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Fast fashion group Shein has reportedly abandoned plans to open a warehouse in the Midlands, according to The Telegraph, as its plans for a London IPO continues to face difficulties from the EU and the US.
The search for a UK warehouse was thought to started as a way for Shein to prepare for its £50bn float on the London Stock Exchange.
Last summer, reports suggested that Shein sent a team of representatives to the East Midlands to scout potential 600,000 sq ft sites for a warehouse in Derby, Daventry, Coventry and Castle Donington. However the retailer has now claimed it has “no plans” to establish a warehouse in the UK.
A Shein spokesperson told The Telegraph: “To support the growth of the business, Shein constantly explores warehousing locations worldwide. However, as Shein has no immediate need for a warehouse in the UK, there are no plans to have one.”
Shein had plans to debut on the London Stock Exchange in the first half of this year, in what would have been one of the UK’s largest listings. However, Shein’s progress has been hampered by a number of issues.
A number of UK MPs have criticised Shein’s lack of supply chain transparency after allegations surfaced that the group has benefitted from forced labour.
Executives were called before the business and trade committee in January to address questions over where it sourced materials. MPs accused Shein of “wilful ignorance” when officials refused to say whether it sources cotton from China.
Earlier this month Donald Trump also moved to close a tax loophole that has aided the fast fashion group’s business model.
Trump is set to scrap the ‘de minimis’ rule, which allows small packages worth less than $800 (£645) to be shipped from China, Canada and Mexico to the US duty-free, as first reported by Bloomberg.
Under the current rules, small packages mailed directly to home addresses in the US avoid import taxes, allowing retailers like Shein and Temu to avoid paying customs duties by shipping small orders directly to customers.
The uncertainty also follows reports from last week (7 February) which indicated that Shein may be reducing its valuation from £50bn to approximately £40bn.
Shein has been approached for comment.
