What the business is
Singapore-headquartered fast fashion giant acquiring Manchester-based online fashion brand Missguided
The bet
Shein's on-demand manufacturing and supply chain can revitalise a distressed fashion brand through a licensing joint venture
Starting capital
Undisclosed; TechCrunch noted Fraser Group had bought Missguided out of administration for $20 million in June 2023, which might indicate the price
How it started
Missguided once rivalled Asos, Boohoo and PrettyLittleThing in online fashion and grew fast during the pandemic, but struggled after stores reopened. In December 2021 retail investor Alteri took over its debt and 50% stake. In May 2022 suppliers owed millions of pounds filed a winding-up petition, and Fraser Group bought it out of administration for $20 million in June 2023.
What happened
A Sky News report in September 2023 had said Shein was in talks to buy Missguided; on 2023-10-30 Shein announced the acquisition from Fraser Group. Founder Nitin Passi and Shein formed a joint venture with access to Missguided's IP under a licensing agreement, and Shein takes over manufacturing and distribution from the joint venture. Two months earlier Shein had bought a minority stake in the operator of Forever 21 and agreed to design, manufacture and distribute a line for it.
What has to be true
Missguided was distressed after the pandemic boom, making it cheap to acquire
Shein's supply chain can respond to real-time demand and keep inventory costs low
A licensing joint venture lets Shein run operations while the founder keeps a stake in the brand
Shein was expanding its range by taking over other fashion brands, as with Forever 21 two months earlier
What can be applied
A supply-chain-led fast-fashion platform can buy distressed Western brands cheaply and run them as licences, but a brand's past problems, including overconsumption criticism, come with the name.
Aftermath
As of 2023-10-30, Shein had acquired Missguided and was setting up a licensing joint venture, with TechCrunch saying it remained to be seen whether Shein could revitalise the brand.
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