Shein has revealed Britain's cheap heart (2024)

#sheinhaul. Xavi Torrent/Getty Images for SHEIN

Maybe you thought Labour was an eco-friendly party led by a virtuous human rights lawyer. But Britain’s economic troubles will make it increasingly difficult for governments to uphold their stated ideals. Cost-of-living issues and grim national finances have already prompted both of Britain’s main parties to backtrack from environmental commitments, including Labour’s now-abandoned plans for a green investment splurge. At least Britain’s politicians are not the only ones facing such contradictions. The French government has also allegedly tried to woo Shein, despite passing a bill in March to penalise ultra-fast fashion companies, which it condemns for “creating buying impulses” with damaging “environmental, social and economic consequences”.

Is Shein a scourge to be tackled, or an opportunity we can’t afford to miss? That we are constantly fretting over the impact of American and Chinese technologies in this way points to a deeper problem for the UK, and Europe more broadly: we produce so few large-scale technologies of our own. Shein is a vivid illustration of how China has managed to leapfrog Europe to enter the age of Big Tech. Producing massive quantities of cheap clothes is the kind of activity China has been associated with since the Nineties, but Shein’s real strength lies elsewhere: in the sophisticated algorithms it uses to identify trends and co-ordinate its vast network of suppliers.

The company’s software scours the internet for emerging fashions, and feeds this information to somewhere between six to 12,000 factories, which then copy the styles and sell them online with targeted advertising. It has bypassed traditional design, retail and marketing to create, in effect, a new fashion industry, one that relies on wannabe social media influencers to create and spread new trends. TikTok now has close to a billion posts under the tag #sheinhaul — the “haul” being a mountain of new garments that shoppers display to their followers.

“Is Shein a scourge to be tackled, or an opportunity we can’t afford to miss?”

To call the UK a tech laggard would be misleading. It has notable strengths in areas such as life sciences and state-of-the-art engineering. But today’s economy, not to mention society and culture, are dominated by companies that control really big networks. Whether through search engines and maps (Google), shopping (Amazon), social media (Meta, TikTok) or software for gadgets (Apple), most of the tech giants have created some form of network — systems that allow people to exchange goods and information — which they can control and squeeze to make profits. When Shein protests that it is not a retailer but a platform connecting suppliers with customers, it is mainly trying to dodge accountability, but also stating an important truth. It, too, is in the business of networks, managing the pathways that channel data and products between the social media feeds of Western teenagers and workshops in southern China.

Only the US and China have developed the kind of capitalism that can repeatedly grow such companies to a gigantic scale. In an earlier era of more harmonious globalisation, that didn’t seem to matter; we hardly thought about where the services on our screens came from. But it’s now clear that controlling these networks provides advantages far beyond a captive audience for advertising. It has allowed the companies in question to dominate the infrastructure underpinning the digital economy, from cloud computing servers to software operating systems and microchips. And it has provided access to the enormous oceans of data needed to train ever more powerful algorithms and instruct AI. The further American and Chinese giants extend their hegemony, the more other parts of the world will depend on them, and the harder it will be for domestic contenders to grow.

Then there is the simple problem of our having such little influence over technologies that are transforming our lives. Regulation can only go so far, as the EU is proving with its titanic efforts. Armed with legislation including the Digital Services Act and the Digital Markets Act, European bureaucrats are locked in trench warfare with Big Tech over everything from social media censorship to data collection and monopolistic practices. Trying to pin down these vast and constantly evolving platforms with legal fine print is like nailing jelly to a wall. Still, it is understandable that they would try. Network technology is inherently destabilising, replacing established industries with chaotic horizontal swarms. Shein’s rewiring of the fashion business is a classic example of this. The UK’s current election campaign provides another: whatever one thinks of traditional media, there is something unnerving about our politicians being forced to tailor their campaigns to TikTok.

The UK’s failure to scale up its tech companies has been a sore point for a government that likes to prattle about creating “the next Silicon Valley”. But even as Hunt tries to entice to Shein to London, foreign investment firms have been snatching promising enterprises from the British stock market en mass. The business world likes to lament that Europeans are just too risk adverse: their regulators too cautious, their investors and governments too scared to throw big sums at ideas that might fail. There is doubtless some truth in this, and a shortage of infrastructure and skills don’t help either. But another, more brutal factor is that China and the US are simply more ruthless when it comes to letting businesses trample over workers, consumers and competitors as they grow to enormous size. Shein is an obvious example of that. Here is another: when the race for AI took off last year, American tech giants rapidly laid off huge numbers of workers to divert funds to research. European labour laws make that impossible.

No doubt most of us would choose a just economy over a competitive one, but that is not really what we are doing. For one thing, falling behind in technology will make it more difficult to implement our noble ideals; the ability of ultra-fast fashion to rapidly match demand and supply, for instance, may well hold the key to reducing waste. Meanwhile, we still demand access to the products of companies whose practices we wouldn’t tolerate here. Refusing Shein a place on the London stock market will not stop millions of Brits from consuming its products.

In many ways, the relationship of Europeans to tech is another instance of a familiar hypocrisy. Globalisation has allowed us to enjoy the illusion of making progress without either material sacrifices or the need to innovate for ourselves. We’ve boasted about reducing fossil fuel extraction, carbon emissions and cruel working conditions, even as we rely on other parts of the world to do those things for us. The realisation that we may not be able to afford rejecting a company like Shein suggests those double standards are now becoming untenable.