mr. Trump has since temporarily restored the exemption and tasked the U.S. Commerce Department with finding a viable alternative. It is unclear how long that process will take.

In the letter, Mr. Tang affirmed his support for "de minimis" policy reform, a view he made public in July 2023. He said he has long supported "de minimis" reform that prioritizes American consumers.

Source: https://dantri.com.vn/kinh-doanh/shein-thuong-hieu-thoi-trang-gia-re-chat-vat-chu-tich-viet-tam-thu-20250218151345455.htm