Shein to invest up to $70 million over the next five years to reinforce supply chain

Shein, the Asian fashion company, will be investing $70 million (€63.5 million) over the next five years to reinforce its supply chain and provide support to its manufacturers, suppliers, and workers, according to a statement released by the company.

In addition to the $15 million (13.6 million euros) that the company has already committed to investing in the Supplier Community Empowerment Program (SCEP), Shein has announced that it will invest an additional $55 million (49.9 million euros) to implement technological advancements and improve the facilities of its production systems. 

Shein will utilise these funds to enhance its "on-demand" production model, which aims to reduce inventory sizes and move away from traditional supply chain systems. To this end, the company has established the Innovation Center for Apparel Manufacturing (CIGM), which will promote sustainability and innovation among its network of suppliers. 

The center covers a vast area of 58,450 square meters and will receive a total funding of $40 million (36.3 million euros) over the next five years. This investment will be used to advance research and development in innovative lean manufacturing solutions for apparel manufacturing.

Training and improvement of facilities

In line with its strategic plan, the multinational corporation is enhancing the skills of its workforce by providing over 380 training sessions in 2022, covering topics such as business management, organisational structure, and commercial processes. In 2023, it plans to offer an additional 480 training sessions specifically for supply chain workers.

Shein has also pledged $15 million (13.6 million euros) towards the Supplier Community Empowerment Program (SCEP), which will help upgrade supplier factories within its supply chain.

So far, Shein has facilitated improvements in 31 factories, covering a total area of 97,000 square meters. The company has plans to upgrade an additional 100 facilities by 2023, which will bring the total number of renovated factories to 300 within the next four years.

In addition, Shein has announced that it will invest $10 million (9.1 million euros) to "provide additional services to the communities that make up its supply chain." This investment will be used to provide accommodation facilities that include sports and recreation areas as well as dining spaces for its workers.