“Shein is likely to source from India for other countries as well, since it is facing scrutiny in the US,” one of the executives said.
The Centre had banned Shein, one of the world’s largest fashion retailers, from selling its products in India through its own app over two years back as part of a larger crackdown on Chinese apps following escalated border conflicts.
“Shein’s positioning of affordable and trendy clothing will complement Reliance’s portfolio, which also sells affordable fashion through its own store chain Reliance Trends,” said the executive cited above.
Shein had created a niche for new styles and accessible price points in India before its app was banned by the home ministry in 2020.
A Wednesday report by Wall Street Journal said Shein has raised $2 billion in its latest funding round, but at two-thirds of its $100-billion valuation from last year. The lower valuation is on account of declining tech share prices and increased pressure from US lawmakers regarding its labour and environmental practices, the report said.
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Shein, which competes with fast fashion labels such as H&M and Zara, closed the last financial year with revenue of $23 billion.While the app of Shein was blocked on grounds that it “was detrimental to national security”, the Ministry of Electronics and information Technology (MeitY) had said sale of Shein products on other platforms or websites is not covered under Section 69A and that a blanket order for blocking their sale cannot be passed by the committee constituted under the legal provision.
Other Chinese etailer apps such as Ali Express were also banned.
Earlier in 2019, Shein had to stall shipping orders and refund customer payments following crackdowns by state authorities that alleged that Chinese shopping sites were paying lower duties than what they were supposed to.
While some inventory of Shein is available on marketplace Amazon in India, the label is not a scale brand yet in the country.
Reliance has been partnering with fashion labels in various genres and adding Shein will give its fast-fashion portfolio further push through physical stores and online, a second executive aware of the negotiations said.
Reliance Retail and Shein did not respond to emailed queries from ET till press time Thursday.
Reliance Brands, which adopts a flanking strategy straddling affordable and luxury fashion, has partnerships with luxury labels such as Giorgio Armani, Gas, Hugo Boss, Armani Exchange and Jimmy Choo. In addition, it has strategic partnerships with domestic fashion brands, including designers Manish Malhotra, Abu Jani Sandeep Khosla, Satya Paul, Raghavendra Rathore and Anamika Khanna.
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