By Marte Rommetveit.

Clothing and shoes from the Chinese brand Shein are making their way into the world through the efforts of individuals. This is how the company reaches new customers without the need for credit cards or direct access to transportation.

On Shein’s website, you can navigate through a jungle of affordable clothing, shoes, bags, and cosmetics.

Despite the company’s bad reputation, its products are incredibly popular. Since its founding in 2008, Shein has grown to become one of the world’s largest players in fast fashion, challenging giants like H&M and Zara.

However, not every country has a distribution agreement with Shein or receives shipments directly from the brand. Despite this, the products still manage to find their way into these markets.

“During a field visit in Ghana, I stumbled upon Shein clothing by chance and was surprised. I wondered how these items had made it here,” says Heidi Østbø Haugen, a professor of China Studies at the University of Oslo.

There are no formal distribution channels for Shein clothing in Ghana, nor does the brand advertise its products in the country. Still, the label has become well-known among young fashion enthusiasts in Ghana.

Selling products on their own platforms

Eventually, she found the answer: Shein products are making their way in thanks to local entrepreneurs.

These individuals browse through Shein’s website, selecting clothing, shoes, and bags they believe will appeal to customers in Ghana. They then place orders and arrange for the items to be delivered to a trusted contact in a third country where Shein ships. Subsequently, they receive the products from that contact.

“But why doesn’t Shein ship products to Ghana?”

“Because customs clearance and taxes would be too expensive. It requires an infrastructure that not all countries have,” she explains.

The entrepreneurs in Ghana style and photograph the items, often featuring new models, before marketing the products on their own platforms, including Instagram, Facebook, and WhatsApp.

In this way, the company reaches customers in new markets, including those who do not have credit cards, permanent addresses, or proper access to transportation.

“It is undoubtedly an infringement on someone else’s brand, but for Shein, it may be beneficial to keep the system as it is,” says the China Studies professor.

Does not intervene

For several years, Haugen has studied China’s international connections (BROKEX) and how they are formed. The distribution of Shein clothing is one of the findings that has surprised her the most.

This apparently takes place without Shein actively intervening or cracking down on individuals using their name, logo, and images to sell products on their own platforms.

This is what makes it very interesting. Haugen imagines that they are asking themselves: “should we invest resources in entering this market, negotiating with the authorities, setting up our own distribution channels, and establishing a marketing department in the country? No, it’s unnecessary when the established informal distribution network is already functioning”.

Instead of protecting their brand and seeking legal intervention, as Western companies typically would, these sales continue without interference. Additionally, the authorities in Ghana permit this practice to occur without collecting customs duties.

“There is an unspoken agreement that people can receive and sell moderate quantities of goods from known sources abroad. Given the high unemployment in Ghana, this keeps the middle class more satisfied,” says the China researcher.

Exploiting informal channels

It is widely recognised that Chinese emigrants play a vital role in introducing Chinese goods into global markets. Additionally,
West Africans have travelled to Southern China, designed products specifically for their market, produced them in small factories, and brought them home to sell in stores and online.

Now, some of these sellers are buying products from the giant Shein instead.

“What’s new is that a multinational company is exploiting these informal distribution channels in this manner and to this extent, says Haugen.

Shein has thus adopted the methods used in Chinese fashion exports to Ghana over the past few decades.

“What Shein has successfully done is look at how they can utilise those who are already in the market to get their products where they want them and reach new groups, all without using formal distribution channels.”

Making a living selling Shein products

Originally, her plan for the field visit in Ghana was to investigate how COVID-19 had affected the entry of Chinese goods into the country. However, she ended up speaking with a woman she has chosen to call “Yvonne”.

“As she takes me to the second-hand clothing market, I notice she seems distracted the entire time. After a little while, I realise why”

“Yvonne” is heavily occupied with selling Shein clothes via social media and is quite successful at it.

“This is how fieldwork operates. We must be flexible enough to capture other important things,” explains the China researcher.

After a few quick searches on Instagram and Facebook, Haugen discovers that “Yvonne” is far from alone. Numerous accounts with names like “Shein Ghana” and “Shein for You” are thriving, selling Shein products.

“‘Yvonne’ started by selling second-hand clothing and received help from her sister in England, who would pick out clothes for her and send them to Ghana. After discovering Shein, she can now personally curate the products, see which items are discounted, and determine which she believes will sell well,” says the China researcher.

Demanding sales job

When a customer places an order for a product, “Yvonne” relies on a dedicated motorcycle driver to deliver the item physically. Customers can pay through an app similar to the Norwegian app Vipps, or the driver can accept cash.
Haugen accompanied a driver on a delivery herself.

“You arrive in an area with no street names or specific addresses, and often you must ask people for directions to find the person you’re looking for. The delivery process is challenging, collecting the money is cumbersome, and marketing requires its own effort.”

As a result, the products can be quite expensive, making them unaffordable for many people in Ghana.

A reflection of something bigger

Haugen’s research has uncovered various examples of how Chinese companies are flexible and adaptable.

“When I discovered Shein, I realised it was a reflection of something larger,” she says.

While Western companies tend to wait until the necessary infrastructure is in place, Chinese companies believe they do not have to wait for everything to be perfectly aligned.

“They are better at considering local conditions and thinking about what they can do with that, adapting accordingly.”

Now the question remains: what will Shein do when duty-free importation to their largest market, the USA, comes to an end? Haugen has already embarked on her investigation into the implications of the trade war for the factories in Southern China that produce clothing for the company.

Shein has been given the opportunity to comment on the research findings in connection with the publication of this article but has not provided a response.