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One hypothesis we are continuously testing internally is whether pure-play internet retailers have a structural advantage over offline incumbents. The fact Shein has scaled to over $30bn revenue in ~4 years has sparked our interest to revisit this hypothesis in fast fashion. 

This analysis is the first in a series we’re conducting to understand the differences between Zara’s best-in-class offline supply chain to Shein’s model. Our work is built from hours interviewing former Zara, Shein, ASOS, and Boohoo executives and current suppliers of each company. 

This piece explores how each stage in Zara’s supply chain. We also walk through each step in the process for short-lead time products using summer dresses as an example. We also share operating KPI’s often overlooked or not discussed by investors such as landed and intake margins, full price sales, and pre-production and production lead times. 

The next piece of research in this series will walk through Shein’s supply chain in a similar manner.

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