Shein’s Purchase of Everlane Isn’t Surprising — It’s the Future of Chinese Global Brands

On Friday, global ultrafast-fashion giant Shein completed its acquisition of Everlane, the U.S.-based clothing retailer that built its entire reputation on a promise of “radical transparency” around how its garments are manufactured. Neither company has released the financial terms of the deal, but media outlet Puck reported last weekend that the transaction clocked in at a $100 million valuation for Everlane.

Founded in 2010, Everlane came to define a specific strain of millennial-focused ethical consumerism that positioned itself as the polar opposite of Shein’s business model. The retailer built its audience selling elevated, minimalist wardrobe staples, convincing a generation of ethically anxious, principle-driven shoppers that they could buy yet another pair of neutral ballet flats or black high-waisted skinny jeans without guilt. Shein, by comparison, is infamous for flooding global online markets with ultra-cheap, fast-turnaround trendy clothing produced on an unprecedented mass scale, and has faced years of widespread criticism over allegations of exploitative labor practices.

Given the stark contrast between the two brands’ core identities and public positioning, the acquisition has sparked sharp reaction online, with many observers describing the deal as ranging from darkly ironic to outright dystopian. Fashion writer Derek Guy, widely known online as the “menswear guy,” summed up the widespread mood in a post on X: “Under Shein,” he wrote, “Everlane’s ‘radical transparency’ means you get to read about the small child making your boring gray crewneck sweater.”

But look past the surface irony, and the deal is far more logical than it first appears. In the long run, this acquisition may end up serving as a clear preview of the next chapter for Chinese consumer-facing companies expanding globally.

Chinese cross-border ecommerce giants have conquered global markets largely by selling low-cost goods at eye-watering scales. Firms like Shein and Temu owe much of their early success to the U.S. “de minimis” trade loophole: a rule that allowed any package valued under $800 to enter the U.S. tariff-free, with minimal customs oversight. This framework became the backbone of a new era of cross-border ecommerce, letting Chinese firms ship bargain-priced goods directly to American consumers faster and more efficiently than most legacy domestic retailers could manage.

But after former U.S. President Donald Trump implemented sweeping new tariffs on Chinese imports and eliminated the de minimis exemption for Chinese goods, the economic model that underpinned this growth began to falter. Chinese firms quickly recognized they could no longer compete on price alone. To sustain international growth, they needed a far more durable advantage: a well-established, trusted consumer brand.

Shein’s purchase of Everlane, no matter how culturally jarring it may seem, fits into a much larger shift already unfolding across Chinese manufacturing and commerce. More and more, Chinese companies are looking to move beyond being anonymous low-cost suppliers, and instead own recognizable global brands tied to quality, lifestyle, and status.

One of the clearest examples of this shift comes from Pinduoduo, the parent company of Temu. In March, the firm launched a major new initiative called New PinMu, a multibillion-dollar effort designed to help Chinese manufacturers build premium international brands. The project is part of a broader strategic vision laid out by Pinduoduo co-CEO Jiazhen Zhao, who has publicly hyped the company’s ambition to raise manufacturing standards and create pathways for Chinese factories to move up the global value chain.

Other major Chinese firms are following the exact same playbook. Luckin Coffee, the Chinese coffee chain that has emerged as one of Starbucks’ largest global competitors, recently acquired Blue Bottle Coffee, the cult U.S. specialty coffee brand that helped define the global third-wave coffee movement. Anta Sports, the Chinese sportswear giant that launched as a domestic sneaker manufacturer, has spent years acquiring stakes in premium global sportswear and outdoor brands, including taking controlling stakes in Arc’teryx and Salomon.

This trend also reflects growing political pressures within China. Beijing has become increasingly critical of the cutthroat price wars and hypercompetition that have defined sectors from ecommerce to electric vehicles, a dynamic widely referred to as “involution.” Chinese authorities now want domestic companies to prioritize sustainable growth, high-end manufacturing, and global competitiveness, rather than an endless race to the bottom on price.

Against this new economic and political backdrop, Chinese companies are no longer content to act as the invisible factories behind Western brand names. They want to own the brands themselves.

As for Everlane? The brand had already lost much of its cultural cachet in recent years, and was facing mounting financial headwinds. Once valued at $250 million, it struggled to fend off competition from newer online basics retailers like Quince. The private equity firm that sold its controlling stake in Everlane to Shein was also eager to unload the $90 million in debt the brand had accumulated over years of underperformance.

Even with its recent struggles, Everlane holds one extremely valuable asset: it is already a well-known American brand tied to tasteful minimalism and a public veneer of ethical credibility. Building that kind of brand identity from scratch takes years of investment and work, so acquiring an existing brand is a far more efficient move for Shein.

The strangest thing about Shein’s acquisition of Everlane is not that the deal happened — it’s that anyone is still surprised by it.

This is an installment of Made in China, a newsletter by Zeyi Yang and Louise Matsakis. Read previous editions of the newsletter here.