Shein announces a global credit card launch amid decelerating sales growth and pending IPO.
- Collaboration with Mexican fintech Stori introduces a points system on purchases.
- Sales growth slowed to 23% in the first half of the year, compared to 40% previously.
- Profits dropped over 70% even as sales exceeded £13.8 billion.
- Shein is engaging investors as it prepares for a potential London Stock Exchange listing.
Shein, a leading fast fashion retailer, is launching its first branded credit card worldwide. This strategic initiative comes in collaboration with Mexican fintech company Stori, allowing customers to earn points on every purchase made on Shein’s website, with double points specifically for clothing orders. This incentivisation aligns with the brand’s objectives to bolster its international market reach and consumer engagement.
The credit card introduction arrives at a time when Shein’s sales growth has notably decelerated. The first half of the current year reflected a growth rate of 23%, a significant decrease from last year’s 40% surge. This marks a pivotal moment for the company as it aims to reinvigorate its growth trajectory amidst a competitive retail landscape.
Furthermore, Shein’s profit figures have experienced a sharp decline, plunging more than 70% to just below £308 million, despite achieving sales figures that surpassed £13.8 billion. This financial backdrop underscores the challenges Shein faces in maintaining profitability while expanding globally.
As part of its strategy to strengthen its financial position, Shein is actively engaging with investors. The company has already appointed Barclays Plc and UBS Group AG as bookrunners in preparation for an anticipated initial public offering (IPO) on the London Stock Exchange. Additionally, Shein is collaborating with Goldman Sachs Group Inc, JPMorgan Chase & Co, and Morgan Stanley to ensure a robust listing process.
Overall, Shein’s launch of a branded credit card and its strategic partnerships indicate a proactive approach to overcoming the hurdles of slowed sales growth and reduced profit margins.
Shein’s credit card launch symbolises a pivotal step towards revitalising its growth and enhancing shareholder value amidst challenging market dynamics.
