Shein finds there’s no place like China after Vietnam warehouse experiment disappoints

A year ago, Chinese fast-fashion company Shein embarked on a grand experiment by leasing a 15-hectare warehouse in Ho Chi Minh City, aiming to make Vietnam a significant export hub. However, the plan has since fizzled out. As U.S. trade policies shifted, Shein's Vietnam strategy began to unravel. The loss of a duty-free exemption for small parcels from China and rising U.S. tariffs on Chinese goods led to mass layoffs and a drastic downsizing of operations in Vietnam.

Today, only a fraction of the original site is operational, and Shein is shifting its focus back to China, investing heavily in Guangdong province. While the company remains committed to its Chinese roots, the U-turn in Vietnam highlights Shein's heavy reliance on Chinese suppliers and the challenges of diversifying manufacturing beyond the country.