Shein opens pop-up shop in Montreal area amid multiple controversies

Shein, the popular but controversial online discount retailer, has made its way to Montreal as part of a global pop-up strategy.

Hundreds of shoppers headed to the South Shore of Montreal this week to get a first look at the brick-and-mortar store.

The massive Chinese retailer is facing a slew of issues, including a lawsuit for copyright infringement, claims of labour exploitation, and environmental concerns.

"It's consumption on steroids in some ways," said retail analyst Carl Boutet.

Shein's business model includes giving consumers thousands of items to choose from.

"Since the rise of fast fashion over the last decade, especially, we're seeing products, new products coming on shelves pretty much every week.," Boutet said. "And now we with new entrants, like Shein we could even talk about ultra-fast fashion."

In today's economy, when shopping has become a luxury many can no longer afford, fast fashion -- and its low price tag -- is enticing some shoppers.

"I don't feel like paying, I don't know, like, $50 for a dress when I can pay $20 or $19," said Justine Lortie, a Montreal Shein shopper.

Popular fashion brand Shein opened a pop up on Montreal's South Shore on July 27, 2023. (Jessica Barile/CTV News)

Shein was founded in 2008, and in less than a decade, the company is now valued at $100 billion.

"I feel bad for the workers because I'm aware of their situations, so I do feel bad for the workers that are making my clothes, basically, but at the same time there is not enough competition. Like the stores we have here in Quebec don't do enough competition. They could do more specials. We don't have the capacity, like me as a student, I don't have the capacity to buy something full price," said Lortie

The Brossard, Que. pop-up store was such a success the shop welcomed lineups circling the large building since opening day on July 27.

The potential reason for such a success story?

"Contrary to the other fast-fashion brands like Zara and H&M, which were started by people that were legitimately interested in fashion, the founder of Shein is known to be sort of a digital expert of search engine optimization," said Boutet.

The hype around the store, he said, is not only due to its low prices but the leverage of digital marketing mixed with the ability to create about 10,000 different items a week with digital iteration.

This is also why the company has been accused of copyright infringement, as the company scrapes social media for trends.

In a statement to CTV News, Shein gave more details about its business model.

"The key differentiating factor is our unique on-demand business model. For each new product sold on Shein's website, the initial production run is as low as 100-200 units per SKU, compared to the thousands of pieces typically produced by traditional peer retailers. We then use algorithms to gauge customer interest in real-time and provide feedback to our supplier partners, empowering them to increase or stop production based directly on market demand. We embrace a test and learn approach to improve efficiency and minimize production waste."

When asked about the numerous controversies surrounding the brand, Shein responded: "As a leading global e-retailer, Shein takes seriously our responsibility to support the local communities where we work, source, and live in, and to preserve our planet."

Shein also promised that it is committed to respecting human rights, claiming supplier facilities are subjected to unannounced audits.

"Suppliers found with forced labour violations in our audits will be immediately suspended and required to implement remediation measures within 30 days. If remediation is not undertaken to our satisfaction, we will terminate the supplier."

Shein currently ships to more than 220 countries and regions worldwide with no signs of slowing down.

Still, Boutet said shoppers should be wary.

"I think beyond just the fast fashion and the consumption, the double-edged sword is the fact that, yes, we want affordable, quality products, but at the same time, you know, we want them to be used," he said.

"If it's just to buy them because they're cheap and not wear them more than a couple of times, I think that's the real tragedy."